peterms

A leasehold sale is still a sale. If we want it back before the end of the lease we will have to buy it back. Unless we nationalise without compensation, of course.

Channel tunnel rail link sold for £2.1bn to Canadian pension funds So let me see if I've got this right. Financial institutions caused major, major havoc in the financial system. To prevent the collapse of the banking system, we baled them out, at massive cost to us and no cost to them. The government says that we now have a big deficit, which must be reduced. In order to achieve this, we are going to have a fire sale of the national infrastructure to, er, financial institutions. Meanwhile, we will make a million unemployed, taking demand out of the economy. VAT will increase. Food prices have risen much faster than inflation and will continue to do so, caused largely by commodity speculation by...could it be...financial institutions?

That could be a good metaphor for the chiefs of staff and defence procurement.

I'm not sure how strongly he would defend the proposition that we should have no defence at all. It comes across as a point for effect, like when someone running for office in Finland said they should scrap their forces and replace it with a recorded message saying "We surrender" in Russian. The main point that I take out of it is that defence spending first bears no strong linkage to what we identify as credible future threats, and second has become unaccountable and out of control to a degree which requires change. I think the interesting questions around this, which both government and opposition should engage with if we are to have a "strategic review" would include: What functions do we wish to be able to exercise through armed forces? (Phrasing it as defence against threats would be too limiting). What capabilities do we require to achieve this? What equipment and staffing do we need for this? What should that reasonably cost, and how should it be procured? And assuming that Jenkins is at least partly correct that what we have isn't what we need, how do we move from where we are to where we should be? Some open and informed parliamentary discussion of this would be nice, but I expect as usual it will get obscured by flag-waving and hysteria.

I am sure Simon wants it all spent on the National Trust and the Churches He might respond that much of what we spend the money on is so quaintly unfit for future purpose, so rooted in the past, that possibly the National Trust might be a more suitable custodian for it.

Here's one for the military bods to get their teeth into. Light blue touchpaper and retire.

This is a significant judgement and an indication of how social care will be delivered in future. Where there used to be personal assistance to use the toilet, now you can expect to lie in bed and piss into a pad. Well, as long as we're all in this together, what? A small price to pay as long as the bankers can still get their bonuses. The money's much better used on that.

Were the Hartz reforms really a consensual approach? Not really; quite divided opinions. But a bit more consensual than some of our approaches. There does seem to my limited viewpoint to be more interest in identifying a common ground over there than over here, though.

Oh dear. Mr Osborne's claims about the degree of the problem and there being no alternative start to unravel.

Well, if I can indulge in a few random musings around these points. Thatcher wasn't mad, just bad. Despite her confrontational style, her utter lack of empathy with people, her innate racism, her inability to understand or practice management styles other than "dominate and crush", and her utter lack of any wider perspective about what might be best for the country, she was lauded as a hero by the usual sections of the press. It's maybe not surprising that young authoritarians with a similar will to power should look up to her and seek to copy her. I blame the social workers, myself. As for the industrial stuff - Britain in the 60s was a basket case. From a post-war base of old and tired plant, we didn't renew quickly enough to keep up with other countries. In the 70s and 80s, you could walk in to factories and see equipment which might better have been on display in the local museum, while the directors enjoyed cordon bleu lunches in private dining rooms. It seems like the "wealth creators" were out to lunch or on the golf course for those 30 or 40 years, because they certainly weren't repositioning the manufacturing sector to respond to new challenges. Feasting off the decaying corpse would be more like it. Throughout the 60s, 70s and 80s, various industries faced a necessary restructuring. That's what "the white heat of the technological revolution" was supposed to be about. There are various ways to approach this, from consensus to diktat. We seem to have done things in a way which resulted in a lot of conflict. It's interesting to see that Germany seem to have reduced labour costs and improved productivity over the last couple of years through a consensual approach. In my view both unions and management spent too much time preserving old ways of doing things, whether working practices or outmoded capital equipment. As a country, we do seem to spend more time looking back than forward. Oh, on the rail thing - I learn that Beeching was appointed by a Tory minister, Marples, who was a director of a company which constructed roads.

10/65? Comprehensive schools? I imagine because it was part of the policy approach at the time, wasn't it? Hardly a personal crusade on Wilson's part (Crosland, maybe). Scargill - tactical error, as many said at the time. Robbo - no idea. Though I'm sure he would be delighted to be bracketed with Thatcher in terms of impact. Of course Thatcher was a reaction to circumstances at the time. If the times weren't favourable (and if she hadn't been lucky) she would still have been working on putting more air bubbles into ice cream on an industrial estate somewhere, an outcome much to be preferred. My point was that far more than other figures, she brought a spitefulness which made her hated.

...and I'm not trying to defend Wilson. He promised to halt the closures, and broke his promise. In other echoes of the present day, the decisions were taken for cost-saving reasons but the assumed savings never quite materialised; and decisions about long-term capital investment were taken for short-term reasons, leading to an outcome which looks wrong today. Scargill and Red Robbo are an entirely different kettle of fish to Thatcher. Industry-specific, in one case quite local as well, engaged in essentially defensive rearguard actions in the face of the restructuring of traditional and pretty outmoded forms of production. Simply no comparison.

Though since "a day away from Hawick is a day wasted", possibly the good citizens saw it as a mixed blessing. Thatcher was qualitatively different to others. When Callaghan and Healey presided over the invitation to the IMF to come in and advise us on how to sort ourselves out in the wake of the oil crisis (a bit like asking Jeremy Clarkson for advice on routing cycle paths), they weren't engaged in planned class warfare against the weak. Thatcher brought to British politics a sneering, spiteful, vindictive hatefulness which, overlaid on her small-town petit-bourgeois class hatreds, translated into years of the most wilfully socially divisive policies we have ever seen. Where other politicians might be disliked, resented, mocked, Thatcher is one of the few who were genuinely and deeply hated.

Happening now.

I agree with all of this - particularly the references to urbanization and loss of religion in the break down of a community ethos - but I think successive governments also bears a large slice of the responsibility for the situation. The Tories have identified the former and the 'big society' idea is about encouraging people to feel ownership of their communities. One of the strongest expressions of community we have seen in the last 25 or so years was the miners' strike. These communities had grown up around one specific form of employment (a pretty unpleasant one) and often had a very strong sense of identity and cohesion. (They were also mostly urbanised and as far as I know not religious). They were smashed as a deliberate act of the state, a planned action involving the stockpiling of coal supplies for months before engaging in behaviour aimed at escalating a strike; the active use of MI5 etc to try to infiltrate the strikers, intercept communications, conduct illegal wiretaps and so on; the payment of large sums to the police as "overtime" in return for physical confrontation to break the strike; and of course relentless use of the lapdog press as a propaganda tool. During the strike, we saw one of the strongest expressions of the power and resilience of community that I can remember. In the end, though, these communities were crushed. When I hear the present government, so closely allied in ideology and networks to their recent predecessors, talk about the "big society" and "building communities", I think of this.

I would have thought that was the case, but countries where you expect that to happen; places like Holland or Sweden seem to be having problems just like us. I am not sure any system or society can say its get the balance perfect. Those countries do have problems, it's true. Maybe someone viewing Bergman's films would see Sweden as a pretty depressing place. Hard to distinguish the various causes of discontent, but having a relatively equal society doesn't mean everyone's happy, it just means one potential source of unhappiness is reduced. Maybe in Sweden they are happy that they are relatively less unequal than some other countries, but still upset that they have to trudge through the Arctic cold and dark to the cinema, where they get to see a Bergman number about someone slowly dying of cancer. And they can't even get a drink after. My son went to Malawi last year. The one thing above all which had an impact on him was the coexistence of severe objective levels of poverty with a general level of happiness which seemed far higher than that experienced by his materially well supplied friends. I don't imagine poverty creates happiness (some ascetics might disagree), and I think it's more about the lack of visible signs of extremes of wealth.

As an illustration of this,

Educational attainment is helped by nutrition, which is an important part of the thinking behind feeding kids who would otherwise be undernourished, lacking attention etc. And education is harmed by enforced moves, when families are evicted for rent arrears and placed in temporary accommodation before being relocated to cheaper areas away from family, friends and support networks. If we want to tackle poverty through education, it helps to look at the impact of a range of policies together, and the impact of these two government policies will be harmful to the educational prospects of poorer children.

Looking at the IFS assessment of how much of the impact on the richest is down to plans previously announced by the last government, I would dispute that the impact on the richest is because of what the Tories have introduced. The wealthiest 2% will be hardest hit, but this is because of what the last government did, not what the current lot are doing.

Poverty is a relative concept; it's about disparties, not about absolute measures of wealth. It is simply not the case that the richer the country, the more people in poverty. What is the case, though, is that the greater the level of inequality, the more people will fall within that particular country's definition of poverty. Landlords will make a rational economic decision based on alternative options open to them. The option you don't seem to recognise is that of selling the property. In a market where property prices were continually rising and rent levels were high, it made sense to own a property and let it out. If the capital value isn't appreciating and rental yields are falling, it might make more sense to sell and invest the money somewhere else. It's simple economics, not scare stories from those naughty lefty papers. And of course the cuts are related to bankers' pay and shareholders dividends. What has happened - can you really have missed it? - is that the losses the banks made have been socialised, ie covered by us, and are now being paid for by cuts in public spending; meanwhile, shareholders who in orthodox economic theory should have lost the value of their investment instead have seen it protected, and the people who caused the problems continue to get pay and bonuses at a level which most people find shocking.

Just out of interest, how are they choosing to redistribute from poorer to richer? All the other stuff I agree with you, but I don't feel they are actually doing this part. They're not moving money from the poor and giving it to the rich. No-one is getting given any more money as a segctor of society. There's a lot that points to wards a sizeable number of the less well off being possibly further disadvantaged, and some stuff that points towards "unfairness" with the very rich being hit hardest, then the poor, then the rest, in that order. There is a kind of massive inertia in what the current gov't are doing and what the last lot did, in terms of really addresing the causes of the mess and in sorting out equitably - banks not being broken up, lack of reform, lack of taxing the problem areas, unwillingness to do more than dick about at the edges, while simultaneously bringing in ideological changes (smaller state), some much needed overhauls (quangos, benefits...) and some bodged mish-mashes like the SDSR and the French thing. Mostly they are getting it wrong and making things worse, mostly they are a bunch of incompetent and ideological driven pillocks, but I still don't thing they're taking from the poor and giving to the rich. Well, for example, the Institute for Fiscal Studies has produced an analysis here showing in what ways the tax and benefit changes are regressive. As they say at the end of the presentation, this ignores the cuts in public services. These are relied on more by the poor than the rich, and their effect will be to compound disadvantage. But the impact of the tax and benefit changes alone will be regressive, ie the gap between poor and the better off will be increased as a direct result of the changes, leaving aside all the indirect effects which will make this worse. Of course there are other things which further contribute to the widening gap between rich and poor. For example in education, we see the scrapping of a plan to extend free school meals to all children below the poverty line, but money for "free schools". In housing, we will be seeing what Boris called ethnic cleansing, shipping the poor out so their housing can be taken over by wealthier people, just like Dame Shirley did in Westminster all those years ago. There's the wider point made by Jon that the impact of financial intervention is felt by the poor while the benefits are received by the rich, both in bankers' pay and in shareholders receiving profits via dividends while any losses are socialised. This is against a backdrop of top boardroom pay having increased by 55% (according to Income Data Services) or "only" 23% (Hays Group). These pay increases are not directly caused by government, but are the context in which regressive changes to taxes and benefits must be seen, ie a pretty fiercely regressive environment to begin with.

i think you've been reading to many left-wing newspapers. Guilty as charged. There, that should save a spot of court time.

Not at all. The government have taken on themselves the power to act in different ways to influence the economy, from regulation to lawmaking to economic policy. In that situation, if they knowingly act to the detriment of a section of society (and I would argue especially if they act against that section least able to protect itself), then they place themselves in a situation similar to knowingly failing to defend some citizens against attack. It is entirely possible to think that the government should act in such a way as to promote growth, stimulate demand, and encourage full employment, without also thinking that the government should directly employ a single more person. As it happens, I think they should employ more people (as do you, at least in some areas), but the point I make is independent of that.

Would it? I wonder how many people charged with trivial offences actually take the case to a higher court, risking harsher sentences. Very few, I think. There are many problems with the court system, but this one is not the big one. For example, if you go to a court, you will find dozens of police sat round in the waiting area for most of the day, on the off chance that they might need to give evidence. Witnesses too, having taken time off work to attend. Sometimes cases are even withdrawn but witnesses aren't told until they get there. Some of these inefficiencies have just crept into the system over time, others are there as a by-product of the courts being organised around the convenience of judges rather than around the efficient management of a process. If we want to make improvements to the way the courts function, we would do better to start with a wide-ranging and thorough analysis of the procedural and logistical factors which create these inefficiencies, followed by a systems redesign to improve flow. Instead of that, we seem to fasten on a relatively trivial factor, involving the removal of rights. Funny, that. It's almost as though the waste in the system wasn't the thing they were trying to tackle at all...

Your last piece from the defence standpoint was interesting and thought provoking. The above is just empty lefty rhetoric. I think from some of your earlier comments (though you don't go into any detail, so it's hard to be sure) that you may have swallowed wholesale the popular line about "there is no alternative" and "oh no! A deficit! We're all doomed!". If in fact you do accept this line as an article of faith, rather than a proposition which a great many economists argue is simply wrong, then I suppose any disagreement with the One True Faith will seem like lefty rhetoric. What's happening in terms of the effect of the current government's approach, and specifically the relative impact on different sections of the population, with the poorest being hit hardest, has been set out in clear terms, and I imagine you can't see that as rhetoric. I think it's pretty clear that the present government wishes to reduce the role of the state, and their actions also show that they are choosing to redistribute wealth from poorer to richer. What then is rhetoric? The idea that they don't really believe there's no alternative, and are using a whipped-up sense of danger and threat as a cover for unpopular measures, as a million politicians have done before them? To write off this view as "empty lefty rhetoric" is naive and trusting to a worrying degree.