The Labour Party has played a blinder in now supporting ‘a’ customs union solution for leaving the EU. Pro Remain campaigners have railed in frustration as Corbyn dragged his feet on this issue or the option of staying within the Single Market. They feared he saw the EU as a capitalist conspiracy and never really wanted to be a member in the first place.

They are probably right but pressure within the Party, combined more importantly with the raw politics of causing the Tories maximum damage, has won out. Perfectly timed, the Tories yet again find themselves in disarray and Thursday’s Chequers meeting to thrash out an agreed stance all looks a long time ago.

Of course, this manoeuvre by Labour was easily predictable but flat-footed Tories torn between their extremities are powerless to swerve out of its way. It is a bit rich for them to respond by saying Labour ‘are playing with our country’s future’!

So what happens now? The EU may of course reject Labour’s proposal immediately on a take it or leave it basis – no bespoke deals – but that would be bad politics from a divide and rule perspective.

There will be a vote in the Commons on remaining within a customs union in the next couple of months, probably April. The scenarios are endless. Labour must back a cross-party motion to get enough Tories on board to defeat the Government. Even Sinn Fein may take up their seats in Parliament to ensure this defeat.

Theresa May could of course make it a Confidence vote; but she should be careful. So disgusted are moderate Tories at the willingness of their right-wing colleagues to abandon the Good Friday Agreement (all related to ensuring a frictionless Irish border between North and South, resolved only by a customs union) that they may let the Government fall.

The Tories’ obsession with Europe has been their Achilles heel for decades, worthy of the great historical debates of the 19th Century. Perhaps they can only prosper in Opposition with a new generation of leaders who do not have to define themselves by their stance on Europe. How did we get here? Ask the European Research Group led by Rees-Mogg… but a few disastrous years of a Labour Government may have to be the price paid for a long term, credible Conservative Party, to emerge.

Oh dear, where have they gone? Representing most of what is sensible in centre, centre left politics, the Liberal Democrats were meant to surge as standard bearers of voters appalled by Brexit and the Tories’ hard line stance on how we depart. But they have flat lined in opinion polls at 7-8%. Why?

Three reasons. First, and foremost, in a polarised world, their weak tone simply doesn’t resonate with voters. Generally anyone interested in politics is angry; angry we are leaving the EU, angry about the compromises being made on the terms of our departure, angry about cuts. The Liberal Democrats simply bore for Britain, and not in a good way.

Second, Vince Cable doesn’t have the energy or charisma to shape debates and none of the other MPs are making any impact either. His leadership also comes hard on the heels of a previous leader with bizarre religious conflicts surrounding homosexuality. You couldn’t write the script about such confusion in such a small political space…

Third, they have lost their PMQ slot, compounding a sense of irrelevance and are losing airtime generally on programmes such as BBC’s Question Time where they often don’t appear, replaced, outrageously, by the Nigel Farage’s of this world (32 slots and counting), and even intentional comedians.

The 2010-15 period for many represented the perfect blend of Conservatism tempered by the Liberal Democrats; fiscal conservatism, social liberalism and pro-European leadership. They were heady days for moderate Tories if not for Liberal Democrat voters who felt betrayed on issues such as tuition fees. So here is an idea for you…

If the current Conservative government supported allegedly by a mere 70,000 Tory Party members continues to inflict damage on the country’s future, why don’t moderate Tories take over and re-brand the Liberal Democrats? They could strengthen its economic stance on government expenditure a la Nick Clegg and David Laws whilst pursuing a pro-EU, social liberal agenda. It would save the high risk option of setting up a new party and meet the demands of the vast majority of centrist voters. Potentially highly attractive to disenfranchised, moderate Labour MPs and their supporters too…

Umm…just a thought…just a thought…

The view through the window doesn’t look good. There are no votes in prisons and the conditions in which prisoners are held is deteriorating. And yet, our justice system and the way we treat offenders, often hidden from public view, is a crucial reflection of how civilised a society we are. And even for those who don’t care, better prisons mean less re-offending and genuine cost savings.

So where are we today? The prison estate is crumbling as real cuts bite to the bone. Add this to the list which includes social care, policing and local authority services generally. The pressures on prisons are exacerbated by rising numbers of prisoners, partly driven by the roundup of sexual offenders, harsher sentencing, so called ‘legal highs’ and falling prison officers.

A few facts from the Prison Reform Trust make startling reading. 68% of prisons are overcrowded with 21,000 prisoners still sharing cells for up to 23 hours a day. We have the highest imprisonment rate in Western Europe with 66,000 jailed in the year to June 2017. Yet 71% had committed a non-violent offence and 47% were sentenced to serve six months or less. Nearly 49% of adults are reconvicted within one year of release with an estimated cost to the economy of between £9.5-13 billion annually. Prison officers have fallen 23% in the last seven years whilst the prison population has risen. Assaults on staff across Britain’s 140 prisons rose by 143% in the last 4 years.

The latest report from HM Chief Inspector of Prisons for England and Wales (and the people who fill this role are no soft touch) highlighted that the percentage of male prisoners held in good or reasonably good conditions has fallen from 78% to 49%. One could go on…

The solution partly lies in new prisons. They are being built but will have no impact on overcrowding until 2022 and, at the current rate of incarceration, a new programme will be needed from 2026. More prison officers are also required (a rapid recruitment drive is on after a realisation the fall in numbers has been disastrous but there is much further to go).

But what we really need to do is jail less people and of course review all those prisoners on shameful indeterminate sentences. Community sentencing is more effective than short prison terms at reducing reoffending, yet its use has nearly halved in the last decade. More of the former please.

Sorting out our jails and sentencing generally strengthens our society and at the same time actually saves money over the longer term. Of all the problems facing this country, this issue actually has identifiable solutions which can be implemented by even this current crop of politicians.

So Trump has spoken and his State of the Union Address wasn’t too bad. In fact it was quite good. Moderate in parts and optimistic in tone, his firm and sometimes dark beliefs were cloaked in unifying words. He stuck to his teleprompter and it worked. The immediate opinion polls were positive. The BBC called him the pugilist President. He would be pleased with that…

We await his next tweet barrage with glee but what if it doesn’t come? What if Trump  acquires a taste for broader popularity?

Let’s look at his record to date and then his speech. After a terrible start with too many mistakes to mention and wild invective, a powering economy and stock market with a record tax cut (the disastrous consequences will take time to arrive) are providing a major boost. It is the economy stupid even if Barack Obama should take the real credit for its current performance.

In his speech he boasted of record low African American unemployment, wants a deal for Dreamers (children of illegal immigrants) but not all family members and is tough on terrorism, drugs and gangs. Keeping Guantanamo open is hardly a vote loser and even the nonsensical Mexican wall which will now be paid for by the US (almost certainly courtesy of the Democrats…) keeps his core base happy. His commitment to infrastructure strikes a chord too.

The Democrats’ response? Churlishly sitting on their hands at too many points of his speech, hand wringing over immigration, not seeing that the game has changed… just look at Brexit and Europe as a whole driven to a frenzy by too much immigration. They could only find a Kennedy to respond averagely. Talk about back to the future…

The Democrats still don’t understand why Trump won the election and still have nothing to say to his core base. Egged on by a largely liberal media, they are too shrill and partisan in their opposition. Torn between the Left and centrists, they have no new alternative agenda and no leading light yet to seize a new presidential mantle. The Democrats should treat Trump more cleverly, embracing some of his more palatable initiatives. Hug your enemy close. If he blows up as they are so certain he will, then they will look magnanimous in victory.

Many issues may (hopefully) derail Trump but if he gets remotely clever, he will have the current Democratic opposition on the ropes. Those November midterm elections seem along way a way…

 

You couldn’t write the script. A bunch of fabulously wealthy elites arriving by private jet to a luxury mountain resort to discuss…the inequities of capitalism…To add insult to injury, Donald Trump is wrapping up the session. Pandering to his POTUS role, they seem to have developed amnesia towards his recent tax bill which slashes corporation tax, rewards the individually better off and inflates the deficit leaving less money to help ease what…oh yes, the inequities of capitalism…

Most sensible people know free markets work and the State should be a facilitator and only a part contributor, aiming to provide equality of opportunity and protecting those who simply can’t manage on their own.

But to limit the role of the State, the rules of economic engagement must be applied equally and they are not currently. The richer you are, the more you can avoid paying tax (global corporations for example, well represented at Davos…). Add to that executive greed, frequently found in privatised industries, exposure to rising property prices and stock markets, all under the scrutiny of social media, and you have a toxic mix that allows the rich to get richer, in full visibility of the ordinary voter.

Making capitalism work fairly involves corporations paying fair taxes globally; executive remuneration based on long term incentives for wealth creation, and the State not over-promising in its role as facilitator and contributor to investment whether it be infrastructure, health care, education, to name but a few services.

The solutions lie partly in active corporate governance. Owners of our pension funds for example need to act in a wider capacity than simply short term gain because in the longer run, it benefits us all. Privatised industries need their monopolies breaking up. Public services under strain also don’t need the exaggerated claims of competing political visions but genuine reform driven by cross-party consensus. There is always a role for government but just think, for example, how valuable free markets are in the area of the environment, where competing firms are driving hugely beneficial technological developments.

When we talk about capitalism and free markets, we really mean a mixed economy. If the tilt is to be away from an ever growing State, the Davos crowd need to step up to the plate and make a few expensive sacrifices. If there is acknowledgement that this is necessary, then through the snow blizzards, you might just see evidence that the system is working…

This has not been a good week for the private sector generally and the role of privatisation in particular. Carillion was apparently a disaster waiting to happen. Its collapse has left a range of public services and smaller company suppliers under threat. Then the Secretary of State for Transport has rescued train operators from East Coast rail franchise terms they willingly signed up to. The political fallout provides further support to the depressing narrative from Corbyn and his team that only state control of public services works.

Can you really imagine the inept Labour frontbench grabbing power over a range of privatised companies and running services better? The collapse of Carillion at least goes to show that civil servants and ministers simply don’t have the skills to oversee complex companies let alone run their services from scratch.

There is a further, long-term narrative from all this however. How far is the private sector and free markets as they stand, serving the wider interests of society? Theresa May once had ambitions to make the governance of companies work better for all stakeholders. Damn Brexit burning up band-width and a barely workable majority put paid to this. A real shame as it could have been her legacy initiative.

Asset managers in alliance with asset owners are at least putting their shoulder to the wheel on companies they invest in, in relation to Environmental, Social and Governance (‘ESG’) issues but is it time to be more radical? Should there be greater, even compulsory, intervention in executive pay deals that are grotesque in size and short-term in nature? Remuneration must be aligned to the long term interests of all stakeholders. Should there be more scrutiny of excessive dividend payments which detract from long term investment? This is often a downside of quoted companies. What is wrong with having employee representation on company boards? It works fine in Germany. Is it time for the Government to wield its influence with golden shares in companies that provide key public services? That’s how many privatisations started.

There is a comprehensive debate to be had. But, in the meantime, what is clear is that there should be at least more business and procurement skills within the civil service. Markets and the way they allocate capital must also work better for all stakeholders (including the tax payer) and shorter term greed and rewarded incompetence must not be allowed to outweigh the manifest benefits of private sector competition. If that takes bolder corporate governance legislation from a Conservative administration then so be it.

If the Conservatives don’t act, Corbyn will, and the results will be very messy indeed for all concerned, not least the consumers of public services.

Oh dear. The best that could be said about the last two days is that reshuffles don’t really matter. Most names are unheard of by the public and it is the longer term, overall perception of Prime Ministerial/Government competence and key policies that matter.

Umm…this week does not contribute to the perception of a Prime Minister in command. At the very least, like a lot of her predecessors, she needs better HR advice/procedures!

How could the mistake be made about Chris Grayling, Chairman of the Party for 27 seconds…? Why wasn’t the disappointing departure of Justine Greening foreseen? Why was Jeremy Hunt’s rumoured promotion allowed to gain legs? Surely it was also obvious he wouldn’t want to be pushed sideways in the middle of an NHS crisis. Why has the awful Andrea Leadsom been allowed to stay on? The list of gripes is endless. Reshuffles are much harder to execute than it seems from the outside but this one involved a series of unforced errors exacerbated by an unpleasant and inaccurate advance rumour mill.

At Cabinet level, there has been a revolving door of Justice, Education, DWP ministers to name but a few. No wonder there is a belief that the Civil Service really runs government.

The good news is that there is a talented cadre of up-and-coming ministers seen on the second day of the reshuffle. If only the public knew some of them, they would realise there is far more depth to the Conservative Party than simply visible around the Cabinet table. Theresa May staying on is good news if it means the next leader comes from this generation.

Lastly, insiderightpolitics (that is me…), will be in the audience (sadly not on the panel…) of this week’s Question Time cheering Gina Miller and booing Piers Morgan. Tune in!

 

2018 will not be a vintage year politically. In particular, here in the UK, it will be a depressing slog through Brexit with badly needed political initiatives in other areas such as social care making little progress. The reshuffle won’t change much in the shorter term (more on that another time) and Theresa May’s imminent pronouncements on a series of domestic policies are awaited with less than feverish excitement…

Elsewhere, intractable problems accompanied by erratic political leaders, will hardly inspire confidence although it is a golden time for satirists. Two positives, however, stand out: reasonable global economic growth subject to a geo-political crisis and Macron.

So in more detail, what can we expect? Emboldened by the predictive failures of the ‘experienced commentariat’ here are a few ‘insiderightpolitical’ predictions for this year:

• There will be no General Election in the UK. Theresa May’s sheer perseverance and fears of a Labour victory will keep Tory MPs onside.  In fact Theresa May herself will go on well into 2019 and perhaps beyond, buoyed by a lack of alternatives and the determination to resurrect her reputation from the calamitous 2017 election.
• However, the Tories electoral position will gradually deteriorate unless there is a radical over-haul of its organisation and policy offering. A lamentable political membership base with unpopularity building in areas such as the NHS will be corrosive and take time to fix. Local election results will be poor and London a disaster. Only the extremism of Corbyn and his allies combined with their sheer incompetence on Brexit alone currently stand between the Tories and the political Armageddon many people think they deserve.
• The Liberal Democrats will go nowhere. With such definitive issues to tackle this is no time for wishy-washy hand wringing even if ultimate solutions have to come from the centre ground of politics at some stage.
• Elsewhere, despite the chaos reigning in the White House, the midterm elections whilst poor will be better than expected for the McDonald’s munching Trump. The Democrats, badly led, and offering no clear alternative, will not make the progress hoped for. There is still a real chance of an 8 year Trump presidency. Scary…
• Merkel will go. Her authority is starting to drain away as coalition talks fail to make progress. She has simply made too many major mistakes (Brexit, asylum seekers) and her competent but bland consensus style of politics will not save her.
• Macron will shine. Despite missteps through hubris, he is gradually making progress. Confident in what he wants to achieve, he will be an increasingly influential leader in Europe and beyond – a model for the next generation of politicians in western democracies.
• The global economy will continue to prosper, increasingly divorced from the actions of clowning political leaders. Business matters more and only a war in Korea or a significant Middle East crisis will change this outlook.
• Lastly, watch Iran. By far the most interesting country in terms of potential if demonstrations lead to any real, positive change.

So there you go.  If much of it feels same old, same old…then take comfort from the fact these predictions may well be wrong. For the last time in 2018: Happy New Year…

Since 1947 the City of Oslo has sent us a Christmas tree in gratitude for our support in the Second World War. We really appreciate the gesture….but…the tree tends to be tall and thin, decorated in energy efficient white lights. It sits in Trafalgar Square, worthy but dull. It is time for a change!

We need more glamour in London. Returning from outsized New York, eyes still dazzled by the Rockefeller Centre Christmas Tree (capitals essential!), it is time for more colour, brighter lights and, yes, if you insist, a bit more Camp at Christmas. Things are getting better but it would be great to see huge decorations adorning London’s walls, a Trafalgar Square tree which is bushy, humorous in the sheer audacity of its decorations with lights everywhere. Who cares, let’s go over the top!

And whilst we are at it, why can’t we have a Garden Bridge in London too, paid for by private funds. It would be a ‘statement’ (and we need a few of those in a post-Brexit world…), competing with the undoubted success of the High Line in New York. Oh, and glass pyramids a la the Louvre, and an amazing new concert hall showcasing radical architectural ideas.

Austerity Britain is making us all weary. London is a dynamic, exciting city. Let’s take a few risks, ditch the moaning Minnies and make it a bit more fabulous too. Manchester, Birmingham etc. you can follow or take the lead. If Britain is to be a Little Island, we should be as lit up as possible.

Merry Christmas!

 

There are a lot of gloomy people out there. Brexit and Trump have ‘triumphed’, the far right and far left in western democratic societies have all gathered more support than feels comfortable (Corbyn, Sanders, Le Pen, the AfD to name but a few) and ‘elites’, whatever this title means, are despised. Nationalism is on the increase and King Canute-like, key economies are trying to turn their back on globalism. The world feels a much less safe place nowadays.

Why are we at this point? For decades in western democracies politicians have over-promised and under-delivered, telling the electorate what they want to hear and racking up deficits in their attempt to deliver. At the same time, post the 2008 crash, the rich seem to have got richer with cuts disproportionately impacting the less well-off. The long term benefits of globalisation for many have been out-weighed by shorter term pain.

What is the solution? Well, first, things are only going to get worse before they get better. The anger with the establishment is not going to abate soon. Trump is still absurdly popular amongst his core base (don’t be reassured by the Democrat win in Alabama); Brexit is happening (regardless of MPs now having the final say on terms) and deficits mean there will be no helping the relatively less well off soon. Corbyn looks alarmingly electable in the UK whilst extremists in continental Europe continue to prosper. And that is before all these populists with their manifest incompetence fail to deliver for their supporters.

And financial markets seem oblivious to any sort of geopolitical risk. A journalist from The Economist speaking recently on rising tensions, reached the conclusion that growing disillusionment with the current order is simply not reflected in the level of markets or price of real assets. If threats cause the bull market in bonds and equities to end sharply, there will be even less money around to oil the wheels of consensual capitalist democracies, further fuelling extremism.

Now back to the solution…What is required is a new political class of higher calibre politicians who tells it to the electorate as it is. Firm on budgets and over-blown promises, socially liberal and willing to take the risk of walking away from existing Party structures, they must act and talk long term, ignoring the 24 hour media cycle. They must measure their success by creating a new economic consensus not by how long they remain at the top.

Remind you of anyone? Well let’s start with Macron in France. Then let’s look to the future; individuals forming a break away Labour Party, a moderate Conservative Party leader not obsessed with Europe or a full political party realignment in the UK? A rejuvenated Democratic Party in the US? That’s just the start.

Sounds optimistic? I hope so. It is the only option.