Bargain Basement Britain

Tonight’s debate, if I believe Better Together’s briefing to Magnus Gardham in the Herald, will concentrate on the ‘untrustworthiness’ of Yes on oil predictions and the NHS. Or, if I take a different interpretation, Salmond will point out how you can’t believe a thing No says on either issue. It is the existential heart of the debate of course – who do you believe, if either?

Well, away from the domestic issues of the Scottish agenda I wondered what else was happening in the kingdom of Great Britain, spiritual home of the No camp.

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As Alistair Darling prepares to issue warning after warning of doom to follow self-determination he might want to reflect on the reality of the country he wishes to preserve.

First, Barnardos says the UK’s poorest families have too little money to cover basic weekly living costs, let alone a trip to the beach (Bank holiday).

Their incomes have declined in recent years due to what the charity condemns as a “toxic mix” of rising living costs and cuts to working and non-working benefits. Welfare changes have included measures that break the link between benefits and inflation.

One in five families have less than £423 a week coming in, based on the government’s 2011-12 statistics for households below average income.

Barnardo’s said its calculations reveal that a family of four on this income could not afford a seaside trip in any of the popular locations it surveyed. Minimum disposable weekly income for the poorest families is £39. (Yes. That is £39 disposable)

Meanwhile, Labour’s own research of the activities of their Better Together allies reveals that the poorest areas of England have endured council cuts under the coalition worth 16 times as much per household as the richest areas. Hilary Benn, the shadow communities secretary, said his figures showed the government had “failed to apply the basic principle of fairness” when allocating money to local councils. Councils covering the 10 most deprived areas of England – measured according to the index of multiple deprivation– are losing £782 on average per household, while authorities covering the richest areas are losing just £48 on average.

Hart district council in Hampshire, the least deprived local authority, is losing £28 per household, while in Liverpool District B, the most deprived area, the figure is £807.

pg-4-child-poverty-ed

So we see a shocking disparity loaded in favour of leafy areas which support the Conservatives and again it is poorer people who bear the brunt of vicious Tory policy – Tories Better Together are campaigning with. Labour are fighting to ensure the same Tories will be able to run the country on average every 10 years. Then comes the sting.

However, Mr Benn confirmed that, given Labour’s commitment to matching the government’s spending plans for 2015-16, a government led by Ed Miliband would not be in a position to raise overall council spending.

That is Labour’s bind. They are committed to the same austerity budget as the Tories they complain about.

Instead Labour would focus on distributing money more fairly, he said. And I’m sure they WILL attempt to help Labour areas more if re-elected but it hardly speaks of radical politics to float all boats, does it? He means they’ll fiddle with the limited budget to help their voters just as the Tories are helping theirs. Hardly a sense of national purpose for social justice.

Those same suffering families mentioned above will be pleased to hear there is likely to be an interest rate rise before Christmas which will hit those living on borrowings to get by and on extended credit. If they have a mortgage they could find their homes under threat unless they are locked into a mortgage deal. The monetary policy committee split for the first time in years on the question of a rise. So it may happen soon. The Governor warned that ‘increases in Bank rate well ahead of any pickup in wage and income growth risked increasing the vulnerability of highly indebted households. Finally, an unexpected increase in Bank rate might cause sterling to appreciate further, bearing down on inflation and further impeding UK economic rebalancing.’

The value of the pound, much trumpeted as an icon of Union is currently weighing down economic performance. The strong pound does have benefits for holidaymakers who can afford to go abroad and in keeping the cost of imports down.

But it is hampering the elusive rebalancing of the economy by pushing up the cost of exports at a time when demand is weak in crucial markets such as Europe. This is Money says: ‘Britain is one of the biggest exporters in the world, selling everything from engines, cars and parts of planes to whisky and Burberry macs. But it still runs a huge trade deficit, with imports vastly outstripping exports.

The eurozone is Britain’s biggest export market followed by the United States, so the strength of the pound against the euro and the dollar is crucial.’

So poverty is rife in Deep Pockets Britain, the economic recovery is trailing behind other countries and looks extremely fragile with the fabled rebalancing no nearer, a big hit could be coming before Christmas with a rates rise and meanwhile Labour stands should to shoulder with the Tories to stop Scotland finding an exit from this neo-liberal catastrophe.

And, if you’re talking doom in Edinburgh as financial institutions plan an exit after a Yes vote, check this out from the Irish Times. ‘London hosts more than 250 foreign banks, many of which have based their main European subsidiaries in the UK capital and gained an automatic passport to operate across the other 27 countries in the EU single market for wholesale financial services.

If the UK were to leave the EU – the so-called “Brexit” scenario – senior bankers worry that Britain would be unable to negotiate the same passporting rights for its financial services industry. If these were lost, it would force many corporate and investment banking operations to leave the UK.’

At least four American banks are making contingency plans to leave London if there’s a Euro exit and only today Cameron is beefing up his exit rhetoric. Not that this is making headlines in Scotland where the No camp’s warnings of corporate flight from Edinburgh were front page news. It raises an interesting point though. Supposing Scotland does vote Yes – are those Edinburgh institutions going to decamp to London if its only a year or two away from leaving the EU? If we vote Yes it could be that Edinburgh becomes the destination of choice for overseas banks wishing to trade with Europe.

Merely some thoughts to hold on to as the slugging match gets under way at Kelvingrove tonight.

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22 thoughts on “Bargain Basement Britain

  1. Thanks Derek. On the issue of EU membership, I tend to EU-scepticism because of the democratic deficit. However, indyref has highlighted for me just how difficult it is to make any assessment of the democratic deficit in the EU before putting the UK house in order first. If we get an in/out referendum in 2017, who knows if the general public will get any sensible analysis of this. More likely, they will be inclined to project the UK’s democratic deficit onto Europe, in the absence of any other mechanism to register their protest.

    • People generally find it easier to blame scapegoats than actually look at the root cause of the issue.

      The root cause of most issues in the UK can be squarely laid at the door of Westminster, but fed with media scapegoats (the poor, the immigrant, the jock, the muslim) it’s so much easier for people to pick up these trends than actually consider that they are being duped.

      Self denial is a curious human trait, it takes quite a bit of effort to question yourself on your beliefs and where they come from. When you do that honestly, it mostly leads you to come to some uncomfortable realisations.

  2. There is an argument that a worse financial crisis lies ahead of the UK. The UK government does not look to be addressing longer term issues, e.g. low wage economy, national infrastructure investment, poverty in retirement, sustainable energy policy, unsustainable property prices, … An EU exit could compound all these underlying issues.

    I wonder if the “first past the post” voting system underlies the UK’s ongoing inability to tackle its problems? People who support FPTP often talk about “strong government” when the reverse is increasingly true. How can you possibly have “strong government” when the national legislature is effectively decided by a dozen or more key marginal seats?

    The UK “system”, to me, simply seems to embed the power of vested interests. In order to tackle this you surely have to go back to rebuilding the democratic process.

    • And what’s most worrying of all Murray, is that FPTP is exactly what the people of the UK want.

      I’ve been posting a lot recently regarding the 2011 failed AV referendum. Although pretty flawed, people failed to see the larger picture and on a 40% turnout, 68% voted against it.

      So the over-riding message to Westminster was we don’t want electoral change and with plenty of justification Westminster can now turn round and say, ‘change the House of Lords ?, change voting systems ? No, the people of Britain made it perfectly clear in 2011 that they don’t want change’

      You have to grab what is offered with both hands, even if it is far from perfect because you have to show that you want change. The AV vote is a perfect example of this.

      So when you hear unionist going on about reform of this that or the other, remember the AV referendum and the real message that gave to Westminster – that they have complete control and the people don’t want change.

      • Except AV is not a proportional system and would do nothing to change that a minority of constituencies elect the government. It would also result in everyone’s second choice winning seats which would hardly engender much needed confidence in the political process.

        There is an argument I recognise that voting against AV because it wasn’t proportional is an example of the perfect being the enemy of the good. But an AV vote could well be a triumph of the mediocre over the good.

        The problem with the AV referendum was the way AV was selected in the first place: in a smoke filled room by politicians. Back in the small vibrant democracy of New Zealand when we raised a groundswell of discontent over FPTP elections the pollies trusted the electorate and we had a National Conversation about voting systems with campaigns for MMP, AV, STV and sundry others all before the internet. Things coalesced around MMP and over two referendums we got it. The same thing is currently happening over changing the flag.

        That is the sort of polity I want Scotland to be and despair that deferential entrenched UK can never become.

    • Its all very well to dream about a better world, but let’s think about this more clearly. I’m afraid it is pure fantasy to imply that a yes vote will bring about a better Scotland. It is more likely to result in higher taxes and reduced services.

      • Nothing wrong with higher taxes if it raises the living standards of the worst off, and helps them to contribute. We cannot drive past Easterhouse with our eyes shut, can we?

  3. When Scotland is independent and the poor old rUK is out in the cold perhaps Ireland will be good enough to share the banks with us – two to you, two to me – and so on! Life is so much easier when the neighbours are friendly!

    Thanks, Derek, for yet another good post.

  4. You can almost smell the rotting flesh of this uk carcass. Unbelievably, there are some who wish to wallow in it. Political cannibals vote No.

  5. I hope tonight is not a slugging match. While the last “debate” showed that only two or three areas can be touched on, even accounting for pandas, this was largely because of Darlings repetitive shouting. I suppose the general public is unfamiliar with the protocols of debate, but I am sure that Daring was well aware of his nihilistic approach.
    Of more concern, is that the subjects for debate are also “non-issues”. The NHS in Scotland is independent of the NHS elsewhere and always has been. It faces the same difficulties (threats) that any social health service does. Increasing demand and the hovering vultures of the US private health business set loose by TTIP are waiting to suck up any amount of money. An independent Scotland may be better able to arrange things to avoid the depradations of TTIP by keeping everything in house, whereas the NHS in England has already opened the gate.
    The dramatic and mendacious intervention by Sir Ian Wood has turned the spotlight on to oil and endless argumetns about how much is left and who said what, and what it will be worth in five years time now that fracking is cheap and oil and are free. There is no response to this other than my favourite; it is the future so who knows? The only people with a real workable estimate, because they spend big money on it, are the oil extraction companies, and they won’t be telling their competitors anything. They are continuing to spend fortunes on further developing their oil fields. They are well aware of fracking, turmoil in the Middle East, developments in Brasil and Angola, the problems in Northern Canada, the volatility relating to the availabilty of Russian oil and so on and so on.They are continuing to spend fortunes on further developing their Scottish oil fields.That should be the only clue the rest of us need. There is lots of oil left. Even if it only lasts the minimum time estimated, some fifteen years, it will give us plenty of money to develop our economy, for example by building those arteries of industry, roads to replace the tarred over cart tracks.
    As yet no-one has addressed a key issue of a balanced democratic parliament. The draft Constitution does not consider the possibility of a second chamber. At present the Scottish Parliament can, and does, pass laws without a vote being taken because there is no opposition. That simply means a concensus and not that they are good laws. As it would be very hard to separate any of the main parties in terms of policies and activities this seems to me to be a major area of risk.
    A party with an overall majority could pass any law it cared to in a single vote. Although I tend to wish for a second chamber it is hard to see how one could be established with sufficient distance from the ruling political groups so as to provide an objective oversight and the power to exercise a check. Any elected body is likely to reflect the party in power, although holding elections at different times might help. Selecting members of the second chamber based on representatives of other bodies, such as Trade Unions, also has dangers as qualifying bodies could be “stuffed” with activists as we saw with the Labour Party not so long ago. As a republican I condemned the House of Lords without thought. On mature reflection having a second chamber composed of landed gentry does have some benefits; they have nothing to gain from adhering to one party or another, their wealth and their self-interest is based on their land-holding so they won’t be leaving the country any time soon, they can afford to be obective and impartial.

  6. For the last 12 months and more, Labour politicians have been talking about redistribution of funding between areas. There is absolutely no mention of redistribution of wealth between individuals or groups – between the rich and poor. The recent Labour policy conference rebranded it as a party of “big reform, not big spending” so Labour is also for smaller government, leaving welfare state and universal services behind. It’s all modern Labour spin for pursuing Tory austerity economics, and their own version of Cameron’s big society.

  7. Whatever else happens tonight I wouldn’t look for a big change in the FMs approach. I suspect a better, simpler message on the currency issue, but on the whole the same measured, reasonable and conversational approach as the STV showing.

    I’d love to see him get stuck in about Darling, but I suspect that’s not the game plan and is unlikely to happen. The main thrust will be IMO, to present a safe and reliable pair of hands in direct contrast to Mr shouty/pointy. Present the statesman and not the debating brawler as it were. More than anything I’d like to see the potential leader of a nation on display and FMQ style point scoring won’t fit that bill.

  8. Who is going to be presenting this in the chair?

  9. Steve Asaneilean

    And the real tragedy of this “bargain basement britain” Derek is that it is inflicting real damage on real ordinary men, women and children. Families are disintegrating; children’s prospects for good health and education are diminishing; mental health crises are growing; we have food banks in rural Scotland; inequality grows and no-one in power has the real courage and guts to stand up there and say “We will tax higher, spend more and redistribute – it’s called civilised democracy”.

    I don’t know which world politicians – Labour or otherwise – live in. They seem blind even to the problems let alone the obvious solutions. A shame on all their houses. And a shame on all the press who blithely ignore what is happening out here in the real world in their desperate grasping to save this worn out and financially and morally bankrupt union.

  10. great stuff Derek.

    And the comments too. Brilliant.

    I am very optimistic about the vote. YES will win and by a fair amount too, but i do worry about the MSM and the BBC in particular. The lies and drivel that they have shown is a disgrace. If i was watching this from abroad i would be comparing the WM/MSM cabal a propaganda group equal to North korea.

    I hope folks see through the spin and vote accordingly.

  11. Some very good thoughts on tonight’s debate well too late for nicy nicy Alex get right into darling firstly how much he personally has trousered during this campaign its been quoted as much as £250.000.00 and is he not embarrassed being the bag man for the money men bankrolling the NO lot ,lets hear a few quotes darling has made in the past when he had a conscience and was a the word labour never uses now,” Socialist policies” and all the scottish labour mps failing to turn up to vote against the bedroom tax let the people know exactly what scottish labour do when no one is watching embarrass him with facts interrupt him ,laugh at his answers in other words get right in his face i bet darling looses it he is on the edge already give him a push don’t walk out of there wishing you had said this or that go for the throat after all the lies that lot had told they don’t deserve any kind of respect , just a thought

  12. Imagine the scenario that Scotland gets independence, keeps the pound and the rUK exits the EU…..and Scotland retains the pound and removes the pension dividend tax put on by Brown…Imagine the Tsunami of pension funds moving north. Even if they don’t exit the EU the temptation to move funds out of the rUK would be enormous.

  13. “One in five families have less than £423 a week” Try £350 a week, and I’m working!

  14. Whoever is perceived “to win” tonight will make no difference to me. I’ll campaign for a Yes vote with all my energy.

    NHS – we have been well warned on the consequences of a No vote.
    Currency – Yawn. We will accept tradeable currencies for the goods and technology we sell.
    Trident – Remove as soon as possible.
    Embassies – Yawn

  15. Gavin Barrie.

    I agree,it is about us, not them.

    Though Alex Salmond did, comrehensively win the political arguement tonight.

    That seems to matter for some folk.

    • The problem is the invincible ignorance of Labour voters who see living in Easterhouse as a real benefit from being in the UK and voting Labour locally and nationally.

  16. Wow, was I ever wrong about how the FM would handle the debate?

    Darling filleted on live telly and forced to bring his own currency strategy crashing to the ground. He looked drained and tired by the end.

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