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?

Trump can't make all the rules

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When I was a child, the kids from our street used to go into the fields at the end of the road and play commandos. Well, it was the 1950s, and ‘the war’ might not have been a memory for us, but it was still fresh to our parents’ generation. It was a game which would often dissolve into acrimony as debate raged over whether one or other of us was ‘taking his shots’; a debate in essence as to whether the imaginary bullet had hit or missed its target. Even the world’s best ballistics expert would have been unable to answer the question – tracing the trajectory of an imaginary bullet fired from an imaginary gun is no simple matter. And we didn’t have such an expert on hand anyway.

It was a childish debate, of course – but then we were children and children are allowed to be childish. But it seems to me that Trump – a man-child if ever there was one – has got to a similar stage in his war against Iran: the Iranians are just not taking their shots. He believes that he has ‘won’, but the loser is declining to oblige him by meekly accepting defeat. Six decades ago, we children learnt that no matter how determined any one of us might have been to set his or her own rules for the game, it only worked as long as the rest of us agreed to be rule-takers. It's not a lesson that everyone learns.

Trump has lived his entire life believing that he alone sets the rules, and that rules set by others can be ignored. Mostly, he’s had that stance validated by the behaviour of others, even if that behaviour has been the result of threats, bullying and aggressive law suits which many of his targets have chosen to settle rather than drag out at huge cost. And now he’s got himself into the most powerful position on the planet, with huge resources of weaponry at his disposal, and he’s encountering more push-back than he’s ever encountered before. Iran might be the bloodiest and most obvious source at present, but it’s also increasingly coming from other governments, which he sees as vassals, declining to prostrate themselves before him and do his bidding without question.

His instinctive reaction has been to fall back on the learned behaviour which has served him so well in the past – turn up the volume on the threats, insults and bullying. If – when – that doesn’t work, what will he do next? The world’s best hope is that he falls back on his other standard ploy: lie and claim victory. Repeatedly. Whether the other players will let him off the hook so easily remains to be seen. Not taking their shots can be habit-forming.

Avoiding the real issue - again

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Last week, this blog referred to the question of a falling birth rate, and the alleged ‘problems’ it creates. The Sunday times (paywall) carried an article this week about a new report from a think tank calling itself the Centre for Social Justice on the same issue. The report itself, Baby Bust, is available here. The main factor on which it alights is that it is all the fault of immature men, who are entering the adult work force later and thus deferring parenthood for men and women alike. But it was the ‘solutions’ which caught my eye.

Leaving aside the socially conservative proposals about incentivising marriage and encouraging mothers (not fathers, note) to be stay-at-home child carers, moving to ‘household’ rather than individual taxation – all massive steps backwards, particularly for the status and role of women in society – it was their proposals for education which leapt out at me:

“Reduce the school leaving age and get most young people into the workplace as early as possible”, and

“In a similar vein, we should drastically reduce the numbers of 18-year-olds going to university.”

They didn’t suggest to what age the school leaving age should be reduced. I suspect that they don’t want to go back to sending 8 or 10 years olds down the mines (or aren’t prepared to say so), but it seems clear that they want to at least reverse the increase from 16 to 18. They also want to increase the retirement age to qualify for the state pension. My interpretation of it all was that their idea of ‘social justice’ seems to mean that working class boys, and women in general, should know their place and understand their station in life, as though the 1950s was some sort of golden age. It was a depressing read, and no surprise to find the foreword written by a Tory Shadow Minister.

But, to return to last week’s post, what it’s really all about is looking for a ‘solution’ to a ‘problem’ in a way which avoids the need to look at how the economy serves society, and above all at wealth distribution within society. ‘Social Justice’ which protects the wealthiest at the expense of the rest is an Orwellian use of language, to say the least.

Davey has right diagnosis, but wrong cure

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There are few government policies that are so financially ruinous that they cannot be made more so by a determined politician. And this weekend, it was Ed Davey’s turn, for the Lib Dems. His diagnosis – that the US is no longer a dependable ally and relying on them to allow the use of missiles which are leased from the US may make them potentially unusable – is accurate enough. His cure, however – that the UK should develop a completely new set of missiles on its own – would add vast amounts of additional cost to a programme which is already hugely expensive. It would also have a lengthy timescale before it could be ready for use, and one of the known unknowns is whether the US will remain a hostile actor for the whole of that period.

Whether it would make the weapons any more usable is another open question. Their value as a deterrent has always depended on a series of assumptions. That the UK has the ability to fire them at all without US permission is certainly one of those, but there are others: that ‘the enemy’ will simultaneously be mad enough to launch a strike which will incinerate millions and make large areas of the earth (maybe even all of it) uninhabitable and sane enough to be deterred by the thought of millions of their own citizens being incinerated in return; that the orders given to the submarine commander instruct him to launch in certain circumstances and that the commander, contemplating the scale of destruction already wreaked on the planet, would follow those instructions; and that the enemy would not already have located and destroyed the submarine. That’s a whole load of caveats, without even considering whether the system would actually work anyway.

All of that matters only if the possession of nuclear weapons had anything at all to do with war, peace or deterrence. If, as many suspect, it’s actually more to do with a post-imperial mindset amongst UK politicians – Labour, Tory and Lib Dem alike – that still doesn’t accept the reduced status of the UK in the world and clings to the belief that what the UK PM thinks is of any importance, then whether they work or not is largely irrelevant; the important thing is whether the UK is accepted by other states as being what its leaders think it is. It fails, though, even on that level. One of the consequences of diverting so much resource into a single weapons system is that the UK doesn’t have the sort of forces which can actually be of use, leading to boats spending three days bobbing about in the English Channel. Some of us might think that’s a positive, of sorts – but I doubt that it’s what Davey had in mind.

Lack of money isn't the problem

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It has long been understood that the one thing that governments can always find money for is war. War is undoubtedly costly, as the US is currently finding out. It is not really, though, a financial problem. As Professor Richard Murphy points out today, the real constraint isn’t financial, it’s about the availability of bombs and missiles and the ability of even the US economy to replace them at a fast enough rate. The US will run out of Tomahawk missiles because it can’t manufacture them with sufficient speed, not because it can’t pay for them. Similar considerations apply to Iran, of course – although an economy using lower cost, easier-to-produce weaponry can to some extent compensate for its relatively smaller size.

There is another corollary to this as well. There is talk that reducing the level of sanctions enforcement on Russian oil and gas to mitigate the economic impact of the war in Iran will enable Russia to prolong its own war in Ukraine by increasing the flow of money into Moscow’s Treasury. It’s true in only one important respect: to the extent that Russia needs materials, components etc from outside its own economy, increasing its flow of foreign exchange will assist it, but to the extent that it can meet those needs internally, then, just like the US, it won’t be a lack of money which constrains it.

Russia is vast; it has a huge range of raw materials available to it. It’s also a dictatorship: switching the use of its natural and human resources from peace time activities to war time ones is a lot easier than it is in a supposed democracy. Much of the response from ‘the West’ to the war in Ukraine has been based on the assumption that economic sanctions will reduce the sums available to the Russian government to spend on armaments and eventually force it to stop its aggression. But if those sanctions only impact Putin’s ability to make purchases outside the Russian economy, and Russia can meet most of its own needs within that economy, then the assumption is invalid. Russia can never run out of money, and can continue its war as long as it has the resources to do so available within its economy.

That’s not to argue that sanctions should not be applied, even if we know that they are widely being broken by back door transactions. It does, though, suggest that merely cutting off economic contact with a country with access to such vast resources of materials and labour will not bring that country to its knees any time soon. It’s more tokenistic than effective. It’s not a new lesson – Iran, for example, has been subject to severe sanctions for decades, and is still able to produce drones not only for its own use but also for export. The mistaken belief that money (or lack thereof) is a constraint on action by sovereign governments running their own currency has a lot to answer for.

The issue of distribution isn't going to go away

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The view that a falling birth rate is a ‘problem’ which needs to be addressed might be being expressed most forcibly by the political ‘right’, but it isn’t confined to that wing, as evidenced by this article last week from Polly Toynbee in the Guardian. Whilst (justifiably) demolishing the arguments of some Reform Ltd figures, she ends up agreeing with the objective (increasing the birth rate) but giving a different rationale.

There is a fringe element amongst those who support increased birth rates which is tinged with both misogyny (men controlling the fertility rate of women) and racism (a belief that the ‘solution’ to the economic drivers of immigration is to produce more native-born workers). Given the roughly twenty-year lead time involved in producing more workers, the latter is economic nonsense, but then racism and xenophobia have never been about logic or economics.

More seriously, the economic case for increasing birth rates revolves around the fact that the ratio of ‘productive’ to ‘unproductive’ adults is changing as the population ages. In an economy built around the assumption that the product of economic activity belongs to those engaged in it rather than to society as a whole, the fact that there is a problem is undeniable. Fewer workers supporting more non-workers – with no other changes to the economic model – will clearly lead to difficulties. Rebalancing the ratio by increasing the supply of people, even if we ignore the 20-year lead time, turns it into something of a Ponzi scheme, in which any increase in life expectancy (generally a good thing) has to be balanced by an increase in population size (not such a good thing in a finite world where resources are already being exploited unsustainably). Another solution, pursued in the UK by governments of both colours, is to reduce the number of non-workers by making people work longer. That would certainly rebalance the ratio and cut the cost of maintaining retirees: fewer pensioners = lower pension costs. But it also makes retirement (and even more so, a lengthy and healthy one) increasingly a privilege for those who have good occupational pensions and are not doing physically demanding work. It’s a ‘solution’, in short, which favours the better-off at the expense of the less well-off.

There is another approach, but it involves a change in paradigm – a shift away from seeing the output of economic activity as belonging only to those actively engaged in economic activity. If, instead, we see the ‘economy’ as being something which belongs to the whole of the society in which it operates, then the question becomes one of how the output of that economic activity is used within that society. A properly functioning society (including the economy which is part of it) needs to meet the needs of all its members – old, young, sick, and disabled members as well as productive workers. The idea that we only need to worry about how big the pie is, rather than how it is shared, has validity only so long as any increase in the size of the pie is both sustainable in terms of its use of finite resources, and equitable in terms of how the extra pie is used. Falling back on ‘growth’ in the abstract – the default position of Labour, Tory, Lib Dem and Reform Ltd politicians alike – is thus no solution at all if, as is the case at present, that growth is not only not sustainable within the resources available, but also the benefits are overwhelmingly captured by a tiny proportion of the population. We cannot simply avoid indefinitely the question of distribution.

Raising money for war

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As the warmongering rhetoric of the UK’s traditional parties (Tory, Lib Dems and Labour), along with newcomer Reform Ltd, ramps up, suggestions have been floated that the UK should start issuing war bonds, a method of borrowing from the public which was used to fund both World Wars. One of those floating the idea is Lib Dem leader, Ed Davey, and the call is also being supported by an alliance of defence industry bosses. The keenness of the armaments industry for the government to raise more money to divert into their pockets is understandable – arms manufacturers are the only consistent winners from warfare. Surprise, surprise – arms manufacturers support a plan to transfer other people’s money to themselves!

Even if we assume, for the purposes of argument, that spending more on armaments is a good thing, there is a big question over whether the government actually needs to borrow money to achieve that aim. The constraint isn’t about money – the government can always create money to fund whatever it wishes – it is about real resources in the economy. Are the raw materials, labour, energy etc to produce more armaments actually available, or do they need to be redirected from other economic uses? The way in which they are financed is a separate question entirely. On the scale on which our politicians apparently wish to manufacture armaments, it is likely that diversion of resources from other activities will be required – and which economic activities are selected to suffer the effects of that diversion is a far more important question, even if not one that any of them are in any great rush to answer.

Those advocating war bonds as a means of raising finance seem to think of it as an opportunity for ordinary people to come together and loan their pennies to the government in a great patriotic outpouring, as happened in the two world wars. Except it didn’t happen; it’s a false memory of events seen through biased lenses. And that little dampener eliminates the need to even consider whether the UK’s population would suddenly be overcome by the jingoistic fervour which the proposal presupposes.

In both world wars, the bonds were overwhelmingly sold not to ordinary individuals in the street but to a small number of wealthy individuals and to companies and institutions, unsurprisingly concentrated in London and south east England. The scheme launched in the first world war was actually a spectacular failure, with the Bank of England being forced to buy many of the bonds itself (an early example of what would probably be called quantitative easing today), hide the assets in its accounts, and then lie about having done so. As the government increased the interest rate in an increasingly vain attempt to attract more money, many of the new bonds were purchased by holders of the existing bonds converting them into the new higher interest bonds instead. As might be expected by any rational observer, the motivation of capitalists was more about making money than saving the country.

That highlights one of the issues with governments issuing bonds – they benefit mostly the wealthiest in society. By treating tax and ‘borrowing’ as alternatives, the rich end up keeping their capital and earning interest on it rather than paying tax. It’s also a double whammy – when the government spends the money into the economy, it overwhelmingly flows upwards into the hands of the wealthiest, through profits and dividends. To the extent that even a small number of ordinary people respond to the call, they end up reducing their own spending power as the flow of capital increases social inequality. It's not quite the wizard wheeze as which its advocates seem to see it. Unless you're an arms manufacturer.

The ultimate unwinnable wager

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There was a report a few days ago about the possibility that there had been some insider trading on a web betting – sorry, ‘prediction’ – site where some individuals may have made a killing by correctly ‘predicting’ either the attack on Iran or the death of the Ayatollah. It may, of course, be the case that the involvement of a Trump in the company hosting the ‘prediction’ market is a complete coincidence and/or that one Trump knew nothing about what another Trump was about to do. Perhaps there should be a market in predicting whether Trumps will gain financially from US government actions.

It is, apparently, possible to put money on a ‘prediction’ of almost anything. It seems that the same company hosting the bets on those ‘predictions’ also briefly ran a market in predictions of nuclear Armageddon. That market has subsequently been pulled, apparently because some felt that an attempt to make a bit of money betting on the deaths of millions of humans might be considered a little distasteful. To a compulsive gambler – sorry, ‘predictor’ – there is nothing that’s off limits when it comes to placing a bet, but the company running the market probably considered that whatever it had by way of a reputation would probably not be helped.

I found myself wondering, though, what sort of person would bet money on such an event. If the event happens, then the chances of the gambler being alive to claim his winnings are slim, to put it mildly. The chances of the company still being in existence to take the money from the losers and pay it to the winners are even lower. And what would the winners do with the money if there was no longer a functioning economy in which to spend it? Maybe those betting on nuclear destruction believe that nuclear Armageddon would not be so bad after all. The individual might survive a nuclear war, the company might still be able to organise the pay out, and the money would still be useful. But in those circumstances, the company would be able to argue, justifiably, that what just happened wasn’t nuclear Armageddon after all; and if the event didn’t happen, then those ‘predicting’ that it would happen would neither win nor receive any payout. It’s an essentially unwinnable bet for those predicting that outcome. There were some, apparently, willing to make the bet anyway. Even if they had advance knowledge that someone intended to start the nuclear war, it’s still a pretty stupid bet. As well as being tasteless.