Can even Trump get something right?

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The Western Mail carried a story earlier this week (which I can’t find online, but basically seems to be a fairly minor edit of this story from three weeks ago) about the problem of desertion facing the Ukrainian armed forces. We knew, of course, that the Russian armed forces were suffering from desertion as well as draft avoidance in the light of the serious level of casualties, but the media in ‘the west’ have seemingly been reluctant to report that the same issue is impacting the Ukrainian armed forces. Whilst it’s credible that Russian problems have been greater than those faced by Ukraine, it’s reasonable to suspect that the gap might not be as large as a less-than-entirely-unbiased media might have us believe. And the fact that Ukraine is suffering its own problem with a high level of desertion should come as no surprise.

It raises a much bigger – and more general – question as to whether the sort of large scale ground war for which the generals and some politicians keep telling us we should be preparing will ever be possible in the future in the same way as it was in the past. The report tells us that the US has been urging Ukraine “to draft more troops, and allow for the conscription of those as young as 18”, since the current minimum age for conscription is 25. Leaving to one side the moral issue of whether anyone should be urging a country to send even more of its people, and at an even younger age, into a vicious and bloody war where many of them will be killed or injured, I found myself wondering how realistic it is in the modern world to expect that people, particularly young people, will willingly comply with an order to go out and kill ‘for their country’. We’re not in the first half of the twentieth century when information flows could be easily controlled, and where jingoism was a fairly normal phenomenon. People – even in dictatorships like Russia – have much easier access to information about what’s happening. Pro patria mori has never been particularly dulce or decorum whatever the politicians might tell us, and that was precisely the point which Wilfred Owen was making more than a century ago. Mass conscription for a major war in the twenty-first century is likely to be problematic for any country which attempts it, with resistance running very high.

Trump has said that he will end the war on day 1 of his renewed presidency. I struggle to understand his drivers. He says it is to stop the killing, which would be a noble enough aim; but coming from a man who has no previous record of concern for anyone other than himself, it doesn’t immediately strike me as being likely. After himself, those about whom he most seems to care are other billionaires, but we know that capitalist billionaires are amongst those who most benefit from war through their investments in the arms industry. It might simply be, for Trump, a case of not spending US money to support another country. That would certainly seem to fit with his ‘America First’ outlook, even if it shows a certain ignorance of the relationship between US government spending on armaments and the overall value of shares on the New York Stock Exchange, which seems to be Trump’s only metric of economic success.

However, whatever his rationale is (to the extent that he has one at all) his conclusion that the immediate priority should be to stop the fighting and killing is difficult to disagree with. And since Ukraine does not have – and without a massive injection of military manpower and firepower from friends and allies is unlikely ever to have – sufficient forces to recapture all its lost territory, an end to the fighting necessarily implies a redrawing of boundaries, on at least a temporary basis. Expecting Ukraine to cede vast swathes of territory in order to buy peace is neither fair nor just, but in the absence of any other basis for agreeing a peace deal, it is surely no worse than the current US position of telling Ukraine to simply conscript more young people who can be ‘expended’ in an ongoing war with no obviously better outcome in sight. There aren’t many boundaries in the world which aren’t the result of a war, a treaty following a war, or arbitrary lines drawn on a map by colonial masters. 

‘Might is right’ is a lousy basis on which to run a planet, but unless and until we collectively find a better way, it’s the basis on which almost all of the world’s current boundaries exist. Supporting the idea that a free and independent country should cede territory to one autocratic bully at the behest of another autocratic bully is uncomfortable, to say the least; but encouraging Ukraine to fight to the last Ukrainian would feel even less comfortable. The devil will, of course, lie in the detail and in the mechanisms for ensuring the integrity of any new boundaries. But on the principle, even Trump might be able to get something right, even if not based entirely on rational analysis or concern for fellow humans.

Nuance is sometimes a way of avoiding hard facts

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When the statue of slave trader Edward Colston was toppled in Bristol a few years ago, reactions were mixed, to say the least. In general terms, views fell into two main camps: those who felt that we should not be celebrating the lives of those who were responsible for a cruel and despicable trade and those who felt that, like him or loathe him, he was a part of history which should not be, to use one of their current favourite words, ‘cancelled’. The compromise, ultimately, was to place the statue in a museum with an appropriate explanation of his role in the past. It’s a nuanced response, which attempts to placate both sides in the debate about statues. It does little, however, to resolve the underlying debate about what history is and whether – and to what extent – we should feel ‘proud’ of it.

No such nuance was observed when it came to the toppling of statues of Lenin or Stalin in the former Soviet Union and its satellites, nor in the case of the toppling of statues of Hussain in Iraq or, this week, those of Assad in Syria. I don’t recall any great outpouring of outrage about the rewriting of history or about the attempts at ‘cancelling’ the role of dictators in the history of those countries, only pleasure at their fall.

That underlines the hypocrisy and deceit at the heart of the arguments of those in the UK who oppose the removal of statues and symbols of those whom history no longer treats so kindly as attitudes and values change. It isn’t just about slavery, it’s about imperialism, colonialism and militarism, with all of which slavery was inextricably bound up. Those who opposed the removal of the statue of Colston and other such statues are actually proud (and believe the rest of us should be too) of Britain’s imperial, colonial, and militaristic past, and it is that – rather than the celebration of slavery – which they don’t want to see ‘cancelled’ or revised. Most of them (but I’m not convinced that this is true of all of them) might see slavery as something of a blot on that history, which is why they want to divert attention to Britain’s role in the abolition of slavery rather than dwelling on its role in creating the trade, but they are unable or unwilling to accept or understand that slavery was actually a key element in the accumulation of wealth from colonial activities. What Colston was actually being celebrated for was what he did with the wealth which he brought back to Britain, as though the means by which he acquired that wealth is somehow irrelevant or unimportant.

Syrians cannot change the history of their country; the Assad dictatorship is something which will always be taught in their schools. But knowing history, understanding history, interpreting history – these are not the same as celebrating history. Those who tore down statues implicitly understand that better than most, even if it was not the uppermost thought in their minds at the time. There’s no nuance around the idea that ‘he did some good things as well’. It’s an attitude from which we can learn something ourselves.

The enemy's enemy isn't always a friend

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The UK’s Prime Minister has taken time out of his busy schedule appeasing a brutal dictator who has his opponents killed and chopped up, and whose regime treats women as second class citizens and executes those who protest against his rule, in order to welcome the fall of a brutal dictator in another country in the neighbourhood. It’s almost as though what matters is not how brutal and barbaric a dictator is, but whether or not he has money available to be laundered by being invested in the UK.

In his rush to celebrate the end of one dictatorship (aided and abetted by his deputy back home) in the middle of a visit to another, the question which he doesn’t seem to be asking is whether, and to what extent, whatever replaces Assad will be any better. If their concern is really, as Rayner put it, ‘the protection of civilians’, the signs are not good. Whilst there might be at least some hope of a more enlightened approach from the Kurdish authorities who control a large chunk of Syria, it’s more than probable that the rather more ruthless rebels who have taken over the rest of the country – aided and abetted by NATO member Türkiye – will merely refocus the civil war along the lines of control between the disparate rebel groups, with the Kurds as a particular target. And within the areas that some of those groups control, the outlook for women and minority groups may end up being even more repressive than what went before.

Our enemy’s enemy isn’t always our friend, and the replacement of one brutal regime by another may not look like such a blessing to those who suffer its excesses. Still, if they can find some money to invest in the UK, Starmer and the rest of the UK government may yet end up appeasing them too.

When prevention becomes cause

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The military mind seems quite fond of developing different euphemisms and phrases which do more to obscure what it being said than to elucidate it. ‘Friendly fire’ and ‘collateral damage’ are two of the obvious ones. There was another one this week: ‘expended’. It seems that the military and the defence ministry are a little worried that, in the event of an all-out war, the UK’s entire army would be ‘expended’ in only six months. Whilst the rational response would be to say that, in that case, we’d better make absolutely certain that we don’t ever get into such a war, the military mind seeks instead to explore ways in which the number of people available to be ‘expended’ can be increased rapidly, in order to add a few months to that period. Whether people are going to be as enthusiastic about being ‘expended’ in the twenty-first century as they were at times in the past is another question: the military, as ever, always seem to believe that they’re going to re-fight the last war, and there does seem to be an assumption that attitudes to participating in a war are unchanged.

Their response to the point about avoiding such a war would probably be something along the lines of, ‘Ah yes, but the best way of doing so is to possess such overwhelming military strength that they would never dare attack in the first place’. But here’s a question: if Russia (to choose a putative enemy not-at-all-at-random) were to seek to build up its forces such that they were capable of deploying overwhelming force against ‘the west’, would ‘the west’ see that as a deterrent or a threat? And if the answer is the latter, why would ‘the west’ expect Russia not to see a military build-up by ‘the west’ in the same light? Underpinning the mindset is a belief, on both sides, that ‘the enemy’ is just waiting for a chance to attack ‘us’, in order to seize land and resources, and to subjugate people.

Historically, it’s not an entirely bad assumption. Looking at empires of the past (whether Roman, Mongol, Ottoman, Spanish, Portuguese, French or British, for instance), expansion of territory and control of resources – including the ‘right’ to conscript people from the new territories into the army to further expand the empire’s control – has been a key driving factor. But that was then and this is now: what if that isn’t the main driver any more, and the real danger of war stems from a belief on one side or the other that they are under threat and the best response is to strike first? What is presented as a way to prevent war then becomes the likeliest cause of war. And it isn’t just military personnel who will be ‘expended’ if that happens.

No need for a new gospel

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Some of the people Trump is picking to form his cabinet seem to believe that the US constitution should be reformed to base it firmly on biblical law. Presumably, they mean Old Testament law rather than the snowflake nonsense about loving one’s neighbours (especially if they happen to be Canadian or Mexican) or turning the other cheek (instead of seeking revenge). It’s a proposal which could prove problematic for Trump himself – I’m not sure that there is a single one of the ten commandments that he hasn’t broken, or actively considered breaking. He’s even mused about having a graven image of himself carved into Mount Rushmore.

He does, however, have a potential get-out mechanism, because he who controls the content of the bible also controls the detail of biblical law. One of his more recent ventures has been selling Trump-branded bibles, which, unsurprisingly, contain additional content over and above that found in other bibles. (Autographed copies are available as well.) If it’s possible to add additional content, it is surely also possible to amend the existing content for the next print run. And it would only take a small change. If all those pesky prohibitions (‘thou shalt not’) were simply prefaced by a few additional words, along the lines of ‘Unless thou hast first rigged the Supreme Court to give thyself immunity’. Fixed, without needing to go to the lengths of writing a new gospel according to St Donald. He wouldn’t be the first leader in history to ‘discover’ that sacred religious texts give him favours not available to others.

Do businesses actually pay any tax at all?

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It looks like a silly question. Look at the accounts of any business, and you’ll certainly see tax payments being recorded. And money actually passes from the business’s accounts into the government’s accounts. But who is really paying those taxes? From a business perspective, tax is just another operating cost and, at its simplest, profit is simply revenue earned by selling goods and services less the cost of production of those goods and services. It follows that (again, at its simplest) price is simply cost of production plus profit, and the financial success of a business depends on the price being sufficiently high to generate an acceptable level of profit. If an extra tax were being paid by the owners/ shareholders of the business, then profits would fall; if profits don’t fall, then it’s because the extra tax is being paid by the customers of the business, through rising prices.

It isn’t always as immediate or obvious as this story about Halfords might suggest. It’s usually more subtle and gradual, but when any business considers its pricing, it inevitably takes account of any increases in its costs. It obviously also considers what its competitors are doing and how much of an increase it thinks it can introduce at a given point in time without losing customers and revenue, but ultimately the dominance of return on capital asserts itself, and increased taxes invariably work through into increased prices. A company threatening an immediate price increase in response to a tax increase looks to be more about politics than accounting, but that’s about presentation.

None of that is to argue that businesses shouldn’t pay taxes. They depend on the infrastructure and services provided by public expenditure, and it is entirely appropriate that those costs should be reflected in the costs of doing business, and thus in the prices of goods and services. We just shouldn’t delude ourselves into believing that ‘taxes on business’ are somehow a free source of money which don’t impact us as individuals. The Chancellor’s mantra that she isn’t increasing taxes on working people is ‘true’ in the sense that they’re not directly paying those taxes – they’re simply facing price increases. Theoretically it’s entirely different; in practice the impact ends up being much the same in aggregate. One of the key differences, though, is that a direct tax on income is related to ability to pay, whilst an increase in the price of everyday goods is not: those on lower incomes are hit hardest.

Why is the return so low?

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The first job I had after leaving university was with an insurance company which specialised in agriculture. During the time I was there, the company introduced a new type of policy for farmers, namely Consequential Loss. The basic idea was that, if a farmer lost stock, a building, or whatever due to storm, fire or some other insured peril, they could claim not only the value of what had been lost, but also for any loss of profit which ensued. A meeting was convened in Cardiff to which the local inspectors from the southern half of Wales were summoned to hear a presentation on the benefits of the policy and to help them sell it. After the presentation, Johnny, ‘our man in Carmarthen’ as he was, quietly asked a question about the information that farmers would have to provide to get the insurance. Specifically, which figure would they have to give about their profit – the one they gave the Inland Revenue or the actual one. After hearing the explanation that both the premium and any payout would be based on the figure that they put on the application form so it needed to be an accurate figure, and that, in any event, providing inaccurate information could invalidate the whole policy, Johnny shook his head briefly before declaring, “Well, I’ll never sell any of that in Carmarthen”. Some might see that as a foul calumny against the honest farmers of Sir Gâr, to which all I can say is that Johnny was astute, was good at a job of which he had decades of experience – and he knew his customers well.

An alternative, and rather more charitable, interpretation of the point that he was making is that the way numbers are presented, and the assumptions used to derive them, can sometimes depend on the purpose for which they are to be used. I wonder, however, if that little anecdote might still help to explain the gulf between the farmers’ understanding of the impact of the changes to inheritance tax (IHT) and that of the Treasury. I don’t recall many farmers ever underestimating the negative impact of any change that they don’t like (which at times seems to cover any proposed change), let alone being optimistic. That’s another way of saying that it’s just possible that they may be ever so slightly overstating their case. On the other hand, the idea that Rachel Reeves and a few allegedly ‘clever’ economists at the Treasury understand agricultural finances better than the average farmer is risible; the probability that the government are significantly underestimating the impact of their proposals is high. But unless we start from a set of commonly agreed and understood assumptions, we will not close that gap in perceptions.

If we assume that the average family farm in Wales really is worth the millions of pounds which would start to attract IHT, and that the average farm income really is as low as some are saying, then in purely financial terms, farmers in that position would be better off selling up, buying a house in the nearest town or village, and putting the rest of the money into a building society from which they would enjoy a much better income. Those are big caveats though. (And the issue isn’t purely financial either. Family farms are the backbone of many rural communities and a major factor in the survival of the Welsh language in the rural north and west of Wales. Few of us would want to see that undermined.)

But if the return on capital from farmland is so poor, why is the price so high? Conventional economics would suggest that low return on an asset should lead to lower asset prices. Part of the reason for the high price of agricultural land is precisely the current exemption from IHT, an exemption which makes it attractive for the very wealthy to put part of their wealth into an asset which, unlike their other assets, will not be taxed on death. And part of the problem with Rachel Reeves’ proposal is that she’s only doing half a job. Not only will her changes not be enough to deter the transfer of non-agricultural wealth into farmland, they will therefore also not do enough to stop the artificial inflation of farm land prices, and will as a result catch many more farmers in the net than the government are claiming.

They also don’t address the real underlying issue – why are the rewards from such an essential enterprise as agriculture so low for those engaged in it? But that’s a whole other question, and not one about which the Chancellor seems particularly bothered.

An easy mistake

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Seen one seaside town, seen them all. OK, Barry might be a little smaller than Blackpool, but for a rare visitor to either, it might be easy to confuse them. Just like confusing Miami with Clacton would be for anyone who is a rare visitor to either. And one grumpy old man is much the same as another grumpy old man, so it’s understandable that someone might have difficulty distinguishing between a grumpy old American billionaire convict and a grumpy old English pensioner. Nigel Farage getting confused as to whether his job in parliament is to represent a billionaire American convict living in Miami or a few poverty-stricken pensioners living in Clacton is therefore perhaps explicable; it’s an easy enough mistake to make. Isn’t it?

Displaying weakness

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The Labour government apparently believe that they are ready for Trump, having gamed a number of different scenarios. That sounds a bit complacent to me: the one thing that is absolutely predictable about Trump is his utter unpredictability. The probability that the UK government can have foreseen all possibilities is remote. It seems increasingly as though the team Trump is assembling around him do indeed have some sort of coherent – albeit deeply unpleasant – programme, but whether they will be able to keep him to it is likely to remain unclear for some time to come. I find myself wondering who exactly the ‘useful idiot’ in all this is. Are his team Trump’s useful idiots, or is he theirs? Him not being the idiot might seem unlikely, but it might still be the better scenario.

Whether he will go ahead with his scheme to impose 10% tariffs on all goods entering the US is yet to be seen. He really does seem to believe that the countries and companies sending those goods will pay the tariff with no impact on the prices paid by American consumers. It’s the stuff of make believe. It is certainly likely to disrupt trade relations and is likely to be counter to World Trade Organisation rules. That latter won’t worry him, not least because he knows that WTO rules and processes mean that it will be years before the WTO can co-ordinate its response, and he will no longer be president by then (assuming that he doesn’t also somehow manage to abolish the two-term limit on presidents – or even abolish elections – in the meantime). There are only two countries or trading blocs big enough and powerful enough to take meaningful retaliatory action, and they are China and the EU.

The UK’s response so far – trying to persuade Trump to exempt the UK from an otherwise universal tariff – assumes that the so-called special relationship is something more than an outdated form of words. But such special pleading is not only not helpful to rebuilding relationships with the EU, it also looks like weakness. Trump might well like to see weakness and supplication before him, but the idea that he will respond otherwise than by taking advantage of any weakness is completely at odds with his nature and history. Starmer’s obsession with not challenging any of the consequences of Brexit, and his willingness to bend the knee to Trump look likely only to compound those consequences.

Vigilantes and gamblers

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The Guardian carried a story the day before the budget, wondering whether ‘bond vigilantes’ would punish Rachel Reeves with a Truss-style market meltdown. Curious word, vigilante, with at least three different connotations that I can think of. The first – showing my age – takes me back to watching Mr Pastry on the TV as a child on a Saturday afternoon. There was one episode where, misunderstanding everything as usual, he wanted to become a village aunty. It has a warm, cosy feel to it – the idea that kindly people are looking out for others. A more dystopian version is where gangs of vigilantes roam the streets imposing their own version of the law, by force if necessary, meting out punishment to those who refuse to comply with their rules. Somewhere in between the two lies the concept of people acting together to assist the enforcement agencies in upholding the law.

The ’bond vigilantes’ referred to by the Guardian don’t fit any of those categories. These are people who are looking to turn a penny by trading bonds, in massive quantities, with the intention of leveraging the odd few pennies here and there – multiplied, of course, by the millions of bonds involved. They are more akin to gamblers and speculators than law enforcement officers. They claim to be using their judgement on financial events, such as the budget, to guess as to whether rates of return will go up or down as a result. In truth, they aren’t really even doing that – they’re actually guessing about whether other traders will guess that rates will go up or down and placing their bets accordingly.

Bond market speculation isn’t like betting on the geegees though. When it comes to horses, the number and size of bets placed may affect the odds that the bookies will give you, but they don’t make the horses run any faster. In the financial markets, the bets placed directly affect the outcome as well. If enough people buy and sell bonds in a way which anticipates a rise in the rate of return, then the rate of return will rise, and vice versa. The sad part is that the neoliberal governments, of whichever party, with which we have been saddled for decades believe that things have to be this way, and they have no choice but to follow the dictats of the markets. Their power is constrained mostly by their own lack of imagination.

"They should be paying us"

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Not to be out-done by Starmer’s display of his imperialist credentials, one of the would-be leaders of the Tories went even further yesterday  by saying that former colonies do not only not deserve any compensation for the exploitation of their resources and the enslavement of their peoples, but they should actually be grateful for having been colonised in the first place. Ever willing to add comedy to arrogance, Sirjake added that “they should be paying us”. Perhaps it isn’t completely surprising that people who believe that taking a substantial economic hit in order to gain the illusory ‘freedoms’ of Brexit should also believe that having their resources and people systematically extracted and exploited is a small price to pay for the delights of an English-based law system and the imposition of Christian values.

The thing is, though, it’s not for ‘us’ to decide whether it was a good bargain or not. The only people who can decide whether what they got outweighs what was taken from them are the peoples who were colonised. It’s possible, of course, that some of them really do believe that they got the best end of the deal – one could argue that the earliest English colony of all, Wales, contains plenty who think that there are net benefits from being ruled from elsewhere. It is, however, clearly not the perception of most of the former colonies, and no amount of criticising their ingratitude is going to change that.

And even if it were to be true that, by some sudden strange Damascene conversion, all the former colonies were to agree with the proposition that colonisation had been a good thing, it doesn’t alter the fact that any benefits from colonisation were more accidental than intentional. Colonisation took place with the express intent of gaining access, by force, to resources, and as a process, it made some of the colonisers very rich indeed. Much of the wealth of the UK’s biggest cities came from the exploitation of colonial possessions. It really doesn’t matter how enlightened some (but certainly not all) of the colonisers were or whether the legacy they left was good or bad: nothing can alter the underlying intention of accumulation of wealth by expropriation of resources. The people seeking to rewrite history here are those who seek to deny that basic truth.

Labour's anti-colonialist delusionists

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A few Labour MPs have criticised their leader in the past few days for his imperialist stance on the question of reparations for slavery. To listen to them speak, one might think that the Labour Party is a bastion of anti-imperialism and anti-colonialism. They’re deluded – the Labour Party is as much an English imperialist-minded party as the Tories. That’s how we are allowed to have elections in the UK: by ensuring that nothing changes very much. If it wasn’t obvious to the ‘rebels’ previously, surely the half-hearted handover of only part of the Chagos Islands whilst retaining the UK’s ‘right’ to Diego García ought to have opened their eyes at least a little.

It isn’t only in relation to reparations that the imperialist mindset operates; it also underlies the nonsense that the UK is a major world power which can threaten (or maybe create) adversaries across the globe. To say nothing, of course, about the continued possession of nuclear weapons. Starmer has been at it again this week, telling Iran that it must not respond to Israel’s ‘retaliation’, and that Iran and the Palestinians must allow Israel to have the last word – or last airstrike, more accurately – in the current tit-for-tat round of violence. Why either should listen to a state which is the former colonial ruler of Palestine and which has a history of using force to secure the economic interests of its capitalists in Iran (and which itself therefore bears no small historical responsibility for the situation in the Middle East) is a question which only a died-in-the-wool imperialist wouldn’t even think to ask. That we need a ceasefire and proper peace talks with the serious intention of seeking a just settlement goes without saying; that the conflict can be ended by the historical school yard bullies telling one side to desist is as delusional as believing Labour to be inherently anti-colonial.

Bankers and fairies

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The headline in yesterday's Business and Money section of the Sunday Times proclaimed that “City tells Reeves: we can lend you £80bn”. It’s an example of the way that the basic facts aren’t always presented in a neutral fashion, because the headline could equally have read, “City tells Reeves: We have £80bn that we want to save with the government”. In the preferred version, the banks and financial institutions are doing us (through the government) a favour by lending us money; in the alternative version, the banks and financial institutions are asking us (through the government) to do them a favour by accepting large deposits of ‘spare’ cash.

They both represent different aspects of the ‘truth’, underlining the way that what looks like a debt to one person will always look like an investment to another. But which is actually the best representation of the underlying truth? Imagine that ‘the City’ is a single corporation here, and that the Chief Financial Officer is talking to the collective board. Is (s)he going to say, “Look chaps, the government has got itself into a bit of difficulty, but I reckon that we can probably divert around £80bn from other places to lend them in order to help them out”, or is (s)he going to say, “Look chaps, there’s something of a dearth of safe and profitable investment opportunities at the moment, and the best thing that we can do would be to deposit £80bn in government funds”? When deciding how best to manage their money financial institutions are always looking for a balance between risk and reward, placing some of their money in high risk, high reward investments and some into lower risk, lower reward investments, such as government bonds. To put the question another way, when they are deciding on that balance, do we believe that they operate on the basis of a community-friendly altruism, or do we believe that they decide on the basis of what’s best for their shareholders?

Those who believe in altruistic bankers might like to come and meet the fairies at the bottom of my garden.

Anti-homeopathy: could it be fatal?

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It could simply be that I haven’t properly comprehended it, but my understanding of homeopathy is that a substance known to be harmful is added to water and then repeatedly diluted until there’s no trace of it left, at which point the water somehow retains a memory of the substance, and that memory, by being drunk, cures the original problem. It would be fair to say that opinions differ as to its efficacy. Science has, to date at least, been unable to explain how water retains a memory of a substance, let alone how that memory can then cure anything. Others swear by it.

The UK Labour government seems to be adopting a form of reverse homeopathy, whereby repeatedly strengthening the dose of the poison is deemed to be a cure. They are committed, for instance, to getting rid of the blight of child poverty, but their approach so far has been to increase the number of children in poverty by retaining the two-child cap on benefits, and now talking about withholding benefits from people deemed able to work, whether work is actually available to them or not. They are also opposed to pensioner poverty, and are tackling it firmly by deliberately reducing pensioner income. The scientific basis for the assumption that increasing poverty is the route to reducing it is even less clear than that for homeopathy, but at least drinking water, with or without a memory, isn’t actively harmful in itself.

The belief in what we might call ‘anti-homeopathy’ isn’t restricted to the governing party. The current main opposition party is suffering from its own version of the same affliction. In their minds, the best way to cure the problem of people not voting for them is to double down on all the reasons why people rejected them. The dose of ideological fervour on offer from Sunak simply wasn’t strong enough, apparently. There were reports yesterday that an opinion poll conducted by Electoral Calculus showed that a Conservative Party led by Robert Jenrick would win rather more seats than one led by Kemi Badenoch. Some foolish commentators have interpreted this as a boost for Jenrick, but they are not taking account of the anti-homeopathy which is currently rife amongst the dwindling number of party members. If what he has to offer might increase the likelihood of people voting for his party, then the dose he’s offering isn’t strong enough. It will surely be Badenoch’s chances which were boosted yesterday.

As to the real cure for this strange affliction currently infecting both parties, it appears there isn’t one. It will just have to work its way through the bodies of both parties until it reaches its conclusion. If we’re lucky, it might even turn out to be fatal.

Chasing savings from benefit payments

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As of today, none of us know what will be in the UK Budget later this month; it’s doubtful if even the Chancellor knows yet, given that work on the detail is continuing. There have been plenty of hints and rumours, though: enough to fuel endless speculation and debate about whether a particular rumoured change does or does not breach a manifesto commitment. One fairly consistent rumour, backed up in a way by today’s suggestion that weight-loss drugs will be prescribed for overweight people who are economically inactive, is that the benefits budget will be one of the targets. It’s not the most lucrative of possible clampdowns – all the evidence suggests that more government expenditure is lost to tax evasion and fraudulent accounting than on paying benefits to those not entitled to them. Choosing to go after benefits is just following an agenda set by the Tories and their media friends. Having said that, it is true to say that there is a saving to be had if benefits can be restricted to those who meet the criteria; the political question is about whether that’s the most productive target.

It raises a question about chickens and eggs. Is the saving being sought a result of a programme to assist people to find suitable employment, or is it intended to use benefit cuts to force people into work, however suitable that work might be for the circumstances of the individual? It was pretty clear under the Tories that it was the latter of the two: cutting benefits would allegedly create an economic incentive which would effectively starve people into taking low-paid (and sometimes multiple) jobs. In relation to those who see living off benefits as a lifestyle choice, there might even be an argument for such an approach, but that group is much smaller in number than anyone reading the tabloids might think, and one of the problems with it is that it can end up causing a lot of collateral damage, especially to children whose life chances are already poor. Those hit aren’t only the tiny number of workshy. There is a huge difference between that approach and an approach which looks at individual circumstances and provides appropriate help and support.

The provision of drugs to help weight loss is potentially a positive step in general terms, although there are some serious questions about potential side-effects, and whether it is merely treating symptoms rather than causes. But even leaving those reservations to one side, directing support to people who are economically inactive is a major corruption of the ethos of the NHS, which is supposed to be about the provision of health care based on assessed medical need. That’s rather a different proposition. It underlines the way in which what used to be the ‘party of the working classes’ increasingly sees people purely in terms of their economic value. There is a political philosophy based on such a belief, but it isn’t the one Labour traditionally promoted. It’s unclear whether the party intends this medication to be mandatory or voluntary, but even voluntary medication of a specific group of people based on criteria other than health needs would be something that ought to worry us. It also plays to, and reinforces, a stereotype of benefit claimants as fat layabouts, encouraging further stigmatisation of a large group whose needs are complex and varied on the basis of a prejudice about a small subset of that group.

It’s not entirely clear which approach Labour favours on either of these issues, although the signs to date are not good. A party which claims it wants to eliminate child poverty hasn’t hesitated to add to that poverty to date, and has been singularly unapologetic about doing so. There is no reason to assume that they won’t continue in the same vein.

Power still lies where it always did

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The UK Transport Secretary got herself into a little bit of trouble over the weekend. As far as I can see, her sin was to repeat in government what she – to say nothing of her party leader – had been saying whilst in opposition, somehow forgetting that the whole point of being in government is to do the opposite of what they said in opposition. The ultimate owner of P&O threw a brief wobbly, threatening not to invest its £1 billion in the UK unless Starmer did a bit of grovelling, and he duly obliged.

To the enormous surprise of almost nobody, the company then decided that making the substantial profit which they expect to earn on their investment was more important to them than some very slightly hurt feelings and agreed to go ahead with the investment after all. Some important lessons have been learned, though. The first is that politicians may huff and puff when companies treat their staff in an appalling way, but they won’t bite, and there will be no repercussions for such behaviour. Short term huffing and puffing headlines are an end in themselves. The second is that the interests of capital will always prevail over those of labour, even under a self-styled ‘Labour’ government. Humiliating Starmer into buckling down and acknowledging that publicly is just a bonus, to say nothing of a marker for what we should expect over the next five years.

Waiting for the next bus?

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It's tempting to see the result of the latest ballot among Tory MPs to choose a new temporary leader as being just another display of the inherent duplicity of the species. But, whilst there certainly is an element of that involved, it seems that the reality on this occasion is that it’s an even bigger demonstration of their incompetence. Their complete absence of trust in each other has meant that they couldn’t even stich up an election where the electorate is only 120 strong. The ‘explanation’ for the result is apparently that some supporters of James Cleverly – the walking, talking demonstration of the inapplicability of the theory of nominative determinism – were so confident that he was going to be in the last two that, instead of voting for him, they voted for the one that they thought he'd best be able to beat.

They think that they’re such a clever and sophisticated electorate that holding multiple ballots eliminating one candidate each time enables them to use all the low cunning which they possess to game the system so that the final run-off is between the one they want to win and the one that (s)he stands the best chance of beating. But here’s the thing: if we look at the very first round of voting back at the beginning of September, the order in which four were eliminated precisely matches the result achieved just over a month ago. And if they’d used the first-past-the-post system, which they insist is the only democratic way of voting, to select the final two they would have ended up with the same two that they’ve actually got. A month of political manoeuvring, Machiavellianism and dissimulation has got them exactly where they could have been a month ago.

It's hard to say whether the use of STV would have produced a different result. I suspect that having to rank six candidates in order of preference might have been too big an intellectual ask of many of them, but it would certainly have been much harder to game. Maybe the result would have been the same anyway, just achieved a lot more quickly. What is clear is that, whether by accident or design, an overwhelming majority of Tory MPs have opted for a final contest to select the candidate who can do the most to wreck what remains of a once-formidable election-winning organisation. And all the signs are that the aging, white, wealthy, south-east England based membership will enthusiastically assist in that aim. But Tory leadership campaigns are like buses: there’ll be another one along shortly.

Representing who to whom?

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Following her removal from the post of Chief of Staff, Sue Gray has been appointed to a new role as some sort of envoy to the nations and regions of the UK. The precise nature of the job is far from clear. After all, the three devolved nations already have cabinet ministers allegedly responsible for promoting their nations’ interests at UK government level. They’re not very good at it, of course, and it’s obvious that they see their function as being more about telling the devolved administrations what to do than about passing views back to the centre. In theory, an envoy’s role is a two-way process, but the main emphasis has always been on representing the interests of their paymasters. In any event, given some of the reports about Gray suggesting that her expertise lies more in withholding what she considers to be unnecessary detail from the PM, it's unlikely that she is the right person to be feeding back the unfiltered views of the natives. At one point, liaison with devolved bodies was the responsibility of a senior cabinet minister, a certain Michael Gove, so it’s also reasonable to wonder whether appointing a non-politician to the role is a step forward or backwards.

But people are asking the wrong questions. The greater the extent to which a person is appointed to a non-job in the UK structure, the more elaborate the accoutrements that generally go with it. Historically, an envoy is one step down from an ambassador, so here’s the first, and most important, question: does she get a bicorn hat? And if she does, will it have a plume of feathers, or are they reserved for full ambassadors? Will she have an official residence in each of the territories assigned to her care, a place where she can host grand parties to make the great and the good of those territories feel as important as herself? Pyramids of a certain type of chocolate delicacy are optional.

And then there’s what is perhaps the biggest question of all: how long will she stick it out before quietly segueing into becoming Baroness Gray of Greyness, with a seat in the House of Lords?

Creating wealth: who benefits?

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Two of the many points of agreement between Labour and the Tories are that both economic growth and wealth creation are generally good things to encourage. On that, at least, they’re more or less right, although they often seem to miss out the important caveat that both things must happen within such limits of resource usage as are necessary to ensure that resources remain available for future generations, and that the ability of the planet to sustain life is not impaired (and that caveat is more far-reaching than it might appear). They even seem to agree, in general terms, that the route to achieving those things has to do with freeing wealth creators to do their thing by minimizing government intervention or control, and that government spending is some sort of drain on wealth – and on those points, they’re both completely misguided. I wonder if they even understand what ‘national’ wealth, as opposed to private wealth, actually is.

For sure, Starmer knows a wealthy man when he sees one (as did his predecessor but two, on a grand scale). But becoming wealthy isn’t the same as creating wealth, and nor is creating wealth the same thing as becoming wealthy. It’s perfectly possible for someone to redirect wealth in his or her own direction without adding to the total wealth of the country; and equally possible for a wealth creator to add to the sum total of wealth in the UK whilst ending up bankrupt. Becoming wealthy can simply be the result of redistributing existing wealth, something which a ‘trickle-up’ economy like the UK tends to facilitate. Creating wealth isn’t the same thing as making a profit either: it’s perfectly possible to turn a decent profit by simply redistributing existing wealth. There’s another myth as well – that somehow the public sector uses or even destroys wealth rather than creating it. But building a new hospital or school, for instance, adds to the country’s stock of capital, and thus wealth. And not all wealth can be measured in cash terms anyway, even though that’s what politicians seem to want to do. A healthy population also adds to the ‘wealth’ of a country, as well as increasing the potential for future wealth creation.

The real issue is not about the creation of wealth, but its use and distribution. An increase in total wealth which flows into the same few hands might look like a positive result at the macro level, but it won’t feel like one at the level of those struggling to get by. The argument that growing the size of the pie means there’s more for everyone without needing to take any away from the owners of the biggest slices only works if everybody’s slice gets bigger in practice, rather than merely in theory. If all the extra merely makes the biggest slices even bigger, then the ‘growth’ about which the government keeps banging on merely increases inequality.

Confusing total ‘national’ wealth with private wealth looks to be deliberate; and it’s no surprise given that the ‘wealthy’ have a disproportionate influence on government and opposition politicians alike. Even if there’s no direct or obvious quid pro quo, does anyone really believe that the generosity of wealthy donors is completely unrelated to their desire to continue to apply that adjective to themselves? People may not need to create wealth to become wealthy, but neither do they stay wealthy by donating part of their wealth to governments which might want to redistribute part of the remainder. But if increased wealth isn’t put to use for the benefit of the population as a whole, what is the point of it? It’s a question to which the government doesn’t seem to have an answer.

Empire trumps justice for Labour

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In defending the decision to transfer the Chagos Islands to Mauritius against Tory criticism, the PM yesterday declared that “the single most important thing” about the deal is that the US/UK military base on Diego Garcia is effectively exempted from the transfer, and the right of the Chagossians to return to the islands excludes that part of their historic territory. It’s an interesting choice of relative importance.

He could have said that, given the rulings against the UK in international courts, the most important thing was that the UK was going to abide by the rule of law. It would be a reasonably credible approach – he does, after all, claim with some justification to have spent most of his career upholding the law. He could have said that the most important thing was rectifying the injustice done to the Chagossians when the UK forcibly deported them from their own lands and homes. Justice, again, is something which he can legitimately claim to have pursued for much of his life.

But he chose to emphasise neither of those things. The priority, for him, was maintaining a military base, the precise nature and purpose of which has long been unclear, and to deny the right of the islanders to return to that part of their land in order to do that. It turns out that, when push comes to shove, maintaining the scattered remnants of the British Empire and the UK’s military reach are more important to him than either the rule of law or justice for those who were unlawfully expelled. Who needs Tory imperialists when we have Labour ones?

The imperial mindset lives on

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No empire was ever created with the active and enthusiastic participation of the populations incorporated into that empire. Empires are, and always have been, based on conquest and war, often savage and brutal. The passage of time and a combination of an influx of people from the conquering power coupled with relentless propaganda about how much worse off people would be if they actually decided to run their own affairs sometimes convinces the conquered to accept their status but, more often than not, disputes about ownership and sovereignty rumble on, sometimes for centuries. Even though they know that the territories were seized by force in the first place, imperial powers somehow end up believing that they have some sort of natural right to the possessions thus gained.

Those in the Tory Party who still have that imperial mindset (i.e. almost all of them) have been outraged by the agreement of the Labour government to transfer what seems to be partial sovereignty over the Chagos Islands to Mauritius. Handing over a few remote islands in the Indian Ocean is, apparently, an unparalleled act of treason (somewhat ignoring the fact that it was the previous Tory Government which opened the negotiations). But in truth, Labour aren’t much better. They have negotiated over the heads of the Chagossians themselves who have had no input into the process, and whose ancestral homelands have been treated as something to be traded and transferred. And, in some form or another, the transfer has been made conditional on retaining some sort of control over Diego Garcia, the large US/UK military base, from which Chagossians will continue to be excluded.

It's presented as some sort of final resolution of a long-outstanding post-colonial problem, but the reality will almost certainly turn out to be different. There is a question as to whether the negotiations have truly been conducted between equals, or whether there isn’t an element of power differential at play. And no ‘agreement’ which has been reached, no matter how well negotiated, where one of the negotiators holds most of the cards is ever likely to stick in the long term. The UK should have learned that from the case of Gibraltar, for instance. In theory, it was ceded to the UK ‘in perpetuity’ under the Treaty of Utrecht in 1713, but that treaty was effectively simply recognising that the peninsular had already been seized by force. The territory was ceded under pressure as part of the settlement of a war, but it was hardly a negotiation between equals, and Spain's claim to the territory is still live.

‘Perpetuity’ might appear to be a word with a clear meaning, but in terms of territorial disputes, it simply means ‘until the balance of power changes’. It may be a decade or two away, but the question of sovereignty over Diego Garcia hasn’t really been ‘resolved’ at all, merely postponed. And the wishes of the Chagossians will make themselves known in due course, not necessarily in the form of acceptance of the deal done between two far away governments. The British, or perhaps I should say English, Empire won’t ever be truly over until the last remnants have been disposed of, and there’s a lot more outrage still to come from those who retain the imperial mindset.

Strong opposition is not an end in itself

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Some analysis of the so-called beauty parade at the Tory Conference this week has been based on the assumption that democracy requires that any government needs a strong opposition to perform this magic function called ‘holding to account’ and that, in current circumstances, that requires a functioning Tory Party. What anything in that last sentence actually means is generally left unexplained on the basis of another assumption: that we all know what it means. But do we really?

If ‘holding to account’ simply means automatic gainsaying of anything the government says, regardless of any evidence, is it actually performing any useful function? In the Senedd, we have a whole opposition party utterly dedicated to simply disagreeing with everything the administration says – even if, in the process, they find themselves obliged to contradict either what they themselves have said in the past or else what their masters in London are saying – in pursuit of a headline or two, the more lurid the better. But the degree of luridity and the number of column inches thus gained is no measure of the usefulness of the process. Some might argue that it’s useful in keeping lazy journalists employed, although many of us might just doubt the value of that as well.

It might be argued that democracy is best served by presenting voters with alternative views of the world and allowing voters to choose between them, but that isn’t the same thing as presenting the same view of the world and merely offering a choice of implementation teams, which is where UK politics currently operates. That’s not to underestimate the value of replacing an incompetent team with a competent one, although recent events suggest that the last election didn’t even achieve that, however much it might have appeared in advance that almost anyone would be able to do a better job. Turns out that ‘almost anyone’ didn’t encompass the main opposition party.

Even if it were true that the UK’s semi-democracy is stronger where there is a strong and clear opposition party, it doesn’t follow – as much of the speculation around the next leader of the English Conservative Party seems to assume – that that opposition must be composed of the party that was last in government. Maybe, even in the case that having a strong opposition is always and necessarily a good thing, it would actually be better to sweep the last lot aside and build anew around another option which actually offers something different. Choosing the least worst new leader in the expectation that (s)he would be capable of replacing the current government with a revamped version of its predecessor and that we would be better off as a result would be another triumph of hope over experience.

There’s more to strengthening democracy than simply preparing the Conservative Party to return to power the next time the pendulum swings. Abolishing the House of Lords, implementing an electoral system which doesn’t give absolute power to one party on the basis of one third of the votes, and further devolution of power would all be better first steps. Ensuring that a party committed to none of those things can only ever be replaced by another party committed to none of those things is a recipe for continuation politics and economics. Rather than being what we need most – which is what the talk of a strong opposition seems to assume – it’s really what we need least. We should be asking ourselves whose interests are being served by restricting the choice.

When does a gift become a tip, and therefore taxable?

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A new law comes into force today regarding the distribution of tips in service industries. Some less than entirely scrupulous employers have been keeping all or part of the tips themselves rather than passing them on to employees. Whether tipping is a good thing or not is a matter of opinion; some of us would certainly prefer that the staff are paid a proper wage in the first place, even if that means prices go up a bit, rather than the staff being dependent on the arbitrary generosity of customers. Leaving that aside, tipping is currently a fact of life, but happens in two ways. Sometimes, cash goes directly into the hands of individual employees, but increasingly customers can choose to add an amount to the bill, and the total gets shared out and processed by the employer.

Tips have long been taxable (as the name suggests, income tax is a tax on income, not just on earnings), and one advantage of employers doing the collection and paying is that the tax can be, and generally is, processed through the employers’ PAYE systems. Cash put directly in the hands of individual staff members, however, is only taxed if it is properly declared to HMRC, and there must be at least some doubt as to how much gets declared in practice. As a general rule, ‘gifts’ are not taxable (although there are exceptions, especially when gifting is used as a means of attempting to avoid paying tax), but ‘gifts’ received by an employee as a result of his or her employment – which is what tips effectively are – are unquestionably taxable, although it does open up something of a grey area.

It made me wonder, though: if gifts received as a result of the job a person does (i.e. they would not be received by the same person if he or she were doing a different job) are taxable, why are gifts received by MPs not subject to income tax? It is clear that they effectively boost the spending power (and thus the ‘real’ income) of the recipients and that they are only given because of the job the individuals are doing, so why are they not treated as income? Why should a waiter earning at or around the minimum wage, say, who receives a tenner at the end of a meal, have to pay 20% tax on it, whilst a person on a substantial salary who receives clothing worth £30,000, to pick a recent example at random, pays nothing? It wouldn’t be a huge money-spinner in the scale of things, but if the Chancellor is serious about closing loopholes on tax avoidance and clamping down on benefit fraud, perhaps she should also look a little closer to home at the people around her.

Not outrageous enough?

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It takes a very special kind of delusion to look at an electoral defeat and claim that what it actually shows is overwhelming support for the losing party. Donald Trump has it in spades, of course, and is clearly keen to apply it to the results of elections in countries other than his own. Last week, as part of his ‘welcome’ for Keir Starmer, he praised the ‘real winner’ of the election, one Nigel Farage, bizarrely claiming that Reform had won more seats than they were allowed to have. From a man whose one and only election victory (to date) was achieved under an electoral system in which he won fewer votes than his opponent, a degree of confusion is perhaps to be expected.

But we have our own adherents of the idea that a defeat is really a victory much closer to home. Wales’ very own RT Davies, for example, declared this week that Wales is ‘inherently Conservative’, the evidence for which is presumably to be found in the number of seats won by Conservatives in the General Election in July. Zero is, I suppose, a nice round number, and the beautiful roundness of it can easily distract attention from its mathematical significance. He also said that, “The Welsh people reject the extreme liberal ideology of Labour, Plaid Cymru nationalists and the Lib Dems”. I’m struggling to identify which part of the mainstream Tory ideology so enthusiastically swallowed by at least two of the named parties is ‘extreme’, but that’s an aside. The evidence for this rejection is clearly to be found in the fact that the remainder of Welsh constituencies, after deducting those taken by the Tories, were won by the three parties he named. Zero for the Tories and a total of 32 for everyone else is the clearest rejection of everyone but the Tories that a Tory leader could wish for.

Perhaps he’s not mathematically-challenged at all, he just believes that election results are like some strange form of double-entry book-keeping, where every debit has to be balanced by a credit somewhere else, and the rest of us are simply looking at the ‘wrong’ side of the balance sheet. After all, a number which looks like a debt to a customer always looks like an asset to the bank. I’m not sure that I’d want him as a banker, though. Even when it isn’t rhyming slang. It’s more likely that he comes from that school of thought which believes that if you repeat an untruth often enough it ends up being believed. It’s an approach which has a long and disreputable history, but as Trump demonstrates, daily, the more outrageous the statement, the more effective it can be. Maybe RT’s problem is that he simply doesn’t have it in him to be outrageous enough. Everyone, or so they say, has at least one redeeming feature – being insufficiently outrageous could be his.

Does Starmer understand how privileged he is?

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In his attempt to make his use of a millionaire’s apartment for four weeks, at an estimated value of £20,000, appear reasonable, Starmer has appealed to the sense which any parent would feel of wanting to do the best for his children. Superficially, it’s an entirely reasonable argument. Having a hoard of reporters virtually camped in the street outside someone’s house is clearly disruptive, and any caring parent would want to avoid disruption to study in the approach to a set of key examinations.

There is a problem, though. Whilst a throng of reporters might be a problem more-or-less unique to the leader of the opposition, it isn’t the only form of disruption which can occur. What, for example, of the child trying to study whilst extensive roadworks are taking place in the road outside?  (Or perhaps the building of a new housing estate, a new prison, or a line of pylons; all things which Starmer has told us people must simply put up with.) Is that somehow less disruptive? Perhaps the parents of that child should just have a word with their friend the multi-millionaire and borrow his pad for a month. Except that most of us don’t know any millionaires, let alone the ‘multi-’ variety.

We know that children born to well-educated, wealthy (or at least comparatively so) parents consistently perform better in school, including in examinations, than poorer children. They start life with a whole range of advantages not available to others. In his attempt to portray himself as just a normal, caring parent wanting to do the best for his children, what Starmer has done is to highlight another of those advantages: knowing the right people. He has also managed to show just how different his idea of 'normal' is from the reality facing most parents.

Chickens, eggs, and confused Chancellors

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There is a report today that the Chancellor is pressurizing the Office of Budget Responsibility to use planned but not yet implemented planning reforms to change its estimate of the rate of UK growth. If they agree, then she will be able to spend more money without breaking her own arbitrary fiscal rules. It doesn’t mean that there will actually be any more money, of course; merely a forecast of extra government revenue at some future date. If they agree to roll over and do as she asks, she will then spend that extra non-existent money on investment in the UK economy. Planning and implementing the spending will, as it always does, precede the actual receipt of the money (always assuming that it is eventually received), and in the short term, that spend will be presented in the accounts as though the money has been ‘borrowed’, even if it’s actually simply been created out of thin air by the Bank of England.

There’s nothing new or unusual about that as a process, it’s what always happens, no matter how much the politicians attempt to deny it. Government spending always precedes government revenue. But here’s the twist: spending the extra money will expand the economy (i.e. create economic growth), thereby validating, to a greater or lesser extent, the original assumption about higher growth. The cause of that growth may not be the one stated when it was first built into the assumptions. But in terms of the outcome, that’s unimportant. Government spending creates economic growth, which eventually leads to increased government revenue.

She could, of course, achieve the same thing by simply adjusting the arbitrary fiscal rules to which she is working. She is, however, too confused about the order of chickens and eggs, and too deeply imbued with Treasury and Bank of England orthodoxy. Maybe it doesn’t matter too much (unless the OBR refuse to play ball), because as long as she abandons her obsession with insisting that the income must precede the expenditure, she does actually stand a chance of achieving the magical growth on which everything, apparently, depends. Whether it’s the right type of growth, in the right places, is a question for another day…