The UK General Election

It does seem remarkable that 2019 was Labour’s worst GE since 1932 and interpreted as a public desire for a changed Labour Party. Getting even fewer votes in 2024 than in 2019 produces Labour’s best result ever and is interpreted as a mandate to implement change in the country.

I fear that Apathy is now the largest single party, polling better than 40%. Put that together with two thirds of those who did vote getting not only a government they didn’t vote for, but one with a huge majority, and overcoming the sense of powerless and disillusion among the electorate will be the hardest change that Labour has to make.

Why isn't Britain apologizing for what they have done to this world? (From Quora)

When a question is self-contradictory, it does not help our understanding.

Britain is a singular noun which tends to be used as shorthand for Great Britain, the island which is in itself part of the United Kingdom of Great Britain and Northern Ireland. “They” is a plural pronoun and has no point of reference within the question.

Since the inanimate is presumably blameless, one is left to surmise that the persons intended by “they” may be the inhabitants of the aforementioned island, presumably the living ones, since the dead ones are in no position to apologise for anything. However, it is far from clear what the present inhabitants of Britain are alleged to have done.

Apologies only make sense when offered by the perpetrator of an offence to the victim. One cannot meaningfully apologise for things one has not done, (unless one ought to have done them, in which case we speak of sins of omission). Nor can one meaningfully apologise for what someone else has done. If offenders wish to apologise, they can apologise for themselves. If they do not wish to apologise, then no one else has the standing to apologise on their behalf.

No one is morally obliged to take responsibility for the behaviour of earlier generations. The present generation does not deserve credit for the good actions, nor blame for the bad actions, of earlier generations.

Reparations for bad actions that took place centuries ago cannot be required of current populations. In any case, it would be next to impossible to separate current populations into those who are and are not descended from the alleged perpetrators. To give just one example, what sense does it make to demand compensation be paid by descendants of an oppressed English factory worker of the late eighteenth century to descendants of an oppressed plantation slave of the late eighteenth century? It should be needless to point out that far more of the current British population are descended from factory hands than from capitalists.

As Cicero said, “O tempora! O mores!” We cannot retrospectively impose our values on the past and hope to emerge from that abstract process with anything resembling a fair judgement. Iconoclasts who think that, by erasing visible signs and symbols of the past, they will achieve anything positive, are simply deluded. You cannot punish the dead; they are immune to your rancour. You can only increase the likelihood that the living will forget the mistakes of the past and hence, through ignorance, increase the risk of repetitions of those errors in the future. In short, one man’s current virtue signalling is another man’s unforgivable cultural vandalism.

For good or ill, the past is gone. The present and the future have more than enough challenges for the living.

The EU, The Vaccine, and Exports

If the EU had gone down the UK route they would have financed both vaccine development and factory construction in their own countries with a capacity sufficient for their own needs. This is not a matter of the UK forcing it’s way to the front of the queue; the UK is creating the supply that others then queue up for!

Because the UK does not have the capacity to supply others at present, it licenses other countries to produce the AZ vaccine on condition that, like the UK, they produce and sell at cost. To look at physical exports and ignore this licensing programme is highly misleading.

The AZ vaccine exists because of the UK government. Philanthropic we may be, but we not unreasonably thought that, having paid for its development as well as its production, the UK taxpayers should get it first.

The UK actually brought AZ into production partnership with Oxford, where the vaccine was developed, precisely because of fears of vaccine nationalism. They reached a production understanding long before the vaccine passed its clinical trials, the government accepting all the risks involved.

Oddly enough, the anticipated nationalism was from Trump's USA, which was why the UK didn’t want Oxford going into partnership with a US firm as originally intended. Obviously, AZ is part Swedish and some of its production is in the EU. As it turns out, maybe we should have expected nationalism from the EU too.

At the same time the UK ordered several other vaccines from various different sources, including some in the EU, gambling that these vaccines would succeed. Any EU country or the EU Commission could have placed similar orders at the same time, but for whatever reasons they decided not to. Once those EU firms had accepted UK contracts they would not expect to be prevented from fulfilling them, any more than AZ expected the EU to try to prevent them fulfilling their contract with the UK.

The EU meanwhile spent a couple of months beating down AZ’s already cost-based price and finally placed its order, if I recall correctly, when the vaccine was already in third phase trials, nevertheless still forcing risk responsibility on to the firm. This meant they got a ‘best efforts’ contract because no company managers in their right mind would definitively guarantee supplies when they were bearing all the risk as well as not making a profit.

We are now witnessing the unedifying spectacle of the EU refusing to admit its own incompetence and seeking to deflect blame on to an external ‘enemy’ who happens to have produced the vaccine in the first place.

Some want to consider financing development of the Oxford vaccine ‘getting lucky’. That is up to them, I suppose. Some people would call it a sound investment of public funds. No risk, no reward. What prevented EU countries doing the same?

It should however be obvious even to an EU supporter that the UK’s involvement in the AZ vaccine is a lot more more than just a contractual arrangement. The UK would hardly have spent all that money in order to export the vaccine at cost before UK needs were met.

Is the EU supposed to have been unaware of this history? Did they not read the contract they signed with AZ? Did they not know that the UK plant had gone through the same production difficulties as the EU plant, just three months earlier?

I’m sorry, but the Commission are negligent, incompetent or both and behaving in their usual belligerent and litigious manner as soon as their failings are exposed. It would never, I suppose, occur to them to say, “I’m sorry, we screwed up, can you help us out?”

Is it more important for Scotland to be in the EU or the UK?

The question begged here is more significant than the question asked, isn’t it? Could an independent Scotland get into the EU? There are several reasons why it might not, and all of these have been rehearsed ad nauseam. Is it worth going over them yet one more time? Probably not. It’s a complete dialogue of the deaf. Essentially it boils down to a disagreement between SNP supporters (who see no obstacle to anything) and unionists (who see obstacles to everything.)

Realistically, it seems far from certain that the option assumed in the question is actually available just for the choosing, especially in the short term. Pragmatically, an independent Scotland must be prepared for membership of neither union.

Perhaps we could look at the people involved instead of the economics. Scotland’s current residents include around 475,000 British nationals from other parts of the UK. Meanwhile, about 720,000 Scots live elsewhere in the UK. Intermarriage for 300 years has produced a very large number of people of mixed Scottish/other-British heritage and today’s British families (including my own) can comprise persons born on different sides of the border.

All of a sudden upon independence, a million and a quarter people would find they no-longer lived in their own country. One of them would be me. Personally, I find the prospect devastating.

Neither group of ‘exiles’ could be deprived of their present nationality against their will. An independent Scotland can offer Scottish nationality to non-Scots-born residents of Scotland, or possibly to Scots-born residents of the rest of the UK, but it cannot force it upon them.

In fact, it must be legally dubious whether a Scottish government could even force nationality change on Scots-born unionists. In the short term at least, a British passport is likely to be more valuable to travellers than a Scottish one.

It is therefore not beyond the bounds of possibility, in the event of a narrow vote in favour of independence, that the subsequent Scottish population would be almost equally divided between Scots and resident aliens.

We’ve recently had cause to notice how well the dividing of a population almost equally across passionately-felt identity lines has gone, I guess?

Quora Question: Should there be a second EU referendum in the UK?

Advocates of a second referendum seem to hold simultaneously two incompatible propositions:

1) The issues involved in the first referendum were too complex for the masses to understand.

2) The complex terms of an eventual exit deal can be put to the electorate in the form of a simple yes / no question.

Among the grounds for holding a second referendum is a claim that only one side misrepresented the facts in the first referendum. It seems we have forgotten Project Fear, with its immediate recession, emergency punishment budget, World War Three etc.

As a general rule I am not an enthusiast for referenda. Experience shows them to be socially divisive blunt instruments, splitting families and communities, reducing complex shades of grey to simple black and white and arousing passions that are not easy to quell after the event. General elections, by contrast,  give almost every voter some sort of stake in the outcome; few are left utterly without representation. A referendum is winner takes all, however small the majority.

However, the EU Referendum eventually became necessary because all the major political parties of the UK supported membership and selected parliamentarians to reflect that policy.  For forty years opponents had no opportunity to vote against a process that steadily eroded the sovereignty of their country. I suspect a majority of voters might still support membership of the sort of Common Market that we were told we were joining in 1973, but not of an inexorably advancing European superstate, To rage against the result of the first popular vote on this issue in four decades carries more than a whiff of anti-democratic elitism.

Inevitably the ordinary citizen, who has his own life to live, is not an expert. That doesn’t make him ignorant of how his own life is affected by the issues. The failing of our modern system of representative democracy has been the emergence of a class of professional politicians with no experience of the normal world in which their constituents live. In consequence three quarters of parliament were Remainers but the country as a whole voted Leave.

Given that almost all the political, commercial and financial elite spent months predicting chaos, it is a tribute to the resilience of the UK's economic system that the immediate aftermath of the Referendum was not vastly greater instability than in fact occurred.

Just as in the Scottish Referendum, the losers are immediately enthusiastic for a re-run. Economically speaking, nothing could be worse than the prolongation of uncertainty. It damages business, deters inward investment and is a self-inflicted wound which the country can do without. Business can adjust to in or out but not to an eternal argument.

Because the truth is, a second referendum will by no means show a clear and settled popular will. Is it not far more likely the national mood will swing periodically against the status quo just as it tends to do in general elections? How many referenda will be a sufficient number? I very much doubt that agitation for a re-run will ever be quelled if we once start along this road.

Let us instead look for the opportunities of a potential worldwide future rather than hankering after a primarily EU past.

Enemies at Home and Friends Abroad

Setting Sail

One might have hoped the UK's  triggering of  Lisbon Article 50 would at least put a stop to Cassandra-like prophecies of doom at home. Surely the country would come together to make the best of the situation, like it or not?

Too much to hope for, I fear. The Scottish Government still wants to undermine the UK's negotiators with plaintive noises off, while many Remainers seem far more anxious to be proved right than they are for the country's wellbeing.

It might help if Remainers remembered the referendum campaign featured a dodgy prospectus on both sides and that Leavers weren't all ignorant and gullible; in fact we included several high-powered economists. The surging exports and solid economic growth since last June don't really resemble the catastrophe Remainers predicted, nor was a punishment budget required.

Moreover it would make more sense complaining about the Brexiteers' failure to deliver if the Brexiteers actually controlled the government, which they don't.  When did Theresa May promise loads of money for the NHS?

Let us consider the two biggest projects of the EU. (Since we opted out of both of these, we could only ever have been peripheral members henceforward anyway.)

• The Euro is an economic disaster which can't be admitted because of the political fallout that would result, so they just let it cause thirty percent unemployment and chronic financial crisis in southern Europe instead. If we lived in Greece we might learn what it really means to have something to feel pessimistic about.

• The Schengen Agreement is collapsing under the weight of uncontrolled migration and frontier fences have gone up all over Eastern Europe.

I have said before that political will is not enough to support a project to link so many economies by a common currency. The fudging of membership criteria did not begin with Greece, it goes right back to the foundation of the single currency when Italy's debt was almost twice the permitted percentage of GDP and France only qualified for the fiscal deficit criterion by a one-off privatisation of Thomson.

The point politicians failed to appreciate then and now is that the Eurozone membership criteria were not mere inconveniences to be circumvented but genuine economic convergence indicators. If you link divergent economies by a single currency you deprive weaker economies of the disequilibrium-corrective possibilities offered by the balance of payments and by currency devaluation, leaving only rising unemployment to provide a quite inadequate escape valve.

This is why it is not just Greece that has experienced severe dislocation but also Cyprus, Italy, Spain, Ireland etc. Even France has suffered. Although Germany has seen benefit from an undervalued currency it is now paying the price in terms of ever-increasing transfers to the hopelessly indebted zone members.

Does anyone really think the EU will return to being an economic powerhouse anytime soon? On the other hand outside the EU we have huge potential to develop new trading relationships with parts of the world that are enjoying rapid growth. The UK is not trying to make enemies or wishing ill to the continuing EU. We are simply seeking a wider circle of friends.

Though peevish voices in Europe may declare the UK must suffer 'pour encourager les autres' it is to be hoped that economic sanity will be allowed to prevail over political pique. Beggar your neighbour is not a good strategy for a continent that needs all the boost from trade it can get. 

And really - can they think of no better arguments for membership of the EU than to show how horrible they can make it for those who want to leave?

Still Remoaning

I wish some of those anxious to remain within the EU Single Market would explain carefully how we are going to lose exports if we leave.

First of all, since we are already within the Single Market the EU 27 will need to take an active decision to raise tariffs against our goods rather than just let things go on as they are. They must do this in the context of full public awareness in their own countries that the UK has a large trade deficit with them and that the damage suffered by the EU if reciprocal tariffs are applied will inevitably be greater than the damage inflicted.

The only possible justification for such behaviour is that the political ideals of the EU are more important than the jobs of EU citizens. For all the sabre rattling coming out of Brussels and other EU capitals this will still be a 'courageous policy' (as Sir Humphrey Appleby would put it) to take before their own electorates in the next polls.

Secondly, the depreciation of the pound sterling since June 23^rd is already greater than the average tariff that would be justified under WTO rules, hence the overall result, even after a tariff war, would be cheaper UK goods in EU markets.

Once again, consumers have to be pretty determined to punish the withdrawing member if they are willing to boycott cheaper products.

Anyway, what does it say about the merits of belonging to an organisation that it must punish a member who leaves in order to encourage the others to remain?

Thirdly, while the UK prices of imported EU produce will rise as a result of sterling's depreciation, there is no obvious reason for the UK to initiate tariffs against other countries. Once again, as an EU member the UK already has numerous trade agreements with third countries. The EU will have sovereignty over neither party to future bilateral trade arrangements and it will be a remarkably impressive, not to mention vindictive, achievement if it is able to force them to impose tariffs on each other.

If President Obama had not already told us that the UK was going to the back of the queue, one might be forgiven for suggesting the revival of the North Atlantic Free Trade Area scheme.

Is there anybody out there who can count?

Those of us who, following the projections contained in the celebrated White Paper Scotland's Future, were not already convinced of the SNP's collective inability to count, should have been convinced by the First Minister's contention that losing her overall majority at Holyrood could be described as winning convincingly.

True, the SNP got more votes than anyone else, but that still left the anti-SNP majority very little changed from the Referendum almost two years ago. It would be nice to think that in the not too far distant future the nationalists' claim to a monopoly of Scottishness would be seen for the nonsense it is and attention could instead be returned to the delivery of public services. Health, education and law & order cannot indefinitely play second fiddle to the demand for constitutional change.

Meanwhile we can all turn our attention to the EU Referendum next month, where we are told by the SNP that it will be an outrage if Scotland is taken out of the EU against its will.

Let us leave aside for the moment the uncomfortable fact that Scotland as such is not a member of the EU, the UK is, and that if Scotland had voted to leave the UK it would therefore have been voting to leave the EU even more briskly.

What is interesting, given the tied opinion polls, is the prospect that a Scottish Remain vote might very well end up obliging the rest of the UK to remain in The EU against its will. Will this also be an outrage? I await enlightenment from the First Minister but I'm not holding my breath.

Although only a few months ago David Cameron told us we could prosper outside the EU and he would himself lead the Leave campaign if he failed to get reforms, we are now presented with the unedifying daily spectacle of (mostly foreign) experts and bigwigs lined up in an orchestrated fashion by the government to prophesy everything up to and including the Third World War if we are foolish enough to think of leaving the EU.

For some reason they have not yet got round to the plagues of frogs and locusts, but I expect they will if the poll numbers remain stubborn.

None of these foreign experts appear to appreciate the perverseness of the British character, which tends to make us more likely to do something, not less, when lots of people with a vested interest are all telling us not to do it.

For my part the key issue is the crippling burden of supporting the ill-starred Eurozone, of which the UK is fortunately not a member.

The Eurozone countries have an in-built majority in the EU and can out-vote the UK permanently, especially since Cameron's renegotiations gave up our right to veto Eurozone measures that are not in the UK's interest.

Already during the Greek crisis last year we have seen the Eurozone vote to use EU funds when non-Eurozone EU-members such as the UK were not even present at the table. In other words they voted for us to share a payment without bothering to consult us. Although a fudge was found to get round this when their abuse of power was exposed, it seems very likely to be a taste of things to come if we vote to remain.

No-one should be under any illusion that a vote to remain is a vote for the status quo. The status quo in the EU is not sustainable as the recurrent national insolvencies show. Despite the lack of a democratic mandate, the EU elite have no option but to pursue further integration, including political integration, for the Eurozone.

Woe betide those EU members who do not see this integration as being in their best interests.

Full Fiscal Autonomy?

During the Scottish Referendum campaign, the question of a sterling currency union was controversial. There were claims that the pound was as much Scottish as English, which were true but which cunningly sidestepped the fact that the pound is not English either. It is the currency of The United Kingdom.

In previous posts on this blog I have discussed the difficulties that are bound to beset two economies of disparate size and structure that attempt to share a common currency. I concluded that the Chancellor was right to rule out a currency union between the UK and an independent Scotland.

Current discussion about Full Fiscal Autonomy for Scotland has so far failed to recognise the same currency problem dressed up in different words. What will happen when a single UK monetary policy is undermined by a fiscally autonomous Scotland adopting a borrow-and-spend stance whilst UK policy is still following a strategy of deficit reduction?

The answer is to be seen in the continuing Eurozone crisis. Under the monetary aegis of Germany, Greece, with Full Fiscal Autonomy because nobody respected the European Stability and Growth Pact, borrowed excessively because borrowing was far too cheap relative to the performance of the Greek economy.

In consequence for Greece the financial crisis of 2008 speedily became a debt crisis. This week's efforts are but the latest attempt by the Eurozone leaders to kick the can down the road one more time, still without addressing the fundamental absurdity of linking Germany and Greece within the straitjacket of a common currency.

It should not have escaped anyone's attention that the Greeks blame the Germans for not lending them more, whilst the Germans are tired of what they see as Greek profligacy. Is it really very difficult to look a little way into the future and see insults being traded between the Scottish and UK governments in remarkably similar circumstances?

The oil revenues that were to be the foundation of Scottish solvency now look like pie in the sky and no-one has much idea how to plug the huge pending revenue shortfall. Vague appeals to the extra revenue that economic growth might yield in the longer term, even if they turn out to be more than just wishful thinking, cannot hide the fact that in the short term Scotland must either tax or borrow heavily, or more likely both.

Full Fiscal Autonomy is incompatible with a common currency. Before our half-baked, less than half thought-through devolution process goes anywhere near it we need a clear, written federal settlement and firm fiscal constraints upon the budgets of all UK member states.

Less Heat, More Light, Please.

Since last Thursday the currency issues in the independence debate have been, perhaps deliberately, obscured by emotional language. As I've said, we really do need to distinguish between a formal currency union and the informal use of the UK pound by an independent Scotland.

A currency union's price is financial interdependence because each member state may create new money. In the Eurozone we see a practical example. The short version of the lesson is: when some members overspend, those which do not overspend have no effective choice but to bail out their partners or risk the collapse of the whole system. 

The Eurozone is now being compelled by economics to pursue exactly the sort of political integration that is the opposite of the objectives of the 'Yes' campaign. 

The failure of the UK to agree a currency union with Scotland would not lead to exchange costs for UK businesses. Such costs would in fact result from a Scottish decision to adopt a currency other than sterling, as I discussed on 13 February.

Informal use of the UK pound by Scotland would be unlikely to lead to much greater financial flexibility however, since we could only obtain more money supply by means of a balance of payments surplus / net inward investment.

Quoting my article of 7 November 2013, "My judgement would be that a Scottish currency is the least of the evils, but that it requires preparation to start yesterday and much statesmanship from Scottish ministers."