Thursday, 3 October 2013

Political conference season: four badly-drawn ideas


So it's been political conference season in the UK. Time for political activists to get together and have a few drinks. Time for politicians to make speeches to the faithful - though, in light of their dwindling membership rolls, 'time to talk to lobbyists and journalists' might be a better way of thinking about it.

And time for more of those bad, mad and dangerous ideas that presently afflict us to keep tumbling out. Landlord checks on tenants' immigration documents? Life sentences for dangerous dogs' owners if they end up killing people? Help to Buy, that disastrous shot of neat steroids straight into the arm of the housing market? They're all out there, and they're all likely to do more harm than good.

But this conference season, we've had even more. Let's take four, shall we? Two from Labour and two from the Conservatives, just for the sake of balance. They're not terrible in and of themselves, you understand, though most of them are in terms of their actual execution. They're simplistic, they've been written on the back of an envelope, and they're never going to happen as intended. That's the real tragedy - and the really disingenuous nature of their announcement, intended to cheer up party members and attract a few headlines rather than really address our problems. Anyway, in no particular order, here's our four:

Making the long-term unemployed work for their benefits. This isn't all that bad on face value. If we conceive of society as an organic whole, composed of rights and responsibilities, some work for benefits is unobjectionable. Except, except... Chancellor George Osborne (above) announced that this would be for 30 hours a week. Such a policy might be popular. But nothing is more likely to make the labour market malfunction. How on earth are you supposed to look for a job, think about your skills, or (I'm sorry if I'm sounding a bit sympathetic to actual people here) feel good about yourself and your choices if George Osborne forces you to break rocks? Let's have a bit of aggregate macroeconomics in here, shall we? There are simply not enough 'jobs' to be taken up: what we're talking about with this 'idea' are pseudo-community service tasks. Labour had a great deal of success, in office, with reducing the level of long-term unemployment: the Coalition still might, if it focuses on growth and continues to cut the marginal rate of income tax for people moving from welfare to work. But this? The only effect will be to make Mr Osborne look 'tough' on welfare recipients.

Funding apprentices in line with immigration numbers. We've bashed this one before, but perhaps we didn't spell it out enough. This Labour idea makes precisely no sense. None. Nada. Put aside the legal questions over the move, because although of course anyone from within the EU can apply for apprenticeships in the UK, in practice few actually do so. No, the problem here is the link between two completely different areas of policy, which should (a) remain separate, and (b) don't impact on one another in ways that politicians expect. Companies recruiting Spanish workers won't have to take on more apprentices; firms employing Russians will. The effects on labour productivity can only be imagined: in the particular slight, but in the aggregate probably harmful. This one's a duffer. It should be dropped forthwith.

Withdrawing benefits from the under-25s. This one's the nastiest, and the one likeliest to do most damage. Again, on the surface, no-one could object to saying that all young people should be in work or training. But this is just not practicable or realistic. Some of our young people are highly vulnerable. Some are less than able to tackle either education or full-time employment without a lot of support. Are they really to be thrown back on their parents, and if they have no parents (or not ones ready or able to take them in), onto charity? At this point one feels like saying: there was a reason that Beveridge and Keynes recommended universal welfare that applied to all. Not because people would be able to 'fall back' on it, like a comfy sofa, but because to do otherwise risked tinkering with very complex processes that should be allowed to work themselves out under a single system. Narrow down your focus too much, and you'll end up with consequences you never imagined: in this case, a medium-sized group of indigent (and, increasingly, homeless) young people, drifting towards city centres with little hope and less to do. To make things worse, Liberal Democrat leader Nick Clegg has successfully muddied the waters on this one today, saying that his total failure of a Youth Contract will cover young people who've completed two years in the Government's similarly useless Work Programme. The right response? A sad shake of the head.

Freezing fuel costs. This Labour announcement the most intriguing one in our list, and potentially the one that's the runner. We know from study after study that our big electricity providers might well be colluding against the consumer, potentially to the tune of many billions of pounds. Breaking them up, and creating a much tougher regulator, may well therefore help to reduce costs - and bills. They're too big, and they're too powerful. Remind you of anyone? Yes, it's the pre-2007 banks. Except that not one estimate of these malignant practices adds up to enough cartellisation to bring down costs immediately upon the election of a Miliband government, or even to cover the costs of a seventeenth-month freeze once legislation has been put in place. Not one. What this means is that (a) the taxpayer would have to plug the gap - perhaps a more equitable solution, given the relatively progressive nature of the tax system, than relying on consumers of the actual power, but hardly likely to encourage sparser and more environmentally-friendly use of gas and electricity. Or, alternatively what might happen is (b), that given the uncertainty - and unless you nationalise the entire system - power companies will spend and invest less in power generation. Either of these routes to perdition will cause a strong political backlash if taxes have to stay high, or the lights go out - exactly what happened, by the way, to the Attlee government in 1947.

The conclusion? Our political class isn't up to its job. We face so many real challenges - from environmental degredation, to the US debt crisis, to what we're going to do with NHS general practice as more and more people age, and health 'consumers' become more and more demanding. And these aren't solutions. They're unlikely to serve as even mildly effective sticking plasters.

The answers we've been presented with over the last few weeks are inadequate to the seriousness of our times. You know it. Every other voter knows it too.

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