Tuesday, 23 January 2018

Boris knows all about the tree

According to media reports, the Foreign Secretary is today demanding that the Cabinet allocate an extra £100 million a week to the NHS.  It’s the sort of thing that Foreign Secretaries do, of course, whenever they’re keen to become popular enough to get elevated to the role of Prime Minister (and when they’re not busy insulting the countries with whom they’re supposed to be building strong relationships).
He does seem to be having a bit of trouble with his arithmetic, though.  Last week, he told us that the £350 million weekly Brexit bonus which could be diverted to the NHS was an underestimate; this week he suggests that the bonus available to the NHS is less than a third of the original number.  But then, since the true number is almost certainly negative – in the early years at least – it doesn’t really matter whether the numbers add up or not.  It also doesn’t matter whether the amount of money corresponds to any identified need or demand; if you’re going to pluck figures from the air, nice round ones are as good as any. 
I don’t know – and neither does Johnson – whether the amount needed by the NHS to provide a decent service is an extra £100 million a week, an extra £200 million a week, or some other figure.  That it needs more to do what it is currently trying to do (and I’ll accept, in deference to one commenter yesterday, that that is based on an assumption that there is an understood definition of what the NHS should or should not be trying to do), seems to be generally accepted, but pulling a figure out of the air is not exactly a scientific approach to government expenditure.  And the idea that an extra weekly sum in about three years’ time after EU payments cease has anything to do with this year’s winter crisis is, shall we say, a ‘creative’ bit of presentation by someone who needs the popularity now, before the government collapses.
In another ‘interesting’ intervention last week, Johnson called for the building of a bridge between the UK and France.  Given his colourful history, there aren’t many people who would use the phrases ‘building bridges’ and ‘Boris Johnson’ in the same sentence, but I’m more interested here in the financial aspects.  No-one can really put a figure on the cost of building a 22 mile bridge across a deep and busy shipping channel with often difficult weather conditions, but it would almost certainly be many billions more than whatever the initial estimate said.
Leaving aside the possibility that the Foreign Secretary has already written off all hope of a Tory victory at the next election and therefore feels free to make outrageous promises which he and his party will never be called upon to honour, I can only conclude that he is admitting that there is, after all, a magic money tree.  The fact that his party came to power in 2010 on the premise that the current account deficit needed to be eliminated by 2015 or else the sky would fall in, and is now saying that it doesn’t really matter if the deficit lasts until 2031, is a pretty strong clue that they’ve known the truth all along.  A government which controls its own fiat currency, such as the UK, can create as much money as it needs to, as and when it needs to.  The only real caveat is that there also needs to be a willingness to raise taxes if the resulting increase in cash leads to excessive inflation.  The point at which that is likely to happen is a matter of belief based on an ideological perspective; it isn’t a number which can be derived by any formula.
If Johnson was really concerned about the NHS rather than positioning himself to succeed May, he’d be demanding the release of extra money now, not artificially linking it to the date of Brexit.  But the NHS, just like leaving the EU, is, for Johnson, more to do with calculating how to serve his own best interests than ours.  The odd thing is how many people fall for it based on the bumbling persona which he has created for himself.

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