Category Archives: Politics

DUP “plan” is simply garbage

Arlene Foster was mocked for talking of a five-point plan during the UTV Leaders’ Debate, which was in fact this:

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So, a ten-point “plan”. Except it isn’t a plan.

And that is what really annoys people.

Who opposes “more jobs, rising incomes”? No one. But where is the plan to achieve it?

Who opposes a “world class health service”? Many would say we already have one. But her party has had five years to reform it and has comprehensively failed.

Who opposes giving “every child the opportunity to succeed”? But where is the analysis of why is not the case?

What exactly is “rebuilding Northern Ireland”? The SDLP also have a peculiar obsession with building.

Where is the plan to “reward hard work”, and how is it judged and defined?

What precisely is “smarter justice” and has she noted we have “safer streets”?

Are “stronger communities” to be “created” or are we just using random words now?

What does a “friend of the farmer” mean and how is that a plan?

Her party has had a decade as largest party to “change politics in Northern Ireland”, so why has it not?

And detail how someone plans to “take pride in Northern Ireland”?

There is not a plan there to be seen. It’s just vacuous nonsense. The DUP clearly has no plan – it just wants power for the sake of it. No wonder its representatives keep failing to turn up for panel events.

Plainly the DUP thinks we will fall for this bunkum; in other words, DUP candidates think we are all fools.

It would be a good idea to prove them wrong.

Populist candidates getting it wrong on infrastructure

No sooner had the CEO of Belfast International Airport tweeted that a crash on the main A57 road from the M2 to the airport demonstrated his case for a dual carriageway, Assembly candidates were lining up to agree – indeed, one first-time candidate for the local constituency instantly called for a motorway.

They thus demonstrated the whole problem with Northern Ireland politics. As soon as someone calls for something, politicians and would-be politicians are climbing over each other to agree. Yet, once they have attained office, they find it isn’t quite so easy… no wonder so many people thing politicians are dishonest!

To be clear, such an upgrade is not a bad idea. But it is not programmed; it is very complex; and in any case it shows a false priority between road construction and road maintenance.

It is a duty of candidates, before making pledges, to do some research into how viable they are. Even a cursory piece of research would have demonstrated that there is zero chance of a significant upgrade to the road from the motorway to the airport this decade, and almost zero even in the next decade. In fact, on this very blog, I provided the current list of programmed primary road projects in Northern Ireland just three months ago – these take us essentially to the end of the 2020s, and the A57 airport road does not appear.

Of course, a future Infrastructure Minister could decide to re-prioritise, and take a project off the list, replacing it with the A57. Yet a cursory look at Assembly debates and party statements notes that absolutely no one has seriously suggested this – there is the odd reference to an upgrade but no reference whatsoever to which project would be removed from the programme to enable it.

Were an upgraded road to the airport to be prioritised, it would become quite complex. It is far from clear that such a road should run along the current alignment of the A6/A57 from M2 J5 (at Templepatrick/Ballymartin) to the airport. In fact, there is perhaps a better case for a route from somewhere near J4 Sandyknowes (this would require the construction of an additional junction roughly where the new Templepatrick Services are, and in fact such a junction is proposed in the longer term for all kinds of reasons); or perhaps even from between J5 and J6 (near Parkgate). Either of these options would make it considerably easier to bypass Templepatrick with a high-speed road without causing significant public protest (and thus delaying the whole thing until well into the 2030s). In other words, it is not at all straightforward, which is one reason it is not programmed!

There is another problem here, which is that for all the understandable excitement about grand projects like the A12 York Street interchange or the A6 Moneynick upgrade, funding is being cut back from basic maintenance. Many readers in Northern Ireland will already have noticed street lights going unrepaired; resurfacing projects being delayed; even still road side verges going untreated.

While we protect funding for an unreformed education and health system and push for more and more grand infrastructure projects (hands up on the latter!), we are omitting many of the basics.

It is the basics the politicians (and those who would be politicians) need to get right. Meanwhile, beware anyone promoting a motorway to the airport. There hasn’t been a motorway constructed in Northern Ireland for over 20 years – and the maintenance of the ones we have is going under-resourced. Let’s fix what we have first…

 

Scotland not so left-wing after all…

Last weekend saw another march in London against “austerity”.

This really is an appalling abuse of the word. Food rationing post-War was austerity. Perhaps the three-day week with limited electricity in the 1970s was austerity. An ever increasing gap between rising public spending and falling income tax at a time when public sector wage growth vastly outstrips inflation is, quite obviously, not austerity.

Facts, eh?

Marchers claimed they had public support for their cause. Yet in last year’s General Election right-of-centre parties or those in coalition with them received almost two thirds of the vote in England.

There are those facts again…

At least it was different in social democratic, left-leaning Scotland.

Or was it?

Scottish Labour recently adopted a courageous policy of adding 1p to Scottish income tax. If Scots are opposed to “Tory austerity”, they reason, they will not mind paying a small bit extra to avoid it. In any case, have Scots just not had a huge debate about taking on more powers and thus obviously, by logical extension, using them? And of course, 21p income tax with the much higher personal allowance still means less to pay than when Labour left office.

Such a courageous, honest and rational stance would no doubt see a swing towards Labour in a social democratic country keen to model itself on Scandinavia, of course.

Well, no.

All the evidence suggests that Labour’s new policy is courageous only in the “Yes, Minister” sense – unpopular, in other words.

A survey by the very man whose exit poll pointed towards the real result of last year’s UK General Election shows that the comfortable majority of Scots oppose putting taxes higher than in the rest of the UK. In line with this, the SNP (which proposes no income tax rises, although it would change the bands to see 40% payers paying slightly more) remains well out in front. In fact, far from gaining it ground, Scottish Labour’s new policy sees it in serious danger of being overtaken as the main opposition at Holyrood by the Scottish Conservatives (who oppose any income tax rises or band changes at all).

Scotland is perfectly normal in this regard. As ever, people want more money spent on the services which affect them, but are notably unwilling to put their hand up to contribute any more towards them.

“Get those tax evaders and welfare fraudsters instead!”

Funny, you never hear that line in Scandinavia. But then, whisper it quietly, Scotland isn’t like Scandinavia…

Sectarianism and the delusion of objectivity

The Undercover Economist author Tim Harford has a very important article here on the “Delusion of Objectivity“.

It applies to many things, but one is the oft stated contention that “It is not sectarian to take a position on the constitution” in Northern Ireland.

Actually, in practice, it usually is.

The position taken on the constitution by parties made up almost entirely of British Protestants educated in state schools on one hand or by Irish Catholics educated in maintained schools on the other is not objective. It is pre-determined. It just so happens that all of the former, who grew up in a broadly British culture, prefer the British state; and all of the latter, who grew up in a broadly Irish culture, prefer the Irish state. Funny, that.

Such constituonal positions, therefore, are a product of cultural upbringing and not of objective and rational thought.

Now read the article again…

We see the tendency of each side to forgive the other side their constitutional position given that people on the other side grew up in a different culture. At heart, though, we still believe the other side to be misguided; we just don’t blame them personally, but rather their upbringing, for this delusion.

Anyone who cannot give a clear, rational view as to why someone of a different background should switch to their constituonal position has arrived at it based solely on cultural upbringing. That cultural upbringing was in a society (and, notably, education system) segregated along sectarian lines.

So yes, if you cannot defend your constitutional position genuinely objectively, the practical reality is that your position is sectarian – because it is arrived at solely based on which side of the sectarian divide you are on. Indeed, you may even be deluded…

“Tax returns” and fearing for democracy

The fuss over tax returns makes me despair for democracy, and politicians publishing them is actually dangerous.

Of course, the reason politicians are often hypocritical is that so are the voters. We are hearing frankly ludicrous demands for six years’ worth of tax returns made by people who themselves would never dream of publishing theirs – indeed, often by anonymous trolls on Twitter!

The real problem with our democracy is that it is increasingly a closed shop – people get a job in a constituency office, become a Councillor, and move “up” from there. We end up with Ministers who have never run a business, never managed a charity, never worked in the public sector, never in fact had to manage a household budget on anything like the average salary.

What we need in our legislatures and governments are people who have created jobs, promoted charities, worked at the coal face, succeeded in academia, seen the public sector first hand and so on – professional people, who can provide valuable experience and knowledge to the policy-making process. Already, when seeking public office, they have to deal with risking careers, restricting family time and dealing with public ire with no guarantee of electoral success. Now, on top of that, we want them to reveal details of their private lives which none of the rest of us would even dream of revealing even to close friends and family? That is going to improve the quality of public debate, is it?

There is of course the issue here of public ignorance about taxation and public finance. Basics, like the difference between “tax avoidance” (which most of those agitating about it actually do themselves!) and “tax evasion” are missed. Moreover, the very point of an “offshore” investment is it does not appear on a UK tax return! Worse than that, however, is that a tax return actually tells us nothing about a person’s real interests. We learn nothing about what industries they may invest in, what property they may own, and even what charities they may support – all of which is potentially relevant to decision making as public office holders. That is why we have registers of interests!

Add to this the modern social media world where sanctimonious outrage is King and anyone engaging in the actual complexities of managing public finances, reforming a health system or assessing social housing stock is instantly dismissed. It is of course a lot easier and less time consuming to tweet #CameronResign to feel good about yourself, than actually to engage in the complexities of the issues and to influence real change in the public interest.

The only issue here is whether people making decisions in the public interest are being up front and honest. We can assess that on the public evidence – and not on private and irrelevant tax returns, which are already assessed by the tax authorities.

We have now spent days discussing tax returns – both a practical and political irrelevance – in a way which can only damage the chances of new blood entering the political system. Meanwhile decisions on Health, Housing and everything else that actually affects us have been made completely without scrutiny. What kind of farcical democracy are we creating for ourselves?

Brexiteers – what about the real world?

The vehicle I use most of the time is in fact leased. Although I use it most of the time and refer to it loosely as “my car” because it is registered to me and is parked on my property, strictly speaking it actually belongs to the manufactuer’s UK financial services company. Yet that company has no interest in the car, only in ensuring it is paid for; I am the one with the interest in it. Who owns it in practice, therefore? And does the ownership have any practical relevance?

There is a section of the Russian Far East which is twice as large as India yet contains a population lower than that of the island of Ireland. Yet it has in recent years experienced notable immigration – number hundreds of thousands. These immigrants come not from elsewhere in Russia, but from China. They have come not to leave China, but in fact to set up a Chinese timber company which will send timber supplies back from this small corner of the world across the border for use in by Chinese industry, notably construction. Who owns that part of Asia, therefore?

Nominally, the territory referred to falls within the boundaries of Russia and is thus theoretically under the sovereignty of the institutions in Moscow. However, it is almost depopulated and has no functioning economy except for timber. That economy is entirely dependent on Chinese immigrants sending timber across the border into China. The territory, therefore, is only under Russian sovereignty in the same way my car is under a financial service’s company’s ownership – it is theoretical but has no current practical purpose (for as long as China needs timber and I keep up my payments, respectively). In effect, Chinese industry has “leased” this territory from Russia, and it is now solely within China’s interest for as long as it wants it and can make it economically functional.

China is of course “leasing” lots of the world, often in terms of maintaining or constructing infrastructure – building piers in Mozambique to cricket grounds in the Caribbean in return for “maintaining interests”. The UK, notably last week Scotland, has not escaped its attentions. This is a form of neo-colonialism – complete even with the partition of Sudan into a China-dominated North and a Western-dominated South.

In this context, what on earth is sovereignty?

The world consists of new mega-cities (often in the Far East) and major trading blocs. Sovereign states are no longer of particular relevance, other than as units of nominal, reactionary government.

Why on earth would we leave the economically largest such bloc?!

Steel issue shows limitations of sovereignty

The debate around the future of the UK steel industry has demonstrated just how ludicrously parochial political debate here has become. People lined up to argue over how losing hundreds of jobs in Port Talbot was the UK Government’s fault, the Welsh Government’s fault, the Remain side’s fault, the Leave side’s fault, the fault of any politician I don’t like…

It is just possible that it isn’t any politician’s fault.

The fact is, since the mid-’90s in particular, we have all literally bought into an economy based on cheap supply from the Far East.

We are not necessarily wrong. Upon retirement in 1997 my father bought an Internet-capable (US-built) PC for the modern equivalent of around £5,000. Its capabilities would be comfortably passed by a basic (Chinese-built) £100 mobile phone now.

So it goes on across a vast range of goods – phones made in China, vacuums made in Malaysia, electronics made in Indonesia, etc etc. In such countries, wages are much lower and workers’ rights much inferior (even basic welfare or pension provision is almost unknown).

But we don’t care, as long as we get the goods cheap and can spend the rest of our wages on leisure activities, fancy cars and holidays (perhaps to places like Dubai, largely built by migrant workers on pitiful salaries with no basic rights at all).

Let us be clear, any politician seeking to deny us this standard of living, even though it is in effect based on slave labour (just not our slave labour), would never attain office.

China and other countries have used this income to grow their economies and create a burgeoning middle class – which, just every few years, grows by a size equivalent to the entire population of the UK. One of the inevitable consequences was a construction boom in the Far East (most obviously in China), and then something of a bust, with a further consequence that China had an excess steel supply which it dumped cheaply on the world market.

So it is that Chinese economic decisions affected an Indian company to the extent that hundreds of jobs were put at risk in South Wales. This is globalisation, an inevitable consequence of the cheap supply economy into which we have all eagerly bought – not “politicians”, us!

Such also is the limitation, or indeed near irrelevance, of the concept of “sovereignty”. It was not a current Welsh Government or UK Cabinet Minister’s decisions which threatened the UK steel industry; it was a Chinese economic decision and an Indian company board’s reaction to it.

This is the ludicrous nonsense of “take back control”. This is a globalised world of quality European imports and cheap Far Eastern imports. We need to be part of a big team, not exposed on the sidelines.

 

UK should leave UN

The United Nations was well intentioned, but the fact is it has failed to deliver peace to the world – an objective which should be easy given there are only 7 billion people in the world and some do not even particularly have competing interests.

At its burdensome headquarters in New York, the UN is a burocrat’s dream. Its complex voting system means nothing ever gets agreed anyway. It is undemocratic, with five countries favoured over all others based solely on their status in 1945, and with decisions taken by administrators and other second-class diplomats not good enough to get a real embassy.

You and I pay into this failed organisation and frankly I am sick of it. The UK should take its own decisions on its security and military operations – who needs cooperation with bigger countries, shared intelligence and new emerging technology anyway? Indeed, the UK would be free to build new armed alliances with other countries which are free from the shackles of the UN – emerging powers like Abkhazia, Somaliland and Northern Cyprus.

Besides, it’s NATO which keeps us safe, not the UN.

It’s time to stop living in the real world and pretend nothing that anyone else does affects us – “taking back control” as some would call it. Let’s get out of this failed, unaccountable, unelected bureaucracy. Let’s leave the UN.

Brexit letter packed with “mistruths”

My wife received this letter the other day.

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That section was the only truthful part of it.

[The Common Market] takes away our right to choose our own future and how we trade with the rest of the world. 

On the contrary, it does the precise opposite. Rather than taking on China and India (with over 1 billion people each and a middle class which grows by more than the entire population of the UK every few years) alone, we get to take them on as part of the world’s largest trading bloc – all while enjoying free trade, which we would not otherwise have, with our nearest neighbours.

The European Parliament regularly passes laws inappropriate to us. 

Name one. Oh, you haven’t. It is actually the second largest democratically elected parliament on the planet. The UK Parliament and NI Assembly regularly pass laws inappropriate to me; it’s called democracy.

We pay €20 billion for this intrusion. 

This is an outright lie – and odd that Brexiteers would use euro…

Firstly, we do not “pay €20b” at all, because the rebate is taken off before the payment. Secondly, the remainder could not come off our national debt because: a) it is made up of things we would do anyway, such as farm subsidies and international aid; b) we would have to pay more to administer things on our own which are currently administered by 28 countries acting jointly (like environmental regulation or negotiating trade deals); and c) we would have extra costs (such as extra intelligence officers or border patrol personnel).

We pay twice…

Er no, we pay once. Another outright lie.

If my wife and I pay for a meal from a joint account, we pay once, not twice.

We buy more from the EU than they buy from us [thus they need us more than we need them]

We do buy more from the EU than they buy from us but unless we are all going to start driving Rovers, returning to holiday camps at Butlins and drinking English wine, that means we need them more than they need us. They’ll sell to us anyway because we want their stuff – but we’ll pay more because of the tariffs.

I urge you to listen to the real people who create wealth…

You mean like the CBI, most of whose members oppose Brexit? Or the FSB, more of whose members (including the author) are pro-EU than anti-EU?

Who’s not listening?!

I am undertaking to issue a [daily] reason to leave on Twitter…

Something which has already not happened; the “reasons” are generally woolly nonsense or outright garbage (like the old mistruth that most SMEs want to leave).

To protect ourselves from waste and misappropriation in Brussels

More people work for HM Customs & Revenue than the entire European Commission.

Safeguard us from laws passed by Eurocrats…

Eurocrat klaxon!

You mean laws passed by democratically elected representatives and those appointed by elected governments under treaties the UK’s elected government signed?

So, not by Eurocrats, in other words.

We can remove politicians who are unanswerable to us…

(I look forward to your campaign to remove the House of Lords. Or indeed the Conservative Government, opposed by 63% of UK voters…)

The EU seeks to shackle the City of London

Not what the City seems to think! It is in fact hugely benefited by its position as the financial centre of the world’s largest trading bloc – as you would know, if you asked anyone who works in it.

Enhance our country’s security by control of our borders

We already control our borders!

Not very well, as it happens (one of the Paris bombers had passed through the UK undetected).

Of course, leaving the EU would make it harder to share intelligence and counter international terrorism and cross-border crime.

New freedom to trade with dynamic parts of the world

Er, except this would involve doing trade deals with them on their terms while disabling trade with our nearest neighbours.

There’s something very peculiar about the argument that we can’t get our way with the Swedes or the Spanish but somehow we’ll be able to with the Chinese and the Russians…

Free but everywhere in chains is not free.

The UK is the world’s fifth biggest economy

Tenth, actually, by total GDP.

The EU is the world’s biggest.

Next.

Reclaim our territorial waters 

You’ll be asking Iceland to build a wall next!

[The EU] certainly adds a huge amount to your grocery bill

You really do wonder if this gentleman understands the meaning of the word “fact”.

Because there are no tariffs on EU products, the EU has negotiated favourable trade deals on our behalf using its power as the world’s largest trading bloc, and we have free movement of goods and services (reducing transport and labour costs), our grocery bills are far lower inside the EU than they would be outside it.

I beseech you to make a considered decision on 23rd June

I will.

On the basis of the actual facts rather than the scaremongering, propaganda and outright lies contained in that letter, I will be voting REMAIN and campaigning for everyone else to do likewise.

Corporation Tax cut must make NI think again

I found last week’s UK Budget slightly scary. The speed at which the Chancellor is reducing growth forecasts, raising tax thresholds and cutting corporation tax hints more at “make it up as you go along” than “long-term economic plan”.

Much of it, quite by accident, was good news for Northern Ireland. The next Assembly gets another £220 million to spend over the term; a population which has few rich people but a lot of comfortable ones will gain from the rise in tax thresholds (a household of two senior public sector workers gains £1410); and the basic stability apparently on offer provides comfort to a region particularly hit by the Great Recession.

However, perhaps most striking from a Northern Ireland viewpoint was the Corporation Tax reduction, with the (UK Standard) rate set to reach 17% just two years after the NI Executive introduces a “Northern Ireland rate” of 12.5%.

A lot of the commentary around this issue is misleading. The application of a Northern Ireland rate is complex; specifically, it is not true to say that “corporation tax” in Northern Ireland can be reduced. Under the Act, the “Northern Ireland rate” must be applied for, and such applications may only be to “trading profits of SMEs whose costs and employee time are largely (75%) in Northern Ireland and to the profits of a large company attributable to a presence in Northern Ireland” (and limited other circumstances); and even then certain sectors are excluded. This means two important things – first, not all businesses qualify (so it is not quite fair to say that, if the “Northern Ireland rate” were set at 12.5%, its Corporation Tax regime would fully match the Republic of Ireland’s); and second, the implementation of any differential “Northern Ireland rate” would attract a significant administrative cost (regardless of how different the rate was from the UK Standard rate).

So, although the reduction from the Northern Ireland grant (i.e. from public spending here on devolved issues such as health and education) would be reduced by each percentage point that the difference between the “UK Standard rate” and the “Northern Ireland rate” were reduced, the administrative cost (which must also be borne exclusively by Northern Ireland) would remain the same.

This then brings us neatly to the point that the administrative cost and bureaucratic complexity which would be brought about by implementation of a differential “Northern Ireland rate” has to be worthwhile (and not just the reduction in public spending). Back when this was first proposed, in 2010, the headline gap would have been a full 15.5 points (the UK Standard rate was 28%). By the time anyone gets around to implementing it, in 2020, that gap will be just 4.5 points. Add to this that the current Chancellor’s speed in the direction of lower Corporation Tax is increasing (i.e. that he may well, in future budgets, announce a further reduction of 2020, quite possibly to as low as 15%), and the differential is scarcely noticeable. We may note also that the aforementioned bureaucratic complexity would not be borne solely by the administrators involved on the government side, but also by the businesses applying for (and proving their qualification for) the “Northern Ireland rate”.

The issue is simple. If they want a 12.5% rate, can Northern Ireland Ministers point with any confidence to a single company which would invest in Northern Ireland with a 12.5% profits tax (noting also the complexity in successfully applying for it) but not with 17% (or 15%)? Can they point to a company which chooses the Republic over Northern Ireland solely for tax reasons (given that employees in Northern Ireland enjoy significantly lower household taxes, more generous tax bands, and more limited VAT)? Can they point to a single company which would choose Northern Ireland over Great Britain because of four-and-a-half (or maybe even two-and-a-half) point profits tax gain? To be clear, it is possible such companies exist – but the public would need to see some evidence of them.

The other question is why, exactly, is the NI Executive so determined to set the “Northern Ireland rate” at 12.5%? Why invest so much time “matching” the Republic (in a limited way with added complexity) when it would now cost the same to beat it? If a lower rate is to be the key argument for choosing Northern Ireland over Great Britain, why not also set a lower rate to encourage choosing Northern Ireland over the Republic? Either a lower corporation (profits) tax rate is important, or it is not!

All of this ultimately suggests that a lower “Northern Ireland rate” of 12.5% will make no difference – merely matching the Republic while offering a steadily decreasing advantage over Great Britain. Northern Ireland’s problems are more fundamental – disinvestment in key skills (teachers over computer scientists), focus on the wrong areas in early education (RE over ICT), a laughably inefficient and instinctively anti-competitive planning system, an energy grid which is unfit for purpose and comparatively illiberal general attitudes (in general and towards incomers) are vastly bigger obstacles to real wealth creation than tax rates.

Not for the first time, the world is changing and Northern Ireland is still behaving as if it is as it was years ago. It is time to offload the “silver bullet” of differential corporation tax and move on to tackling the real economic problems we face – starting by tackling the vested interests which hold us all back.

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