David Young was wise to say sorry

 

            I have had all too many calls asking me whether I think David Young’s comments were true, or had in them grains of truth. I think the wisest thing he said was that his remarks were inaccurate and insensitive. He made a fulsome apology and the world should move on. Anyone can make a mistake. It does not  mean most Conservatives think as he did in his off the cuff remarks.

            We have just lived through the worst recession since the 1930s. Many people in private industry and commerce lost jobs, or went on to short time, or took a pay cut during the intense part of the downturn. It was not a great time for them. Millions of savers have seen their savings income from deposit and bond interest slashed, as we live through an era of low official and savings interest rates. Many people do not have tracker mortgages, and have been paying mortgage rates well above base rate. Now it is the turn of those in the public sector to experience pay freezes, productivity raising reorganisations, and reduction of back office headcounts.

                The current high rate of UK inflation, low wage growth and devalued pound inherited from the previous government are squeezing disposable incomes. Some of the spending measures in areas which are being cut are difficult choices which the government has made.

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27 Comments

  1. lifelogic
    Posted November 20, 2010 at 6:44 am | Permalink

    Lord Young is clearly a good man (I say this despite his having started off as a lawyer). He is however now 78 and what he said was insensitive and somewhat detached from the real world of the private sector. This is however what happens, even to good men, when they become surrounded by state employees, politicians, BBC think and EU/UK functionaries. This is one of many areas where “democracy” fails. As politicians become detached from the real world of wealth creation. It rapidly become government of the state sector, for the state sector, the private sector just being there to be milked often slowly to death with tax, regulation, licences and fines.

    Politicians become totally detached from the real world of the wealth creating sector and go native.

    Like the honourable man he is he has resigned.

    Cameron however has behaved appallingly in this matter. His harsh treatment of a better man than himself who was only trying to help surely showed very poor judgement indeed.

  2. Deltic
    Posted November 20, 2010 at 9:20 am | Permalink

    Those of a cautious disposition are being hit hardest. The savers and those who didn’t overstretch by re-mortgaging and who fixed their repayments at a ‘sensible’ rate fearing that the Government was being reckless with the economy. Base rate slashed to 0.5% ? Who on earth would have forseen that emergency measure ?

    Let’s all celebrate ! (I know a few who are – the Peer was not entirely wrong)

    This is being done to save those heavily in debt – for the rest of us the recession is real enough. And the message is clear. Low interest/high inflation. Subsidise the profligate of the backs of the prudent. Borrow and spend – borrow and spend and you’ll feel far less of a fool for doing it. This policy shouldn’t surprise us as it is entirely in line with welfarist thinking. Under a Tory Govt no less.

    I am utterly ashamed of what I have done. I am embarassed to tell people that I fixed my mortgage some while ago and bought only a modest house, worked for a living on a payroll – my true earnings fully exposed to the taxman – and eked out my cash to avoid debt as much as possible. I feel utterly inferior – not to say financially brassic – for having done so.

    The wise and the savvy have done precisely the opposite to me and played the game. Whatever the definition of a meritocracy then Britain has become the exact opposite – in every area and by every measure.

    And no. We’re most definitely not ‘all in this together. ‘ A rather foolish slogan given that the people aren’t as stupid as the politicians might think.

    • JimF
      Posted November 20, 2010 at 11:12 am | Permalink

      This is a more accurate analysis than Mr Redwood’s. If Lord Young must say sorry for his remarks, Osborne should be grovelling for saying “we’re all in this together” – totally untrue, “we should take lessons from the Irish”, well perhaps only in their taxation policy, certainly not in their regulation of their banks, or the “creative nature” of their property developers.

      I think this is one rule for the Friends of Maggie, and one rule for Dave and his mates.

  3. Bill
    Posted November 20, 2010 at 10:24 am | Permalink

    Shouldn’t have been a resigning issue – if that’s the “height” to offend look for lots more resignations in the coming years.

  4. Andrew Johnson
    Posted November 20, 2010 at 10:50 am | Permalink

    Lord Young is only a Government advisor. He is perfectly entitled to his views and we are free to agree with them or not. What Mr. Cameron should have said is, “These are Lord Young’s off the cuff views, they are not the views of the government.” Whatever happened to Voltaire’s dictum, “I disapprove of what you say, but I will defend to the death your right to say it”? Under the coalition, we seem to be continuing our long march to totalitarianism, ed by the machinations of the Big Brother Communicator. The irony is we tax payers are paying for this to happen. Personally, I think yesterday was another sad day for democracy and freeom of speech, lightened only by the integrity shown by Lord Young’s resignation.

  5. electro-kevin
    Posted November 20, 2010 at 11:16 am | Permalink

    Was Lord Young ‘wise’ or was he right ?

    There is a difference.

    • lifelogic
      Posted November 20, 2010 at 1:03 pm | Permalink

      He was right for people with secure or state sector jobs and/or pensions and floating rate mortgages. He was wrong for people with fixed mortgages, or savings or rents – People put out of work, looking for work, or undercut by imported labour or have had their jobs exported to lower cost regimes or put out of business by regulation or a lack of bank lending or the EU madness. People who have to put up with much higher taxes lower wages, fewer hours, loss of family allowances and the rest.

      Wise – certainly not this time your Lordship.

    • Steve Tierney
      Posted November 20, 2010 at 1:53 pm | Permalink

      He was neither wise NOR right. The fact that some people (those with mortages attached to the base rate) are benefitting from low rates really doesn’t offset the relentless rise in the cost of everything else – or the desperate struggle of many businesses to stay afloat. The man badly needs a reality check.

  6. Gary
    Posted November 20, 2010 at 11:20 am | Permalink

    And the recession is not over yet, or indeed has really started in ernest. For example here is a banking anlysis by Chris Whalen who backs it with data :

    Pictures of a deflation
    Whalen’s forecast , Oct 6 2010

    •The U.S. banking industry is entering a new period of crisis where operating costs are rising dramatically due to
    foreclosures and defaults. We are less than ¼ of the way
    through the foreclosure process. Laurie Goodman of
    Amherst Securities predicts that 1 in 5 mortgages could go
    into foreclosure without radical action.

    • Rising operating costs in banks will be more significant than in past recessions and could force the U.S. government to restructure some large lenders as expenses overwhelm revenue. ….Foreclosure moratoriums only the start of the crisis that threatens the financial
    foundations of the entire U.S. political economy.

    •The largest U.S. banks remain (financially stressed-ed) and must continue
    to shrink. Failure by the Obama Administration to
    restructure the largest banks during 2007-2009 period only
    means that this process is going to occur over next three to five years – whether we like it or not. The issue is
    recognizing existing losses — not if a loss occurred.

    • Impending (financial weakness -ed) of some of the largest U.S. banks will serve as the catalyst for re-creation of RFC-type liquidation vehicle(s) to handle the operational task of finally deflating the subprime bubble. End of the
    liquidation cycle of the deflating bubble will arrive in
    another four to five years.

  7. Gary
    Posted November 20, 2010 at 11:26 am | Permalink

    Not to mention that TOTAL debt(and yes total debt does matter) of the UK was and eye-watering 466% of GDP when McKinsey analysed it at the begining of this year, second only behind Japan and way more than Ireland. It may be even worse now.

    And I trust Pimco’s Bill Gross who trusts these figures, because as the head of the largest bond fund in the world he has to put his money where his mouth is :

    http://europe.pimco.com/LeftNav/Featured+Market+Commentary/IO/2010/Investment+Outlook+February+2010+Bill+Gross+The+Ring+of+Fire.htm

    Maybe Lord Young has not read the right reports ?

  8. Cliff
    Posted November 20, 2010 at 11:52 am | Permalink

    John,

    I feel people, especially MPs and advisers, should be able to express an opinion, whether one agrees with it or not, without being “slapped down” (what an awful phrase) by party leaders.

    We see too many examples of people being too afraid to express an opinion and this, stifels both free speech and democracy.

    The problem in my view, is too much power held by the party leader, whether he be in opposition or in government. We see too many career politicians that have come straight into politics, without ever having lived in the world outside of the Westminster bubble. Because they are career politicians, they can do little else, so they rely on building their career, lifestyle etc as part of the party machine; the leader hires and fires in terms of ministerial jobs and therefore, an ambitious politician will do or say nothing that would upset his boss, namely the party leader. The leader can also “load” his party with those of a similar narrow view; examples regarding our party include the pro-EUSSR front bench and the number that support Mr Cameron’s new false religion of climate change which, will completely bankrupt our nation and, in time, force us to accept bailouts, with strings attached, from the EUSSR, just as has happened in Greece and Eire so far and will happen in Portugal and Spain soon; then the EUSSR will turn its attention to bringing down our nation and, for our own good of course, taking us into their control as part of a de facto giant socialist superstate; this is already happening and evidence of this can bee seen at NATO; Why does a trade block need a seat on NATO alongside so called members of the said trading block, unless it has larger ambitions?

    I know John, having lived in Wokingham for over twenty years, that you have voiced opinions in the past that you would not dare voice now. It is a sad indictment on modern politics and the party system which, is now destroying, the little that is left, of our democracy.

    Reply: I do still speak truth to power in various ways.

  9. Ruth
    Posted November 20, 2010 at 1:24 pm | Permalink

    An accurate post on what is happening in the real world, thanks.

    I fixed my mortgage rate when rates were rising, and ended up paying £100 a month more than I am now I’m on a tracker. I expected high interest rates as the economy went belly up, but got my bet wrong. My choice, though.

    What isn’t my choice though is the rise in the cost of fuel and food, my biggest expenditure items as I am self-employed and have had a very difficult year due to the recession. When the new fuel increases come in soon, the cost to me will have doubled in the last 10 years – that’s not a small increase over that time, but a full 100% rise. And that’s after I replaced all my windows and increased my loft insulation (at my expense, naturally) – I dread to think what my bills would have been like if I hadn’t done this.

    I’ve had to work hard to survive this year, and seen my disposable income fall. While I’m sure some people have had an easier time of it, I don’t appreciate out of touch politicians and public sector workers reminding me that they’ve had “a good war”.

  10. Steve Tierney
    Posted November 20, 2010 at 1:51 pm | Permalink

    Lord Young said some very silly things that reveal how detached he is from the real world. He may be very clever and a very good advisor – but he’s also apparently cushioned on a bubble of easy money so that he cannot understand what’s going on. His remarks had a distinct: “Let them eat cake” about them.

    But somehow everybody seemed to gloss over the worst comment he made. Which wasn’t the bit about how easy life is for everyone thanks to a low interest rate – but when he called the recession a “so-called” recession.

    There, in that simple phrase, he revealed himself to be desperately out of touch.

  11. alan jutson
    Posted November 20, 2010 at 1:52 pm | Permalink

    Lord Young only made a one word mistake.

    If he had said “SOME” instead of “Majority” he would have been right.

    I can think of many people who have been better off during the past few years.
    They still have a secure job.
    Have still had both wage (yearly cost of living) review, and wage scale increases, Have still an excellent Pension scheme, and work the same hours.
    Still have a paid sickness scheme.
    Still have In Service life Insurance cover.
    Still have increased holiday entitlement with length of service.
    Have paid a much lower monthly sum on their mortgage.
    Home improvements have cost less due to shortage of building work and competitive pricing.
    But they still moan because food and utility bills have gone up.

    Guess which Section they are employed in ?

    Did not realise Lord Young was 78 years old, cannot help but believe he must by now be a little out of touch, but according to reports he was working for “Free” as an unpaid advisor.

    One is forced to ask why DC did not pick up the phone and speak to one of his more senior MPs who is still employed in the private sector, and who has a track record of calling it right.

  12. Dr Bernard Juby
    Posted November 20, 2010 at 2:23 pm | Permalink

    David Young should be brought back in again and his resignation refused. He did the honourable thing but he would have been excellent help to the 95% of all European businesses (i.e. microbusinesses employing 1-5 people). He was when he was Margaret Thatcher Small Business Advisor and there is no reason why he can’t be now.

    Past National Chairman of the 215,000-strong Federation od Small Businesses.

  13. bf2
    Posted November 20, 2010 at 2:35 pm | Permalink

    What Lord Young said is 100% true and truth always hurts.

  14. Norman Dee
    Posted November 20, 2010 at 3:33 pm | Permalink

    This kind of crass overreaction is becoming the norm unfortunately, and is a staple diet for the BBC. You can bet it didn’t take much persuasion from the BBC to get Minimilli out of his house to also overreact. Democracy, and simple common sense is being overwhelmed by the mass media promoting it’s agendas, and the stupidity of modern party politics.

  15. SM
    Posted November 20, 2010 at 4:31 pm | Permalink

    Meanwhile ‘must haves’ prices increase, gas, electric,transport.

    Looks like the MPC should resign enmasse.

    Still no reductions in MP headcount, just a keep em quiet 10% cut some time in the future, which may get forgotten.

    Still with 53% of the economy in the public sector i am sure a large minority have had a ‘ as good as you can get’ recession’ particularly higher paid functionaires with expenses etc. EU, MEP’s

  16. Colin Adkins
    Posted November 20, 2010 at 4:42 pm | Permalink

    The person who comes out of this badly is Cameron not Lord Young. There is clearly some truth in the remarks but your points, John, are equally true. By the sound of the background noise on the tape, the interview sounded as if it was carried out over a convivial meal. In those circumstances, a less than complete analysis of the situation may not be suprising. If, as widely canvassed, Lord Young is believed to be doing a good job then an imprudent interview seems no justification for being publicly ostracised by Number 10.
    On the other hand Cameron once again shows himself as a shallow and vacuous twerp only interested in his press cuttings.
    I also note that our old friends the BBC were leading all their news bulletins with the story despite the impending disaster for Ireland of the vice like grip of the Euro fanatics becoming ever more frantic. I thought megaphone diplomacy was old hat!

  17. Sean O'Hare
    Posted November 20, 2010 at 6:02 pm | Permalink

    John

    Do you really believe that we have lived through this recession? I fear that you are way too premature – it is only the beginning of a severe depression yet to come. While Labour are largely to blame, the coalition have irresponsibly continued to allow the BoE to decide whether or not to print money to inflate our way out of debt. As a pensioner largely on a fixed income this is inexcusable to me. Whatever happened to the Conservative’s monetary policies that rescued us last time?

    • Rose
      Posted November 20, 2010 at 8:08 pm | Permalink

      What has happened is that there is no Margaret Thatcher to make the moral case against the evil of inflation and really fight it as if on crusade. Most politicians don’t want to make enemies of the powerful people who are either unaffected or actually benefit from inflation.

  18. Rose
    Posted November 20, 2010 at 8:02 pm | Permalink

    When one looks back on the “gaffes” people have been sacked for one does wonder what all the fuss was about: Enoch Powell for saying communalism would corrode our parliamentary democracy; Nicolas Ridley for saying there would be riots in the streets of European cities under the strain of a single currency; Patrick Mercer for saying redheads still get bullied. And what about Edwina and the eggs since the marzipan season is upon us? But the coup de grace was the assassination of Margaret Thatcher for saying no to the 3 unacceptable facets of the EU.

    The one thing one never hears in the wake of these “gaffes” is the original utterance, just other people on their high horses, while wondering whether they didn’t hear the original words either.

    People are always sacked for being embarrassingly right, never for being fashionably wrong. That is why we are never allowed to hear what they actually said. If people were sacked for being wrong there wouldn’t be anyone left!

    Actually, when Lord Young forgot to include savers, he was only doing what Government and the Bank have been doing all along. Little people who save and don’t get into debt, who pay their own way and live modestly, just don’t count. How dare the PM and the BBC posture as if they did. We all know that savers are being cruelly and deliberately squeezed to make them spend their savings. And we know too that the profligate borrowers and spenders are the favoured group, besides being the ones who have brought us all to our knees. The majority of them are indeed having a good recession – the more they have borrowed, the better, especially if they are both on a state salary or index-linked pension. Why was it outrageous for Lord Young to toe the line?

  19. norman
    Posted November 20, 2010 at 8:32 pm | Permalink

    Lord Young’s biggest mistake is that he is tainted by association with those ‘nasty Thatcher years’ (I also believe that’s why our esteemed host, who could run economic circles around anyone else in the Party, isn’t in Cabinet).

    Every day we read in blogs such as Guido Fawkes about the misdemeanors of Cameroons and nothing happens. Andy Coulson is never off the front page of the papers.

    Lord Young makes one moderately ill-advised comment (it never seemed all that bad to me – in fact it had quite a bit of truth to it) and suddenly he’s the Devil incarnate.

  20. simple soul
    Posted November 20, 2010 at 8:40 pm | Permalink

    Lord Young clearly fell victim to media entrapment and to Mr Cameron’s growing Blairite tendency to concern himself too much with tomorrow’s headlines. It is clear from the internet tape that Lord Young was not making a prepared statement or giving a considered ministerial opinion for public consumption, but was using informal and unguarded language in private while trying to eat. He evidently did not expect it to be taken out of context by someone he was treating as an intellectual equal, and anyway he is right about there having been a mortgage windfall enjoyed by many.

    As a result of this treachery we have now lost one of the few people in public life capable of increasing employment.

  21. Alan Wheatley
    Posted November 21, 2010 at 11:27 am | Permalink

    Oh dear oh dear , it seems we are still in a world of government by spin.

  22. grahams
    Posted November 22, 2010 at 4:23 am | Permalink

    Your post is by far the wisest and best comment I have read on this subject. Thank you.

  23. John K
    Posted November 22, 2010 at 4:35 pm | Permalink

    I wish somebody would look up the word “fulsome” in the dictionary before using it.

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, and graduated from Magdalen College Oxford. He is a Distinguished fellow of All Souls, Oxford. A businessman by background, he has set up an investment management business, was both executive and non executive chairman of a quoted industrial PLC, and chaired a manufacturing company with factories in Birmingham, Chicago, India and China. He is the MP for Wokingham, first elected in 1987.

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