Something to talk about...

In 1942 Beveridge's report concluded that the State "should not stifle incentive, opportunity, responsibility".

Now, in the 70th anniversary year, we see welfare recipients saying"We're taking advantage of the system, but that's the system's fault – It's ridiculous, but I'm better off volunteering than earning – we're well off and I'm not going to give that up until I have to"

How relevant are Beveridge's concerns today?

So long The Boy Phelan, hello Manchester Liberal

Its been five fun filled years but a man in his 30s shouldn't be calling himself a boy anymore.

Hence the new blog. If you didn't think The Boy Phelan was a total waste of time, come and join me at Manchester Liberal.

Conservative, liberal, and all the rest

Out of the mouths of Vulcans

One of the great things about sites like Facebook is that every now and then a half forgotten name from the past pops into your head, you rattle it into the search box and up they pop. It can be fascinating and enjoyable to see what someones journey through life has been since it diverged from yours.

So I was happy to see an old friend of mine from university called Gordon on there, someone I'd not seen in ten years. He seemed to have a wife and kids, stuff we'd talked about back when it was in the distant future.

He and his girlfriend Tess were American exchange students at Swansea University. Me and Gordon got on incredibly well. We hung around together, travelled to Ireland together and he came to stay at my parents.

Gordon was a pretty political guy. I suppose he was fairly left wing by American standards which is to say not very by British standards. It was from him, a gun owner and recreational shooter, and not Charlton Heston, that I first heard the phrase "From my cold, dead hand" But he supported the rights of any group you care to name; gays, African-Americans, Native Americans, 'diversity' was his watchword.

So when I sent him an email saying hi and asking how he was I was dismayed to get this reply

"Things are good! Thanks. I read some of your writings and, well, have a nice life. I hope the whole conservative thing works out for you"

When he'd finished typing he blocked me. Apparently Gordon's support for diversity stops short of people's politics. That is a diversity too far.

I think that's sad. Beyond having the memory of a nice guy and friend tainted he isn't even right; like Margaret Thatcher's idol Freidrich von Hayek, I am not a conservative. I'm a liberal.

I don't mean that in the sense that it is used in America where it has become a term for what, in Europe, we would call social democrats. I mean it in the original, enlightenment sense, of being a believer in the sovereignty of the individual.

This is why I am not a conservative. There are still very many areas where the scope for free people to pursue their welfare and that of others, to map out their own paths and define their own destinies is hobbled. I do not want to conserve this.

So much for semantics. The real sadness here is a lost friendship. And for what? Because he didn't like my politics? Many don't. I don't like theirs.

But there is more to each of us than that. Human beings are deep, complex, fascinating creatures. There is more to each of us than our politics, our social class, our nationality, religion, race or sports team. As the Vulcans had it, 'Infinite Diversity in Infinite Combinations'

So there are few more depressing trends in the world today than that of sticking labels on each other. 'conservative' or 'liberal', 'rich' or 'poor', 'Christian' or 'Muslim', all of these may be partly true for some of us but are never wholly true for any of us. We are all more complex than that with more identities. To boil us down to this label or that label strips us of the rich variety of our humanity. It is debasing and dehumanising.

In large part this accounts for the increasingly divisive and bitter tone that public debate is conducted in. I'm guilty of it myself from time to time.

So in losing, or not regaining, a friendship with Gordon, I have not lost some leftie Democrat. I have lost a guy who came to see me in the plays I was in, who I introduced to Newcastle Brown Ale and who I spent long hours with discussing the novel I wonder if he wrote. I lost a guy I liked just because my politics were different from his.

As for my friend Tess, well, she's better off with her new guy. He's a lovely chap, a dyed in the wool Democrat, but we get on because there is more to us than our political views. We are all human beings. Which ever box you tick on election day, that remains our inalienable common ground.

The rise and fall of Occupy London

No, you're not

One night last week the BBC news ran an item about the Tobin Tax on financial transactions. An economist bobbed his head up and down speaking rather earnestly about why it would be damaging. Then something extraordinary happened; the report cut to a rather nondescript person standing at the Occupy LSX camp outside St Pauls Cathedral who maintained that it definitely would be a good idea.

Why, I wondered, were they giving a few dozen oiks* like this a national platform? Why not drag someone out of the Dog and Duck and ask them? I felt like Jacobin Mugatu in Zoolander when confronted with Blue Steel; “I feel like I’m taking crazy pills!”.

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* Substituted by the editor for the original 'drug addicts'

Public sector strikes: Unaffordable and unfair

Hands off my wages

And so the world keeps turning. An estimated two million public sector workers have gone on strike and the nation has kept ticking along.

The false argument about public sector pensions is put rather well by this which is going round on Facebook

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The late, occasionally great, Ken Russell

The 1960s ‘Harry Palmer’ spy films starring Michael Caine were intended as the antithesis of James Bond. They were downbeat, gritty, and realistic. The first in the series, ‘The Ipcress File’ (1965), opened with Palmer fumbling for his horn rimmed specs and sleepily making coffee. Then Ken Russell, who died yesterday aged 84, was hired to direct the third instalment, ‘Billion Dollar Brain’ (1967).

Perhaps the producers were attracted by Russell’s intellectual cache and documentary film background. He made his name with a string of films he produced in the 1960s for ‘Monitor’, the BBC’s arts show. In themes he would return to in his films Russell’s finest television work focused on artists. His documentary on Edward Elgar (1962) was more than a simple biography with some musical clips. By setting up shots and scenes and using Elgar’s symphonies almost as incidental music Russell placed the composer squarely in his time and setting. It was as much an evocation of the high noon of Imperial Britain as a documentary about Elgar.

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Versus: Death of the Author

The late Roland Barthes

Holly Steell: The Death of the Author by Roland Barthes was published in 1967, and in this controversial essay he criticises the tradition of interpreting text through the author’s history, personal views and actions.

Barthes argues that the text is not the sole product of the author, but rather it is the sum of society – every sentence is the quotation of a previous work and the author merely the channel it is expressed through; they are the “Scriptor”, not the creator.

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What's holding the British economy back? Debt, debt, and more debt

Maxed out

Last week the coalition government was hit with a combination punch of bad economic news. On the same day unemployment was upand the Bank of England’s growth forecasts were down.

Labour were quick to point the finger. Shadow Chancellor Ed Balls said “The British economic recovery was choked off well before the instability in the last few months in the eurozone...The government is cutting too far and too fast and it’s pushing borrowing and unemployment up at the same time”

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Maggie, Maggie, Maggie!

Four more years

According to an old joke a dancefloor will have to built over Margaret Thatcher's grave to accomodate the vast number of people who plan to dance on it.

Perhaps not. I've looked before at how such a hated and unpopular leader, for so we are often told she was, could have won every general election she fought.

This weekend saw further evidence that hatred of Thatcher id neither so widespread nor so deep as those who really do hate her would have you believe. A YouGov poll for The Sunday Times placed her firmly at the top of a list of post war British prime ministers with a whopping 27%, more even than Winston Churchill. The sainted Clement Atlee, architect of the welfare state, overseer of the NHS, and nationaliser of industries, limped home with just 5% of the vote behind Tony Blair and, mysteriously, Harold Wilson.

This is not to say that some people do not hate Margaret Thatcher ver much but they are not so numerous as they would have you think. They may need that dancefloor, albeit a smaller one than they expect, and the DJ might be playing 'Dancing With Myself'.

Cameron faces a fight on two fronts against Germany's Merkel

Watch out for those Prussians on the left!

It has become a terrible cliché to discuss Anglo-German relations using World War Two metaphors. But as David Cameron advanced on Berlin for a showdown with Angela Merkel on Friday other military antecedents sprung to mind.

Cameron is fighting Merkel on two fronts. First, he is attempting to resist the tax on financial transactions which the European Union wants to introduce. And so he should. The tax, which is supposed to fund future Eurozone bailouts, will get an estimated 80 percent of its take from the City of London.

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Monetarism: what it is and what it isn't

On last week’s Question Time two people in the audience angrily condemned the “monetarist” policies apparently being pursued by the British and German governments. I groaned. It seems that the only people who use the phrases ‘monetarist’ or ‘monetarism’ anymore are people who haven’t got a clue what they mean.

Monetarism was at its height around thirty years ago. With double digit inflation in Britain, the United States and elsewhere and the failure of Keynesian policies to deal with it (indeed, they were the cause of it) the search was on for a set of policies which would. As the chaos grew in the late 1970s many fixed on monetarism as the answer. It went where few economic theories had gone before; debated in Parliament, the front pages of national newspapers and TV current affairs shows. Rarely has a reasonably technically involved economic concept achieved such widespread discussion among non-economists.

Though it had roots deep in the history of economic thought monetarism was popularized in the 1970s by Milton Friedman, a Nobel Prize winning economist from Chicago University. Friedman was on a roll at the time. In the 1950s he had argued for floating exchange rates and in the 1970s these had come about. In 1968 he had predicted the breakdown of the Phillips Curve relationship between unemployment and inflation and, again, in the 1970s this had come about.

His theory was really very simple and was based around one of the oldest and one of the very few useful equations in economics, the equation of exchange

MV = PT
Here M stands for the amount of money in an economy and V stands for velocity of circulation, how many times in a given period a unit of currency is spent. Thus, if M was, say, £50 and V was 3 then MV would equal £150 which would be the total amount of spending in that economy in that given period.

P stands for the price level, a statistical aggregate of prices in the economy like the inflation figure reported monthly in newspapers. T stands for the real value of aggregate transactions in the economy in a given period. If that sounds like a slippery concept don’t worry, Freidman swapped it for y, or income in the economy in a given period to give a refined equation

MV = Py
So far we have a truism, an equation which is true by its very definition. It simply says that spending (MV) will equal income (Py) in the economy in the given period which, when you think about it, is obvious.

Freidman took the truism and made it into a theory by holding V and y constant. V would depend on people’s habits which would change little over the short and medium term. Y was fixed by the economy’s capacity; given a set amount of capital and labour in the economy in a given period production could not be expanded in the short and medium term.

The conclusion that followed utterly logically from this was that increases in P, the very inflation which was plaguing economies, must have been caused by increases in M. Indeed, in his mammoth 1963 book ‘A Monetary History of the United States 1867 – 1960’ (written with Anna J Schwartz) Freidman claimed to have conclusive empirical proof of this theory.

The policy prescription that followed was equally utterly logical; if you wanted to lower and control inflation you had to lower and control increases in the money supply. Freidman argued that the aim should be for price stability, that the money supply should grow at a fixed, pre announced rate which would be calculated to match the trend growth rate of the economy.

That, and nothing else, was monetarism. Its supporters might have argued for and its practitioners might have enacted a raft of other policies such as lower taxes, lower public spending and privatization which could crudely be labeled ‘right wing’ but these were not part of monetarism which was a narrow theory of monetary management. It would have been perfectly possible for a left wing government to have raised taxes, raised spending and nationalized and still committed itself to monetarism.

And plainly not Britain, Germany, nor anyone else today is even following anything which could be called a monetarist economic policy. Monetarism prescribed control of the money supply to control inflation; it said nothing about interest rates which it left to the market. By contrast Britain and the German controlled European Central Bank follow the monetary management method which replaced monetarism when it fell out of favour towards the end of the 1980s. Nowadays the control of interest rates is the chosen tool in the fight against inflation. It is the money supply, central to monetarism, which is left to the market.

This isn’t necessarily to praise monetarism or even to bury it. It is simply to wash off of it some of the mud thrown at other ideas.

From Miliband and Balls to Osborne: riding our luck in the bond market

Only the second most dangerous type of Bond there is

String theory posits the possibility of multiple universes exiting at the same time and in the same space. Economically we saw a little of that last week.

In London a few thousand students and professional protestors marched against the government’s plans to make them pay more towards their education.

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Protesting is soooooooooooooo last year

Put an X in any of the many empty spaces where you think a protestor was and send your coupon to...

Late last year some students, many of whom turned out to be rather plummy middle class kids, decided it would be larks to smash up bits of London to register their annoyance at having to pay for a service they were using.

Today saw students take to London's streets again. But, perhaps because the news that universities are cutting tuition fees to compete on costs suggests the coalition's policy is working as they said, only 2,500 are estimated to have turned out. Rather embarrassingly for the revolutionaries this dismally small gathering, nearly 2,000 fewer than saw Yeovil vs Walsall in the Third Division a couple of weeks ago, was outnumbered by the Police.

That's the thing about fashions, whether for leg warmers or protests. They're fickle.

More regulation is not a good thing

Courtesy of the Financial Times

A common interpretation of the credit crunch and ensuing global turmoil is that it was all down to unregulated or under-regulated financial institutions and markets. As a result, one of the most commonly advanced solutions is for more and/or better regulation. Indeed, this call is about as close as we get to a firm demand from the presently fashionable ‘occupy’ protests.

There are many things wrong with this view. First, the underlying causes of the recent boom and bust could be found, as so often, in monetary disturbances. In comparison to the damage wrought by a deluge of credit, any regulatory deficiencies are just hundreds and thousands atop a cake that was always going to turn out pretty sour.

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The European Union would have Pericles turning in his grave

Lo, all their pomp and circumstance...

“We have a form of government not fetched by imitation from the laws of our neighbouring states - nay, we are rather a pattern to others, than they to us - which, because in the administration it hath respect not to a few but to the multitude, is called a democracy”

Pericles spoke those words in 430 BC, at the end of the first year of the Peloponnesian War. In his famous funeral oration he commemorated the men of Athens who had died defending their democracy from the military dictatorship of Sparta, and reaffirmed what they had died for.

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Clerically clueless - The Church and the protestors

It is difficult to understand quite what protestors expected to happen when they tried to ‘occupy’ the London Stock Exchange a couple of weeks ago. Firstly, it’s a pretty well used building already so is in little need of further ‘occupation’. Secondly, it’s a privately owned building. Even Britain’s supine Police force was unlikely to allow a well advertised act of breaking and entering to take place.

So the protest was rather silly from the off. But as they kicked their heels outside the stock exchange the protestors knew enough to know that they would get a warm welcome from the Church of England, an institution which has become rather silly itself.

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EU referendum and the political class

"This guy cracks me up"

Poor old Gerald Ford was derided for, apparently, being unable to walk and chew gum at the same time. But today’s front rank (sic) British politicians are open about their inability to do two things at once.

As momentum grew in the Conservative parliamentary party for a referendum on membership of the ailing European Union, David Cameron and Ed Miliband both said that to hold one would be a “distraction” from the more pressing business of saving the euro.

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Dirty Hari

“Uh huh, I know what you’re thinking; you’re thinking does this article contain six lies or only five?”

Drowned out by Hackgate this summer was another spectacular story of media self-immolation. Johann Hari, columnist at the Independent, winner of the prestigious Orwell Prize, regular on Newsnight Review, and darling of the left was caught stuffing his columns with lies.

It began in June when a blogger noticed that some of the quotes given by Hari’s interviewees were identical to quotes which had previously appeared in those interviewees published works. Hari defended the charge, saying that “When you interview a writer – especially but not only when English isn’t their first language – they will sometimes make a point that sounds clear when you hear it, but turns out to be incomprehensible or confusing on the page. In those instances, I have sometimes substituted a passage they have written or said more clearly elsewhere on the same subject for what they said to me so the reader understands their point as clearly as possible” He called any allegation of plagiarism “totally false”

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No more Solyndras: time for the sun to go down on public spending

$535 million
Whenever I watch Dragon’s Den (Shark Tank to readers in the United States) and I see some entrepreneur waking away with £50,000 in his pocket I try and come up with my own ‘Dragon’s Den idea’.

I wonder how far I’d get if I turned up and said “I want $535 billion and I’ll go bust in two years”? I might not get too far with Duncan Bannatyne, but if I was pitching to Steven Chu, Barack Obama’s Energy Secretary, I might be in with a shot.

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The Tea Party and the Occupy Movement: two sides of the same coin but only the former really gets it

That is, like, soooooooo Tea Party

My mother always used to tell me that what was sauce for the goose was sauce for the gander. Apparently not. Many of the same people who get swivel eyed about Tea Party rallies are running out of laudatory epithets for the various ‘Occupy’ protests.

Back in January it only took a pair of crosshairs on a web page for New York Times columnist Paul Krugman to deduce that the Tea Party were behind the horrific shooting of Gabrielle Giffords.

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