The government is building 12 new nuclear reactors, generating a total of 16GW, at a cost of at least £60 billion. We already have 15 reactors, so why the sudden increase? One issue is that the current reactors will almost all be shut down by 2030 so need to be replaced, but why nuclear?
One very good reason is security of supply, an even bigger issue now that Article 50 has been invoked. The UK imports electricity from France and the Netherlands, with them supplying up to 55% of our needs by 2025. What is the use of going on about 'sovereignty' when another country has their hand on the light switch?
Another reason is the UK's commitment to climate-friendly energy sources. That is not just self-sacrifice it is self-interest - London is at serious risk from rising sea levels.
If you are against nuclear energy then the good news is that things aren't going too well. Toshiba is meant to be building a plant in Moorside but has announced serious financial problems, so it isn't clear what will happen to that one. The French company EDF is building a new nuclear power station at Hinkley Point. but they are also having financial problems, not to mention the explosion at one of their new reactors (using the same design). Fortunately a number of the other planned reactors will be built by the Chinese, who probably won't be going insolvent any time soon. Made in Britain? Well, it isn't any different from our car industry.
If that wasn't enough then Brexit is going to cause even more problems. The UK government intends to leave Euratom - the European atomic agency - as it comes under the European Court of Justice, and Mrs May won't have a bar of that. However leaving Euratom will mean negotiating new treaties with overseas nuclear partners, otherwise they will not be able to work with us - for example, help build new power stations. More treaties to negotiate - or maybe EDF could slap something together in the next 24 months.
We may not even to be able to buy the fuel we need for them.
Let's hope the government is quick off the mark on this, but maybe you should stock up on candles just in case.
Wednesday, 29 March 2017
Monday, 27 March 2017
Doctors and Nurses
5.5 million UK employees are foreign-born. There are 1.6 million people who are currently unemployed. Presumably the government is hoping that when they send the foreigners home that Brits will take a second job - maybe we will have to with the economy tanking.
So who is going to look after you when you are whisked to hospital collapsed from overwork?
13.5% nurses and 25% of doctors are non-British. However overseas applicants have dropped by 90% since the referendum and almost every hospital is short of nurses - there are 24,000 nursing vacancies across the UK. Not to mention the 25,000 NHS workers from overseas who are considering returning home under their own steam.
Maybe Mrs May should have agreed to the amendment to Article 50 promising to respect the rights of EU citizens in Britain, rather than keeping them to use as bargaining counters.
With the precipitous fall in the pound many potential immigrants are deciding to stay home - net migration is at its lowest for three years. Clearly the stay-at-homes are the ones who would have otherwise come to get a job, but it isn't worth their while now. A shame as the taxes they would have paid would have been welcome.
Still, with the Immigrant Skills Charge coming into force next month, it may be that the NHS won't be able to afford overseas staff anyway. At a thousand pounds a pop, that is £3.5 million ripped each year from hospital budgets, plus an annual bill of another £3.7 million for the organisations that train hospital staff.
The NHS already has a projected overspend of nearly £1 billion this financial year. Part of this is paying for the social care the NHS has to provide to make up for care gaps, so maybe the extra £2 billion councils have been promised for social care by Mr Hammond could reduce that. Even so, expect to find your local hospital ever more understaffed and overstretched over the next few years.
So who is going to look after you when you are whisked to hospital collapsed from overwork?
13.5% nurses and 25% of doctors are non-British. However overseas applicants have dropped by 90% since the referendum and almost every hospital is short of nurses - there are 24,000 nursing vacancies across the UK. Not to mention the 25,000 NHS workers from overseas who are considering returning home under their own steam.
Maybe Mrs May should have agreed to the amendment to Article 50 promising to respect the rights of EU citizens in Britain, rather than keeping them to use as bargaining counters.
With the precipitous fall in the pound many potential immigrants are deciding to stay home - net migration is at its lowest for three years. Clearly the stay-at-homes are the ones who would have otherwise come to get a job, but it isn't worth their while now. A shame as the taxes they would have paid would have been welcome.
Still, with the Immigrant Skills Charge coming into force next month, it may be that the NHS won't be able to afford overseas staff anyway. At a thousand pounds a pop, that is £3.5 million ripped each year from hospital budgets, plus an annual bill of another £3.7 million for the organisations that train hospital staff.
The NHS already has a projected overspend of nearly £1 billion this financial year. Part of this is paying for the social care the NHS has to provide to make up for care gaps, so maybe the extra £2 billion councils have been promised for social care by Mr Hammond could reduce that. Even so, expect to find your local hospital ever more understaffed and overstretched over the next few years.
Sunday, 26 March 2017
Why have an election?
Reports that Mrs May has ruled out an early election should be no surprise. This has always been her line. So why are senior Tories lobbying for one?
Their argument is that social conditions in the UK's are getting worse and will continue to slide due to the economic slowdown being caused by Brexit uncertainty:
Social care
Age UK have just published a report showing how the care system is failing the elderly, with 1.2 million given no support at all - a 48% increase since 2010 - due to spending cuts of £160 million.
Care homes are suffering. Already private payers are subsidising council-funded residents by paying up to 43% more for the same care. But this is unsustainable and nearly one in eight care homes fear they will have to close within the next three years. A leading provider, Mears, has already cancelled three contracts due to "unworkable pay and conditions for care workers”. Panorama found a quarter of care homes risk insolvency - 69 have closed in the last 3 months - with cost pressures and severe recruitment difficulties proving too great.
NHS
The NHS has reduced beds by 20% over the past decade, and will keep cutting - aiming to cut budgets by another £22 billion before 2021. Already four out of five hospital trusts are putting patients at risk due to cuts.
However, it isn't just NHS budget cuts that are causing this. The social care crisis has meant the NHS is now funding 16% of social care, up from just 2% ten years ago, and this is far more expensive than care delivered in the community. For example, one fit but elderly lady had to stay in hospital for six months, at a cost of £80,000, simply because no care home place could be found for her.- another patient blocked a hospital bed for 508 days for the same reason.
Benefits
Disability benefit is being cut again, on top of Osborne's cuts last year, this time aimed at cutting support for people with psychological problems - shades of Mrs Thatcher's "care in the community".
Infrastructure
The Department of Transport is forecasting an overspend on new roads of nearly £1 billion, with 16 projects at risk or not value for money and likely to be cancelled. Meanwhile maintenance of the existing road network is being neglected - 26% of A-roads may be providing inadequate skid resistance, leading to more accidents.
Blame Brexit?
Note that none of these have anything to do with Brexit. Clearly governments have been underfunding for years. The fear is of the effect of the economic hit over the next few years as we adapt to being outside the common market. With even less money to hand out, we are in for some difficult decisions - and this government will get the blame.
Their argument is that social conditions in the UK's are getting worse and will continue to slide due to the economic slowdown being caused by Brexit uncertainty:
Social care
Age UK have just published a report showing how the care system is failing the elderly, with 1.2 million given no support at all - a 48% increase since 2010 - due to spending cuts of £160 million.
Care homes are suffering. Already private payers are subsidising council-funded residents by paying up to 43% more for the same care. But this is unsustainable and nearly one in eight care homes fear they will have to close within the next three years. A leading provider, Mears, has already cancelled three contracts due to "unworkable pay and conditions for care workers”. Panorama found a quarter of care homes risk insolvency - 69 have closed in the last 3 months - with cost pressures and severe recruitment difficulties proving too great.
NHS
The NHS has reduced beds by 20% over the past decade, and will keep cutting - aiming to cut budgets by another £22 billion before 2021. Already four out of five hospital trusts are putting patients at risk due to cuts.
However, it isn't just NHS budget cuts that are causing this. The social care crisis has meant the NHS is now funding 16% of social care, up from just 2% ten years ago, and this is far more expensive than care delivered in the community. For example, one fit but elderly lady had to stay in hospital for six months, at a cost of £80,000, simply because no care home place could be found for her.- another patient blocked a hospital bed for 508 days for the same reason.
Benefits
Disability benefit is being cut again, on top of Osborne's cuts last year, this time aimed at cutting support for people with psychological problems - shades of Mrs Thatcher's "care in the community".
Infrastructure
The Department of Transport is forecasting an overspend on new roads of nearly £1 billion, with 16 projects at risk or not value for money and likely to be cancelled. Meanwhile maintenance of the existing road network is being neglected - 26% of A-roads may be providing inadequate skid resistance, leading to more accidents.
Blame Brexit?
Note that none of these have anything to do with Brexit. Clearly governments have been underfunding for years. The fear is of the effect of the economic hit over the next few years as we adapt to being outside the common market. With even less money to hand out, we are in for some difficult decisions - and this government will get the blame.
Saturday, 25 March 2017
Cake
Mrs May has told we that we can either eat cake - or go hungry.
Mrs May's Brexit negotiation strategy is based on the idea that we can keep the benefits of being in the EU without the costs - the "have our cake and eat it" principle.
Her alternative is to crash out of the EU and start trading with them under WTO rules - "no deal is better than a bad deal". However we still don't have a plan for that.
So is it likely? Do we really need a plan? Surely Mrs May will want to make at least a basic agreement. Of course she does - on her terms. If the EU won't agree to those then it is no deal.
Why is she doing this? Essentially it is a negotiating tactic to try to prevent the EU from whittling down what they will agree to. The same tactic can be used in human relationships - "if you don't [insert demand here] then I will [insert threat here]". However the tactic only works if the threat is believable, it is certain you will carry it out, and the outcome would be worse than agreeing to the demand.
So is the threat believable? Well, Mrs May has made some efforts in that direction - in particular her fight to prevent Parliament having any say. This means the EU cannot bank on MPs over-ruling her.
However, if she really does want a good deal then she needs a clear, public plan for falling off the cliff. Without a believable, detailed WTO plan to point to when challenged it would be sensible for negotiators to assume it was just a bluff.
In other words, the only reason to not have a (public) plan is if the intention is to crash out regardless.
Would the UK defaulting to WTO rules be worse for Europe than Mrs May's demands? This is impossible to say right now - her demands are clear (no ECJ, no free movement) but we have no idea what she is prepared to actually negotiate on.
Already our Ambassador to the EU, Sir Ivan Rogers, has resigned, warning that the UK has little negotiating experience and that our Brexit strategists don't want to hear anything negative.
If you hope that we can negotiate a controlled exit from the EU then - ironically - you should be demanding a detailed plan for what happens if we fail.
Mrs May's Brexit negotiation strategy is based on the idea that we can keep the benefits of being in the EU without the costs - the "have our cake and eat it" principle.
Her alternative is to crash out of the EU and start trading with them under WTO rules - "no deal is better than a bad deal". However we still don't have a plan for that.
So is it likely? Do we really need a plan? Surely Mrs May will want to make at least a basic agreement. Of course she does - on her terms. If the EU won't agree to those then it is no deal.
Why is she doing this? Essentially it is a negotiating tactic to try to prevent the EU from whittling down what they will agree to. The same tactic can be used in human relationships - "if you don't [insert demand here] then I will [insert threat here]". However the tactic only works if the threat is believable, it is certain you will carry it out, and the outcome would be worse than agreeing to the demand.
So is the threat believable? Well, Mrs May has made some efforts in that direction - in particular her fight to prevent Parliament having any say. This means the EU cannot bank on MPs over-ruling her.
However, if she really does want a good deal then she needs a clear, public plan for falling off the cliff. Without a believable, detailed WTO plan to point to when challenged it would be sensible for negotiators to assume it was just a bluff.
In other words, the only reason to not have a (public) plan is if the intention is to crash out regardless.
Would the UK defaulting to WTO rules be worse for Europe than Mrs May's demands? This is impossible to say right now - her demands are clear (no ECJ, no free movement) but we have no idea what she is prepared to actually negotiate on.
Already our Ambassador to the EU, Sir Ivan Rogers, has resigned, warning that the UK has little negotiating experience and that our Brexit strategists don't want to hear anything negative.
If you hope that we can negotiate a controlled exit from the EU then - ironically - you should be demanding a detailed plan for what happens if we fail.
Saturday, 18 March 2017
My Deal or No Deal
My Deal or No Deal
Why does Mrs May want absolute control over the Brexit negotiations? Her control-freakery is not the only reason. Though she has intended to be PM since her undergraduate days and she is clear about what values are important for her, she isn't sure what policies will support these. She has toyed with ideas but has stuck with none of them.
So right now she is sticking to what she perceives the (English) nation as wanting: sovereignty and control of immigration. She struggled with both of these when she was Home Secretary, so it certainly suits her to treat these as the primary goals of Brexit.
She failed to control immigration over her six years as Home Secretary, while sovereignty for her means getting out from under the European Court of Justice who not only got in the way of her deporting undesirables but - far more annoyingly - ruled that her Snooper's Charter (supported whole-heartedly by Labour, astonishingly enough) broke EU law as it allowed indiscriminate retention of citizens' communications, with no safeguards against abuse.
Not that the ECJ were against the intent of the Bill - they just wanted it to include some protection for you and me. Mrs May managed to rush through a replacement which did make some concessions to protecting our privacy.
Clearly, giving the ECJ its marching orders will make it much easier for Mrs May to keep tabs on us and kick out anyone that she doesn't want.
This desire for control isn't an authoritarian streak so much as a paternalistic one. Mrs May knows what's best for us. To keep us on the straight and narrow she needs to be able to see into our private lives and be as strict as necessary with those who break the rules.
Mrs May needs full control of the Brexit negotiations and the final agreement so that she can ensure she gets what she wants. Even if that means no agreement at all.
Why does Mrs May want absolute control over the Brexit negotiations? Her control-freakery is not the only reason. Though she has intended to be PM since her undergraduate days and she is clear about what values are important for her, she isn't sure what policies will support these. She has toyed with ideas but has stuck with none of them.
So right now she is sticking to what she perceives the (English) nation as wanting: sovereignty and control of immigration. She struggled with both of these when she was Home Secretary, so it certainly suits her to treat these as the primary goals of Brexit.
She failed to control immigration over her six years as Home Secretary, while sovereignty for her means getting out from under the European Court of Justice who not only got in the way of her deporting undesirables but - far more annoyingly - ruled that her Snooper's Charter (supported whole-heartedly by Labour, astonishingly enough) broke EU law as it allowed indiscriminate retention of citizens' communications, with no safeguards against abuse.
Not that the ECJ were against the intent of the Bill - they just wanted it to include some protection for you and me. Mrs May managed to rush through a replacement which did make some concessions to protecting our privacy.
Clearly, giving the ECJ its marching orders will make it much easier for Mrs May to keep tabs on us and kick out anyone that she doesn't want.
This desire for control isn't an authoritarian streak so much as a paternalistic one. Mrs May knows what's best for us. To keep us on the straight and narrow she needs to be able to see into our private lives and be as strict as necessary with those who break the rules.
Mrs May needs full control of the Brexit negotiations and the final agreement so that she can ensure she gets what she wants. Even if that means no agreement at all.
Mrs T May (Headmistress)
Mrs T May (Headmistress)
Mrs May has fought hard to ensure that she has a free hand in the Brexit negotiation. While repeating the mantras "sovereignty" and "the will of the people", she has insisted that Parliament and the people have no say in the deal, nor can they require any pre-conditions, such as guaranteeing the rights of EU citizens.
Is Mrs May a power-mad dictator, or is she maybe a crusader, convinced her beliefs are right and anyone who disagrees is simply wrong?
A dictator? No - at least not yet, though she already shows some of the characteristics: control-freakery, punishing external and internal criticism, banning dissent. However, she refused Mr Johnson's request for water cannon to 'control' protesters and has restored at least the show of cabinet government. It is worrying that she refers to "the will of the people" (a popular refrain for demagogues and dictators), and that the cabinet meetings may be mostly rubber-stamping decisions already taken, however she has actually achieved very little so far, and seems unclear about what she does want to achieve. Hardly the marks of a dictator.
A crusader? Again, her shilly shallying does not support this. Her JAMs, for instance, were here today and gone tomorrow.
In fact Private Eye has made a spot-on diagnosis, with their column "The Headmistress Writes". Mrs T May (Headmistress) accurately captures her approach. Nanny knows best, chin up, discipline is good for you, no moaning. She will listen to the staff, the parents and the pupils (though the doddery old governors are a nuisance), but it should be up to her to make the final decision.
Her upbringing as the daughter of an Anglican vicar means that she sees the people of this country as her flock, to be treated with respect, but ultimately to be guided down the 'right' path. The Church is hierarchical and paternalistic, it knows what is best for its members - though it is often unclear on how to achieve it - and so strongly discourages debate and squashes dissent (some branches labelling it heresy and taking extreme measures against it). It intensely dislikes any external scrutiny, to the extent of covering up serious crimes within its ranks (such as child abuse) so as to avoid any public investigation.
Mrs May's respect for her father and his work in his parish drives her to reproduce this on a national scale. She knows what is best for us, she is intolerant of dissent - having her own personal 'enforcers' - she is secretive, very hard working, and wants what is best for us as individual people not just as a nation.
Will she succeed? Or will her attention to detail mean sight of the larger picture is lost? Is she our guide through difficult times or the Queen of Misrule?
Mrs May has fought hard to ensure that she has a free hand in the Brexit negotiation. While repeating the mantras "sovereignty" and "the will of the people", she has insisted that Parliament and the people have no say in the deal, nor can they require any pre-conditions, such as guaranteeing the rights of EU citizens.
Is Mrs May a power-mad dictator, or is she maybe a crusader, convinced her beliefs are right and anyone who disagrees is simply wrong?
A dictator? No - at least not yet, though she already shows some of the characteristics: control-freakery, punishing external and internal criticism, banning dissent. However, she refused Mr Johnson's request for water cannon to 'control' protesters and has restored at least the show of cabinet government. It is worrying that she refers to "the will of the people" (a popular refrain for demagogues and dictators), and that the cabinet meetings may be mostly rubber-stamping decisions already taken, however she has actually achieved very little so far, and seems unclear about what she does want to achieve. Hardly the marks of a dictator.
A crusader? Again, her shilly shallying does not support this. Her JAMs, for instance, were here today and gone tomorrow.
In fact Private Eye has made a spot-on diagnosis, with their column "The Headmistress Writes". Mrs T May (Headmistress) accurately captures her approach. Nanny knows best, chin up, discipline is good for you, no moaning. She will listen to the staff, the parents and the pupils (though the doddery old governors are a nuisance), but it should be up to her to make the final decision.
Her upbringing as the daughter of an Anglican vicar means that she sees the people of this country as her flock, to be treated with respect, but ultimately to be guided down the 'right' path. The Church is hierarchical and paternalistic, it knows what is best for its members - though it is often unclear on how to achieve it - and so strongly discourages debate and squashes dissent (some branches labelling it heresy and taking extreme measures against it). It intensely dislikes any external scrutiny, to the extent of covering up serious crimes within its ranks (such as child abuse) so as to avoid any public investigation.
Mrs May's respect for her father and his work in his parish drives her to reproduce this on a national scale. She knows what is best for us, she is intolerant of dissent - having her own personal 'enforcers' - she is secretive, very hard working, and wants what is best for us as individual people not just as a nation.
Will she succeed? Or will her attention to detail mean sight of the larger picture is lost? Is she our guide through difficult times or the Queen of Misrule?
Sunday, 12 March 2017
Food, Glorious Food
Food, Glorious Food
Why is the price of agricultural land going down? Quite simply farmers are very worried about the effects of Brexit. Of course, land prices only affect sales and mortgages, so this is really a proxy for farming's economic health - to farm you need land. If land prices are dropping this means people see farming as becoming uneconomic.
Subsidies
The government has promised to maintain subsidies until 2020 - after that they won't say. It is likely the subsidies will drop 20% and keep going down after that.
How big a difference will that make? On average 60% of farm income is from subsidies, rising to over 100% for grazing livestock. So a very big difference.
Another issue is the expected loss of land management payments (worth £600 million) - i.e. being paid for looking after the land rather than what is produced.
Exchange rates
The fall of the pound means that many inputs (feed, fertiliser) are more expensive now, so expected profit per acre is less, meaning each acre is worth less in investment terms.
Labour
Another serious concern is who is going to harvest the crops? I've hand-harvested melons - I lasted a day and won't ever do that again. There are around 35,000 non-UK agricultural workers, two-thirds from the EU. That is not including seasonal workers.
Cutting migrant numbers will mean attracting UK residents to farm labouring - wages will have to rise, so prices will have to go up. That is for permanent posts - seasonal work is even more problematic. Most UK residents want a permanent job.
One strategy would be re-introducing the Seasonal Agricultural Workers Scheme - but that would go directly against the pledge to cut immigration to “tens of thousands” - remember students count as immigrants, though they are only here temporarily. There is also the issue of how to make sure temporary workers actually return home.
Exports
On the bright side, if the pound falls low enough then UK crops will still be economic to grow for export. The downside is that this pushes up UK food prices - e.g. British wheat is now 38% more expensive than last year.
Why? The lower price for overseas customers (due to the low pound) means there is more demand from them, while the higher price of imports (the pound again) means that UK customers (e.g. for animal feed and bioethanol) switch to British wheat. In consequence, the price of Hovis Wheatgerm bread has increased 31%.
Why is the price of agricultural land going down? Quite simply farmers are very worried about the effects of Brexit. Of course, land prices only affect sales and mortgages, so this is really a proxy for farming's economic health - to farm you need land. If land prices are dropping this means people see farming as becoming uneconomic.
Subsidies
The government has promised to maintain subsidies until 2020 - after that they won't say. It is likely the subsidies will drop 20% and keep going down after that.
How big a difference will that make? On average 60% of farm income is from subsidies, rising to over 100% for grazing livestock. So a very big difference.
Another issue is the expected loss of land management payments (worth £600 million) - i.e. being paid for looking after the land rather than what is produced.
Exchange rates
The fall of the pound means that many inputs (feed, fertiliser) are more expensive now, so expected profit per acre is less, meaning each acre is worth less in investment terms.
Labour
Another serious concern is who is going to harvest the crops? I've hand-harvested melons - I lasted a day and won't ever do that again. There are around 35,000 non-UK agricultural workers, two-thirds from the EU. That is not including seasonal workers.
Cutting migrant numbers will mean attracting UK residents to farm labouring - wages will have to rise, so prices will have to go up. That is for permanent posts - seasonal work is even more problematic. Most UK residents want a permanent job.
One strategy would be re-introducing the Seasonal Agricultural Workers Scheme - but that would go directly against the pledge to cut immigration to “tens of thousands” - remember students count as immigrants, though they are only here temporarily. There is also the issue of how to make sure temporary workers actually return home.
Exports
On the bright side, if the pound falls low enough then UK crops will still be economic to grow for export. The downside is that this pushes up UK food prices - e.g. British wheat is now 38% more expensive than last year.
Why? The lower price for overseas customers (due to the low pound) means there is more demand from them, while the higher price of imports (the pound again) means that UK customers (e.g. for animal feed and bioethanol) switch to British wheat. In consequence, the price of Hovis Wheatgerm bread has increased 31%.
Saturday, 11 March 2017
Taking our jobs
Taking our jobs
It is absolutely true - Johnny Foreigner really does take our jobs. When I saw that Liverpool FC was looking to sign another goalkeeper I had quick glance at their First Team line up. Not a single first team goalkeeper they have now is British! Then I had a glance at their staff - the first six (listed by seniority) are all foreign too. No wonder they are desperate to sign a goalie - presumably a Brit so that when the rest are repatriated there won't be an open goal on the field when they play.
What about own goals? I don't have any strong views on overseas players in British clubs, but I do on foreigners working in Britain - I am strongly in favour of them. Purging the Premier League might only make the football less exciting, but chucking out the people willing to work in low-paid service jobs means a lower standard of living for all of us. It really is as simple as that.
Only 1 in 50 Pret A Manger job applicants is British. Two thirds of their staff are from the EU. Their director of HR says that increasing wages probably wouldn't attract British applications. I disagree. I have worked in a sandwich bar and I'd go back - but the pay would have to be a lot higher than 'above minimum wage'. Maybe when I retire, have a wrecked pension and need to pay for food and heating...
Right now we have 32 million people in work - 5.5 million of them are foreign-born. There are 1.6 million people who are currently unemployed. You don't need a degree to see that booting out the Bulgarians etc will leave a lot of job positions unfillable. Even if we only evict the EU lot, that is 2.3 million job vacancies.
However, paying enough to attract UK staff will mean prices must go up, so that coffee and a sarnie is going to be a special treat not a desk lunch.
It is absolutely true - Johnny Foreigner really does take our jobs. When I saw that Liverpool FC was looking to sign another goalkeeper I had quick glance at their First Team line up. Not a single first team goalkeeper they have now is British! Then I had a glance at their staff - the first six (listed by seniority) are all foreign too. No wonder they are desperate to sign a goalie - presumably a Brit so that when the rest are repatriated there won't be an open goal on the field when they play.
What about own goals? I don't have any strong views on overseas players in British clubs, but I do on foreigners working in Britain - I am strongly in favour of them. Purging the Premier League might only make the football less exciting, but chucking out the people willing to work in low-paid service jobs means a lower standard of living for all of us. It really is as simple as that.
Only 1 in 50 Pret A Manger job applicants is British. Two thirds of their staff are from the EU. Their director of HR says that increasing wages probably wouldn't attract British applications. I disagree. I have worked in a sandwich bar and I'd go back - but the pay would have to be a lot higher than 'above minimum wage'. Maybe when I retire, have a wrecked pension and need to pay for food and heating...
Right now we have 32 million people in work - 5.5 million of them are foreign-born. There are 1.6 million people who are currently unemployed. You don't need a degree to see that booting out the Bulgarians etc will leave a lot of job positions unfillable. Even if we only evict the EU lot, that is 2.3 million job vacancies.
However, paying enough to attract UK staff will mean prices must go up, so that coffee and a sarnie is going to be a special treat not a desk lunch.
Thursday, 9 March 2017
Friends of the people, fighting for democracy
Friends of the people, fighting for democracy
So the Lords has passed two amendments to Article 50. These will be debated by the Commons next week.
Who let them stick their oar in? Well, it was those judges who allowed Parliament a vote on triggering Article 50. Those 'enemies of the people' whose decision was going to lead to chaos, delay Brexit by a year, force Mrs May to say what our aims are in the negotiations, force an early election... OK, that was the Daily Mail and some overheated Brexiteers, and sadly none of it came to pass.
The Mail said these 'enemies of the people' had 'declared war on democracy'.
Democracy now tends to mean taking decisions based on majority votes. Brexit was clearly democratic - a clear majority in a free vote. The campaign lies may have swayed people but are irrelevant. So surely the judges were going against the will of the people?
The will of the people? 17.4 million voted Leave, out of a UK population of around 65 million and another 5 million who live abroad. So those judges (and their 'unholy alliance') could only be enemies of at most a quarter of the people.
Enemies? The judges decided on a point of law. They were asked whether the government could remove a right the people have, without first getting the consent of Parliament. The judges said no. So they are in fact friends of all the people.
Warring on democracy? The judges said Parliament should be allowed to vote but didn't say anything at all about how Parliament should vote. It is unclear how allowing a free vote is warring against democracy - unlike the actions of those Brexiteers who made death threats against Gina Miller and the judges, and the one who actually murdered Jo Cox, MP.
OK, so they weren't enemies of the people, and they weren't declaring jihad against democracy, but were they simply wrong? Why can't the government do what they were asked to do by majority vote? Why ask Parliament?
The Bill of Rights, 1689, says "dispensing with laws by regal authority without consent of Parliament is illegal". The government was going to use the royal prerogative to remove the people's rights (e.g. free movement, European citizenship) without asking Parliament. Now just imagine that the new Tory leader had been unkeen on Brexit and the Queen tried using the royal prerogative to force it through... Democratic?
So those judges - and Gina Miller, her funders and her supporters - turn out to be friends of the people, fighting for democracy. No wonder Wikipedia deems the Daily Mail too unreliable to be used as a source.
So the Lords has passed two amendments to Article 50. These will be debated by the Commons next week.
Who let them stick their oar in? Well, it was those judges who allowed Parliament a vote on triggering Article 50. Those 'enemies of the people' whose decision was going to lead to chaos, delay Brexit by a year, force Mrs May to say what our aims are in the negotiations, force an early election... OK, that was the Daily Mail and some overheated Brexiteers, and sadly none of it came to pass.
The Mail said these 'enemies of the people' had 'declared war on democracy'.
Democracy now tends to mean taking decisions based on majority votes. Brexit was clearly democratic - a clear majority in a free vote. The campaign lies may have swayed people but are irrelevant. So surely the judges were going against the will of the people?
The will of the people? 17.4 million voted Leave, out of a UK population of around 65 million and another 5 million who live abroad. So those judges (and their 'unholy alliance') could only be enemies of at most a quarter of the people.
Enemies? The judges decided on a point of law. They were asked whether the government could remove a right the people have, without first getting the consent of Parliament. The judges said no. So they are in fact friends of all the people.
Warring on democracy? The judges said Parliament should be allowed to vote but didn't say anything at all about how Parliament should vote. It is unclear how allowing a free vote is warring against democracy - unlike the actions of those Brexiteers who made death threats against Gina Miller and the judges, and the one who actually murdered Jo Cox, MP.
OK, so they weren't enemies of the people, and they weren't declaring jihad against democracy, but were they simply wrong? Why can't the government do what they were asked to do by majority vote? Why ask Parliament?
The Bill of Rights, 1689, says "dispensing with laws by regal authority without consent of Parliament is illegal". The government was going to use the royal prerogative to remove the people's rights (e.g. free movement, European citizenship) without asking Parliament. Now just imagine that the new Tory leader had been unkeen on Brexit and the Queen tried using the royal prerogative to force it through... Democratic?
So those judges - and Gina Miller, her funders and her supporters - turn out to be friends of the people, fighting for democracy. No wonder Wikipedia deems the Daily Mail too unreliable to be used as a source.
Saturday, 4 March 2017
Industrial Strategy
Industrial Strategy
Mrs May has said she won't accept a bad deal over Brexit - she would prefer no deal, crashing out of the EU and moving immediately to trading under WTO rules. If that happens she wants to develop a "Singapore-on-Thames" model - with light regulation and low corporate taxes.
So what is her industrial strategy to prepare for this? It seems to be "Keep calm and carry on" according to the recent green paper. For example, it suggests sector deals - such as the secret promises made to Nissan - a road trodden unsuccessfully decades ago, leading to the state shoring up uncompetitive industries and thereby stifling innovative firms. The report is filled with vague aspirations, such as regional rebalancing and skills development, and positions itself as a 'vision'. We don't need a vision we need plans.
What about the concrete statements Mrs May has made about the future? Can she cut corporate taxes? Not if she abides by OECD guidelines, so is she intending to break free of them too?
If she does tax companies less, we will have to make up the shortfall or cut back the welfare state even more brutally than is currently happening.
What about trading under WTO rules? Well, let's hope we don't step on Mr Trump's toes as he has already said that he will ignore the rules if he wishes to. Given that Mrs May seems to be banking on a sweetheart trade deal with the US, she should be watching him very carefully. A further concern is that, given how dominant the US still is in international trade, if they start acting outside the rules then other countries will too and the government's plan for Free Trade UK will become a pipedream.
Fortunately Mrs May does seem aware of the dangers of a hard Brexit. Clearly we have to be ready to just leave, as a negotiating lever, but she says she will try to retain the “greatest possible access to the single market” and some elements of customs union membership. She wants to have a transition period, phasing in changes slowly, and is open to continuing to pay into the EU.
Let us hope that she can rustle up the negotiators needed - and that the EU will play ball.
Mrs May has said she won't accept a bad deal over Brexit - she would prefer no deal, crashing out of the EU and moving immediately to trading under WTO rules. If that happens she wants to develop a "Singapore-on-Thames" model - with light regulation and low corporate taxes.
So what is her industrial strategy to prepare for this? It seems to be "Keep calm and carry on" according to the recent green paper. For example, it suggests sector deals - such as the secret promises made to Nissan - a road trodden unsuccessfully decades ago, leading to the state shoring up uncompetitive industries and thereby stifling innovative firms. The report is filled with vague aspirations, such as regional rebalancing and skills development, and positions itself as a 'vision'. We don't need a vision we need plans.
What about the concrete statements Mrs May has made about the future? Can she cut corporate taxes? Not if she abides by OECD guidelines, so is she intending to break free of them too?
If she does tax companies less, we will have to make up the shortfall or cut back the welfare state even more brutally than is currently happening.
What about trading under WTO rules? Well, let's hope we don't step on Mr Trump's toes as he has already said that he will ignore the rules if he wishes to. Given that Mrs May seems to be banking on a sweetheart trade deal with the US, she should be watching him very carefully. A further concern is that, given how dominant the US still is in international trade, if they start acting outside the rules then other countries will too and the government's plan for Free Trade UK will become a pipedream.
Fortunately Mrs May does seem aware of the dangers of a hard Brexit. Clearly we have to be ready to just leave, as a negotiating lever, but she says she will try to retain the “greatest possible access to the single market” and some elements of customs union membership. She wants to have a transition period, phasing in changes slowly, and is open to continuing to pay into the EU.
Let us hope that she can rustle up the negotiators needed - and that the EU will play ball.
Friday, 3 March 2017
Garden Sheds
Garden Sheds
The weak pound is starting to show up in the price of imported goods: timber is up 14% since the referendum, putting (for example) garden shed prices up by 10%; wireless speakers (from Sonos) have gone up 18%.
Overseas investors are disinvesting, disposing of £7.6 billion of UK government bonds. 2,000 job cuts were announced today by US-owned businesses.
The national debt is £1.6 trillion and rising, with a deficit of £68 billion forecast this year.
But, just a minute! The weak pound means our exports could become more competitive, job losses could be made up for by deporting foreign workers such as nurses, so freeing up their jobs for locals, and we have managed with a national debt for centuries.
So why worry?
Well, it depends upon what is important to you. If you are well off then it's the rising cost of holidays abroad and those imported luxuries you like. If you are just about managing then it is your standard of living. The UK will be fine outside the EU, but we are going to have to tighten our belts. Taxes are going up - local and national - while services will be cut. House prices are still rising at 4.5% annually, with wages failing to keep up (2.6% growth last year and falling).
Forget Project Fear, this is Project Here. This is happening, and a lot of it has nothing to do with Brexit. At least, not so far. The referendum hit the pound hard, but care costs and house prices were bound to rise anyway. Care has to be paid for, so taxes were sure to go up.
The real question is how do we achieve Brexit while keeping the economic pain manageable? Leaving the EU is a big extra expense, and the cost isn't just the one-off admin. In fact the effect on our on-going GDP will be greater - and could be much greater. That is why Parliament needs to be involved in the negotiations, that is why we should have a voice in the decision, so that we, the people, are not sacrificed to a political idea.
The weak pound is starting to show up in the price of imported goods: timber is up 14% since the referendum, putting (for example) garden shed prices up by 10%; wireless speakers (from Sonos) have gone up 18%.
Overseas investors are disinvesting, disposing of £7.6 billion of UK government bonds. 2,000 job cuts were announced today by US-owned businesses.
The national debt is £1.6 trillion and rising, with a deficit of £68 billion forecast this year.
But, just a minute! The weak pound means our exports could become more competitive, job losses could be made up for by deporting foreign workers such as nurses, so freeing up their jobs for locals, and we have managed with a national debt for centuries.
So why worry?
Well, it depends upon what is important to you. If you are well off then it's the rising cost of holidays abroad and those imported luxuries you like. If you are just about managing then it is your standard of living. The UK will be fine outside the EU, but we are going to have to tighten our belts. Taxes are going up - local and national - while services will be cut. House prices are still rising at 4.5% annually, with wages failing to keep up (2.6% growth last year and falling).
Forget Project Fear, this is Project Here. This is happening, and a lot of it has nothing to do with Brexit. At least, not so far. The referendum hit the pound hard, but care costs and house prices were bound to rise anyway. Care has to be paid for, so taxes were sure to go up.
The real question is how do we achieve Brexit while keeping the economic pain manageable? Leaving the EU is a big extra expense, and the cost isn't just the one-off admin. In fact the effect on our on-going GDP will be greater - and could be much greater. That is why Parliament needs to be involved in the negotiations, that is why we should have a voice in the decision, so that we, the people, are not sacrificed to a political idea.
Thursday, 2 March 2017
Sovereignty
Sovereignty
The Lords have voted for the rights of ordinary people in Britain, voting for decency and fair play - something that our own elected MPs have signally failed to do. I trust that they will also vote for democratic oversight of Brexit negotiations.
Members of both Houses of the British Parliament, as the representatives of the British people and guardians of our best interest, should have oversight of the Brexit process and a meaningful choice presented to them - yet Mrs May’s avowed strategy does not respect this.
Her plan to present a final deal to Parliament as a “take it or leave it” choice – and with “leave it” meaning exit without any agreement at all – is a repudiation of Parliamentary democracy. She says she is bowing to “the will of the people”. Yet her goals are hers not ours. One third of the electorate voted Leave, one third Remain. That is all - no one has asked us what sort of deal we want.
It is even more chilling that, in pursuit of a Mrs May's hard-and-fast Brexit, members of her party have attempted intimidation, with Dominic Raab explicitly voicing otherwise veiled threats made against the Lords, hinting at abolition if the Upper House does any more than act as a rubber-stamp for legislation passed in the Commons. It is heartening to see that the Lords refuse to be bullied in this way. The Brexiteers' abuse of power is seen also in the threat of possible deportation which is hanging over the EU citizens currently resident in the UK, a threat intended to be used as a bargaining counter.
Mrs May is rushing towards a hard Brexit, attempting to complete it before she and the Conservative party go to the country in 2020, when they will be saddled with a foundering economy, with the NHS and social services in crisis, with rising inequality - and cut-throat capitalism their suggested solution.
Mrs May is rushing towards a hard Brexit, attempting to complete it before she and the Conservative party go to the country in 2020, when they will be saddled with a foundering economy, with the NHS and social services in crisis, with rising inequality - and cut-throat capitalism their suggested solution.
The Brexit deal will affect each one of us profoundly for the rest of our lives. What an irony that our best chance for having a voice is given by Parliament's unelected chamber.
Wednesday, 1 March 2017
Living on Plastic
Living on Plastic
So the UK economy is still strong. What is the secret? Sadly, the weak pound hasn't made much of a difference to export sales - it is down to you and me and the fact that we keep on spending. In fact we are spending more despite household incomes dropping. To do this we are squandering our savings and building up debt.
Why are we doing this? The Bank of England acted very quickly when Leave won:
Of course, there must come a point when we can't keep the economy going because we haven't any money left to spend and no one will lend us any more.
So the UK economy is still strong. What is the secret? Sadly, the weak pound hasn't made much of a difference to export sales - it is down to you and me and the fact that we keep on spending. In fact we are spending more despite household incomes dropping. To do this we are squandering our savings and building up debt.
Why are we doing this? The Bank of England acted very quickly when Leave won:
- It cut interest rates to 0.25% to make borrowing cheaper, and make saving worse than pointless - if you put £5000 in the bank today (with inflation at 2% - and rising fast) then next year it will be worth only £4900. So spend it now (and keep us afloat)!
- It gave out government money (i.e. your taxes) to the banks so they could lend it back to you at the new rate. That made it easier to borrow - the banks only got it if they managed to lend it out - and why borrow except to spend!
- It printed more money (aka quantitative easing). This is essentially printing more inflation. With more pieces of paper saying '£5' but the same amount of real things to buy then you need to give more of the pieces of paper to buy the exact same stuff.
Essentially it is the same as adding a zero to every bank note we have. Sadly, that wouldn't mean that suddenly you could buy ten times as much - you would find that all the shopkeepers have simply written an extra zero on the end of their prices - hey presto, inflation.
So far so pointless?
Not at all. Lenders can't simply say, "Well, with this QE we need to add a chunk onto the amount you owe." People would go nuts (and the government would jump on the lenders). So people's debts shrink magically and they can afford to borrow (and spend!) more.
How come the banks put up with this? Well, of course, it isn't their money they lend, it is ours (i.e. savers' money or government money), So the banks don't lose - it is the savers who suffer because we get back less than we saved.
Of course, there must come a point when we can't keep the economy going because we haven't any money left to spend and no one will lend us any more.
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