Cutting wages is no solution

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As a simple fact of mathematics, any organisation which can cut the salaries it pays to its employees will ‘save’ money. Whether it’s a sensible thing to do, whether it’s the right thing to do, whether the employees will calmly accept the reduction without resorting to industrial action – none of those things affect the simple mathematical truth that reducing salaries means the employer spends less to achieve the same result. For those of us lucky enough to be part of an occupational pension scheme (which is most people by now, even if some of the schemes aren’t particularly good), the employers’ contribution to those schemes is part of the overall remuneration package: it’s a form of deferred salary. Cutting the amount employers pay for pensions is, therefore, a wage cut by another name – it’s just that the impact won’t be felt immediately.

One of Reform Ltd’s latest wheezes to ‘save’ money involves doing just that – cutting back on the benefits paid out in pension schemes, and thus reducing the amount of the deferred salary due to employees. It’s a not very well disguised salary cut. Whether it’s quite the pain-free saving as which it appears in the short term is another question, however. Reducing the incomes of future pensioners will reduce their retirement standard of living. By how much depends on the circumstances of the individuals, but we can be certain that at least some will end up applying for extra benefits as a result, and it will also reduce the amount of income tax collected from pensioners – it’s not a ‘no-cost’ proposal. Looking at the wider economic impact, people with less money spend less as a result, and that in turn reduces demand in the economy.

The fact that none of this is immediately obvious to many is down to the fact that the real impact won’t happen for years – or even decades – when those with a reduced pension reach retirement age. Maybe those proposing it believe that it will be so effective in deterring people from retiring at all that the impact will be insignificant. In a world which increasingly treats only ‘working people’ as having any validity whilst all others are to be regarded as a ‘burden’, that’s a perfectly possible interpretation. It’s a view of the world which isn’t restricted to Reform Ltd – it will probably be mainstream Labour-Tory policy in a year or two. It highlights a feature of politics – and indeed, the capitalist economic system – which is the increasingly short term views which prevail. A society which works for all people throughout their lives has to take a long term view, considering the first 18 years of life, as well as the last 20-30, when people are likely to be ‘unproductive’ in economic terms, but are still part of the society in which they live. Squeezing out costs in the short term might be good micro-economics, but it’s lousy macro-economics, quite apart from being a lousy way of treating individual members of society. It’s a distinction which those who benefit directly from the short term gains are unable – or, more likely, unwilling – to understand.

It's not true that 'all votes count'

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The new electoral system coming into effect for this year’s Senedd elections is a step forward from first-past-the-post, but is still less than perfect. The main criticism levelled at it by many is that it means that electors cannot choose individuals, only parties. Personally, I’m relaxed about that aspect – decades of door-to-door campaigning taught me that (other than in local council elections, where they may know the individuals) most people vote on party lines anyway, and pay little attention to the candidates. For me, the bigger criticism has always been that there is no opportunity for people to express a second or third choice, so that anyone voting for a party which wins no seats has effectively had no say in the outcome. It was, though, the best outcome that was possible given Labour opposition to STV, and it would be churlish not to recognise that.

As campaigning ramps up, however, the failings of the selected system are becoming more obvious, with Labour and – if anything, even more so – Plaid suggesting repeatedly that a vote for anyone else will split the anti-Reform vote and hand seats to Reform. Leaving aside the essentially negative message of that proposition, encouraging people to vote against one party rather than for another, it isn’t the sort of behaviour a properly proportional system should be encouraging. It’s an admission, in effect, that the chosen system is sub-optimal, giving the lie to the oft-repeated claim that 'all votes count'.

It opens the question, though – will the new Senedd change the decision and opt for a proper STV system? Officially, Plaid support STV (although they haven’t always looked exactly enthusiastic about doing so in the councils they control), as do the Lib Dems and the Greens. The last time he opined on the matter, I’m sure that Farage also supported STV (although all Reform Ltd polices have to carry the caveat that they are subject to sudden and arbitrary change). The only parties dead set against it are Labour and the Tories. The opinion polls could all be wrong, of course, but if the general trend of the polls were to be true, current projections would give supporters of STV a clear super-majority in the Senedd, enough to push through such a change if they wished to do so. If they can summon the courage to act, it might even become the most lasting legacy of a change of government in Cardiff.

Undermining the hereditary principle

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In 1900, there were around 160 monarchies in the world compared to a mere 43 today (and of those 43, 15 are reigned over by a single monarch, namely the King of England). Whilst there are rare instances of a republic reverting to a monarchy (such as Spain, post-Franco), the trend is overwhelmingly in the opposite direction. It isn’t so clear cut as a choice between heredity and democracy, though: Putin and Xi may not be hereditary monarchs, but that doesn’t mean that they can be removed through a popular vote.

Despite the UK being firmly in the minority in global terms, there are many who seem unable to conceive of the idea that the head of state should be an elected post rather than a hereditary one. In reality, the UK monarch isn’t fully hereditary either; in some ways, the monarch is more like an indirectly elected president, where heredity is the default rather than the sole basis for selection. There have been times, albeit infrequent, when parliament has changed the order of succession and/or decreed that certain people (Catholics for instance) may not ascend to the throne, no matter how strong the bloodline claim might be.

If parliament can remove the eighth in line from any chance of succession (which seems likely to happen shortly) then it can also remove the seventh, or the sixth – or even the first. Indeed, in 1701, parliament removed around 50 people from the line of succession at a stroke. Maybe parliament does not actually elect the monarch, but it can veto some candidates and/or redefine the candidate pool, and has done so on several occasions. For those who cling to the official notion that the monarch’s family was selected by God to rule over us (because, presumably, God identified something very special about one particular blood line), deleting people from the line is a power which can only be used sparingly if at all, since declaring that one of the family might not be so special after all somewhat underlines the alleged legitimacy of the whole process.

Perhaps, though, it also offers a glimpse of a gradualist approach to introducing a presidential system. After all, if parliament can shrink the pool of possible candidates, it can also expand that pool. Deciding that parliament should choose the next head of state (an approach followed by a number of other countries which indirectly elect their head of state) is a smaller change than outright abolition. And if there’s one certainty about constitutional change in England (and this is, ultimately, an issue for England mostly) it is that they will never make a large change if a smaller fudge is available.

Experience is often over-rated

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‘Experience’ is an odd qualification for anything. It’s often assumed that someone who has a lot of experience at doing a job is somehow better qualified to do it than someone with less. It depends, though, on the nature of that experience and what people have learned from it. I once interviewed someone for a job who claimed to have 20 years’ experience of doing the job, but on more detailed questioning, it turned out that he had one years’ experience, repeated twenty times. Length of experience isn’t the same as depth – and experience of failure isn’t the same as experience of success. Contrary to popular belief, people don’t always learn from the former, and the latter can breed complacency and inflexibility.

This week, Farage announced his shadow team – or four of them anyway – and part of his justification for two of the selections (and indeed, for accepting the continued outflow of failed Tory politicians) is that they have experience of government. However, his faith in the value of their experience apparently didn’t extend to allowing them to answer any press questions, a job which he firmly restricted to himself. Given the roles that Braverman and Jenrick performed in a succession of Conservative governments, they certainly have plenty of experience of what failure looks like, although it’s hard to identify any particular success with which either of them were associated during their ministerial careers. Whether they have learned anything from their failures is a matter of opinion, but insofar as we can believe a word they say, or use their words as evidence, that evidence is more negative than positive.

The wider question, though, is whether, or to what extent, ‘experience’ of government is relevant to the potential success of anyone taking on a ministerial job. There are plenty of examples of people who have such experience going on to fail – and equally of people who have no such experience turning out to be rather successful as ministers. And it is almost a given of the UK system that any party entering government after a long period of opposition is likely to be short on people with ministerial experience. I think it’s true to say that, if the polls turn out to be right and the next Welsh government turns out to be either a Plaid minority government or a Plaid-Green coalition, it is probable that there will be only one MS in the governing party/coalition with any experience of government at all. Whether that’s a good thing or a bad thing can only be a matter of opinion at this stage; a judgement based on actual performance will have to wait. I tend to the view that what’s more important than experience of being a minister is experience of doing other things outside politics, and being able to apply that experience in the new context. Time will tell, but returning to Farage’s experience fetish, it’s not clear that his so-called ‘experienced’ hires have a huge amount of useful experience built up in any non-political roles either.

‘Experience’ in any role, without assessing how good it is, or what’s been learned from it, is over-rated as a qualification, but Farage isn’t the only one to make the mistake of assuming that it is a key attribute.

What are we proposing to defend?

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Labour’s warmongers are at it again. On the basis of absolutely no evidence that they are willing to share, they have declared that “the threat of a Russian attack on the UK grows”, and that the UK therefore needs to spend vastly more on new weapons in order to repulse such an attack. I don’t know whether Putin is really planning to launch an attack on the UK, but – despite his obvious desire to reinstate what he regards as being the right of Russia to control certain territories – he isn’t obviously a stupid man. He is, for instance, perfectly capable of extrapolating from his difficulties in conquering Ukraine to the likely consequences of attacking any of the major NATO states, and concluding that it is probably not a battle Russia would be likely to win. He also understands at least a little about geography: Ukraine is close to Russia and shares a long and eminently invadable land border, whilst the UK is further away and any attack beyond an aerial assault would require the use of air and sea transport for a large number of forces.

The military clearly want more weapons, but then the military always do, regardless of the assessed scale of any threat. The real beneficiaries of the proposed increase in military expenditure are the arms companies (and their shareholders), companies which are already profitable and seem to have a knack of ending up invariably charging much more than the price initially quoted. The losers – in a situation where Labour are hemmed in by their own blind commitment to neoliberal economics and wholly arbitrary fiscal rules – will be the population of the UK, and especially those most dependent on the state finances and services which will be cut to pay for weaponry.

The first question we need to be asking is what exactly is it we are proposing to defend? And that raises the question of what sort of society we want to be. If the only way to ‘defend’ citizens is to impoverish and marginalise ever more of them, and prepare them to give their lives in order to do so, there is a danger that the ‘cure’ is worse than the disease. Defending the interests and wealth of the wealthy isn’t serving the population as a whole. The interests of most of us have more in common with those of the ordinary citizens of the 'enemy' state than with the interests of the elites who run the states on either side.

The second – and even more important – question is about how we prevent war in the first place, rather than merely setting out to ‘win’ it. War only becomes inevitable when government on both sides becomes captured by people who think it to be so, and much of what looks to be defence preparation to one side will look to be threat of an attack to the other. The most likely cause of any further attack by Russia is a belief that ‘we’ are preparing to attack them. Building up military forces, with more weapons and more powerful weapons, especially when more of them are stationed close to their borders, isn’t exactly the best way of dispelling that belief.

We need to retake control of the economy

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Figures announced this week show a rise in the level of unemployment, with young people being particularly hard hit. The government has responded in the way that all governments do, by talking about ‘helping more people into work’ (often a euphemism for cutting benefit payments) and inventing more, sometimes dubious, apprenticeships as a back door way of subsidising employers. The opposition has responded in the way that all oppositions do, by blaming government policies, especially those relating to wages, tax and regulation. The assumption underlying both of those positions – even if it drives them to propose different solutions – is that rising unemployment is a cyclical problem, which will be resolved if only we can get that magical growth they keep talking about.

It’s possible that they’re right; but it’s also possible that they’re wrong. What if, rather than growth and innovation solving the issue, that same growth and innovation, powered perhaps by AI, compounds it? There is a certain complacency surrounding that question. In a sense, it’s entirely natural – history shows us that the initial response to innovation and increased productivity is a loss of some jobs, which is usually followed by the appearance of new jobs, sometimes of a type and nature which nobody had foreseen. Maybe the same will be true of AI, and it’s overly pessimistic to believe that the job losses will be more permanent and generalised than we’ve seen in the past. It’s clear that the workers likely to be displaced by AI will include those in more technical and high-paid jobs than previous rounds of innovation, but the fact that the nature of any resultant replacement jobs is not currently clear doesn’t mean that there won’t be any. But the statement that ‘there always have been’ in the past can’t be taken as a certainty for the future either.

One junior minister in the UK government has already suggested that part of the response to the growth of AI might be the introduction of some sort of Universal Basic Income (UBI), although even he seems to be talking abut it as a temporary response, allowing people to retrain for the jobs of the future, whatever they may be. And there’s no doubt that any sort of UBI would be enormously expensive: even an income set at the less than adequate level of Universal Credit would be likely to carry a price tag of some £200 billion per annum. But what is the alternative that those objecting to the cost would propose in a situation where most work is done by automatons or AI? Are those people who have been displaced to be treated as disposable, and left without food or shelter as a result, whilst those lucky enough to still have work continue to live as normal (and those who own the machines and the software continue to accumulate wealth well beyond their capacity to spend it)?

It’s a scenario which raises questions about what an economy is for. Forget ‘invisible hands’ and market spirits – an economy is a social construct, and it’s up to the society in which it operates to determine how it works, who benefits from economic activity, and by how much. If an economy cannot supply at least the basic needs of all the people in that society, than it’s not performing its social function. From that perspective, tax is not some burden placed unfairly on those who own the capital or provide the labour, it is merely the mechanism by which the outputs of economic activity are used for the benefit of all. It is, in its very essence, a mechanism for redistribution. For the last four or five decades, we’ve increasingly lost sight of that and allowed the economy to be captured by a few, and corrupted to serve only their interests. If the resulting gross inequality hasn’t been enough to force a rethink, perhaps the impact of AI will be.

Will Farage let me drive on the right if I want to?

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Whether the 20mph default speed limit in built-up areas is a good thing or a bad thing is obviously a matter of opinion, depending on whether we prioritise reducing casualties or convenience and speed. The statistics show that it has reduced the number and severity of casualties on the roads, although a thorough evaluation might need a few more years to assess whether it is really working as well as it appears to be. On the downside, experience suggests that it has led to an increase in aggressive driving and risky overtaking manoeuvres, especially by those vehicles whose drivers are exempt from the law. I can’t find a definitive definition of exempt categories in the legislation itself, but simple observation over the past year leads me to conclude that it includes taxis, white vans, and BMWs.

Farage told us last week that it is a ‘looney’ policy, and went on in a Q&A session to describe it as being an example of government telling people what is right for them, adding "It is typical of control, control, control". In essence, his view seems to be that it has nothing to do with safety, and that the Welsh Government have introduced it solely with the aim of controlling what people may or may not do. It’s a particularly silly argument – if it applies to the 20mph limit, then it also applies to the 30mph limit, or to any limit set at 40, 50, 60 or 70. All of them control what citizens can and can’t do. Come to that, why should the government control on which side of the road I should drive? All laws set limits on what we can and can’t do, they all ‘control’ us to a greater or lesser extent. The question is – or ought to be – about where we draw the line, and how we balance safety against speed of travel – or, more generally, personal advantage against collective advantage. ‘Not liking something’ is not enough to distinguish between an arbitrary control of behaviour and a sensible safety measure.

Reasoned debate is not, though, what Farage and his ilk want. Their aim is to appeal to people whose minds are already made up, and to strengthen those existing prejudices. Not that reasoned debate would ever help anyway. No-one who has not arrived at a particular view in the first place through a careful and rational study of the evidence is going to be persuaded to a different view by a careful and rational study of that same evidence. And that doesn’t only apply to the question of speed limits. Believing that evidence can and will shift an opinion which was never evidence-based to start with is a mistake which many of us make. Overcoming prejudice and a willingness to disregard mere facts is more of a long term project, which involves teaching critical thinking as a key element of education. There is a reason why Farageists and their fellow travellers are hostile to the idea of an educated populace.

Who's going to check? And when?

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Whether the newly appointed leader of Reform Ltd in Wales actually lives in Wales or not appears to be an open question at present. It’s a question which Martin Shipton, at Nation.Cymru, is doggedly pursuing. If it’s really true that he doesn’t, then both he and Farage have been more than a little foolish in putting forward a story which falls apart after one day of scrutiny. Maybe they really are that stupid, but it’s more likely that they believe that they can game the system.

The requirement that candidates for May’s Senedd election should live in Wales, and be registered to vote in Wales, is entirely reasonable, especially after the experience of a predecessor party to Reform having had a resident of Wiltshire as its leader in the Senedd. It’s something of a departure for UK electoral politics, though: there is no requirement, for instance, for any candidate for Westminster to reside in the UK. They merely have to state that “they are at least 18 years old and be either: a British citizen, or a citizen of the Republic of Ireland, or a citizen of a commonwealth country who does not require leave to enter or remain in the UK, or has indefinite leave to remain in the UK”. They also need to provide an address where they can be contacted. But as far as I’m aware, there is no requirement for the returning officer to verify the information provided. Verifying the veracity of the information provided by candidates has never been part of their role; they merely verify that the relevant boxes on the form have been completed properly. It seems probable that the same approach will apply in the case of Senedd elections: if the candidate provides a valid Welsh electoral roll number, and gives an address where (s)he claims to live, is it any part of the responsibility of the Returning Officer to check that those details are true?

It is perfectly legal to be registered to vote at two different addresses (it’s not usually legal to vote at both, although there is no check on that), and the definition of ‘main residence’ is not as straightforward as it might sound. Reform Ltd may be about to ‘test the system’ by putting forward as a candidate an individual who may not meet the legal requirements. It’s not at all clear that there is any process in place to challenge the information provided by candidates, let alone pro-actively verify its veracity, other than by a court process after the election. Relying on ‘the law says’ amounts to assuming that all candidates are honest people of good faith. It’s just possible that some might not be.

Is poverty really the right way to save pubs?

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Not so long ago, I wondered whether capitalists and supporters of capitalism really understood the way it worked, a theme picked up again in relation to pubs in this post. Pubs, in particular, have been back in the news again over the last week, with Farage’s proposal that impoverishing 450,000 children and redirecting the money saved into pubs could knock 5p off the price of a pint and save thousands of pubs, and the suggestion from the First Minister, Eluned Morgan, that people should stop drinking wine and watching Netflix at home and get down to the pub instead. The opposition’s response to the First Minister was, sadly, more Farage than Morgan, claiming that the problem was for the government rather than citizens to solve, and lies in the system of rates and taxation. Both Farage and the opposition in the Senedd seem to be starting from the wholly unrealistic proposition – albeit a basic tenet of classical economics – that all consumer decisions boil down to cost comparisons. Under that tenet, people choose wine and Netflix over beer and pubs purely on the basis of relative cost.

Like much of theoretical economics, it’s utter nonsense. It is an established fact that young people, overall, are drinking less and that traditional pubs are considered increasingly unattractive to many of them. Cutting the price of a pub visit so that more people go, or encouraging people to drink more when they get there – which is what subsidies, whether direct or in the form of tax concessions, actually set out to do – might delay the inevitable, but if supply outstrips demand by an increasing margin, and if that falling demand is the result of demographic change rather than price considerations, then capitalism decrees that the supply should fall. Put another way, closing pubs is the natural and rational outcome of a change in consumer choices.

Whether that’s a good thing or not is another question. I’m certainly not a fan of leaving all decisions to the dictates of capitalist markets. There are some pubs – particularly, but not exclusively, in rural areas – which also provide a sort of community hub, and act as a centre for other (not necessarily alcohol-related) activities. There is a case, in terms of social cohesion rather than dry cost-benefit analysis, for government action to keep such places open. That, though, requires rather more effort in identifying criteria and assessing locations against those criteria than some sort of blanket aid to the sector (which is what changes to the taxation regime provide). Setting out to save all pubs may be popular with those who use them, but it’s not good policy, and nor is it a good use of resources. And proposing to impoverish children to achieve it is about the best illustration one can think of as to why it’s wrong.

It shouldn't be down to the wrongdoer to take action

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It’s unclear whether Mandelson has committed any crimes or not in relation to his friendship with Jeffrey Epstein, although – to date, at least – I’ve seen no serious suggestion that he has. Folly, yes, plenty of that. Failing to declare income to parliament, maybe: he says that he can’t remember receiving money from Epstein, and it’s just about possible that there’s some other explanation for the relevant lines on bank statements. Lobbying other ministers to reduce the tax bill for a friend, yes, that seems pretty clear cut. Leaking sensitive government documents to his friend, again, yes that also seems pretty clear cut. None of it, however, appears to be criminal. It’s enough, though, for people to be demanding that he should be stripped of his peerage as well as standing down immediately from the House of Lords.

It is a ‘feature’ of the English system of governance that people appointed to the Lords cannot easily be stripped of either their membership or their title. Apparently, it requires a specific act of parliament in each and every case, and Sir Starmer appears to have concluded that that is just too much trouble and is instead simply appealing to Mandelson to voluntarily relinquish his seat, and voluntarily stop using his title, while formally retaining it. It’s the sort of compromise and cop-out which bedevils a constitution which assumes that all parliamentarians, in whichever House, are inherently honourable people.

It’s a silly assumption to make – and it’s not as if there haven’t been previous cases to underline the point. The one which immediately leaps to mind is, of course, Jeffrey Archer. Unlike (so far) Mandelson, Archer really did commit criminal acts and was sentenced to four years as a guest of Her Majesty as a result. On his release in 2003, and although not a very active member, he remained a member of the House of Lords until he voluntarily stepped down in 2024. He remains a peer today.

It’s true that the law was subsequently changed – but it took more than ten years, until 2014 – to make it easier to sack a member of the House of Lords for serious crimes (although being sentenced to prison for less than twelve months, which one might think is still rather more serious than anything Mandelson has so far been found to have done, is still considered insufficient grounds for expulsion). The point here is not to defend Mandelson – on the contrary, he deserves to be kicked out. It is, rather, to highlight the arbitrary and inconsistent way in which things work, and the laziness and incompetence which means that successive governments would prefer to leave things alone than address an obvious failing. Demanding that the man accused of poor behaviour takes action himself rather than ensuring that he could be dealt with swiftly and effectively is a less than honest political response.