Foot in mouth disease

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The British Labour Party seems to have scored two spectacular own goals in Scotland over the weekend, by despatching both its leader and the Mayor of London up to Perth to put the SNP in its place to address the Scottish branch conference.  As is often the case when British (or English – they’re much the same in this context) nationalists try to put down Scottish (or Welsh) independentistas, their remarks tell us more about them and their attitudes than about the subject matter of their words.

Corbyn merely managed to undermine completely his branch manager’s pitch for a rethink over the nature of the union between Scotland and England, and in the process probably destroy the only slim chance his party had of salvaging something in Scotland.  But that as almost as nothing compared to Khan’s success in equating Scottish nationalism with racism and hate, a comparison which all his subsequent ‘clarifications’ did nothing but confirm.  Between them, it was quite an achievement.

It isn’t only Saddiq Khan who sees Scottish nationalism as being about hatred and division, of course.  The idea that the whole idea is based first and foremost of a hatred of England and all things English is the standard assumption of most metropolitan commentators (and, when they can be bothered to think about Wales at all, they make the same lazy assumption).  I don’t think that it’s true (but then, I would say that, wouldn’t I?), and I don’t see any good evidential basis for it.  That’s not to deny that there are some people who do display such an irrational hatred; of course there are – just as there are some people in England who display a similar irrational hatred of the Scots and Welsh.  But extrapolating from a few examples to the axiomatic assertion that the SNP’s whole rationale is based on such hatred is equally irrational.

Some of the people making this assumption are far from stupid – so why do they do it?  Clearly one reason is the very cynical one that painting people as racists and haters is a lot easier than engaging in adult debate about options and alternative futures.  And there’s quite a lot of evidence that playing to prejudices works as a political strategy, more’s the pity.  But I think that there are other factors as well, and I’ll touch on two.

The first is that very English sense of superiority and exceptionalism.  When you “know”, with no scintilla of doubt, that the “British” way of doing things is the very best and most successful in the whole wide world, it can be very difficult to understand why anyone would ever want to do anything different.  Clearly, anyone who does cannot be motivated by logic or reason, and must therefore be driven by emotion.  And the only emotion that can cause anyone to reject the ultimate perfection of Britishness must be hatred.  From a certain perspective, that is blindingly obvious.

The second is that their own nationalism (you know, the one that they always deny possessing, even when Corbyn is making his appeals to British patriotism) is inherently driven by a sense of superiority and difference.  As often as not, they subconsciously define themselves by what they are not, rather than by what they are.  And if their own variety of nationalism is driven by such factors, it is entirely reasonable for them to assume that any nationalism in Scotland is driven by the same factors.

And once they “know” that Scottish nationalism is driven by hatred of the English and an innate feeling of Scottish superiority, it’s easy to explain why they talk as they do.  The result, of course, is that the scope for debate with people who already know that anything you say is so motivated is so limited as to be worthless.  The only thing left to do is to ignore them and get on with the task of building the case from within.  There is, though, one other thing that independentistas could usefully do – and that’s stop referring to these people as possible allies in some sort of ‘progressive alliance’.  All that does is hinder the exposure of their real beliefs.

For Wales, don't see Scotland

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Wales isn’t Scotland, and there are always dangers in trying to extrapolate the situation in one country into conclusions for the other.  The differences go back a long way, well before the advent of devolution; the difference in the devolution settlements is in large part the result of the starting point being so different.  Scotland, for instance, already had its own legal system.  And here in Wales, the national cause has long been complicated by the overlap between the political and the linguistic battles.

But we shouldn’t allow the stress on the differences to blind us to some similarities either.  Plaid Cymru and the SNP both have their roots in the same period of history, and their record of electoral success (or lack thereof) over the long term shows a number of parallels.  Even as recently as the first elections to the devolved bodies in 1999, the electoral pattern was broadly similar – the SNP took 35 seats out of 129 whilst Plaid took 17 out of 60.  It is only since then that the paths have diverged so significantly.

There are many reasons for that electoral divergence, but they’re not particularly relevant here.  The important thing is that the degree of divergence in electoral history between the two countries since 1999 leaves the two countries in very different circumstances.  

Whilst support for independence in Scotland has varied over the years, it has been consistently higher than support for Welsh independence.  Again, there are a number of possible reasons for that, but I cannot help but conclude that one of those reasons is that, in Scotland, the case has been regularly debated and promoted.  There has been a political party in Scotland prepared to make the case, through thick and thin, whilst in Wales the advent of devolution and the need for nation-building (which, by the way, I don’t question per se) was used as a substitute for, rather than an adjunct to, making the case for the aim of independence.  I don’t believe that any argument is ever won by not being made, and waiting for the people of Wales to come around to support for independence of their own accord – which is where much of the ‘national’ movement currently seems to be – looks like a recipe for never making it.

The result is that the future looks very different for the two nations, particularly in the light of Brexit.  For all the optimism of independentistas, it is far from certain that Scotland will make the break and choose a European future rather than an isolationist British one.  For their sakes, I hope that they do, even if such a move would leave Wales even more vulnerable to domination from our very much larger eastern neighbour.  But we cannot be certain, and should not take the outcome for granted.  We can, though, at least consider the impact on Wales of such an outcome.

I fear that, to return to my starting point, too many independentistas in Wales are reading across from Scotland to Wales, and hoping (or even assuming) that Scottish independence (and, with that, continued Scottish membership of the EU) will make Welsh independence more attractive and more likely.  I can see why that might be the case in the context of continued UK membership of the EU, particularly if other European nations such as Catalunya follow a similar path.  The parallel, particularly if those other nations (as seems likely) make a success of their choice, is clear enough.  But the parallel in the case of a Wales which would have to face a significant transitional period outside the UK whilst seeking to negotiate entry to the EU as a new member is a great deal less obvious.  I’d go so far as to say that it isn’t really a parallel at all; it would be, rather, a unique situation.  As a result, people would naturally see it as being a great deal more risky.

The assumption that a Scottish exit from the UK before Brexit happens will lead to a demand for the same thing in Wales is a lazy one.  The danger is that, by making such an assumption, and through continued failure to make the case for Wales to take control of her own affairs, the likelier future for Wales in a UK shorn of Scotland and outside the EU is greater integration into England, especially in economic terms.  Oh, I’m sure that we’ll be allowed to keep our little Assembly down in Cardiff, but our voice will be heard even less than it is now.  The timescale for any change in direction to avert that outcome is short, and the clock is ticking.

Taking control

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One of the arguments regularly used by independentistas who prefer not to talk about it is that the economic situation of Wales is too bad to allow independence at this stage.  It’s an argument that I understand, but I have never understood why, even if it were true, it means that the case in principle shouldn’t even be put.  Failure to make the case at all – even as a context for deciding which economic changes are required and in what timescale – looks more like electoral expedience than principled position.  It also gives the impression that we need ‘someone else’ to fix things for us first; and actually, that is a greater argument against independence than Wales’ undoubted economic problems.  A nation which needs ‘someone else’ to fix things for them doesn’t sound like a nation ready to take responsibility for its own affairs.

In any event, I’m far from convinced that our problems are as serious as they’re made out to be by a political class which actually seems to enjoy being in a state of dependence.  I’ve pointed out previously that on the most commonly accepted measure of prosperity, GDP per head, Wales is in fact one of the world’s richer nations.  And we are above the average for member states of the EU.  If those other countries can be successful member states, what stops Wales emulating them?  Why are we so ready to use only one single comparator – England – rather than taking a wider view?  It’s as though we’re so dazzled by our nearest neighbours that we’ve fallen into their habit of believing that the civilized world ends at Dover.

Would we need to make changes in order to cope with becoming an independent state?  Yes, of course we would; indeed, that’s the whole point.  And since even a positive vote for independence tomorrow would still lead to a transitional period before independence actually happened, the government of Wales would have time during that period to start that process.  Add to that the fact that there isn’t going to be a vote tomorrow – and since it appears unlikely that any party will even enter the 2021 Assembly elections with a promise to hold a vote, let alone win those elections and implement that promise, we can probably rule out a vote for at least ten years. 

I find it impossible to believe that any country with our level of GDP per head could not prepare itself adequately to take control of its own affairs in that timescale; and any political movement serious about achieving that aim would be setting out a route map towards that goal.  It isn’t a soft option; far from it.  It is a lot easier to whinge about other people letting us down than it is to take responsibility for putting things right ourselves.  But if that’s the best we can manage, then perhaps we really aren’t ready even to consider the idea.

Double-edged swords

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One of the arguments often used by opponents of membership of the EU is that the UK could compete more successfully in the world if it was not subject to EU rules on issues such as employment law.  Flexibility in the field of employment, runs the argument, makes it easier to attract inward investment. 

Despite the harmonisation which has taken place, there are still differences in employment law even now; the UK labour market is more flexible than the labour market in say Germany or France.  Whether that’s a good thing or not is a matter of opinion, but I’ll accept that, when it comes to attracting inward investment, perceived flexibility is more advantageous than perceived inflexibility.  It’s a double-edged sword, though.  That which makes it easier to attract some types of investment also makes it easier for the same companies to disinvest. 

One very current real example is the proposed take-over of the European arm of General Motors by the parent company of Citroen and Peugeot.  It is likely to lead to a degree of rationalisation as the various parts of the company are brought together – and that may lead to redundancies or even plant closures.  For political reasons, they may not be immediate, but over the longer term, they are highly likely.  Faced with a choice of closing plants in Germany or the UK, which are most likely to close?  Well, one of the results of the UK’s much-vaunted ‘flexibility’ in the labour market is that it’s actually much easier and cheaper to sack workers here than it is to sack them in Germany.

More generally, whilst Germany has not been immune to the trend which has seen manufacturing jobs move overseas, it has been less badly impacted than the UK.  Whilst it would be a mistake to attribute the whole of this to a single factor, the relative ease with which manufacturing plants can be closed in the UK is undoubtedly one of the factors underlying that difference.

It would be over-simplistic to argue that continued membership of the EU per se is enough to provide job security for UK workers, although it is one of a number of cases where further harmonisation of rules across Europe would help.  But there is, after all, nothing to prevent a UK free of so-called ‘Brussels interference’ from implementing its own rules to protect UK jobs.  But it would be naïve to believe that that is the how the Brexiteers intend to operate their new-found ‘freedom’ to make our own rules.  Creation of an offshore tax haven has more to do with removing workers’ rights than enhancing them. 

When they come to write future history, people will surely marvel at how easy it was to persuade those who stood to lose most from deregulation to support it so enthusiastically.

Selecting people for visas

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I’ve long thought that the whole idea of the “Commonwealth of Nations” is a concept which is outdated now, and was probably outdated at the time that it was conceived.  It has always seemed like an attempt to somehow cling on to the imperial past, pretending from the UK perspective that those countries conquered, ruled, and exploited by one European power in particular must, as a result of that process, look up in awe to the ‘motherland’, whilst hoping, from the other perspective, for some sort of favourable treatment from the former colonists.

But ‘breaking ties with the commonwealth’ was one of the issues in the 1975 referendum on membership of the EEC, so it probably shouldn’t be a surprise that renewing and strengthening those ties would be an issue arising in the wake of the 2016 referendum, particularly for those with a yearning to dwell in the past.  It is in that context that 45 Tory MPs wrote to the Home Secretary just under a fortnight ago, advocating changes to visa rules for Commonwealth citizens.  The issue, it seems, is to be debated in parliament shortly.  (The report suggests 26^th, but as far as I’m aware, parliament doesn’t hold debates on Sundays.)

As someone who supports the idea of free movement of people in principle, I welcome any moves to ease restrictions (although it would be better if the government would also give at least a passing thought to preparing for the consequences).  But restricting freedom of movement from Europe whilst loosening controls on those further afield seems bizarre to me.  Perhaps it doesn’t look the same to those who view the imperial past through rose-tinted spectacles.

I don’t know how broadly popular the idea of giving priority to the commonwealth will be; I’m afraid that I rather suspect that it depends on what image the word conjures up.  For me, it is of a widely dispersed territory most of the population of which lives in Africa or the sub-continent of India.  I wonder, though, whether for many the image is more one of ‘kith-and-kin’ in Canada, Australia, and New Zealand.  I’ll admit find it hard to believe that many of those who voted in the referendum thinking that they were going to put a stop to movement of people from the rest of the EU would really be delighted to see them replaced by more people from India or Pakistan.  Not for the first time, it suggests that immigration was merely an issue seized upon to achieve a result rather than a real concern for those leading the campaign.

Cunning subterfuge - or perhaps not

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According to reports earlier this week, the UK Government is considering making aid payments to some of the poorer members of the EU, such as Poland, Hungary and the Baltic states in the hope that those countries will be more supportive of giving the UK a better deal over Brexit.  All of these independent countries are poorer than Wales of course which is why they're net recipients of EU funding.  But being independent states, they have more say than Wales does when it comes to the terms of Brexit.  Their votes count for more than anything Carwyn Jones says or does, and need to be bought.  Those who want to pursue this line are suggesting that the money should be diverted from the poorer countries in Asia and Africa where it is currently being spent as part of the overseas aid budget.

There is a ‘slight’ problem in that it would no longer count as foreign aid under OECD rules, so that the UK would then be failing to meet the international target of 0.7% of GDP, but I suppose that the Brexiteers would simply see that as another example of ‘taking back control’ from those foreign johnnies when it comes to spending ‘our’ money.  That seems to be the only obstacle that they perceive, but it isn’t the only one that strikes me.

Firstly, however such a proposal is dressed up, it’s a blatant piece of attempted bribery which in the commercial field would lead to politicians demanding an enquiry, a few rolled heads, and some lengthy terms of imprisonment.  I don't recall that bribery was one of those special 'British' values which the Prime Minister is always banging on about.  Perhaps it's one of those cases where some values are so obvious that they don't need to be spelled out.  It's also worthy of note, in passing at least, that one of the arguments of the Brexiteers was that we should opt out of being a net contributor to the EU, which can only mean ending those payments which find their way to the poorer parts of Europe.  I don't remember them saying that what they really meant was taking money away from even poorer countries in order to continue paying the poorer parts of Europe.

However the biggest problem that I foresee is that the politicians in the affected countries (and the rest of the EU) will be completely aware of what is being attempted.  Even if it weren’t being discussed in the media, any such move would be too obvious for them not to be.  But then, assuming that the other 27 members are stupid seems to be the basis of the UK’s whole negotiating position.  On the other hand, I suppose, they are foreigners after all…

Free - or Fair?

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One of the mantras of the Brexiteers since the vote has been that we should negotiate ‘free trade’ deals with lots of other countries rather than restricting ourselves solely to those in the EU.  And one of their great hopes has been that there will be an early deal with the USA.  During his long and meandering ramble last week, Trump had something interesting to say about his approach to trade deals.  In his own (inimitable) words, he said this:

“Now look, fair trade.  Not free, fair.  If a country is taking advantage of us, not going to let that happen anymore.  Every country takes advantage of us almost.  I may be able to find a couple that don’t.  But for the most part, that would be a very tough job for me to do.”

It’s perfectly clear – well as clear as anything Trump says.  Whilst the UK government think they’re going to negotiate a free trade deal with the US, he is interested only in ‘fair’ trade.  He didn’t actually define what that means, but we can be sure that it isn’t what most of us mean when we think of the ‘FairTrade’ campaign.  I suspect that he means trade which has a favourable, or at least neutral, balance for the US.  On that criterion, the UK’s current trade surplus with the US amounts to “taking advantage” and his objective will be to end that.  I can certainly see why that would be in the interest of the US, but why would anyone think that it’s in the interest of the UK?

But then, I don’t think that the UK government has ever been concerned about the detail; they just want a deal, any deal, to show what ‘global Britain’ can achieve.  From that perspective, the existence of a deal with the US is more important than its content, however harmful the latter may be.

The Blair quandary

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I agree with much of what Blair said last week – and there’s a sentence I never expected to write.  The response from the committed Brexiteers was entirely predictable, but he is right to say that in a democracy, people opposed to a decision, even one taken democratically, have every right to seek to change that decision, and to persuade others that they too should support a reconsideration of the question.

Given their professed great love for freedom and democracy, why are Brexiteers are so insistent in their demands that this one decision, uniquely, is something that can never ever be revisited?  I can only assume that it’s their fear of a different result.  I suspect that I’m not alone in thinking that one of the reasons that so many of them are keen on a quick exit and hang the consequences is that the longer the situation drags on the more obvious it will be that the outcome is not going to be the land of milk and honey that they promised us; and their real reasons for wanting Brexit had little to do with the promises which they made.

If the referendum decision had gone the other way, does anyone really believe that Duncan Smith, Farage and their ilk would have said “Oh well, that’s it then” and gone away to do something even less productive?  No, of course not – and it would be their right to continue making the case.  (In the same way, closer to home, those people opposed to the existence of the National Assembly – and indeed, in some cases, even to the existence of the Welsh nation itself – have every right to continue to campaign for its abolition.  I hope they fail, but I accept that the decision that Wales should become a political nation isn’t a once-and-for-ever decision; it’s something that we need to re-affirm continually.)

If, in either case – or indeed on any other issue – clear evidence emerges that public opinion has changed, then there is always a case for revisiting a decision.  And campaigning to bring about a change of opinion is a wholly legitimate form of political activity.  Blair wasn’t doing much more than making that simple point.  Merely asking for a second referendum with no evidence of a significant and sustained opinion shift seems to me to be futile; but working to bring about that shift is another matter entirely. 

On that point, it was obvious that Blair was deliberately avoiding the question of a second referendum - perhaps unwisely because it gave the impression that he believed the decision could somehow be changed without further reference to a democratic vote.  Whilst I too might prefer not to have referendums which reduce complex questions to a simple binary choice, in the case of Brexit that’s already been done and it is hard to see how those who voted to leave would consider a decision to remain after all to be legitimate without another vote.

Having said all of that, there is a problem with the personage of Blair.  I don’t understand how the man who took the UK to war in Iraq on the basis of an outright lie about weapons of mass destruction could stand there with a straight face and accuse the Brexiteers of having lied to get the result they wanted.  Pot, kettle, black – could he really not see the way that was going to be interpreted?  He has a serious credibility problem as a leader of any campaign given his history.

There is a ‘however’ to that, as well, though.  Given that the only debate which any of our mainstream politicians are prepared to engage in is about the nature of Brexit, who else is speaking out?  Most of the MPs who told us during the referendum campaign that Brexit would be a huge mistake for the UK have subsequently trooped through the division lobbies of the House of Commons in support of that which they told us would be a disaster.  And here in Wales, of the four party groups represented in the Assembly two are committed to full-on Brexit and the other two have decided to restrict themselves to whingeing about the detail.

So, this for me is the quandary.  For all my doubts about Blair as a leader of anything, who else is stepping up to the plate?  Is he really so toxic that it’s better to have no-one making the case than for him to do so?

Tax and migration

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This story on ClickonWales yesterday did not provide a link to the report which formed the basis for it.  But it looks to me like the same report that I posted on last October.  And the detail is replete with all the occurrences of ‘may’, ‘could’, and ‘might’ that I noted at the time, all of which make it very non-robust as a basis for taking decisions on taxation.

One of the basic premises is that we can extrapolate the tendency of a difference in council tax rates to cause people to migrate between council areas to deduce the likely tendency of people to migrate between areas where different income tax regimes operate.  It requires some complex calculations about the differential impact of different taxes on a household, but in principle that premise seems to me to be reasonable.  However, it clearly requires a good understanding of the extent to which people move between council areas in response to different rates of council tax.  And their conclusions on that point seem to me to be a good deal less robust.

As I understand the methodology here, they’ve analysed large numbers of movements between different council areas, attempted to eliminate those which are due to other reasons which can be identified, and attributed the net remaining migration to the difference in council tax.  Have I oversimplified?  Yes, of course – but I believe that I’ve captured the essence of the approach.  For the purposes of academic research, it’s an entirely valid approach; without asking people why they chose to move, the reasons for that behaviour can only be deduced.  The problem is that such an approach does not provide hard evidence that all that migration was actually driven by council tax differentials.  I’d go further – it doesn’t provide hard evidence that any of the migration was actually driven by tax differentials.

Much of theoretical economics seems to be based on an assumption that human decisions are driven first and foremost by the perceived economic interests of those making them; that man is essentially an economic animal.  For the purposes of analysis and academic research, it’s a reasonable starting point, and it can produce some interesting results and hypotheses.  But one of the reasons why theoretical economics does not always accurately predict what actual people will do is that real living people take decisions based on a whole range of factors, not all of which are down to money.

I wouldn’t argue that ‘nobody’ will ever decide where to live based on the taxation regimes in operation.  Quite the reverse; we know that some very wealthy people choose to live in tax havens in order to maximise their own wealth.  But I suspect that the number is much more limited than a simple – or even a complex – economic model would predict.  One of the reasons for that is that single tax changes rarely apply in isolation; another is that what you get for your taxation varies as well.  So, whilst a lower income tax regime might attract some, a higher council tax regime in the same place, or a lower level of services supplied because of the lower tax revenues of the government, might offset that.

No doubt some will respond along the lines of, “yes, but what about the Laffer curve” under which there comes a point where higher taxes become counter-productive and generate lower rather than higher revenue as the higher taxed seek ways to avoid paying their taxes.  The problem is that although the theory is clear and makes intuitive sense, hard evidence that it applies in practice is much harder to come by.  Academic theory isn’t always backed up by the actual behaviour of real people – some of the reasons for that have been touched on above.

The problem isn’t with the research and analysis itself; it’s useful and interesting in its own right.  No, the problem is when people attempt to use this sort of research as a justification for a particular tax regime which just happens to match their own ideological perspective.  In this case, it’s already been used by the Tories to justify their own predilection for low taxes.  And the article on ClickonWales sought to use it to justify opposition to further tax devolution.

There’s nothing wrong with arguing for low taxes as such, or even for a common taxation regime across different jurisdictions (although I wouldn’t agree); the problem comes when people start to argue that they don’t need to cut spending to pay for lower taxes because lower taxes will actually increase rather than reduce government revenue, or that differentials in tax rates will directly lead to migration, because the evidence offered in support of those positions is theoretical rather than based on hard facts.  We should always be wary of anyone offering us what looks like a free lunch.  And tax cuts with no matching spending cuts look a lot like a free lunch to me.

Apologies and short memories

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I’m not a fan of the current tendency for politicians to continually demand that other politicians apologise for anything and everything.  It makes for easy headlines, and it’s easier than putting problems right, but it’s all a bit pathetic really.  The latest example is the leader of the Tory Assembly group demanding that all of those who predicted economic collapse after Brexit should apologise because their predictions haven’t come true.

As it happens, I agree with him that many of the predictions were over-egged.  Worse, they failed to make any distinctions over timescales, and specifically, between what would happen after the vote, what would happen between the vote and actual exit from the EU, what would happen immediately after Brexit, and what would happen in the long term.  Whether the claims were more or less misleading than the statement of those promising a non-existent £350 million a week for the NHS is a moot point.  Two wrongs don’t make a right, and arguing over which side told the biggest lies seems to me almost as pointless as arguing over who should give the biggest apology.

But for what it’s worth, I understood (and I'm sure that many others did as well) most of the predictions to be referring to what would happen after Brexit, rather than what would happen immediately after the vote, and from that perspective what Davies seems not to be recognising here, in his desire for a quick headline, is that Brexit hasn’t actually happened yet.  That’s a pretty good ‘get-out-of-jail’ card for anyone who predicted disaster post-Brexit, quite apart from making Davies just look plain silly.  He’s probably hoping that two years is such a long time that, when the inevitable effects of Brexit do kick in, the voters will all have forgotten the detail and will blame something else.  I wish I could believe that that hope was as silly as his demand for an apology, not least because the likeliest outcome seems to be that many will simply think that Brexit wasn't Brexity enough, and didn't do enough to deal with those immigrants who apparently cause all our problems...