The Tories gather in Manchester this week, with the economy, Europe, and more Europe set to dominate, reports Left Foot Forward’s Shamik Das.
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• The Tories gather in Manchester this week, with the economy, Europe, and more Europe set to dominate.
Trying to head off the rage of the angry Eurosceptic right, David Cameron told Andrew Marr this morning:
“The eurozone is a threat not just to itself but a threat to the British economy and to the worldwide economy… The logic of the single currency is it leads you [towards fiscal union].
“[But] it’s more than that. Action needs to be taken… They’ve got to get ahead of the markets now…
“I will always defend the British national interest, I think we need to be in the European Union, we need the single market, we’re a trading nation, but I have always said… we need to bring back policies from Europe.”
While William Hague, party-conferencing like it’s 1999, came out with the old classic:
“I want to be in Europe but not run by Europe.”
For more on the eurozone crisis, see Ben Fox’s article for us earlier this week.
On the question of the faltering UK economy, meanwhile, the chair of the Treasury select committee, Tory backbencher Andrew Tyrie, warned last night the government did not have a “coherent and credible” plan for growth.
He said current policy did not “adequately recognise” the fact “the age of abundance has been replaced by the age of austerity”, adding
“The Big Society, localism, the green strategy – whether right or wrong, these and other initiatives have seemed at best irrelevant to the task in hand, if not downright contradictory to it.”
George Osborne, who will deliver the key note tomorrow (arguably more important this year than the prime minister’s address), is expected to say unspent central government money will be injected into capital projects to kickstart the economy, a welcome boost in addition to Danny Alexander’s announcement to Lib Dem conference a fortnight ago of a £500 million capital spending surge.
Today, the chancellor announced new enterprise zones are to be set up to help tackle the problems caused by BAe’s plan to axe 3,000 jobs, job losses described by Unite Assistant General Secretary Tony Burke on Left Foot Forward on Friday as a “serious disaster” that shows the coalition’s manufacturing policy has been “shot to pieces”.
Mr Osborne’s predecessor Alistair Darling, meanwhile, told the Independent on Sunday this morning the government will change course on the economy. He said the chancellor “is not daft”, and will have already realised his austerity drive had “choked off” growth.
Darling writes:
“Deficits have to be brought down but the rate at which you do that affects growth. Without growth, deficits will rise not fall. We are already seeing that. That’s why George Osborne will change course. He won’t admit it, or call it Plan B. But he knows, because he’s not daft, that what growth there was has been choked off.
“Whether it be investment in infrastructure projects, or tax cuts to relieve hard-pressed families, or another dose of quantative easing, policy must change. Osborne left himself some wriggle room as to when precisely the structural deficit will be eliminated and he will need it.”
Left Foot Forward will have reaction to the Tory conference all this week.
• The calls for a Plan B grow ever louder, turning up the pressure on the government to act.
President of the European Commission José Manuel Barroso became the latest to join the chorus, warning:
“It is true that we do not have much room for a new fiscal stimulus. But that does not mean that we cannot do more to promote growth. First, those who have fiscal space available must explore it – but in a sustainable way; second, all member states need to promote structural reforms.
“Together, we must tap the potential of the Single Market, exploit the benefits of trade and mobilise investment at the Union level.”
To ram home the point of how dire the current situation is, Friday saw the worst quarterly fall in the FTSE’s value for nine years, down 13.7 per cent since the start of July; Paris’s CAC 40 slumped 25.1%, Frankfurt’s DAX dropped 25.4%, and the Dow Jones fell 11%.
Also on Friday, Goldman Sachs warned the global economy is heading into a “Great Stagnation”, during which we would experience long periods of sluggish growth of about 0.5%, low inflation, rising and sticky unemployment, stagnant house prices, and lower returns on shares. Their economists calculate there is a 40% chance of this happening.
Having examined 150 years of macroeconomic history, Goldman found the probability of stagnation much higher after financial crises, explaining:
“Trends in Europe and the US are so far still following growth paths that would be typical of stagnations…
“Given those risks, whether these countries manage to avoid a ‘Great Stagnation’ by a pick-up in the recovery is likely to depend on policy being able to restore confidence and putting in place reforms that can decisively jolt growth.”
Further proof of the pressing need for the government to put aside dogma, follow the evidence and change their minds on Plan B before it’s too late.
• The Labour party met in Liverpool last week, with Ed Miliband stamping his vision on the party in an adequately scripted if poorly delivered oration.
As Ed Jacobs reported, Miliband:
“…delivered a speech to his party conference with a message of fairness. Calling for a ‘new bargin’ based on a ‘something for something culture’ and hard work, Miliband called for a sense of responsibility at all ends of the social spectrum…
“Calling for a ‘new economy’, he outlined Labour’s support for British business; putting himself firmly side by side with those affected by the decision not to award Derby based Bombardier a contract for new trains and BAe systems today…
“How the speech goes down with tomorrow’s press awaits to be seen, and will be mulled over for many hours in the bars of Liverpool, but Miliband, who declared himself to be his own man, has a clear agenda – of fairness, of responsibility across the social and political spectrum and of a need to stand up for those in the middle, struggling to make ends meet.
“The framework is now there – it’s time to put flesh on the bone.”
The press reaction, as Alex Hern reported, was mixed, with the Guardian in particular balanced but ultimately negative:
“Some good lines uttered, some false notes struck, some bad luck sustained when the TV feed broke for five minutes mid-speech. But it still requires a generous leap of faith to conclude that Ed Miliband’s speech to Labour’s Liverpool conference will persuade wary voters that they have got him wrong and he is ready to be prime minister if the call comes soon.”
Meanwhile the Tory reaction, predictably, was, well, see for yourself; as Alex Hern wrote:
“If you are part of the Tory party, however, it appears you were watching an entirely different speech to most of the country, in which Miliband announced he wanted to ban business, nationalise everything, and eat the rich.
“From Norman Tebbit calling him a ‘backward looking socialist’, to Luke Johnson claiming it shows he ‘probably doesn’t even believe in capitalism’, the ‘red Ed’ spin machine clearly only has one setting.”
On policy, Tim Nichols wrote on Left Foot Forward that Miliband should “stop spreading myths about benefit claimants”, and “stay within the facts on benefit claimants”, while on presentation, Left Foot Forward’s speech writing expert Asher Dresner wrote:
“There’s room for improvement, but rhetorically, Ed Miliband’s party conference speech was better than many of his previous speeches.
“Party conference speeches are especially hard to write because as well as all the usual requirements of a speech like tone, pacing, and imagery, you also have to address all the issues so that nobody feels left out. Hardest of all, you also have to formulate and articulate a ‘big argument’ for why you are doing everything you are doing.
“Rhetorically, he is improving. All persuasive language must appeal to one of the five senses, and the easiest way to do it is by painting pictures for the listener. This was something lacking from many of his previous speeches, but he’s getting better at it…
“All in all, there will always be room for improvement, but it was a good speech. It spoke to the public and the party. It contained a big argument. It painted pictures. It used analogies to make tricky arguments.
“In short, it was better than many of his previous speeches; let’s hope they continue to improve.”
The day after his big speech, Miliband took part in a Q&A session with conference delegates and opened the doors to non-Labour members of the public, a forum he appears to prefer, and one in which he was universally accepted to have performed better.
He was quizzed by disabled blogger and activist Kaliya Franklin, founder of the non-partisan “The Broken of Britain” campaign, on disability reforms, an issue previously un-raised at the conference – read our report and watch the video.
Finally, back to the economy, and in his speech to conference on Monday, Ed Balls called for growth now and cuts later, a speech described by Cormac Hollingsworth on Left Foot Forward as giving Labour “a solid economic foundation”.
Progressive of the week:
Ninety-six-year-old veteran of the Battle of Cable Street Max Levitas, who today spoke at the 75th anniversary rally and march to commemorate the day Londoners stood up to Oswald Mosley’s black-shirted fascists and sent them packing.
He recalled how, in October 1936, every entrance to the East End was blockaded, while Irish dockers and Jewish tailors built three barricades across Cable Street to prevent an invasion by 3,000 uniformed fascists. An estimated 300,000 anti-fascist demonstrators turned out.
Mr Levitas was joined today by representatives from Bengali and Jewish organisations, trade union leaders and local political figures. They urged marchers to celebrate the spirit of Cable Street by campaigning together to send a powerful message of unity against all who sow division and hatred in Britain today.
Regressive of the week:
London Mayor Boris Johnson, a man never far from the headlines, who this week was revealed to have broken his pledge to donate a fraction of the £250,000 annual fee he receives for writing his Telegraph column – a fee described as “chicken feed” by the Bullingdon boy.
According to a new biography of Boris, he is said to have screamed:
“It’s outrageous! I’ve been raped! I’ve been raped!”
The biography claims Boris:
“…donated only a total of £20,000 over three years (compared to the £75,000 pledged) to fund six bursaries for a sports journalism course at the College of Communications, with another final sum of £10,000 expected.
“He has also not given ‘nearly as much’ as £75,000 to a new charity set up by Friends of Classics to support Latin and Greek teaching in state schools.
“Boris has given a tidy sum but it appears a long way short of what was publicly promised in return for resuming his column. There is also no future commitment for his second term, should he win.
“Once again Boris seems to have been reluctant to part with his cash, whatever his moral if not legal obligations.”
Earlier this week at the Labour party conference, Ken Livingstone outlined his key policies if elected next year, while Harriet Harman slammed Johnson for being “so removed from people’s lives”, standing for “higher fares for Londoners and lower taxes for bankers”, and being “in it for himself”.
Evidence of the week:
The Resolution Foundation’s “Low Pay Britain” report (pdf), published this morning, which coincides with yesterday’s 15p rise in the minimum wage from £5.93 to £6.08. An improvement, for sure, but the report reveals there are still five million workers – 20 per cent of all employees – still earning less than the living wage, which is designed to provide a ‘minimum acceptable quality of life’.
The report finds:
“Low wage workers are more likely to be female, part-time and in the private sector. They are also more likely to be younger, though this is in part due to the traditional trajectory of earnings over the life course. Low wage workers are more likely to be found outside of London and the South East although in absolute terms, the South East, the North West and London all have more than half a million people earning less than the Living wage.
“The retail and transport sectors have the greatest concentration of employees earning less than the Living Wage while finance and public administration are among the lowest. Unsurprisingly, those without any formal qualifications are more likely than other employees to earn less than the Living Wage, while those with degrees are least likely…
“Six out of sixteen sectors have over 30% of employees earning below the Living Wage. Just fewer than 10 per cent of people who hold degrees earn less than the Living Wage. 1 in 7 of those aged 36-45 (at the point of their ‘peak earnings’ potential) are on low pay, as are some of those working in the skilled trades and professional occupations.”
We will have more on the report on Left Foot Forward tomorrow.
The World Outside Westminster by The Grapevine’s Chris Tarquini:
Much of the recent news outside the United Kingdom has focused on the death of senior al-Qaeda figure Anwar Al-Awlaki at the hands of American forces. The death of Al-Awlaki, who was killed by a drone strike in the volatile country of Yemen, is seen as another public victory for the Obama administration in the war on terror.
Although seen mainly as an ideological leader as opposed to a direct organiser within al-Qaeda, it will still be a bitter blow for a movement reeling from the death of Osama Bin Laden.
However, the killing of US-born Al-Awlaki prompted condemnation from anti-war Republican Presidential candidate Ron Paul, who argued:
“He is an American citizen. He was never tried or charged with any crime. Nobody knows if he killed anyone.”
***
Additionally, al-Qaeda made the news following an unlikely spat with outspoken Iranian President Mahmoud Ahmadinejad, whom they accuse of ‘spreading conspiracy theories’ about 9/11. ‘Inspire’, an al-Qaeda-linked online magazine, argued that despite Iran using the theories as a rallying call against America, the nation was “a collaborator with the US when it suits it”.
***
Meanwhile, outside of the world of Iranian conspiracy theories, American foreign policy has been under scrutiny concerning their multi-billion dollar support for Pakistan. With much of the news media focusing on the ‘Haqqani’ militant group and their links with the Pakistani intelligence service, Pakistan has been urged to do more to combat extremism in its own ranks.
However, prime minister Yousuf Raza Gilani has argued:
“…the blame game should end, and Pakistan’s sensitive national interests should be respected.”
Tensions rose last week after the most senior US military officer Admiral Mike Mullen described the Haqqanis as a “veritable arm’ of Pakistan’s spy agency, while the BBC reports a senior Haqqani leader, Haji Mali Khan, has been captured by Afghan and coalition forces.
***
This week also marked a big step forward for Saudi women, who were given the right to vote from 2015. Furthermore they will be allowed the right to sit on the Shura council, an advisory body of appointed members.
Women are still not allowed to drive cars or leave the country without the permission of a male relative, so despite being an important progressive step, there is still a long way to go in Saudi Arabia.
***
In slightly less positive news, five decomposing heads have been discovered in a sack outside a primary school in Acapulco. The resort city has been the scene of a bitter battle as drug gangs fight for control.
Whilst the Mexican government is engaged in a crackdown on the cartels it is still a massive issue in the country to the point where concerns are being raised in the US about the spread of the crime wave over the border into southern states.
***
Despite a lot of comments on foreign policy in the last week the American political agenda has been shaped by one man in the past week, Republican Governor Chris Christie.
As previous frontrunner, Texas Governor Rick Perry, falls back into second in the latest Fox News Poll behind the more moderate Mitt Romney, many Tea Party backers and social conservatives are looking for a strong alternative to the former Massachusetts Governor.
The flavour of the week is former Godfathers Pizza CEO Herman Cain, who, having crushed his opposition in the Florida straw poll, is now polling third in the FOX poll on 17%, just 3% behind Perry and 6% behind Romney. Perry’s slump is seen mainly due to a series of poor, bumbling debate performances in contrast to the competent Romney or the charismatic Cain.
Cain himself has come under scrutiny in the past week for arguing African-Americans have been ‘brainwashed’ into voting so strongly for the Democratic party. Following Christie’s seeming refusal to jump into the race it remains to be seen whether any serious Tea Party candidate will decide to compete, whether Cain will keep his momentum, and if Perry can make a comeback.
***
The Obama campaign will be watching the Republican primary closely but will also be concerned by the President’s dismal approval rating in the latest Gallup daily tracking poll. With just 39% approving and 52% disapproving, recent polling in a contest with Mitt Romney is making depressing reading for Obama supporters across the pond.
However, with the GOP primary being as unpredictable as it is they will be hoping a far-right candidate makes the currently unpopular President the lesser of two evils.
Ed Jacobs’s Week Outside Westminster:
Scotland:
As Labour formally approved plans to beef up the role of its leader in Scotland and Iain Gray delivered his final speech to the party’s annual gathering as leader, there were a plethora of warnings about the state of the party north of the border and the extent of the challenges it needs to confront.
Speaking to the Express, leadership contender, Tom Harris MP, warned his Scottish colleagues:
“By the time the next election comes around, if Labour don’t make the right decisions, Labour will no longer be a player.”
The Herald, meanwhile, concluded:
“The Labour party in Scotland has been scarred by internal disputes, some going back to disagreements about devolution. These might have been overcome under a powerful leader, capable of knocking heads together and driving the party forward, but Scottish Labour has suffered from a semi-permanent leadership crisis since the death of Donald Dewar in 2000.
“Labour’s biggest challenge lies in finding a Scottish leader capable of mounting a fight back.”
Elsewhere, there were warnings over the state of morale amongst Scottish nurses as new survey data found just 30% feel nursing will continue to offer them a secure job in the future, compared with 82% two years ago; only 38% would recommend nursing as a career, compared with 54% in 2009; and 74% of those questioned reported increased stress at work.
Theresa Fyffe, director of RCN Scotland, warned:
“The survey’s findings should fire a warning shot across the bows for the Scottish government and NHS managers alike.
“Given the continuing cuts to the nursing workforce, prolonged pay freeze and planned pension increases, it is no surprise the morale of nurses and healthcare support workers in our NHS is plummeting.”
Wales:
It was a busy week for Welsh first minister Carwyn Jones. Having used his speech to the Labour party conference in Liverpool on Monday to declare the party’s victory in Wales in May shows Labour is “back in the saddle”, on Tuesday he outlined to AMs his Programme for Government (pdf).
With a pledge to establish a Welsh Jobs Fund to support young people out of work, the first minister said of the measures announced:
“These improvements will be firmly grounded in our uniquely Welsh approach to fairness and sustainability – a commitment that goes beyond the narrow concept of ‘greenness’, and delivers our vision for the economic and environmental wellbeing of our communities.”
Responding, the Lib Dem leader in Wales, Kirsty Williams, declared the programme a “joke”, accusing Labour of having simply copied and pasted its election manifesto into a programme for government.
Meanwhile, having obtained figures showing more than 1,000 employers across Wales had been found to have flouted national minimum wage legislation since 2002, Plaid Cymru AM, Leanne Wood, called for HM Revenue & Customs to do more to bring companies flouting the legislation to justice.
Citing an HMRC operation in Swansea against a rogue employer, she said:
“I’m pleased the HMRC and the UK Department for Business, Innovation and Skills carried out the first exercise of its kind in Wales against agencies.
“There should be more enforcement operations like this… and they should not just be allowed to pay off under-payments. Action is regularly taken against benefit claimants, but there always appears a reluctance to take on rogue employers.”
Northern Ireland:
Sinn Fein’s education minister and acting deputy first minister, John O’Dowd, outlined plans that could potentially see the closure or merger of up to one third of all Northern Ireland’s schools as part of a shake up of the education system.
Speaking to Assembly Members at Stormont on Monday, the minister explained:
“We have too many schools that do not have the capacity to give children the broad and rich educational experience they deserve. Schools which, in some cases, have lost the confidence of the parents, pupils, and communities they were built to serve.”
DUP health minister Edwin Poots, meanwhile, suggested women who choose to have their babies delivered by Caesarean section when it would be safe to give birth normally may have to pay for it.
And first minister Peter Robinson had a clear message on public sector reform, saying:
“I am not someone who believes that the public sector has a monopoly of knowledge or a divine right to be the sole provider of public services. I am not dogmatic about how public services should be delivered, but I am absolutely insistent that we deliver the very best public services possible.
“One thing is clear – simply doing what we have always done in the same way that we have always done it isn’t going to work. Unreformed public services – in a context of reduced budgets – means only one thing: public services getting worse.”
This week’s most read:
1. Exposed: The Mail-inspired Dispatches hatchet job on Blair – Shamik Das
2. LFF’s most influential left-wing thinker of the year 2010/11 is Owen Jones – Daniel Elton
3. Miliband must stop spreading myths about benefit claimants – Tim Nichols, Child Poverty Action Group
4. How disability reforms were whitewashed from Labour’s conference – Daniel Elton
5. One Tory is tired of being in the nasty party – Alex Hern
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