Where do you want to be shot?

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When ‘news’ papers have a space to fill, one common response is to report the results of some survey or other listing the world’s favourite **** (insert item of your choice here). The extent to which the findings are meaningful is an open question. Passing through Heathrow a few weeks ago, I spotted this advert urging people to vote for Heathrow as their favourite airport.

And there was a similar message (for a different airport, obviously) at the destination. Respondents are self-selecting (none of this demographic weighting stuff), and are not required to have actually visited any other airports – or, even, the one for which they are voting. And the appeal of the message is a clear one – vote for ‘your’ airport. More of a loyalty test than a scientific survey. It's a reminder that we should always be questioning the context and methods used in any survey, even professionally conducted opinion polls, before blindly accepting the headline summary.

Which brings me to a report in yesterday’s Sunday Times about a More in Common opinion poll which suggested that 67% would prefer the Chancellor’s budget this week to fill the fiscal black hole by cutting spending rather than increasing taxes on working people. It’s hardly a surprising result – as a general rule, people seem to naively believe that spending cuts somehow affect ‘other people’ whereas tax cuts impact them directly. But, in reality, it’s a bit like an assassin asking whether you’d prefer to be shot in the head or in the heart: it avoids the much more important question about whether you really want to be shot at all. The existence of Rachel Reeves’ black hole isn’t questioned, and nor is the need to fill it by balancing the budget. In effect, the reporting of a simple opinion poll (which I’m sure was conducted professionally in terms of its methodology) manages to confirm and reinforce the Overton window for debate around government finances, confining it to the assumptions made by the UK’s three right-wing parties (Tories, Reform and Labour), all of which are signed up to the ridiculous household analogy for government finances.

For all the leaks, briefings and speculation, we don’t yet know what Reeves will announce this week, but whether she opts for spending cuts, tax rises, or some combination of the two, the effect will be much the same: she will be reducing the purchasing power (and therefore the standard of living) of millions of people in pursuit of an ideological position which imposes upon her an entirely arbitrary set of rules which she herself has designed. And the post-budget debate will revolve around whether the totals she’s arrived at are correct and whether there’s a better combination to achieve the same outcome. But who will be asking whether we really want to be shot at all?

Who cares about an arbitrary number?

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There is a long-standing, but rather odd if you stop to think about it, trend for organisations announcing new initiatives, buildings, or policies to concentrate on the cost rather than the substance. It’s as though the PR officers believe that the most important part of the news is how much is being spent, rather than what is being done. Here, here, and here are a few random examples. Anyone wanting to know what the story is really about will never find out from the headline alone. But in terms of the impact, it’s what is being done that is the real story – and the price attached to it is often a largely arbitrary first guess rather than a detailed costing.

That, it seems to me, was always the status of Labour’s £28 billion Green Investment Plan – just another headline lacking in real detail. Just about everyone can tell you how much they planned to spend – few can tell you what they were actually going to do with it. In that limited sense, ditching the headline sum is, or should be, a non-story. The question should be more about what they’re actually now not going to do which they were previously planning to do. And the answer to that question is far from clear in anything that they’ve managed to say so far – it’s all been about the number, which was pretty much plucked out of the air to begin with. Listening to their statements, one could be forgiven for believing that they are not changing their plans at all, just stopping all talk about the cost. But doing what they previously said would cost £28 billion, without spending £28 billion, and sticking to the silly fiscal rule which they themselves have invented is a mathematical impossibility. Whether it helps them politically is another question – switching the debate away from an essentially ridiculous numbers game to a more complex question which the media can’t even be bothered to engage with might help them electorally, but it tells us little about what we can expect from a new government.

The party was, in reality, pretty stupid to name a figure at all in the first place. It might have made a good headline at the time as an indicator of how serious they were about taking  action on climate change without having to do the hard yards to spell out the detailed policies, but that’s a very short term consideration. And it played into the hands of a Tory Party determined to hold Labour to a standard of fiscal responsibility to which they’ve never adhered themselves. To say nothing of a lazy media more interested in the yah boo politics of ‘he said, she said’ than in attempting to explain the seriousness of the situation and the required actions and consequences, let alone the complexities of public finances.

And that brings us to the real, and very sad, story here. It’s not some superficial froth about U-turns and flip-flops, it’s not about the detail of government expenditure and how it is financed, it’s not even about climate change and the urgent need for action. It’s about the one thing – the only thing – to which Labour is now resolutely committed. That is to play the game under Tory rules and abide by whatever constraints the outgoing Tories leave for them. At a time when people seem to be crying out for change, the only thing Labour are planning to change is the people implementing the policies.

Being 'on it'

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A colleague in one of the various places I worked over the years told us one day that she’d come up with a brilliant way of impressing our mutual boss with her commitment to the job. She had set up an ‘auto-reply’ rule in Outlook such that every e-mail from said boss received an instant response, saying “OK, I’m on it”. The potential flaws in this approach seemed a little obvious to me; whilst it’s a good response to a request for information or the completion of a task, there are plenty of other boss-originated e-mails to which it is a pretty poor response. And always receiving such a response within seconds to an e-mail sent at 3am (said boss did work all hours; the organisation had something of a culture of presenteeism) is never going to be entirely credible. Even leaving aside the practical issues and potential misunderstandings, what does the phrase even mean anyway? Sent automatically without the ‘sender’ having even read the original e-mail, it is an inherent lie from the outset.

It’s probably no surprise, therefore, that it was a phrase used by Sunak yesterday, albeit with the added flourish of him being ‘100%’ on it in relation to the cost of living problem. And it is, equally obviously, a lie. In this particular case, being ‘on it’ means that he has no plans to actually do anything except shout a bit of encouragement from the sidelines while the Bank of England engineer a deliberate recession in the strange belief that denying people money to spend will somehow overcome the barriers to trade which his government has chosen to erect. And being ‘100%’ on it implies that he is doing nothing else at all (although, on reflection, it might be better if that bit were true, given how much damage he causes when he does do anything).

In theory, it shouldn’t matter how wealthy a PM is, but a bland reassurance that “It is going to be OK and we are going to get through this” will always sound more than a little tone deaf coming from a multimillionaire who clearly doesn’t understand the sort of financial pressures which most of the population are facing, and who certainly isn’t facing them himself. His ‘we’ is really a ‘you’ in that context. Whilst he’s obviously trying to sound positive and upbeat, he really doesn’t have a clue as to how his statements sound. Telling people in increasingly desperate financial straits that all will be well as long as they don’t ask for pay increases sounds a bit like telling someone suffering from serious depression to pull themselves together, as though the solution is entirely in their own hands. The crisis is of the government’s own making, resulting from decisions that they have taken, and demanding that the majority suffer a drop in living standards to pay for the government’s mistakes is no substitute for action. Getting poorer more slowly isn’t the killer campaign line that they seem to think it should be.

Unshackling our thinking

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There was an article published by the Independent yesterday talking about the growth in support for independence in both Wales and Scotland and the way in which the pandemic has impacted this. On the whole, it seemed a reasonable analysis, but it was undermined completely by the uncritical inclusion of this passage: “Neither Cardiff or Edinburgh would have had the finances to support the widely praised furlough scheme, which, so far, has saved hundreds of thousands of jobs”. This is not analysis or comment, it is pure and unadulterated unionist propaganda. Whilst the scheme has indeed received some praise, it has also received a lot of criticism (largely because of the arbitrary cut-offs in both percentage of salary covered and timescales), a point which the words ‘widely praised’ glosses over. But more importantly, what is the basis for stating that “Neither Cardiff nor Edinburgh would have had the finances to support the … scheme”?

It’s true, of course, that neither would have been in any position to support a UK-wide scheme; in that narrow sense, the sentence is factually correct. But they don’t need to – they only need to be able to support the schemes as they relate to Scotland or Wales. It’s also true, of course, that under current powers and budgets they would be unable even to do that; but that’s not what was being posited here. The context is clearly making the unsupported claim that an independent Wales or Scotland would be unable to run such a scheme itself, a claim which is completely without foundation. Given that the UK scheme has been funded by simply creating new money, there is no reason in principle why Scotland or Wales could not do the same on a scale which suits each country, with a couple of important caveats to which I’ll return.

In fact, there’s no reason why they could not do so without the limitation on the period for which the scheme operates or the initial limit of 80% of salary, let alone the current limitation of 67%. These limits, imposed by the Chancellor, are entirely arbitrary, based on a particular ideological view of the world. There is nothing necessary or inevitable about them. What that means is that Wales or Scotland could not only have initiated such schemes themselves, they could have done so without the arbitrary limits, making the schemes better and saving more jobs. Far from us being dependent on the UK Treasury, the Treasury is actually making things worse than they need to be and preventing both Wales and Scotland from taking more radical action.

As I mentioned above, however, there are important caveats. The first is that to be able to create money in this way, a state needs to have its own fiat currency and to be in complete control of that currency. The ‘sterlingisation’ which I understand to be the current policy of the SNP, would be a severe obstacle to this approach and leave Scotland highly dependent on decisions taken elsewhere. In a crisis like this pandemic, it would significantly constrain Scotland’s freedom to do better than London – and it could conceivably make things worse. The other caveat is that spending money into the economy on a larger scale does not cause inflation – but this is not a problem in a period of severe economic contraction where deflation is potentially a bigger danger.

The fact that anyone can repeat the claim about an independent Scotland or Wales being unable to act in the same way as any other independent country with no need to explain or justify it highlights how easily current perspectives can shackle thinking. The biggest obstacle to becoming independent is, in some ways, throwing off those mental shackles, and allowing ourselves to think as people in independent countries would. Not only could we do just as well, we could do considerably better than the ideologically hidebound incompetents currently in charge.

Ethics and the law

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The revelation that the rich and powerful use tax havens to shelter their wealth from the taxes faced by the rest of the population is about as surprising as a revelation about the Pope’s religious affiliation.  Of course those who own the wealth take steps to protect that ownership; they always have.  But that doesn’t mean that there are no surprising aspects of the affair.

I wouldn’t expect people such as the monarch to be personally managing their own finances; the real decisions are taken by the lawyers and advisors who oversee the day to day issues.  But I would expect those advisors to have been given some sort of steer on the way in which they should behave, and three general directives strike me as being key to such a steer:

·         Get the best returns possible,

·         Make sure that everything is legal, and

·         Don’t do anything that would cause embarrassment if it became public.

It is in relation to the third of those points that there has been a failure, and three possible reasons occur to me for that failure:

·         The steer given to the advisors didn’t cover that point,

·         It did cover that point, but the advisors ignored it, or

·         It simply didn’t occur to anyone that a perfectly legal investment would cause any embarrassment.

Whilst I can’t entirely discount either of the first two, it is the third which seems to me to be likeliest; and it is in line with the defence generally being presented (and emphasised again and again in the media), namely that ‘there is no suggestion of any illegal activity’.  It raises the question, though, about whether we expect the richer members of society to exercise any moral or ethical responsibility, or whether compliance with the law is considered adequate.  It’s quite clear to me that those involved in this whole affair consider that their responsibility starts and ends with that which is legal; they have effectively outsourced their ethical responsibility to the legislature.  If the legislature does not explicitly prohibit something, then it’s acceptable.

At one level, that abdication of responsibility is deeply depressing, but at another it actually provides an opportunity.  It’s almost an invitation to the legislators to take on the responsibility and outlaw anything which looks like an attempt to avoid taxation or otherwise outrages the wider public.  All we need to do is to find enough legislators with an operational financial moral compass.  That's the part which might prove difficult.

Who decides?

Tweet When I hear a politician talking about ‘post code lotteries’, I hear the voice of a centralist demanding uniformity and consistency driven from the centre.  It's something from which all four parties in the Assembly suffer on a regular basis, but latest up last week was the leader of the Tories in the Assembly, demanding a ring-fenced cancer drugs fund, like they have in England, so that cancer patients can get access to the drugs they need.

His timing was unfortunate, to say the least, coming as it did just a day or two before it was announced that the said English fund will no longer be funding certain drugs because they’re too expensive.  But then, expecting ‘Dave’ to tell RT what he was going to do would be wholly unrealistic. Even RT himself would never expect that.

The idea of a ring-fenced fund to pay for certain drugs for certain illnesses is superficially attractive, particularly for the patients involved.  The fund in England has undoubtedly made some drugs available to people who would not otherwise have had them; and I can well understand why that would make this a popular initiative.  And it’s that popularity, of course, which drives the Tories in Wales to keep demanding that Wales follows suit - they think that there are votes in it.

But is it the right way to run a health service?  Effectively, it is a case of the politicians telling the doctors that they can’t have enough money to treat everyone, whatever their illness, in the way that the doctors would like.  Instead, the politicians will set the priorities for them, and ring fence a sum of money for certain drugs for use only in the case of certain illnesses, regardless of whether the medical professionals consider that to be the best use of funds to achieve the best outcomes for the largest number of people. 

Driven, as it is, by electoral considerations, I’m far from convinced that this is the best way of making clinical decisions.  And, as they’ve discovered in England, it gives the drugs companies no incentive to reduce the cost of the drugs.

Responding to wholly understandable public demands that the latest drugs should be available by creating a ring-fenced fund is no way to address the overall problem of lack of resources in the health service.  Attending to the high profile diverts attention from, but does not resolve, the decisions which doctors face daily about how best to use the resources they do have to benefit the greatest number.  And, ultimately, that’s my real objection to the idea of a ring-fenced fund – it’s not tackling the real problem.

Being right for the wrong reasons

Tweet I find it hard to disagree with Ed Miliband’s assertion that banks have become too large and financial power too concentrated in the hands of a few.  That alone is reason enough to want to see some of them broken up into smaller banks.

I’m far less convinced about his apparent belief that the additional competition which he expects to result will bring benefits to businesses, such as more lending.  The faith in “competition” as the answer to just about everything is what gave us the marketization of the health service – perhaps he isn’t so far away from Thatcher and Blair as he’d like us to believe.

Certainly, having more and smaller banks will lead to more competition; it’s the leap beyond that to the conclusions about who would benefit that I would doubt.  Smaller banks are likely to take less risk rather than more; they’ll be competing for the safest, most profitable, customers, not the riskiest ones.  And if banks aren’t lending to businesses at the moment, it isn’t because they can’t – it’s because of their assessment of the likely levels of risk and return.

Paradoxically, Miliband’s advocacy of breaking up the banks may actually have the opposite effect of that he claims.  Insofar as breaking up the banks is one of his better ideas, it’s for completely different reasons than those he gives.

Stating the obvious

Tweet I was disappointed by the report a few days ago about the Assembly Committee which had been deliberating the question of small rural schools. The conclusion that 'small schools should not be kept open at the expense of a child's education' is unquestionably a case of stating the obvious, and didn't need a six month enquiry to reach.

Some politicians have a technique of asking questions in a way which leads you to the conclusion that they want, and the statement by the committee's chair, Alun Davies AM, is a classic in that context. "Should we provide children with a second-rate education so a community group can have a hall in which to meet?", he asked. Well, no, of course not – but that isn't what anyone is asking for. When communities lose their school, it isn't the buildings that are the most important factor – it's the social and community activity which revolves around the school.

I've had some experience as a parent of children in both a medium-sized urban school and a small rural school, and the educational experience of children in the two settings is clearly very different.

Larger schools provide more competition between children of the same age, and for some children, the lack of that element in a small school can be a real problem. But smaller schools can provide a real family atmosphere in which there is individual attention for children, and in which the children look out for each other across the age ranges.

Larger schools can and do select the ablest pupils to take part in concerts, sports and shows – small schools typically find a role for every child in every event.

Small schools tend to get more support from parents, grandparents and friends at their events. There is a much more real sense of 'ownership' by the community. A turnout of 20% at the annual meeting with governors would be considered good by many larger schools; less than 80% at many small schools would be seen as very poor.

There is no necessary reason why the educational experience provided in a small school should be any better, or any worse, than that provided in a larger school; but it will be very different. The quality of leadership is probably the most important factor governing success or failure, not the size.

That brings us back to the one factor which is indisputably different between small and large schools – the cost per head. From this report, as from so many other new stories in recent years, it is hard to escape the fact that, whatever politicians say about the quality of the educational experience, the real driver behind the move to fewer, larger schools is financial. And no-one should be surprised that, when they realise this, communities feel that the community benefits of retaining the schools make it a price worth paying.