Are productivity and efficiency always good things?

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Will Hayward drew attention this week to the rather defeatist comment by a Reform Ltd MS that “we are not very good in Wales at being efficient in running things”. There’s a sense in which we should not be overly surprised at the comment; it is, after all, in line with the general view held by the unionist parties that Wales is too small and too poor, and Welsh people too stupid, to ever govern ourselves, and that we should defer to our betters in London. For a Reform Ltd politician to express similar views is on a par with the breaking news that the Pope is a Catholic; all he’s done is to repeat a weary old trope in rather more blunt language than that to which we are accustomed.

Leaving that aside, though, the thing that piqued my interest is the inherent assumption that ‘efficiency’ is always and necessarily a good thing anyway. It may seem blindingly obvious, and be a generally applicable rule, that it’s better to achieve a given goal with fewer resources; but being blindingly obvious doesn’t make something true. I’ve been around long enough to know that what’s obvious isn’t always true and what’s true isn’t always obvious. Whilst they’re not quite the same thing, there is a clear overlap between efficiency and productivity, and coincidentally the new Welsh Government announced this week that it will be setting a national productivity target aimed at closing the gap between Wales and the rest of the UK. The announcement itself makes it clear that many of the details are yet to be determined, so it’s impossible to predict the likelihood of success at this stage. The encouraging thing, though, is that it looks as if the target is to be set and monitored at a macro level, rather than being a micro-economic target for individual businesses or sectors.

That difference between the micro level and the macro level is an important one, and brings us back to the question of whether improved efficiency is always a good thing. For any individual business, the ability to produce the same output with, say, half the input in terms of labour is a huge financial advantage, and unquestionably a benefit for that business. But for the economy as a whole, producing the same output with half the input could simply leave half the workforce unemployed, an outcome which few would welcome – even the businesses which have achieved the savings, who could find that half their potential customers can no longer afford their products. Whether reducing the number employed in existing enterprises is a good thing or a bad thing thus depends on whether – or to what extent – those freed up resources can be employed on other useful activities. That is a lot harder to plan for and achieve, and increased use of AI in the drive for efficiency / productivity gains may make it more so.

It also opens up other questions, particularly about how the benefits of improved productivity / efficiency are distributed (increased wages, reduced working hours or increased profits, for example). Changing that distribution goes beyond the current powers of the Senedd, unfortunately. It would, though, be good to see, amongst the yet-to-be-announced metrics which will be used to measure success, an attempt to at least monitor who is benefitting, rather than simply assume that an overall average increase in productivity is sufficient in itself. Sometimes, a simplistic bottom line can obfuscate rather than clarify meaningful progress.

Identifying the right problem

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There was a report of an opinion poll in the i paper a few days ago on the issue of paying benefits to young people who are not in employment, education or training. The article itself is behind a paywall, but the data is available in Table 53 in this report. The headline figure was that 56% of those questioned believed that all benefits should be stopped for such people. As one might expect, the numbers vary between supporters of different parties, with those supporting parties of ‘the right’ most likely to support the proposition. Asked in isolation, it’s easy to see why so many might support that (why, the implication is, should anyone not seen to be ‘contributing’ expect to be supported?), but I wonder whether the implications have been thought through by those responding to the survey.

For people in that ‘NEET’ category, benefits are likely to be their only direct source of income; removing it implies that those 56% of respondents are quite happy for the young people to go without food, clothing or shelter. In reality, of course, many (but by no means all) in that category will be living with their parents, who would presumably be expected to continue paying the living costs for their adult offspring. The key economic fact to note, though, is that the withdrawal of benefits from anyone means that someone, somewhere, has their own spending power reduced. Maybe it’s the individuals directly affected, maybe it’s their parents who are obliged to divert money from their own discretionary expenditure. In economic terms, it matters little to the basic conclusion: somebody’s spending power would be reduced, with a consequent reduction in overall demand. In fact, there’s a more general point which this underlines – if a government cuts spending or increases taxation in pursuit of the alleged nirvana of a balanced budget, someone, somewhere must always have their spending power reduced.

The political question is that the ‘who’ and the ‘where’ are ultimately choices being made by politicians. The claims that ‘benefits’ or ‘pensions’ are unaffordable are not the result of some iron-clad law of economics; they are the direct result of political choices as to who should pay for the entirely arbitrary need to pursue a balanced budget. Worse, they are framed in such a way as to encourage us to believe that governments have no choice but to act to reduce such expenditure, and that the impact of doing so will be felt by ‘someone else’. But if we ask a rather different question, it’s easy enough to expose the lie. That question is, in simple terms, ‘are there enough resources in the UK to provide every citizen with a decent standard of living?’ The answer, unquestionably, is ‘yes, of course there are’. That we ‘choose’ not to use those resources to achieve that aim is down to ideology, not economics.

None of that, of course, provides an answer to the problem of so-called NEETs – but then neither does simply cutting their benefits. The only ‘problem’ that that solves is how we continue to ensure that resources are concentrated in fewer and fewer hands. But that concentration of wealth is the much bigger economic problem.

Curiosity isn't enough to justify an inquiry

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There is no rule or mechanism which guarantees that members of a political party committed to the pursuit of a cause rather than merely power will be any more honest or less venal than mere careerists; nor that they will be any more resistant to temptation when it is waved in front of their noses. But, somehow, we all want to believe that ‘our’ side are more inherently honest and genuine than everybody else. As a result, the conviction, last week, of the former CEO of the SNP (and ex-husband of the former First Minister) somehow comes as more of a shock, to say nothing of disappointment, than the secret £5 million payment to Farage, or a whole host of financial scandals relating to other politicians in recent years.

Having been Treasurer of a party for five years in the 1980s, I’ll admit that I’m somewhat mystified as to how it can have happened. The level of scrutiny to which accounts were submitted back then was intense, and I distinctly remember lengthy meetings examining the budgets line by line looking for potential savings for a party which was perpetually cash-strapped. Things are different now: the advent of devolution has transformed the finances of parties which are now at the centre of events rather than eternally on the periphery. But still… The defence that the auditors had signed off the accounts looks rather weak to me. A thorough audit would surely have checked that expenditure (for large items as a minimum) was properly authorised and had an appropriate ‘paper’ trail in terms of invoices and receipts, but it’s hard to believe that to have been the case in relation to some of the items on the list. I find myself with a number of serious unanswered questions.

It’s true, as some of the SNP’s opponents have suggested, that the guilty plea means that those questions will never be aired in open court. That’s a pity – as much for the members of the party, who are the victims here, as for the wider public – but the idea that that justifies some sort of public inquiry is a strange one. I can see the attraction to the SNP’s opponents of demanding such an inquiry; keeping the scandal running for as long as possible has its political attractions for parties which have been unable to make a serious dent in the SNP’s popularity. But public inquiries are not cheap, and if one were to be set up for every resolved crime that left the curious with some unanswered questions, there would be an awful lot more public inquiries being held. Good news for the lawyers, I suppose, but probably not for the rest of us.

Whether the initial investigation was politically-motivated or not isn’t entirely clear – but the way it was handled, with a ‘murder tent’ outside the house and so forth, certainly looked a lot like a political act. Even the stated cause for the investigation, that money had been raised for one purpose and then spent on another, looked more than a little dodgy; the idea that specific pounds and pennies would somehow be locked away in a special account doesn’t look like a realistic expectation. It seems, though, that they found a real crime, even if it wasn’t quite the one they were looking for. It’s a disappointment, of course – but to return to my starting point, there is no rule which guarantees honesty, even amongst those apparently committed to a cause. Clay feet can appear even where they’re least expected.

Five million unanswered questions

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Labour’s decision to report the alleged hacking of Farage’s phone to the police is a gimmick, of course. Given the reluctance / inability (delete as applicable) of the boys in blue to investigate a whole host of crimes, diverting resources to a crime which the ‘victim’ himself has not seen fit to report is an unlikely prospect. But if the objective is to keep the story about Farage’s receipt of a £5 million gift running for a day or two longer, it is at least an effective gimmick. It’s reasonable to suppose that the attempt by Farage to turn the story into one about an illegal action performed against him was itself an attempt to divert attention from the £5 million, a generous gift which he continues to maintain is an entirely personal matter between friends.

But the ‘hacking’ story raises more questions as well. Farage is claiming that the ‘hacking’ was the result of a spear-phishing exercise. Assuming that to be true, then it wasn’t really what most of us would call ‘hacking’ at all: it means that he was conned into giving the attackers access to his phone and/or data. Still a crime, of course, just not quite the one which is being alleged. We’ve not been told what the messages were which induced him to part with the access codes to his data, but the possibility that revealing them might just be embarrassing could be one explanation for his coyness in involving the appropriate authorities. We also don’t know who the cyber-security experts were who have concluded that it was a “hostile state actor” behind the plot but, again, those experts seem not to have been the ones employed by the British state precisely to counter such actions against politicians and others.

It’s easy to see why, tactically, Farage might want to blame Russia. Given the suggestions that he and his party are too friendly by far towards Putin, putting some distance between him and the Kremlin looks like a reasonable plan. But hold on a moment – let’s look at this from the other side. Why exactly would Russia want to bring down Farage (and it’s reasonable to suppose that to be the aim of the leak of information)? Looked at from the Kremlin, the best chance of getting a more Russia-friendly government in the UK at the next General Election is through getting Reform Ltd elected, and all the conventional wisdom suggests that is more likely under Farage than under any alternative leader. That must surely be as obvious to Putin as it is to me, so why sabotage the campaign?

There are still far too many unanswered questions about that mysterious £5 million and the events surrounding it.

Irrelevance may be infectious

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If there is a single UK politician who should understand what political irrelevance looks and feels like, it is surely ex-PM Tony Blair, and it’s tempting to dismiss his critique of the way the UK is becoming irrelevant under the leadership of his own party on that basis. That would, though, miss the point, because for all the robust rebuttals of that critique by current-day Labour figures, the whole episode serves to emphasise not the difference between the Blair generation and the Starmer generation but the intrinsic similarities.

It is clear, for instance, that both what Blair had to say and what Starmer has been doing are predicated on an idea of the UK as a great global power, with influence way beyond its size and economic importance to the world. It’s a sort of post-imperial delusion on the part of people who can’t quite get their heads around the idea of the UK as a medium-sized offshore European archipelago, and expect the rest of the world to somehow take them at their own evaluation of their relevance.

Some have been surprised at the similarity between the responses of Burnham and Streeting, with their insistence that the idea of inequality is missing from Blair’s response. But both men, like Blair himself, are wedded to the neoliberal economic creed that ‘the markets’ can solve every problem and that governments must do, fiscally, whatever they interpret the bond markets as demanding. Increasing inequality is not only baked into that creed, it is its main driving force. In his failure to pretend that he thinks it important, Blair is simply being more honest than either. There is no great ‘battle of ideas’ going on between the Labour leadership hopefuls, just a beauty contest between two over-ambitious wannabe Messiahs. Irrelevant is quite an apt description.

Holes, spades, and generous gifts

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The first law of holes states that when you’re in one, you should stop digging. Like most laws, rules, regulations and probably gravity itself, it’s one that Farage seems to think somehow doesn’t apply to him. The more answers he gives about that dodgy donation of £5 million, the more difficult questions arise. He claims that he didn’t use any part of the £5 million to buy the £1.4 million house that he bought in 2024, and that he actually purchased that out of his £1.5 million fee for appearing on I’m a Celebrity. It didn’t take a lot of financial forensics for journalists to demonstrate that that wasn’t exactly true – that money remained in the account into which it was paid.

I almost hesitate to say this, but that might be a little unfair. Someone who suddenly finds himself £1.5 million richer can afford to spend £1.5 million more than he would otherwise have been able to spend: it doesn’t have to be the exact same pounds and pennies or come from the same account. That concept is one with which most of us will probably be familiar, albeit on a much smaller scale. A windfall of £50 might do nicely for a meal out, we might think, even if that £50 is initially used to pay a bill and the meal out comes a month or so later.

The problem for Farage in using that explanation is that what is true for £1.5 million is also true for £5 million, and adds to the need for him to explain that other little windfall. Whether it was for his security (as he originally claimed) or a reward for campaigning for Brexit, as he is now claiming, matters little (apparently, being paid handsomely for delivering a result which might benefit a donor only counts as proper corruption if the quid pro quo was spelled out in advance – a rather curious, not to say large, loophole). The bottom line is that a politician paid £5 million by someone (who just might benefit by rather more than that if said politician reaches a position of power) gives that politician an extra £5 million of spending power. Whether Farage did or did not spend it on security (and the change of rationale rather suggests that he cannot demonstrate that he did) is irrelevant to that basic fact – he had an extra £5 million to spend, unconditionally according to him, on whatever he wanted. And, on the basis of his latest attempt to ‘explain’ the basis of the gift, it was directly related to his political activity over a lengthy period. I find it hard to believe that even the UK could really dream up a set of rules which means that rewarding a politician for taking a particular political position is somehow a non-declarable gift, but I guess the investigation will tell us the answer to that.

In the meantime, if he didn’t own the company, surely someone would be trying to relieve him of his spade.

Principles and virtue-signalling

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Principled stands are all very well, and something for which politicians are generally happy to be credited. Until, that is, the cost of taking such a stand is perceived to outweigh the advantages gained. We saw it in Starmer’s ‘principled stand’ against the US bombing campaign in Iran, which was principled until he decided that allowing the US to use UK bases for ‘purely defensive’ bombing raids (an oxymoron if ever there was one) was a less costly option. And he’s never explained exactly how the purpose and target of each bombing raid was verified to determine whether it met the unspecified criteria for being ‘purely defensive’ – the suspicion remains that the ‘principled stand’ amounted to making a grand statement and then turning a blind eye.

Starmer also took a ‘principled stand’ over Ukraine, backing strong sanctions against unwarranted Russian aggression. Until unwarranted US aggression against Iran caused a potential lack of jet fuel and diesel, at which point the principles got lost. Principles which last only until those espousing them conclude that they are costing themselves too much aren’t really principles at all; they’re more about virtue-signalling.

Whether sanctions actually achieve very much is another question entirely. The theory is that by denying a country access to goods from outside the country and denying that country access to markets for its own goods, then pressure is placed on the economy to such an extent that the government can no longer sustain itself and must collapse/ surrender/ stop a war (delete as applicable). The truth of the proposition depends on three assumptions. The first is that the country being sanctioned cannot sustain itself entirely on the basis of its own resources and productive capacity, the second is the neoliberal economic dogma that the limiting factor on any government’s actions is the amount of money available to it, and the third is that all other countries buy into the sanctions regime.

In the case of Russia, none of those three assumptions are valid. Russia may not have the climate to grow certain crops, which might limit the population’s dietary choices (although after decades of Soviet rule, that might not be as novel as one might think), but the country’s resources are vast and varied, and they have the people and skills to exploit them. As long as they don’t need foreign currency, the idea that the money supply is somehow limited is a myth anyway: the constraint on government action is the availability of real resources, not the means of exchange to buy them. And in any event, there are significant other powers prepared to ignore the sanctions regime. Sanctions have the ring of the old adage, which runs ‘something must be done, this is something, we must do this’.

The conclusion – that sanctions are largely symbolic statements by those applying them, and little more than irritations to those to whom they are applied – is depressing. Failure to recognise that fact is even more so – it simply encourages people to continue to pursue a failed path. There is no quick or easy solution. Universal adherence to agreed international law is our only hope in the long term, but achieving it is another matter entirely. Perhaps we never will, but that doesn’t mean we shouldn’t try. In the meantime, pretend principles achieve little except to divert attention from the real issue.

The five stages of Messiahdom

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Political parties finding themselves in difficulty whilst retaining an absolute conviction that they are right about everything have a tendency to start to believe in the idea of a Messiah. If only, the story goes, we had a different leader, all would be well. That’s the first stage of messiahdom.

The second stage comes when they alight upon the Chosen One. He (and it’s invariably a ‘he’) might not be immediately available: perhaps he’s overseas or at the very least stuck in political exile in the frozen and inhospitable north. These are simply obstacles to be overcome.

The third stage is when the Chosen One himself starts to believe that he really is the Messiah, the one the whole world has been waiting for, and the only one who can put right those things which need to be put right and lead his party to the sunlit uplands. That seems to be about the point at which the Labour Party has now arrived.

The fourth stage is the anointment of the new leader, and it’s the trickiest of all. It’s far from clear at this point whether Labour will overcome this particular hurdle. There will be those who lay obstacles in his route, such as re-opening a debate which makes it harder to persuade ordinary people outside the party to vote for him, whilst smiling sweetly and uttering welcoming words. Maybe his silvery northern tongue will win round the doubters, both inside the party membership and amongst the wider electorate, maybe not. I have a suspicion that at least some will feel more than a little p****d off at being taken for granted in the power games being played with and around them.

Whether the Labour Party gets through stage 4 or not might be an open question, but if they do, then stage 5 has a degree of inevitability about it. This is when it becomes clear that he’s not the Messiah at all, just a very naughty boy. Heroes almost invariably turn out to have feet of clay. The chances that a change of leadership will solve the problems of the Labour Party are slim; the historical record (particularly over the past decade) does not exactly convince me that switching out the person at the top will change any of the fundamentals, even if it may deliver a short term boost based more on hope than experience. A glib tongue and a chameleon-like ability to change position are no substitute for substance, and a few years spent in the political wilderness do not necessarily equip someone to succeed in the top job.

The potential for doing more harm than good is high, particularly if he falls off the horse at the next hurdle. Still, as spectator sports go, it’s better than a lot of politics.

Vigilantes are the problem, not the solution

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It must have been sometime in the 1950s that I used to watch Mr Pastry on the television, and I’m sure that I remember one episode in which he wanted to be a ‘village auntie’; but my memory also told me that Mr Pastry was Clive Dunn rather than Richard Hearne, so maybe it was a different programme. Anyway, the plot line was that our hero had completely failed to understand what a vigilante was. The media and commentators seem to be suffering from a similar lack of understanding every time that they refer to the dreaded ‘bond vigilantes’ who are apparently forcing interest rates up because they’re worried that the Labour government might in any way deviate from the Tory financial straightjacket rectitude to which they’ve been stupid enough to commit themselves.

It’s not true; the participants in the bond markets really don’t give a damn about what government policy is, and are not trying (as true vigilantes would) to exercise extra-judicial powers over perceived miscreants. They care only about extracting maximum benefit for themselves, and see the widespread belief that a change in government policy might make UK bonds a riskier prospect as an opportunity to line their own pockets. It’s a form of self-fulfilling prophecy. Those paying the interest might well want a stable low level, but that isn't necessarily true of those receiving it.

That doesn’t mean that paying higher interest rates on government ‘debt’ isn’t a potential problem for the public finances. The extent of that problem is somewhat exaggerated though: part of the ‘debt’ is held by the government-owned Bank of England, so the government is paying interest to itself in an exercise which is more about book-keeping than debt management, and the higher interest rates only apply to new ‘debt’, not to the money which has been ‘borrowed’ previously. It’s also true that around 30% of the 'debt' is owed to banks, financial institutions and governments outside the UK, but that is offset by the fact that governments outside the UK also owe large amounts (almost £900 billion in the case of the US alone) to UK banks and financial institutions, and to the UK government itself, and interest comes into the UK as well as flowing out.

The bigger problem with the conventional analysis is that it looks at only one side of the equation, to wit the financial impact on government finances. But we need to look at the other side of the equation – after all, if one body is paying interest, someone else is receiving it, and those recipients are the holders of those bonds, and they are mostly based in the UK. They include a small number of wealthy individuals who directly buy bonds and a much larger number of indirect holders, mostly current and future pensioners. And since the benefit received through interest payments is proportional to the amount of bonds held, the benefits will flow disproportionately to the most well-off. In short, government bonds are a mechanism by which wealth is transferred from the many to the few (Richard Murphy has a fuller explanation of that here), and it is the few (or their representatives) who are manipulating the markets to maximise that flow.

Bowing to the perceived pressure from ‘the markets’ is outsourcing financial policy to those to whom wealth is being transferred. Understanding that is a key first step to debating alternatives – but not one that the political representatives of the few, whether Tory, Labour, Reform UK or whatever, are keen on promoting.

The problem is with the product, not the salesman

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If the election results last week exposed just how much trouble Labour is in, the party’s reaction since then serves only to emphasise the fact. Whilst replacing a failed leader might not, in itself, be an altogether bad idea, believing that doing so will, in itself, ‘solve’ the problems facing the party is a triumph for hope over experience. Even more so when the ‘vision’ of all those being touted as replacements differs little from that of the incumbent. The problem is far more deep-seated than that, and it’s only due to an inadequate and unrepresentative electoral system coupled with a Tory collapse that Starmer was regarded as a ‘winner’ for getting a huge majority of seats in 2024 on 34% of the votes, whilst his predecessor, Jeremy Corbyn, was regarded as a dismal failure for gaining far fewer seats in 2017 on 40% of the vote. Which was the best salesman?

Whether history is made by the actions of prominent individuals or by what Boris Johnson called the ‘movement of the herd’ is one of those unresolved questions to which there is never a definitive answer. Mao, as I recall, once said that ‘the people are the motive force in the making of world history’; but then he also said something about ‘power springing from the barrel of a gun’, so take your pick of apposite quotations. I’ve long suspected that the truth lies somewhere between the two. Leaders come to the fore at a time and in a context which is set by longer term changes. The right person who happens to be in the right place at the right time can articulate things in a way which makes it look like he or she is driving change, but there are almost certainly others who could and would have fulfilled the role. I tend to support Ledru-Rollin with his "There go the people. I must follow them, for I am their leader", or whatever variation on the alleged quote you might prefer.

Whatever, the panicked masses of the Labour Party seem to have convinced themselves that, if only X were in charge, the party’s fortunes would be transformed. They might be in with a marginally better chance if they could agree on a name to insert instead of the X. I can think of few worse outcomes for them at this stage than for an MP to stand down to allow Andy Burnham to contest a parliamentary seat and then lose it (along with the Manchester mayoralty) to the Greens or Reform, but it’s an outcome which they don’t even appear able to foresee. The bottom line, though, is that whoever replaces the X, the party is still stuck in a context where they are expecting any new leader to do a better job of repackaging and selling the existing product rather than improving the product. It’s not an approach which has exactly been universally successful in the world of business. Maybe politics is different. Maybe not.

Electoral change might be boring, but that doesn't mean it's unimportant

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With the dust settling on last week’s Senedd election, it’s opportune to review how well the new system of voting actually worked. No doubt the academics are already hard at work on a detailed analysis of the results and the factors which led people to vote as they did. One obvious weakness is that the system ended up favouring the largest parties, encouraging a degree of polarisation between them, just as first past the post has long done. And for all the talk of ‘every vote counts’, clearly some votes did not count; the lack of an opportunity to express a second or third choice meant that the votes of those whose first choice was rapidly eliminated ultimately counted for nothing. And then there’s the argument about voting for a party rather than a person – I’m personally not convinced of that, although many others are, because years of campaigning told me that most people vote for the party anyway. Overall, it’s produced a more proportional result than the previous system, but it’s not ideal.

Some have criticised Labour and Plaid for introducing the new system, describing it as some sort of stitch-up. Criticism of Labour is fair, but I’m not convinced that the same is true of Plaid. Multi-party politics with no overall majority requires compromise and agreement, and had Plaid not agreed to support Labour on this detail, we probably wouldn’t have had the other changes to the Senedd. With a super-majority required for such a change, it looked like a worthwhile compromise – provided it doesn’t become the norm for the longer term.

Most supporters of Proportional Representation tend to favour the Single Transferable Vote. Looking at the new Senedd, that’s true of Plaid, the Lib Dems, and the Greens – but those three parties together do not have the votes for a supermajority on this issue, and Labour and the Tories are generally opposed. Enter, stage right, Reform Ltd. It’s always hard to know what the company’s policy is on any issue because it keeps changing, but Farage (the ultimate determiner of all policies, as the owner and proprietor) has in the past been supportive of a move to STV. Whether he still supports that (given how well his company did in England under FPTP) is an open question, but if he does, there is a clear supermajority in favour in the new Senedd. It creates a potential opportunity for a change with long-lasting effect.

It’s clearly not going to be the top priority for the incoming government. There are far more urgent priorities in areas such as health and education, where visible change is urgently required. Electoral Reform is top of few people’s lists. I hope, though, that the new government will find time to discuss this with other parties – yes, including Reform Ltd – during the current Senedd term, while the door might be at least ajar. Thursday’s results were historic, there is no doubt about that. But historic isn’t the same as irreversible. Sometimes phoenixes do rise out of the ashes, and the Labour and Conservative parties in Wales might not be quite as moribund as they currently appear to be.

Gift or grift?

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The owner and proprietor of Reform Ltd claims that no rules were broken by the £5 million gift made to him prior to his decision to stand for election again in 2024. The gift, he claims, was entirely personal and not related to politics at all. It’s hard to believe that a gift of that magnitude to pay for security had no impact on the decision to stand for election of a man who had been reluctant to do so for reasons of security. The gift was described as ‘unconditional’, with no requirement to spend it on security, and it’s also hard to believe that a sudden windfall of £5 million had no impact on the spending of the recipient on things other than security, even if only by leaving him more of his own money. Given that Sir Starmer was obliged to declare donations for new suits and spectacles, it’s hard to see how the same rules allow undeclared donations of £5 million. Perhaps the various bodies looking into the donation will reach the same conclusion as Farage, although many might think that that would tell us more about the rules than about the gift or the individuals involved.

The donor’s generosity didn’t stop with the party’s owner and proprietor; he also became the largest individual donor in political history with his largesse to Reform Ltd. There’s no corruption involved, apparently, because he didn’t ask for anything in return. That’s probably true – but he didn’t need to. The Reform Ltd stance on cryptocurrency was already well-established. He doesn’t need the party to change any policies for his investment to pay off, he just needs the party to win power. And therein lies a gaping hole in the rules concerning donations to political parties. Giving donations to parties to buy a favourable change in policy is unlawful; giving donations to a party in an attempt to buy an electoral victory which will allow it to implement an already-adopted favourable policy is entirely within the rules.

The difference between gift and grift turns out to be a lot smaller and harder to define than many might think. What we need isn’t one or more enquiries into whether or not rules have been broken, but a change in the rules themselves. Most particularly, we need a cap on the amount anyone can give a political party – or an individual politician – in any financial year. And it needs to be a low cap – a figure in thousands rather than tens of thousands, let alone millions.

Reform Ltd are using a curious form of logic

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Maybe, as some have suggested, the proposal by Reform Ltd to site internment camps for migrants in constituencies which vote for the Green Party is just a wind-up, an attempt to provoke outrage. Maybe, maybe not. There’s certainly something very Trumpian about it, aping the way violent immigration enforcement is used differentially in the US depending on whether a particular state did or did not vote for Trump. Some have suggested that it might be illegal, but if the UK ever got to the stage of electing a majority Reform Ltd government, such a government would have no trouble legislating to remove any legal obstacles. There is certainly something very ‘un-British’ about it, curiously enough from an overtly British/English nationalist party.

Perhaps we’ll never get there. After all, the ability of Reform UK to actually implement such a policy depends on a party led by Farage not imploding for another three years, and then winning a majority of seats in the Westminster parliament. History suggests that the former is unlikely, and the latter depends on the former, but we shouldn’t be complacent. I suspect that they actually mean what they say. Whether they would be able, as they claim, to hold detainees for only a short time before deporting them is an open question. It sounds simple, but in practical terms I suspect that people would need to be held for months rather than weeks, and the total number of detainees at any one time would be very much higher than they are claiming as a result.

Leaving aside the questions of both practicality and probability, the logic, even on their own terms, is a little ‘fuzzy’ to say the least. Setting up the camps is presented as a consequence of voting for open borders, and therefore something which those who vote for open borders should welcome, but that’s a complete logical reversal. Setting up camps is actually a consequence of voting for closed borders and a mass deportation policy; those who should welcome the camps are those who vote to set them up (Reform Ltd voters), not those who vote against them. On the other hand, and they probably haven’t worked this through themselves yet, they’ve actually given us a clear way of stopping their deportation policy in its tracks. They have guaranteed that no Reform Ltd-voting constituency will get a camp, so if every constituency elects a Reform Ltd MP, there would be nowhere to site a single camp. It’s not an action I’d encourage, of course – but ‘Vote Reform to stop Reform’ has a certain ring to it. Logic, like arithmetic, isn't exactly one of their strengths.

It's the vision that matters

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The demands and counter-demands about costings from the various parties contesting the Senedd elections are not just a red herring, they’re a diversion from the substance of the debate between the parties. The media may be provoking this, but the parties seem to be falling in. There are three good reasons why no party will ever convince another party (or any objective observer) that their costings are ‘right’.

Firstly, any set of costings is necessarily based on estimates and assumptions – it cannot be otherwise. Those estimates and assumptions will always be open to challenge – with no shared basis, there can never be a meeting of minds.

Secondly, one of the few things which seems certain about next week’s results is that no party will have an overall majority. Whether we have a coalition government or a minority government, the party leading that government will not be able to get its full programme through the Senedd without negotiation and compromise with one or other parties. No programme, no matter how ‘fully costed’ it is, will survive intact as a result.

Thirdly, even if there were to be a party with an overall majority, able to attempt to implement its programme in full, circumstances will always conspire to obstruct it. The generals say that no battle plan ever survives first contact with the enemy – much the same is true when a manifesto meets the reality of government.

That doesn’t make manifestoes irrelevant, and it doesn’t invalidate making at least an attempt to show how they might be implementable, but debating the financial minutiae diverts attention from the one thing that manifestoes should give us – a sense of the priorities and values of the varying parties. Reducing the debate to the level of ‘I’ll show you mine if you’ll show me yours’, or arguing abut the credentials and eminence of the economists who’ve given the numbers a detached nod tells us nothing about the various parties’ visions for Wales. Or, rather more worryingly, perhaps it actually speaks volumes about their visions.

Enforced poverty is no answer

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The political parties of the neoliberal right (Reform Ltd, the Tories, and Labour), aided and abetted by the majority of the media, continue to push their agenda of cutting the bill for benefits and pensions. The current most popular rationale which they give is to divert money into armaments, but if it wasn’t that, it would be something else. It’s easier to sell the anti-benefits message if it can be presented as a binary choice, even if that presentation is a complete nonsense.

It may even be a popular policy, given that the debate around benefits has been slowly and insidiously polarised over recent years in such a way that many people have come to believe that anyone receiving benefits is a freeloader on the efforts of the rest of us. They just don't think it will affect them. The turkeys have been sold on the argument that promoting the virtues of stuffing somehow means that they will be spared the Christmas chop.

There is, of course, no doubt that some savings can be made. Complex rules could be simplified to reduce administration costs, benefit fraud could be targeted (although the costs of doing that will eat into any savings, and targeting tax fraud and evasion would be a more productive use of resources). But such savings are on the margins: the only real way of generating large financial savings from the benefits bill is to cut the amounts being paid. Reducing payments is one approach, cutting eligibility is another; but whichever approach is chosen, one inescapable consequence is that the spending power of some real people in the real economy would be reduced. How many, and by how much, are debateable questions; the underlying fact of a reduction in spending power is not.

Even if it were possible to identify accurately and precisely which people are ‘choosing’ not to work as opposed to which are unable to (and the reality is that that is very difficult to do – real people, in real families, in real communities have a complex mix of circumstances which mostly lie in grey areas rather than black and white ones), the bottom line is that the number of them is much lower than popular sentiment might suggest. Savings on the scale being demanded by some require a much less targeted approach under which many more people lose access to funds. They will include older people, sick people, children – are we really going to push them into poverty in an attempt to starve someone in the household into a probably non-existent job?

‘Cutting the benefits bill’ looks to be an easy task if we look only at the number of pounds and pennies being spent by government. It looks very different, though, if we start to look at the people involved. It challenges our perceptions of the sort of society we are or want to be. Yes, of course, we want those who can do so to make a contribution, but is being employed really the only way of doing that – and is enforced poverty for those who don’t really the best answer? For the neoliberals – for whom everything boils down to pounds and pennies – the answers might be in the affirmative; for those who believe that there is more to life and the human experience than money and economics, jettisoning that narrow approach and starting with people is the essential first step.

Experience of failure is not the killer qualification as which some see it

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Experience is an odd commodity. As a generalization, most of us might expect that someone who has a lot of experience of doing something will be better at it than someone who has none, but it doesn’t always work that way. One of the reasons why some people end up doing the same job for many, many years is that they really aren’t very good at it. Peter’s Principle (“In a hierarchy individuals tend to rise to their levels of incompetence”) applies. I once interviewed someone for a job who claimed to have twenty years’ experience, but when we questioned him it turned out that he really had one year’s experience repeated twenty times. Experience is not only about duration – it’s also about depth and breadth. And experience of repeated failure without learning from mistakes made is a handicap, not a qualification.

The First Minister claimed this week that Labour should stay in power because it is the only party with previous governing experience in Wales. Even if it didn’t effectively amount to an argument that Labour should therefore enjoy perpetual power (because no-one will ever be able to gain that experience if we accept the argument), it’s a curious claim to make. In the first place, whilst some of the lessons learned from experience can be passed on after a fashion, ‘experience’ itself is personal to the experiencer. In the second place, ‘parties’ don’t have experience of government, it’s the ministers (who are often in any post for only a comparatively short time) who do; parties, as institutions, tend not to be very good at passing lessons on, which is one of the reasons why new generations of politicians often repeat the mistakes of the past. In the third place, many of those within Labour who possess this magical experience are either standing down in this election, or else at risk of defeat anyway. In the fourth place, whilst not everything that the Labour Government has done can fairly be described as a disaster (whatever their opponents might say), and there are often mitigating arguments based on relative incomes, ages and health, the objective evidence surely means that there are very few who would look at the last 27 years and see nothing but outstanding success; experience of failure may not be quite the qualification as which the First Minister apparently sees it. Finally, the institution which is supposed to be the guardian and repository of experience and its lessons isn’t the party, or even the ministers, but the apolitical civil service – which will still be there after May 7 to serve the new ministers.

I’m not sure that “desperate” – the headline accusation lobbed by Plaid – is an entirely fair description of the tactic by Labour. The subtext is surely a much more powerful condemnation: Inability to comprehend any alternative approach, complete failure to understand that voters in Wales want ‘change’ (even if they don’t all want the same change), and a general weariness with the apparent inertia of our political systems and structures. Our best hope for the outcome on 7 May is a government composed solely of independence-supporting parties. It’s hard to envisage any government which includes the attitudes currently being displayed by Labour having the vision and the energy to do anything sufficiently different.

Are the parties fighting the last war?

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It’s difficult to know how seriously we should treat any individual opinion poll. Different organisations use different methods, particularly when it comes to ‘weighting’ to try and ensure that the sample is representative. But when multiple polls by different organisations over a lengthy period show broadly consistent trends, it’s reasonable to suppose that they are telling us something about what is happening. In the case of the upcoming Senedd elections, I’m still struggling to believe how well in the one case, and how badly in the other, Reform Ltd and the Labour Party are doing. Whilst I can’t simply ignore the data-driven evidence in front of us, I’ll admit that, for someone who spent decades campaigning door to door, the extent and speed of the change is something I’m struggling to understand and accept. It somehow doesn't 'feel' right, and evidence which contradicts experience is always a difficult thing.

Once we get to a situation where there are two obvious front-runners, it’s probably inevitable that those two will start trying to ‘squeeze’ the votes of the other parties by presenting the outcome as a binary choice. That doesn’t mean that it isn’t intensely disappointing. In most of the campaigns I ever fought, I was more of a squeezee than a squeezer, left trying to convince people to vote for what they wanted most rather than against what they wanted least. So-called tactical voting is harder to determine under the new voting system for the Senedd elections, since it will probably only really have an impact on the sixth, or at best fifth and sixth, seats in any constituency, and it’s really hard to predict what will happen as we get down to that level of vote counting. Some of the politicians try to tell us that the new system makes every vote count, but it really isn’t true. Anyone voting for a party (or independent candidate) receiving less than around 10-12% of the vote in a constituency will effectively be, in the eyes of those trying to use the squeezing tactic, ‘wasting’ their vote; such votes will have no impact on the outcome of the election. Denial of the opportunity to register a second or third choice is my main criticism of the new system.

The question isn’t just about the mechanics and technicalities, however. I’ve long wondered just how effective the pressure to choose between Labour and Tory has been or, rather, to what extent the polarisation of electoral politics in the UK between the two largest parties was down to this tactic as opposed to other factors. Purely on the numbers, more recent elections show an increasing tendency away from a two-party polarisation – if it did work in the past, it hasn’t worked so well recently. Not only is it essentially a negative approach, but to the extent that it did work at all, it was never based on any careful analysis of opposing manifestos before choosing the lesser of two evils – it was far more visceral than that. A hatred of ‘the Tories’ on the one side and of ‘the Socialists’ on the other was always a substitute for proper debate between alternative visions for the future. Perhaps the fact that the ‘alternatives’ were generally not that different when analysed more objectively helped that framing. Whether either Plaid or Reform Ltd attract that sort of folk history-based hatred to a sufficient degree (outside the bubble in which the political anoraks live) is surely an open question. 'Stopping Reform' may not be quite the killer line that some seem to think.

They say that generals always prepare to refight the last war rather than the one that might actually happen, and I can’t help wondering if adopting a tactic based on what has historically believed to have been the case and trying to apply it in an entirely different scenario isn’t acting in a similar manner.

"The markets won't allow it"

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Faced with rising energy costs, largely as a result of Trump’s disastrous war in Iran, the former Tory Chancellor, Jeremy Hunt, told us that: “The markets wouldn't allow the kind of intervention I was able to do in 2022”, and suggested that any assistance to households would have to be far more targeted. There are, of course, good arguments both for and against targeting of assistance, and that’s an argument which will continue for the foreseeable future, whether in relation to energy costs or any other policy. Governments will make choices; the question, however, is whether they will make those choices on the basis of their own judgement as to what is right, or whether they will follow the neoliberal line that ‘the markets’ have such a stranglehold on policy that they will make the decision. Sadly, the current Chancellor seems to be as much in hock to that neoliberal argument as her predecessor.

Markets, as argued here previously, are an effective way of matching buyers and sellers, and can perform a highly valuable role in any economy. But markets which constrain, or even determine, government policy have ceased to be a tool of society and have set themselves up, instead, as our masters. ‘Markets’ are not objective arbiters of right and wrong, they don’t come out of nowhere with rules set entirely by themselves. They are, rather, a human construct, designed and built by people with the aim of facilitating economic activity. They are not impersonal forces which react in a considered way to events in accordance with predictable rules – market movements are the agglomeration of a large number of individual bets about the probable direction of future movements or, rather, bets about the way in which other participants will bet on those future movements. The idea that governments should allow their policies to be determined by markets which have been captured by gamblers and speculators is a complete abdication of responsibility, and a capitulation to vested interests.

Giving credence to the idea that ‘markets’ can and should control what governments can do comes naturally enough to those who support neoliberal economics and the obsession with abiding by arbitrary fiscal rules. The problem that we face is that the government and the official opposition are united in swallowing the lie – Reeves and Hunt are interchangeable. Austerity and economic inequality are two sides of the same coin – we’ll only escape from both when we re-establish the role of markets as servants rather than masters.

Protecting citizens doesn't mean impoverishing them

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Whether a US major actually said “It became necessary to destroy the town to save it” in justification of the destruction of Ben Tre during the Vietnam war remains a matter of conjecture. That it describes the more-than-occasional absurdity of the military mindset is less open to question. It’s reflected in Donald Trump’s apparent belief that bombing the whole of Iran back to the Stone Age is a way of freeing Iranians from an oppressive regime: the difference is more a matter of scale than of substance. UK politicians aren’t immune to the same way of thinking, as Tory leader Kemi Badenoch demonstrated a day or two ago. According to her, the way to prepare for war with Russia is to cut benefits, pushing more families into poverty in the process. ‘It is necessary to starve them in order to save them’, apparently.

Politicians and military chiefs seem to delight in telling us that Russia will be ready to attack us in five years’ time, a ‘truth’ which underpins their obsession with increasing military spending at the expense of anything and everything else. Whilst it is true that the loss of soldiers and equipment in Ukraine over the past 4 years means that Russia is hardly ready today to launch a major attack on the rest of Europe, and that it would take time for them to rebuild their forces and replace the losses, the evidence that they will be ready to launch said attack in five years’ time is not exactly obvious. And, in any event, it assumes firstly that the losses in Ukraine stop rather than continue, and secondly that Russia’s leaders will have learnt nothing from the cost of invading a single country which will in any way influence their thinking about attacking an even larger ‘enemy’. It rather looks as though ‘five years’ has been selected as the timeframe of choice by NATO’s political and military leaders because it’s close enough to sound imminent, but far enough away to allow people to believe that a huge redirection of resources into military hardware might make a difference. A betting man might suggest that, five years from now, the alleged threat will still be five years in the future. But the demand for more resources will continue to grow.

But here’s the other side of that five-year coin, as it were: it’s also enough time to pursue an alternative course of action, aimed at preventing a war rather than preparing to fight one. The warmongering politicians and military leaders demanding the impoverishment of the population in order to be ready to fight another major war in Europe may well sincerely believe that the best way of preventing a war is to convince ‘the other side’ that they would lose and lose heavily if they attempted it, but the danger of such an approach is that that ‘other side’ instead sees every improvement in equipment, and every deployment of troops, as a sign that an attack on them is being prepared, and reacts accordingly. Whilst I really don’t believe that NATO’s eastward expansion was an intentional precursor for an invasion of Russia (one of the concerns allegedly underlying the Russian invasion of Ukraine), I can understand that things might look different when viewed from Moscow.

With a major war raging on European soil, and with the White House and the Kremlin both occupied by madmen, seeking to de-escalate and build trust instead of planning a war isn’t going to be easy, but it’s the only rational approach for Europe to follow. Those who would lead us into war are fond of telling us that the first duty of any government is the protection of its citizens, but there’s an unspoken addendum: ‘even if it means impoverishing them’. I wouldn’t phrase the ‘first duty’ like that. It takes a very narrow view of the meaning of ‘protection’. If we rephrase it to say that the first duty of any government is to maintain and improve the wellbeing, welfare, and living standards of the population, priorities start to look very different. And they don’t include pushing people into poverty in order to fight a war.

Who's checking what the US are doing from UK bases?

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A few hours before Trump’s deadline for Iran to surrender, it was reported that heavily-laden B52 bombers were taking off (or at least attempting to) from RAF Fairford, presumably en route to Iran. Whether they were armed with conventional weapons or nuclear weapons we may never know, but we can only assume that the jets were turned back in flight after Trump agreed, instead, to negotiate the terms of his own surrender, based on an Iranian document which Trump described as “a workable basis on which to negotiate”, and which would require, amongst other things, the payment of reparations to Iran and the removal of US bases from the region. Trump clearly blinked first, although under what pressures from within his own administration remains uncertain.

Whether it’s really a sound basis for a lasting peace is another unknown at this stage, but the use of a UK base for launching those B52s is an issue which shouldn’t be allowed to go away. Starmer has taken what appears to be a very principled and legalistic stance in demanding that UK bases only be used for ‘defensive’ actions to protect British and allied lives in the Persian Gulf, and he has banned their use for offensive bombing campaigns against Iran. But here’s the question: does anyone really believe that those B52’s, whose take-off was timed so that they would arrive over Iran at about the time that Trump said he wanted to destroy an entire civilisation, were in any way involved in a ‘defensive’ mission rather than part of his planned attacks on civilian infrastructure?

When a bomb falls on an Iranian hospital, school, bridge, or power plant, who in the UK government knows whether it came from a plane flying from a UK base or not? Is anyone checking the mission details and flight logs of all US military aircraft departing from the UK to see whether the US is abiding by Starmer’s rules or not? Starmer has banked a certain, albeit limited, quantity of kudos for setting strict rules, but if adherence is not being monitored (even Starmer, surely, couldn’t be stupid enough to take Trump’s word about what he is doing), then those rules are meaningless. Accepting the word of the US president and then turning a blind eye to what happens in practice would not be the principled stance as which it is being presented.

Laser-focused complacency might not help

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In Blazing Saddles, Cleavon Little’s Sheriff holds a gun to his own head and gets out of a sticky situation by telling the townsfolk that “The next man makes a move, the n***** gets it”. In the real world, Trump’s approach to Iran seems to involve telling them that he’s going to bomb them for another two to three weeks, and if they then agree to his terms, he’ll walk away and reserve the right to bomb them again whenever he feels like it, but if they don’t agree to his terms, he’ll walk away anyway and reserve the right to bomb them again whenever he feels like it. He doesn’t quite seem to realise that he isn’t creating as much fear as he thinks, merely telling them that they just have to hold on for another two or three weeks. When Boris Johnson kept threatening to walk away from EU talks unless they gave the UK everything he wanted, the EU’s response was along the lines of “bye!”. That sheriff had no real power to compel anyone to do anything, but it was a comedy, and in fiction, characters will do whatever the scriptwriter tells them to do. While there are undeniable comic aspects to both Trump and Johnson, their lack of control of the script meant that neither could compel their interlocutors to do what they wanted – and those interlocutors weren’t playing it for laughs either. Trump, in business as in politics, has always over-stated the strength of his own hand and depended on bullying, violence and threats to obtain compliance; Johnson was just a typical English exceptionalist.

Talk of English exceptionalists brings us to the current PM, Keir Starmer, who tried to tell us yesterday that the UK is somehow uniquely well-placed to weather the current economic storms resulting from an ill-thought-out war. He has a plan, he told us, although detail on the content of said plan was remarkably short. From what little he did say, it seems to consist mostly of being laser-focused on waiting to see what happens and then being resolutely determined to do as little as he can get away with. The picture of the UK being painted by some others, i.e. as being perhaps more vulnerable than others to some shortages, seems not to have penetrated his laser-focused complacency. Maybe things won’t turn out as bad as some of the doom and gloom merchants are prophesying; maybe Trump's expressed admiration for Charlie Windsor will lead him to moderate his behaviour rather than add a king to the list of those publicly humiliated by him, but neither seem to be the soundest of foundations on which to build any sort of strategy. As a work colleague of mine once observed, ‘if you can keep your head while all around are losing theirs, you probably don’t know what’s going on’. A message intended to reassure, from someone who seems not to know what’s going on, doesn’t exactly hit the target. Even if the target is laser-focused.

Pressing concerns of the aristocracy

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As the world stands on the brink of an economic disaster brought about by the deranged occupant of the White House, and we ordinary mortals contemplate even further pressure on the availability, let alone the price, of essentials such as food and fuel, spare a thought for the trials and tribulations of that far from ordinary band known as the English aristocracy, the last of the hereditary members which are now, at last, being expelled from their cosy sinecures as part of the legislature of the United Kingdom. My thoughts lie particularly with the 7th Baron Carrington who was apparently disturbed by the possibility of losing his esteemed slot as the Lord Great Chamberlain, a post whose responsibilities include such important matters as 'attending upon' the sovereign and members of his family if they are ever present on the parliamentary estate, and organising the state opening of parliament (although I have a sneaky feeling that the actual ‘organising’ might just possibly be done by minions rather than by the noble lord in person).

It is obvious to all (well, all those who count, at least, including the Prime Minister who has agreed that the role should continue to be hereditary even if it is no longer accompanied by a seat in parliament) that the best way of choosing someone to fill this role is for the incumbent to inherit it from his (I believe that it’s still always going to be a he) forebears rather than to conduct any sort of assessment of their skills and abilities. The UK is, after all, a very special sort of meritocracy, in which merit is imparted by breeding. With a huge sigh of relief, the Baron can now be certain that the position is secure for himself and his descendants for generations to come.

Well, not exactly. The role might be hereditary after a fashion, but it’s shared between three families, passing from one to another whenever the sovereign changes. And one of those families has a 50% share, meaning that they get the job with every alternate sovereign, and the other two families have 25% shares, meaning that they only get the job once in every four sovereigns. Worse (if you happen to be a Carrington) is that the Carrington share is split 11 ways between different members of the family. What that means in practice is that the current incumbent has only been in post since the death of Elizabeth, and if Charlie Windsor pops his clogs tomorrow, no Carrington will hold the post again until Charlie’s first (currently unborn) great, great grandchild ascends the throne (if the monarchy lasts that long) in a century or more’s time. Even then, it may not be a descendant of the current incumbent, since the descendants of the 11 members of the family who jointly inherit the quarter share of the job will need to agree which of them should take the job.

Still, securing that somewhat tenuous privilege is clearly more important than the sort of thing which concerns we lesser souls.

War and its beneficiaries

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The dire warnings about the impact of the war in the Middle East on the global economy are mostly valid, and the fault lies squarely at the feet of Trump for failing to foresee the obvious consequences of his actions. The longer it continues, the more we will all suffer. In strictly economic terms (a very important caveat), however, it isn’t all bad news. Capitalism thrives on destruction – using up all those munitions generates orders for replacements; every aeroplane lost requires a new one to take its place; violent demolition creates opportunities for redevelopment. I’m not suggesting that any of this is a good thing for humanity, it’s just that there have always been some who benefit from war, and current wars are no different. The euphemistically-named ‘defence’ industries and their owners will be amongst the beneficiaries, obviously.

For the rest of us, though, it underlines the folly of looking at anything in ‘strictly economic terms’. Production of munitions will certainly generate employment and economic growth, as will the rebuilding programs which will be needed after any war. But pure economics ignores the human and moral aspects. There’s a lesson there as well which goes much wider than a specific military conflict, or even war in general. Government and politicians who bang on about growth and jobs invariably ignore other aspects in pursuit of increased total material wealth (which inevitably accumulates in the hands of the few). Mechanistic economics pays too little attention to questions about the non-monetary value of activity, let alone the morality of it, and whether it really serves the needs of humanity.

There’s nothing mystical or divine about an economy – it’s a human construct, designed by humans and operating in accordance with rules laid down by humans. It’s our collective choice whether we design economies to facilitate the accumulation of wealth by a few, or to meet the needs of all. It’s our choice whether decisions are made on purely economic grounds or whether they’re made after considering whether humanity as a whole benefits. It’s a mark of the extent to which a social, human construct has been captured and placed at the service of a tiny minority that we live in the world we do. And it’s a measure of the success of the ideology underpinning it that so few understand that it is not the natural order of things, but the outcome of that capture.

Taming the markets

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It is a given that Trump’s statement about talks with Iran is a lie. Working out which part of his rant is the lie is much harder – maybe there are no talks at all; maybe there are some sort of indirect talks taking place through an intermediary; maybe (as Trump himself has hinted) the talks are taking place with someone who has no authority to hold them (and therefore to implement any agreement), and whose life is under threat if the regime currently in power find out he’s talking to Trump; perhaps he’s even talking to the late Shah’s son in the mistaken belief that he can put him back on the throne. With Trump, any or all of these are possibilities: the nearest thing to a certainty is that the statements coming from the regime in Iran are more likely to be true than anything Trump says. Only time will tell which lie he is telling.

Meanwhile, one of the apparent certainties is that the words emanating from Trump’s phone fingers can and do move markets. As a direct result of Trump’s claim about talks, conveniently issued shortly before markets opened, oil prices fell and stock market prices rose – two of the outcomes most highly valued by a man who measures the success or failure of everything in terms of increasing the wealth of himself and his billionaire friends. Superficially, it’s a puzzle as to why this happens. After all, those involved in the markets know as well as I do that the truth is a stranger to Trump’s lips, and that whatever he says now will probably be reversed in days, if not hours. What makes them place such trust in his words?

The answer to that lies not in what any of those involved in speculative buying and selling themselves believe might or might not be true, but in what they think that other speculative traders might or might not believe. If you believe that everyone else is going to be selling oil (pushing the price down) or buying stock (pushing the price up), then it becomes a race to sell or buy before everyone else does so in order to turn a quick profit. (And if you can get hold of some advance information, speculation – or even simple betting – becomes easier. It’s an obvious hazard when dealing with a ‘leader’ who sees personal and family enrichment as an entirely legitimate goal.)

That brings us to the problem with markets. As a mechanism for matching genuine sellers with genuine buyers, markets are an extremely effective process. They have, though, been largely hijacked by people who have no interest whatsoever in the ‘things’ they are buying and selling; it is the process of buying and selling in itself, with the prospect of turning a quick profit, which attracts them. Commentators describe volatile markets as a ‘problem’, but that’s only true for those genuine buyers and sellers. For speculators, volatility equals opportunity. The consequences of that volatility are felt in the ‘real’ economy by all of us, whilst a minority redirect wealth to themselves. For as long as legislatures allow this situation to continue, markets and the economy they support end up controlling us, when they should be serving society as a whole. Where are the politicians willing to tackle this scourge?