Uk politics

Monday

Peter Hoskin

Talkin’ ’bout long-term stagnation

From our UK edition

Politics is often a messy squiggle, but this morning's Resolution Foundation event did much to reduce it to a binary choice. Do we follow the US into a decades-long stagnancy around low-to-middle-income earners? Or do we not? James Plunkett explained the basic dilemma on Coffee House earlier, but more was said by a group of panellists which included Jared Bernstein, Martin Wolf, Steve Machin and Lane Kenworthy. Here, for the saddest CoffeeHousers, are eight points that I've distilled from my notes. This is more reportage than opinion, but I thought you might care to applaud or eviscerate some of the arguments that were put forward: 1) The UK triumphant. Or not quite — but at least we've outpaced the US on most measures of income growth for low-to-middle earners.

Fraser Nelson

How ambitious is Cameron on Europe?

From our UK edition

Someone forgot to pack his handbag. We heard yesterday that David Cameron has agreed to let Merkel pursue full fiscal union – and in return she will... drum roll please... let him repatriate parts of the Working Time Directive. There's nothing official from Number 10, but the well-informed Ben Brogan suggests this morning that this could well be Britain's price for agreeing to Merkel's deal. If so, this would be an opportunity squandered on a massive – perhaps historic – scale. Let's recap. Cameron is in an incredibly powerful position: leading a government which is, in defiance of public opinion, giving £9 billion of overseas aid to EU member states each year.

Hamish Macdonell

The SNP hit the jackpot

From our UK edition

Some political leaders might be a bit hesitant when it comes to approaching lottery winners in the hope of securing some of their dosh for the party cause – but not Alex Salmond. Back in July this year, when it emerged that a couple in Ayrshire – Colin and Chris Weir – had scooped a record £161 million on the EuroMillions, Scotland's First Minister reacted with astonishing speed. Within days Mr Salmond had written a letter to the couple congratulating them on their success and adding: 'When I heard the fantastic news that a Scot had landed the EuroMillions jackpot, I did wonder if this was the same Colin Weir who helped produce SNP party political broadcasts for a young party publicity vice-convener all those years ago.

James Forsyth

The government’s airport conundrum

From our UK edition

There is a growing acceptance in government that the South East needs more airport capacity. But, as today's Times outlines, there's nowhere near agreement on how best to achieve this. The big problem with a new airport on the Kent coast or 'Boris Island' is that the Dutch would not be prepared to open up the necessary air space. They control most of the air above the North Sea under international treaty because of Schiphol airport. I understand that feelers put out to the Dutch on this matter have been rebuffed. Another option is Heathwick. The idea is that an extra runway is built at Gatwick and then the two airports are joined together by a high-speed rail line. Initial work suggests that journey time between the two airports would be just 15 minutes.

James Plunkett

Are we facing an American nightmare?

From our UK edition

With the Chancellor’s autumn statement due next Tuesday, we're all talking about growth. The ECB and Bank of England now say the UK economy is set to grow at less than half the rate the OBR forecast back in March. That makes it all but certain that George Osborne will announce dramatic downward revisions to UK forecasts when he stands up in parliament next week. But before all the fighting about Plan As and Bs reaches fever pitch, it’s worth asking what the next decade looked like under the previous, more optimistic growth projections. The answer isn’t pretty and it helps highlight one major question that’s rarely asked in our debate about GDP: what kind of growth are we after? The chart below neatly sums up the problem.

Sunday

James Forsyth

The vote in Spain

From our UK edition

The expected triumph of the centre-right Popular Party in today’s Spanish elections promises to have some interesting consequences for British politics. The PP have been in close touch with the Tories here and plan to introduce an emergency budget based on the Osborne model: a clear deficit reduction plan combined with an increase in the retirement age. They hope that this will reduce the ever-upwards pressure on Spanish bond yields. Certainly, if the PP approach does succeed in gaining Spain credibility with the bond markets, it will bolster the coalition’s arguments about the importance of sticking to Plan A.

Daniel Korski

Are the Lib Dems pro-EU?

From our UK edition

This might seem a very odd question. A pro-EU position is part of the party's internationalist DNA. Listen to any EU-related speech by the likes of Nick Clegg or Paddy Ashdown and heartfelt support for the European project is apparent. The Liberal Democrats have also made a virtue of reining in Tory euroscepticism, for example rejecting a call for repatriation of powers in the Coalition Agreement. The Deputy Prime Minister remains, in private and public, pro-EU. And to many activists and MPs, the party's European stance is what makes it different to the Tories – and is the reason why they are Lib Dems. They see in Tory euroscepticism a boorish Little Englanderness they abhor and find out of synch with the way of the modern world.

Fraser Nelson

Now will we learn the truth about Saif’s British ties?

From our UK edition

Now that Saif Gaddafi has been captured, the race will be on to interview him from a prison cell and ask what his business was with the various figures of the British establishment with whom he was so close. CoffeeHousers will remember the 2009 party at the Rothschilds' manor in Corfu: Saif, Mandy and Nat Rothschild. A little later, Charles Moore revealed in The Spectator that the trio were later reunited in a shooting party at Lord Rothschild's Waddesdon Manor in Buckinghamshire. I spoke to Lord Mandelson a few weeks after the piece appeared, and thought CoffeeHousers may be interested in the transcript. The noble lord was outraged at Charles' piece – because it suggested he was also hanging out with Cherie Blair that night.

Saturday

James Forsyth

Riots and responsibilities

From our UK edition

The riots are fast in danger of becoming the forgotten issue in our politics. The social and cultural problems that they laid bare have been knocked out of the news by the continuing financial and political drama in the Eurozone But if we, as a society, don’t work out how to address these problems then they will simply get worse. The essay by David Lammy, the MP for Tottenham, on what happened this summer in The Guardian magazine today is thought-provoking even if I don’t agree with all of its conclusions. . Interestingly for a man of the left, Lammy accepts the points that the riots were about culture as much as anything else. As he writes, ‘the mothers sitting nervously in my surgeries were not just talking about money.

Fraser Nelson

Nigel Lawson versus Mervyn King

From our UK edition

In this week’s Spectator we have a piece from one of our former editors, Nigel Lawson, where he confronts this idea that the West’s woes can be blamed on a new bogeyman called ‘global imbalances’. This is fast becoming the received wisdom, something that even the bankers can point to and blame. It gets everyone off the hook, and takes attention away from the basic failure to regulate the supply of money and quality of investments. CoffeeHousers may be familiar with the argument by now. Time and time again, we hear central bankers shrug their shoulders and say something like: ‘Don’t blame us central bankers and financial policymakers for the debt crisis.

Peter Hoskin

Assessing the sick

From our UK edition

Should GPs determine whether people on long-term sick leave are too ill to work? Perhaps not, according to the draft copy of a government-commissioned review into sickness absence. It proposes setting up a new, separate and independent body to assess those on long-term sick leave, on the grounds that doctors have no incentive — nor, perhaps, the specific knowledge — to prod and coax them back towards employment. The new service, it is said, would advise sick leavers, and their employers, about just what they can and can't manage. If the government does introduce this, it will be another sign of their intent to untangle the problems with sickness benefits.

Friday

Jonathan Jones

200,000 extra working pensioners

From our UK edition

Despite – or perhaps because of – the recession, pensioner employment has increased dramtically over the past few years. In his Telegraph column today, Fraser remarks on this important but largely ignored trend in Britain's workforce. 'A million jobs have been lost since the Great Recession began', he says, 'but the number of pension-aged people in work has increased by 200,000.' Here's that phenomenom in graph form: Why has this happened? Fraser puts his finger on one important factor: 'Crucially, they pay less tax. A pensioner manning the tills in Tesco will take home 12 per cent more than a working-age colleague on the same salary.

James Forsyth

Cameron and Merkel: all smiles but no progress

From our UK edition

David Cameron and Angela Merkel were clearly keen to show that, whatever the tensions over the role of the European Central Bank, they still get on. I lost count of the number of times in their press conference that they used the word 'good' to characterise their relationship and their discussions. But there did not appear to have been any actual progress on how to deal with the current crisis. Certainly, there was no softening of Germany's opposition to using the ECB as the backstop for the Eurozone. Merkel conceded that she had raised a European-only financial transactions tax with the Prime Minister but that, unsurprisingly, no progress had been made on this front.

Jonathan Jones

Farage scolds Europe’s wrecking crew

From our UK edition

In his cover story for last week's Spectator, Fraser described how the Frankfurt Group – which he dubbed 'a new EU hit squad' – has begun imposing it's will on Greece and Italy. In the European Parliament on Wednesday night, Ukip leader Nigel Farage made the same case against them – and quite forecefully, too: https://www.youtube.com/watch?v=bdob6QRLRJU It's now going viral, with over 75,000 views so far.

Matthew Sinclair

What does the ‘carbon floor price’ mean? More emissions and fewer jobs

From our UK edition

After the Conservative Party Conference, Fraser described this statement in George Osborne’s speech as the Osborne Doctrine: ‘Let’s at the very least resolve that we’re going to cut our carbon emissions no slower but also no faster than our fellow countries in Europe.’ The Government’s current climate policy clearly fails that test, as I set out for this site at the time, and there is no more egregious violation than the carbon floor price. It is one of those policies that can sound reasonable in theory: the EU Emissions Trading System creates a carbon market. That market produces a carbon price that is supposed to encourage business to invest in cutting emissions by doing things like building nuclear plants.

Thursday

James Forsyth

Benefits won’t rise in line with September’s inflation figures

From our UK edition

Jill Sherman, the Whitehall editor of The Times, reports tomorrow that the government will not raise benefits in line with September’s inflation figures as normally happens. However, there’ll be no freeze in benefits. Instead, they’ll rise in line with a six month inflation average which stands at 4.5 percent rather than September’s 5.2 percent figure. This move will save the government a little less than a billion pounds as pensions will be exempt from the move. I suspect that there’ll be objections to this shift from various quarters. But it is worth remembering that 4.5 percent is far larger than the pay rises most private sector workers will see while there’s a wage freeze in the public sector.

Mark Bathgate

Some context for the ongoing growth debate

From our UK edition

Listening to Ed Miliband's speech today, you'd be left with the impression that the UK is suffering a huge decline in government spending this year, and that this is to blame for most of our economic ills. The facts are a little different, as the below chart shows. The European Commission estimates that the UK is likely to have the second largest growth in government spending of any of the EU’s 27 members this year, clocking in at a robust 1.5 per cent increase for the year. Yet this has done nothing to help the UK’s relative growth performance. The UK is forecast to be the fifth slowest growing economy in the EU this year, ahead of only Greece, Portugal, Cyprus and Italy.

Ruth Porter

Miliband’s ‘responsible capitalism’ requires deregulation

From our UK edition

Despite yesterday’s gloomy unemployment figures there is, it turns out, good news for the government buried in current labour patterns: the total number of hours worked in the last three months has risen by three million. The bad news is that employers are currently filling this demand by getting current employees to work longer hours (average weekly hours over this time period rose by 0.3 to 31.5), rather than taking on new workers. Presumably this is because it is so much cheaper, and less risky, to do so.   This should come as an encouragement to the government, as they search for ways to bring about growth.

Peter Hoskin

Some advice for Osborne

From our UK edition

In the latest issue of the magazine, a flock of politicians, commentators and economists offers George Osborne some advice for growing the economy. There are ten contributions in total, but here are three for CoffeeHousers' consideration: Arthur Laffer Chairman, Laffer Associates Cut the 50p tax Reducing the burden which government places on the economy, through tax cuts, is the surest way to promote growth. I have never heard of a country that taxed itself into prosperity. Yet Britain last year raised the top rate of income tax from 40 per cent to 50 per cent. For more economic growth, and more tax revenue, this rate should be lowered immediately.

Peter Hoskin

Osborne sells off the Rock

From our UK edition

‘Sir Richard Branson set to buy Northern Rock.’ So read the headlines in November 2007 — and now they're finally true. It has been announced this morning that Virgin Money is going stump up £747 million to return the bank to the private sector. This, says George Osborne, ‘is an important first step in getting the British taxpayer out of the business of owning banks.’ By the looks of it, Virgin will be paying less than they would have done four years ago, but they have also had to make various assurances about how they will handle the Rock. When Branson's bid failed in 2007, and the bank was nationalised, it was because the government started worrying about what they saw as 'extortion' on Virgin's part.