Vir Cantium

I'm right, you know …

Monthly Archives: October 2011

How To Get The Right & Bob Crow on the Same Side #EU #PeoplesPledge

Tomorrow’s vote will change nothing and we will not get a referendum on our EU membership this side of 2016.

Well, that was stating the blinking obvious I admit; it’s a non-binding vote even if enough MPs had the principles and minerals to vote for it. The debate is significant though, as it will be the first time that there will be a serious debate on the principle of a referendum on our membership of the EU which will draw in the PM and Foreign Secretary.

It will also be a useful albeit small step on the road to a referendum and, hopefully, our exit from the EU (or, as Europhile referendum supporters like Keith Vaz would put it, ‘settle the issue once and for all’ in the hope of staying in). We will be able to name names and see just how sound our MPs are.

It will also enable us to carry out that exercise on MPs on both sides of the house. One refreshing aspect of yesterday’s ‘People’s Pledge’ event was the genuine cross party involvement (by which I don’t mean another session of UKIP vs. Tory back-biting) and for a rightie like me it was particularly enlightening to hear the case put from a left-wing perspective alongside those of my own political persuasion. Indeed, I didn’t stay for the Conservative panel’s session; if I wanted to hear right-wingers banging on about Europe I could just talk to myself go to a Bruges Group meeting.

It takes some doing to get the likes of the RMT (one of the anti-EU unions) and Dan Hannan to agree, but the arrogance of Cameron and Miliband have achieved it. Ed Miliband might be siding with David Cameron in calling the pro-referendum campaigners ‘barking’, but he should remember that Britain is a nation of dog lovers. His own party membership’s views on a referendum are close to the Conservatives with over half supporting it.

Frankly the news I found most disconcerting in recent months was not Cameron’s three line whip on tomorrow’s vote (sadly I was unsurprised by such Heathite behaviour), but Ed Miliband’s ruling out a referendum being in the next Labour manifesto – I suspect that, given Cameron’s self-survival instinct, such a pledge could tip the balance and force the Conservatives to match Ed’s bid or risk serious in-fighting 1992-style. Of course, given that Labour’s half-baked promise ‘to increase tuition fees but just not by as much as those nasty Tories’ was openly admitted to be unlikely to survive until 2015, there may still be some cause for hope.

For once only I shall say, “more power to Bob Crow’s elbow!”

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The 1% that Capitalists and Occupiers Agree On … Sort of

Two camps (metaphorically speaking, in one case) like the free market capitalists and OccupyLondon/Wall Street are unlikely to agree on anything. Diametrically opposed views on the nature of profit, business, property, the Rule of Law, and campaigning methods make it surprising that, regarding one particular issue surrounding the banking system, the two sides actually agree. That is, that the taxpayers’ bailout of the failing banks was wrong.

Soviet propaganda poster

You say "Resource Based Economy", I say "Communism Redux"

Even on this single point, though, the differences are clearly visible. It’s like looking at a sheet of paper edge-on, move just slightly left or right and you see it has quite different pictures drawn on each side.

Free marketeers opposed the bailouts on the grounds that such institutions, badly managed and destined for failure, should have been allowed to fail (though I suspect many might accept the case for some depositor protection). We would point out that those banks were not the sole cause of their own demise; irresponsible lending means irresponsible borrowing (by both individuals and states), and government played its own part in other ways too. However, bailing out a failing bank should be as much an anathema as keeping open uneconomic coal mines, or indeed propping up any other business; it is unsustainable. Iceland is frequently now being cited as a positive outcome to a refusal to flog the bank’s dead horse.

As for the Occupiers, any attempt to summarise their political wishes must be qualified by that fact that, typically, they are but a loose collection of vaguely coinciding viewpoints, and that’s when you can find any with a remotely clear idea of an ‘alternative’.

Some talk of a ‘Resourced Based Economy’ (16 min. video here, if you fancy a laugh) with it’s global resource system, central distribution points and central planning of, well, everything, is making the classic mistake of all collectivists. Such communal living may work within a household, cathedral courtyard or kibbutz, but the more you try to scale up such ideas, the more diverse and dispirate become the needs and aspirations of the participants, and so the system – in the absence of coercion and force – breaks down.

Even so, it’s probably fair to say that a general dissatisfaction does exist with ‘the current system’ stemming, in part, from an apparent lack of control over the banks, ‘excessive’ profits, bonuses, and lack of sharing the wealth. The solution implied by the Occupiers as regards banking would be to nationalise the banks (or subjecting them to such stifling state control that the effect would be much the same).

So while neither side is happy with the bailouts, free marketeers’ discontent is that the bailouts happened at all, whereas Occupiers would rather the government had gone the whole way and nationalised the entire sector.

So much for a ‘new’ system; it seems Occupiers simply want to try good old Communism again, and ignore the lessons of history. Those of us of an Austrian economic persuasion are still hoping for the first sighting of some genuine capitalism, instead of the various degrees of corporatism which the Left mistake for it.

Local Government Pensions: People in Glass Houses Shouldn’t Use Trebuchets

The Daily Mail (which I would point out is not my newspaper of choice) has got the Left worked up over a claim they repeated again yesterday.

Taxpayers had to find almost £6billion to maintain the pensions official accounts show – a sum that swallowed up nearly 28% of the council tax collected

This has upset the ironically named* public sector campaign group The Campaign for Pensions Justice.

Oh dear! The 25 per cent council tax fallacy is back

[…]

Readers are no doubt meant to think that councils are now spending more than a quarter of their funds on pensions every year.

But this is a trick.

Nice wickerwork on that straw man there!

Councils do not just get money from council tax-payers. They also get a business rate from local companies and income from charges such as parking charges and fines. But their biggest source of income – at least for most – is income from central government. These together pay for council spending – a big part of which will be on staff costs given that much of what councils do is pretty labour intensive.

OK, the article simply says that £6bn is equivalent to 28% of council tax. The CPJ aren’t denying this, or maybe they are, given the title of their blog post. Anyway, the implication could equally be that without that £6bn (an unlikely situation, granted) council tax would be reduced by 28%. Also true.

Unfortunately the CPJ aren’t too careful with their own facts. Councils don’t ‘get’ business rates; they collect the rates, which are then remitted to the government, who then redistribute that money around the country. Some councils do well out of the deal, some not. The system is due to change soon, but it’s a bit rich for the CPJ to criticise the Daily Mail for a lack of precision with the facts.

However, all this is trivial compared to the hypocrisy of the Left in making some of their own claims on the subject of the Local Government Pension Scheme (LGPS), which are far more misleading than the Daily Mail piece. Let’s look at just the first point from here:
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How the Council Tax Freeze Could Become to a Quick Thaw

Among the (intentional) headline-grabbers at last week’s Conservative Party Conference was the underwhelming news of the council tax freeze being extended for a second year; news that had been known to local councillors and council officers for some months already.

Puddle

Council tax freeze ... and for next year?

However, it now seems that all was not quite what it seemed, and that the announcement is indeed a surprise to local government, and not in a good way.

The nasty surprise was tucked away, as they so often are, in the smallprint, in the notes at the bottom of the Treasury’s media release.

If an authority sets its basic amount of council tax (i.e. its Band D council tax) in 2012-13 at a level which is no more than its basic amount of council tax in 2011-12, it will receive a one-off grant equivalent to a 2.5 per cent increase.

Did you spot it? “One-off grant” – words so inoccuous they passed by deadline-watching journos.

“So what?”, you may ask. It means, quite simply, that the residents of any council taking advantage of the extra money to freeze their council tax could be facing a stinging double hike in the tax in 2013. Let me explain….

This current year’s freeze was funded by money that was given as an increase in the annual (recurring) grant to councils. This makes sense, since council tax is a recurring annual revenue stream. It would be like someone saying they’ll protect you from next year’s increase in your fuel bills by paying you an ongoing regular annual income equivalent to the increase in next year’s costs.

Now suppose someone made that same promise, but to do it they would give you a pile of cash equal to the extra costs next year, but that was it. For that next year, all would be well. The following year, though, you would still face not only the higher prices from the year just gone (which had been offset by that pile of cash), but also the following year’s increase. While you have been protected from the increase in year one, you now face a double whammy because the gift only lasted for that one year. All that it has done is put off the inevitable, so now you have to pay for both increases at the same time.

And so it has turned out to be with the money for the second year’s council tax freeze. Like this year, it will be paid to councils bringing their budgeted increases to 2.5% or less, but if they want to avoid the ‘bounce-back’ in council tax next year, they actually will have to cut their budgets to a 0% increase anyway, before getting the grant.

As a proponent of low taxation, I don’t necessarily see that as a bad thing. However, Osborne and Pickles are playing the same media game as Labour by suggesting that the freeze has been extended for another year when, in fact, all that is being offered to councils is a reward grant for keeping the tax down, by their own devices, for a second year running.

Perhaps more damning, it is the sort of faux-localism which was so beloved of Labour, complete with the moral blackmail of raising the public’s expectations.

I’ve nothing against tax cuts – one form of fiscal stimulus that actually works – put please, Eric Pickles, call a spade a spade; it’s what northerners are meant to be renowned for isn’t it?

It’s the Conference Freebie Generation Game

So I’m back from Manchester. It will probably be my last party conference, partly for the reasons covered by Tim Montgomerie over at ConHome. I’ll blog more about that in the next couple of days.

However, on a lighter note, one thing that does make conference a little more worthwhile (and helps to placate Mrs C on my return) is the haul of free stuff that the more experienced conference-goer can amass. This something that I suspect applies to all the major conferences (perhaps my UKIP friends can compare with the experience at their own – ahem – more intimate bash). This year was particularly good, making the inventory sound like that old TV standard the Generation Game:

A cuddly toy. Not a freebie.

  • A pen that lights up when you write
  • A pencil (that doesn’t)
  • Two alternative lanyards: one Boris and one NASUWT – guess which one got worn
  • A large fridge-magnetic/clip
  • A pack of travel tissues
  • A couple of small notepads
  • A security pass ‘yo-yo’ clip
  • A couple of rubbers, for the children of course (stop looking so shocked, you septics, and learn proper English)
  • An LED mini torch key-ring
  • A yo-yo
  • A pound coin substitute key-ring (for shopping trolleys)
  • An LED imitation tea-light candle
  • A mini-football launcher/catcher game
  • A chunky ruler
  • A solar-powered calculator with transparent keypad
  • Blueberry muffins (still sealed – aren’t I good?)
  • Various biscuits (ditto)
  • Some chocolate (errm…)
  • A kite. Yes, a proper kite.
  • A sturdy canvas bag.
  • A cuddly toy

Comments about free-loading politicians in the usual place, please.

“OK, but…” – Yes, It’s a George Osborne Speech #cpc11

In to the conference hall (my customary no-more-than-one visit to that glorified media briefing) to hear George Osborne’s contribution. It was a good speech from a technical point of view; it had a few jokes and he said what need to be said (S&P today reaffirming the UK’s AAA credit rating).

The Party has also learned a lesson from New Labour: that reannouncements work, as the morning’s headlines testified. Those in local government had it confirmed some time ago that the second year of the concil tax freeze was on, and so Labour were right that it was nothing new … but such details never stopped them when in government.

The interesting stuff was the small business ‘credit easing’ (is that a recognised term?) and the reigning back on the carbon emissions targets. The latter might also have the happy outcome of cheesing off Chris Huhne; as it was no doubt meant to, to keep us polar bear barbecuing right-wingers happy.

Yet just as with the Chancellor’s major parliamentary statements, such as the budget, the announcements among the cynical old timers could only lead to a muted “OK, good, but …”.

On small business lending, the banks are not avoiding lending because they can’t be bothered to take the time out from counting their bonuses and toasting their saviour Gordon Brown. Banks are nervous, quite probably over-cautious, and are looking to rebuild balance sheets and minimise the effects of any existing toxic debt. Presumably Osborne’s scheme, one way or another, will involve the government intervening in lending decisions (either by the banks or markets at large). Will they have available some secret font of wisdom as to whether businesses are being denied credit by a nervous bank, or if they are genuinely bad risks; be it because of poor management, business potential or more quantifiable matters such as collateral?

Having avoided the temptations of unfunded fiscal stimulus, an infrastructure bank or more direct means of forcing banks to lend, he must not, even unwittingly, spark the creation of another credit bubble.

Then we have the scaling back of the carbon emissions targets. Again, good on the face of it, but the acid test will be what effect it has on the climate change levy, fuel duties, feed-in-tariffs and carbon reduction commitment mechanisms, all of which are adding to living costs in the name of fighting climate change, sometimes with the most tenuous of justifications.

OK, that’ll do for now, back to the fringe guide to find something to eat before the Boris rally tonight.

To Manchester …

… to discover whether there really are Mancunians this thick.

Anyway blogging will be light / sporadic / concise, but if you’re really interested you can follow me on Twitter.

Ta-ra!