What difference will this election make to jobs, wages and prices?

The Conservatives have seen the choice for the election as a simple one. Do you want the Conservative team to continue, who have presided over a decent recovery, with 2 million new jobs and now rising real incomes? Or do you want to hand the keys back to the people who crashed the car in the first place? Labour in its last period in government put up unemployment and brought down real incomes with a jolt.

Labour sees the election as being about the NHS, as we discussed before. Drawn into the economy, Labour has now pledged to get the deficit down, though by less than the Conservatives. Labour has pledged to avoid tax rises for most people, and has been imprecise about their public spending plans. Conservatives have been very clear about the overall pattern of spending, tax revenue and borrowing for each year of the next Parliament, but have not published details of how the extra cash public spending they are proposing  is divided between departments.

The polls show either a Conservative government or a Labour minority  with SNP support on a vote by vote basis. The SNP say they wish to end austerity, which they say means they wish to spend a bit more than Labour’s plans, and therefore borrow a bit more, whilst still gradually bringing down the deficit.

So there will be a difference- Conservatives will borrow less and get the finances on a stable and sustainable footing earlier.

The bigger difference will come in the attitudes towards enterprise and the private sector. More than 25 million people work in the UK private sector, more than five times as many as work in the public sector. The left of centre parties all see the private sector as needing more price controls, regulations, taxes and even state control and ownership. They have a range of policies to limit rents in housing, to control energy prices, to increase state control of the railways, to tax the banks more, to tax property and homes more, to tax foreign residents more and above all to tax anyone who is financially successful more.

This approach was tried by Mr Hollande in France, with very poor results. The French economy lost talent and money, the economy stayed depressed when the UK’s grew well, and in the end Mr Hollande had to moderate some of his ideas.

The choice on May 7th is between a policy which is delivering growth, more jobs and rising living standards, and a series of measures which however well intentioned will make the outlook worse.

 

Labour has proposed a number of interventions to control prices in the energy sector, for housing rents and certain kinds of lending. Such controls usually reduce supply and end up damaging those they are trying to help.

This entry was posted in Uncategorized. Bookmark the permalink. Both comments and trackbacks are currently closed.

116 Comments

  1. Lifelogic
    Posted May 4, 2015 at 6:13 am | Permalink

    Indeed as you say the Labour proposals to limit rents in housing, to control energy prices, to increase state control of the railways, to tax the banks more, to tax property and homes more, to tax foreign residents more and to tax anyone who is financially successful more will be a total disaster. Just the threat of them is already causing damage. They were a disaster under Hollande in France and will be here. But Hollande did alas win the election, let us hope the British (or rather it seems mainly the English) are not as daft as the French were. HSBC will surely & very sensibly be leaving the UK even under the Tories I suspect.

    Labour’s approach is essentially like trying to make yourself taller by pulling on your shoe laces. Or richer by passing laws on rates of pay. Worse in fact, as it will actually make everyone poorer by disrupting and damaging free markets and making the rich leave or invest elsewhere.

    It is a shame Cameron is not offering anything very much better, no sensible vision whatsoever from the man. He too is pushing higher taxes (299+ so far), he has ratted on his IHT promise, he has continued Brown’s attacks on private pensions, he wastes money on HS2, the greencrap expensive energy insanity, the counter productive wars and endless other such waste and lunacy.

    He has no sensible proposals for “the free at the point of use” & largely inept NHS nor indeed education. He is anti-business, happiness index toting, even passing regulations as patently idiotic as the gender neutral insurance and annuities laws. He even fired Owen Patterson and Michael Gove, perhaps his only two decent ministers.

    • Lifelogic
      Posted May 4, 2015 at 6:20 am | Permalink

      He may also have a very dangerous referendum on the EU, which, under Cameron, will clearly be as biased in favour of staying in the EU as he can make it.

      Surely no one sensible in England wants rule by Miliband/SNP. But then Cameron did pathetically fail to get fair boundaries out of the Libdems. What a weak deal he did with the Libdems – non a single real Tory policy was enacted. For the past five years we have had a tax, borrow and piss down the drain, anti business, tax increasing, greencrap, wasteful essentially LibDem government.

      All thanks to Cameron’s cast iron ratting and lefty loon approach that threw the last sitting duck election. Cameron is alas a pro EU, tax increasing, greencrap, Libdem at heart just look at his appalling record.

      Any one employing Ed Davey as energy minister or Vince Cable as a business minister cannot be remotely sensible. Nor indeed anyone employing David Laws at all, with his expenses claims history.

      • Hope
        Posted May 4, 2015 at 8:23 am | Permalink

        Labour will kill the economy, jobs and business, once again. However their narrative they are for the working man and poor has resonated with the public while Cameron has failed, again, to put across a plausible line that sticks. He has broken his word so many times no one trusts him.

        It really is not hard to work out. What is depressing is that he has not learnt from experience. Lord Ashcroft clearly made the point why he failed to get a majority in 2010. It is time for Tories to make the connection that he is more concerned about changing the Tory party to the left than going alone. The Tories need to consider, again, what they are going to do and what they are going to stand for very quickly otherwise they will be in opposition for another couple of generations. He allowed the Lib Dems to criticise the Tories as a partner without any reposte so that it becomes natural for the public to assume the Tories in power hold the same view as their dopey LibDem partners.

        UKIP is the only conservative choice in town and Cameron has derided them so much he will not be able to do a deal with them. Your party is slowly dying.

        • Lifelogic
          Posted May 4, 2015 at 9:39 am | Permalink

          The voting system is such that UKIP will get at best about three or four seats and are thus largely irrelevant. Not remotely fair for a party that came first in the EU elections – where people can vote for what they want – but that is the system that pertains.

          The choice is between the Libdem, ratting, EUphile, lefty Cameron or Miliband/SNP. Cameron is dreadful but rather preferable to the latter, which would be an even more complete disaster.

          • Hope
            Posted May 4, 2015 at 2:47 pm | Permalink

            No I disagree. There are many people who will vote UKIP without saying so. No one predicted the Manchester by election where UKIP were 600 votes from beating
            Labour, it was the Tories who stopped UKIP from winning the seat.

            LL, would you confidently know what you were voting for if you gave Cameron your vote? Gay marriage plus, HS2, more wind farms, how much more to overseas aid, how much more to the EU? European Arrest Warrant and carted to some EU backwater without evidence! Broken promises, a lot of hot air and delivers nothing. As he said if he fails to deliver boot him out. This is the only thing I agree with him.

        • Timaction
          Posted May 4, 2015 at 10:08 am | Permalink

          They argue over the differences that can fit on the head of a pin.
          UKIP would get us out 0f the EU saving direct net costs of £14.5 billion.
          Billions more for the EU HS2 useless rail project, they pretend it was their idea!
          £12 billion saving on the foreign aid bill.
          £5 billion in tax credits.
          Billions more savings on the regulation imposed on all our businesses of which only 8% trade with the EU! 12% with the rest of the world.
          400,000 jobs created by returning our fishing industry.
          Billions saved by removal of the CAP so we don’t have to subsidise foreign inefficient farmers.
          Billions more saved as we don’t have to provide health, education housing costs for the annual influx of 623,000 people.
          Out of the climate change/energy religion to help our pensioners/low paid out of fuel poverty and make our industries competitive.
          Stop mass migration to encourage living wages so 900,000 don’t need to use food banks! No more need to build on the green fields.

          • fedupsouthener
            Posted May 4, 2015 at 9:18 pm | Permalink

            Yes, agree. How can many people on this site even think of voting for Cameron??? Indeed, any of the other party leaders either. UKIP are speaking for the true British people who just want their country back. I am not talking about Scotland but England. There are many who are not telling others they are voting UKIP and I hope to God UKIP’s vote goes up way beyond what the polls are saying. All I see on these pages are disillusionment with Cameron, Clegg and Milliband so why are they still getting votes? Let’s set the election alight and vote for change. Vote UKIP and let the other leaders take their lead from Farage.

            reply The pro UKIP people who try to dominate this site are far from representative of majority opinion in this country. it is interesting they want to spend their time on my site rather than on UKIP sites,

      • Denis Cooper
        Posted May 4, 2015 at 9:13 am | Permalink

        I expect that if the Tory leaders propose any coalition agreement after the election then Tory MPs will be looking to see whether it would absolutely guarantee reform of the constituencies. Last time the agreement with the LibDems left them with too much room to renege on their commitment to support the boundary changes. Perhaps JR will correct me if necessary, but as I read the coalition agreement it required the LibDems to support the Bill ordering the Boundary Commissions to draw up the changes, as well as ordering the AV referendum, but it did not require the LibDems to support the statutory instrument to implement the changes. In a way it is surprising that Cameron has not already said that this would be one of his “red lines” during any negotiations for a fresh coalition, but I suppose that highlighting this would invite UKIP and others to complain that the lack of the proportionality inherent in the FPTP system hurts them far more than the inequality of the constituencies hurts the Tory party.

        Reply Yes the agreement did require them to vote for the SI but they broke their promise.

        • Bob
          Posted May 4, 2015 at 5:36 pm | Permalink

          “Reply Yes the agreement did require them to vote for the SI but they broke their promise.”

          And yet you would still go into coalition with them if they are not completely wiped out on Thursday?

          Reply I have never proposed that and argued against a coalition with them in 2010

        • Denis Cooper
          Posted May 4, 2015 at 5:37 pm | Permalink

          Well, the only explicit reference was to the Bill:

          http://news.bbc.co.uk/1/hi/uk_politics/election_2010/8677933.stm

          “The parties will bring forward a Referendum Bill on electoral reform, which includes provision for the introduction of the Alternative Vote in the event of a positive result in the referendum, as well as for the creation of fewer and more equal sized constituencies. Both parties will whip their Parliamentary Parties in both Houses to support a simple majority referendum on the Alternative Vote, without prejudice to the positions parties will take during such a referendum.”

          And that was done. However I would agree that the LibDems broke the spirit of the agreement if not the letter.

          • sjb
            Posted May 4, 2015 at 8:42 pm | Permalink

            Mark Harper, the then Conservative Minister for Constitutional Reform, said: “[…] those who look at the Coalition Agreement and say that because it talked about bringing forward proposals, somehow that meant that all we committed to do was produce our reform proposals and then pop them in a drawer and do nothing with them and I was making the point that both coalition negotiating teams that signed the Coalition Agreement were very clear that what they were committing both coalition parties to do was to actually deliver on House of Lords reform [emphasis added]”[1]

            So when the Tories breached their obligation on this matter the LibDems retaliated by opposing boundary changes.

            [1] https://corporate.sky.com/media-centre/media-packs/2012/murnaghan-8.07.12-mark-harper-mp-and-jeremy-browne-mp-on-lords-reform

            Reply Mr Clegg was at his own request given the task of finding proposals which would meet with majority support in both Lords and commons and failed.

        • Lifelogic
          Posted May 4, 2015 at 7:51 pm | Permalink

          The Lidems broke their promise because Cameron failed to ensure that they could not do so. He gave them all they wanted before getting anything the Tories or the country wanted. Did the Tories get anything at all? The coalition has been Libdem in all but name, but then so is Cameron.

      • Richard1
        Posted May 4, 2015 at 12:25 pm | Permalink

        The latest move in the BBCs desperate attempt to avoid a Conservative govt: over the next four days (ie until the election) prime time on the world at one is to be given to an interview with a guy who claims he was abused 40 years ago by various people including a known convicted peodophile (conveniently an old Etonian) and various politicians from ‘one political party’ (ie the hated Tories). This – unsubstantiated but possibly true story – is to take priority over coverage of the election and all contemporary global problems – and obviously the royal baby.

        I don’t think it will work.

        • oldtimer
          Posted May 4, 2015 at 2:55 pm | Permalink

          I noticed that and came to the same conclusion.

        • Lifelogic
          Posted May 4, 2015 at 7:53 pm | Permalink

          Such is the BBC. Cameron could have started to sort the BBC bias out but just appointed Lord Patten instead.

    • Bazman
      Posted May 4, 2015 at 8:49 am | Permalink

      As pointed out to you a number of times we have seen what the free market has done to homes and energy. It has made in unaffordable for many. Your do nothing approach is only beneficial to the few and mainly rich non dome tax avoiders living under the same sky as the rest of us. You primarily rely on the mostly debunked trickle down effect or the horses and sparrows theory as it is known
      HSBC given their past record in this country are in no position to lecture us. They can sling their hooks, but like most threats to leave by companies and individuals do not and don’t forget we do not respond to threats do we?
      Do you ever read anything sensible like Private Eye or
      The Observer or look at the internet or all of your views formed by Tory propaganda sheets and the deluded whining of the rich who really could not care less about the country.
      I often see these views in the pub from small minded part time landords who when confronted that their view are formed by lies and propaganda squirm and try to agree to disagree. They are wrong and I often point out that unfortunately for them the internet is available to check their sources. ‘The Big Lie’ for example. Years ago they just thought they could rant and be right without recourse. They then have look but do not fancy their chances…

  2. matthu
    Posted May 4, 2015 at 6:28 am | Permalink

    Interventions to control prices in the energy sector will prove spectacularly ineffective. Prices will be determined firstly by the world price of oil and secondly by idiotic directives from the EU and green crap subsidies which will continue regardless of who is PM.

    Prices will be hammered this way and that by a Greek exit of the Euro and possibly the EU as people finally focus on the untrue assurances that have been uttered by EU politicians for as long as anybody can remember.

    Politics will be thrown into disarray as mass marches occur simultaneously in cities all over Europe and amongst the most insecure jobs will be leaders of several mainstream political parties in Westminster.

  3. Matt
    Posted May 4, 2015 at 6:38 am | Permalink

    “… a series of measures which however well intentioned will make the outlook worse”

    It’s always the way isn’t it. Socialism comes along with lots of good intentions that just don’t work in practise.
    I find it extremely frustrating that the “left of centre” parties and their supporters don’t learn the lessons of history. If you try to divide up the pie evenly, you find that the pie ends up smaller and everybody is worse off.
    If you break the link, however imperfect it is, between effort and reward; everything goes wrong.
    When I was young, I used to support left wing ideas. I saw them fail time and again, read lots of history showing emphatically that they always fail, and I stopped supporting them. I can understand inexperienced voters still supporting these ideas, but professional politicians must realise the folly of them.
    How many times do we have to try socialism and watch it fail catastrophically before we give up on it.

    Let’s not forget that there is also a strong moral case for capitalism: It rewards effort and it rewards risk taking where such risk taking benefits society. A bigger pie is ultimately in everybody’s best interests. Even if you’re not getting an equal share of the pie, because the pie is bigger, you’re getting more pie. Surely that’s what really matters. Who cares whether somebody else is getting more share of the pie as long as you’re getting more pie.

    • Paul
      Posted May 4, 2015 at 8:45 am | Permalink

      “It’s always the way isn’t it. Socialism comes along with lots of good intentions that just don’t work in practise.”

      Oh, yes. I’ve lost count of the number of debates I’ve had which are basically “we should be nice to people”. Like Milliband’s tombstone thing yesterday, the ‘promises’ are actually vagaries at about the ‘be nice to people’ level.

      I always ask, right , how are you going to pay for all this stuff. The answer is usually silence, occasionally some waffle about Banker’s Bonus tax or Vodaphone, about which they know no detail.

      The attitude to concerns about banks and businesses appears to amount to “Good riddance”. I don’t think they have any grasp how dependent we are on income from taxing the rich or financials. Yeah, they can clear off, now find that money as well.

      There’s an old saying, if you vote Conservative when you are 20 you have no heart, if you vote Labour when you are 40 you have no brain.

      • Lifelogic
        Posted May 4, 2015 at 9:47 am | Permalink

        They are not “good intentions that just don’t work in practise”

        They are cynical attempts by lefty politicians to con and/or buy voters with empty promises (usually to given other people’s money to them). The politicians know full well they will not work in practise and most will actually cause positive harm. But they know they will con some voters and so they do not care.

        • Leslie Singleton
          Posted May 4, 2015 at 6:00 pm | Permalink

          Practice with a c please (what with its being a noun here)

          • Lifelogic
            Posted May 4, 2015 at 8:14 pm | Permalink

            Copied and pasted from Paul above is my excuse. But then to have a single “right” spelling is a dreadfully socialist concept anyway. There is no such distinction needed in the spoken language and non is needed in the written one.

            If you know it is “wrong” then clearly no confusion has arisen.

  4. Mondeo Man
    Posted May 4, 2015 at 6:46 am | Permalink

    Once again – on a subject to which it is vital – the elephant in the room is ignored completely.

    Mass immigration is a key determinant in the levels of jobs, wages and prices.

    “Ah. Part of the reason for record mass immigration is that we are the jobs factory of Europe. It is because of our success.” To loosely quote David Cameron.

    Then we’d rather we weren’t the jobs factory of Europe . These jobs come at huge cost (many subsidised with in-work top ups and unfunded public service entitlements) and in the next downturn there will be far more eligible welfare claimants to pile pressure on public services than we’ve ever had.

    The phrase ‘fixing the roof while the sun shines’ should be coupled with ‘making sure everyone brings a bottle to the party.’

    There will be another downturn – or do the Tories claim to have brought an end to boom and bust as Brown did ?

    The UKIP supporter can see it for what it is. Very much a double-edged sword that is being swung against them and only Nigel Farage has the guts to speak out on it.

    Reply I have often written about immigration on this site, and my contributors write about it most days. Of the main parties, only the Conservatives are offering a renegotiate with the EU which is the only way to get control of our borders back

    • matthu
      Posted May 4, 2015 at 7:11 am | Permalink

      Why should we believe that Cameron’s renegotiation skills are the only way to win back control of our borders? Ed Miliband has carved a promise in a slab of ROCK that he will achieve control over immigration. Why is his promise less credible than the Conservative promise?

      Reply Because he has no intention of renegotiating with the EU who control our EU order.

      • bigneil
        Posted May 4, 2015 at 9:40 am | Permalink

        reply to reply – – Just what IS Cameron’s renegotiation terms – – a change of biscuits with the coffee? – he keeps making his famous weasel word pledges and promises, that are broken straight away – but won’t tell us what the renegotiation pledges actually are on immigration. There is absolutely NO trust of him at all.
        Another thing seen on YOUR area BBC local news text service – (wonderful to be able to read it up here) – a site for travellers has been turned down if I read it correctly – the place – a town called Wokingham? – With DC’s fight against a massive housing project in his home area – -are you all nimby’s?
        It seems like the rest of the country can have thousands and thousands of houses built to hand over to people who turn up and get their totally free uncontributed-to lives – – yet they get turned down when it’s in your area.

      • Lifelogic
        Posted May 4, 2015 at 9:53 am | Permalink

        Cameron has not said he will insist on control of EU migration in any renegotiation either. His “no ifs no buts” record is not very encouraging.

        • Hope
          Posted May 4, 2015 at 2:49 pm | Permalink

          Nor can he insists on it and he has been told unequivocally by EU leaders that it is not for discussion.

          • Leslie Singleton
            Posted May 4, 2015 at 6:04 pm | Permalink

            Dear Hope–Sure he can insist on it else no discussion

    • Dame Rita Webb
      Posted May 4, 2015 at 7:33 am | Permalink

      Yes but how about fixing the borders with regard to who can come in from outside the EU? Its not as though we have enough home grown people who effectively are going to be wards of the state till the day they die. Where is the money going to come from to take care of those cannot speak English and/or have no skills or qualifications that will allow them to make a positive contribution?

    • Mondeo Man
      Posted May 4, 2015 at 7:37 am | Permalink

      Reply to reply

      And we are right to mention it every day, John.

      This is the #1 issue that is holding your party down in the polls. It should be streets ahead of Labour.

      Yes. A vague offer to renegotiate with Europe. But there is no sign that our government is in control.

      What might have worked is our government making a proper stand during its term in office. Realising that this is a matter of urgency and pausing immigration until these renegotiations had take place.

      Because David Cameron didn’t do this and because he bombed Libya we now have mass migrations from Africa and refugees massing on the French coast having heard about our record employment and now world famous welfare system.

      It has reached critical mass as some of us have tried to warn you it would.

      It’s time to stop blaming Labour.

      This is your party’s fault and it cannot be trusted to negotiate anything. Especially on things it won’t even talk about.

      I think we’re in for a shock on Thursday. Huge amounts of people I know intend to vote UKIP.

      • Paul
        Posted May 4, 2015 at 8:46 am | Permalink

        The thing that holds down the Conservatives is tribal voting by people who aren’t very smart and just vote for who they think will hand them the most money.

        There’s a core Labour vote that would blame Margaret Thatcher if Ed Miliband personally came round their house and shot their children.

        • Mondeo Man
          Posted May 4, 2015 at 6:13 pm | Permalink

          What is holding down the Tories is their own losses.

          They should have split decades ago.

          In fact and hobbled and divided Tory party has been all part of the plan.

      • Timaction
        Posted May 4, 2015 at 10:13 am | Permalink

        I really hope you are right about the vote and we need to wait and see. It will take that earthquake to make the political class realise how fed up the populous is with the political class who arrogantly do as they wish without any mandate………………….because they always have!

        • Mondeo Man
          Posted May 4, 2015 at 6:18 pm | Permalink

          Timaction – The Tories are relying on the Lab/SNP prospect scaring Ukippers back to them.

          Well I took a straw poll at word today.

          “What do you think about Scotland and the SNP ?” Nobody knew anything about it.

          It only seems to matter (in England) to those in the political bubble and to blog followers such as ourselves.

          The sight of the boat people is biblical in its proportions.

          The Tory party caused this.

          It continued to make England appealing and it bombed Libya uncorking the Africa bottle.

          What’s worse the Tories have caused us to have a moral obligation.

          They have been a disaster and when the economy unravels we’ll realise just how much.

          • Mondeo Man
            Posted May 4, 2015 at 6:25 pm | Permalink

            work

      • John C.
        Posted May 4, 2015 at 2:21 pm | Permalink

        There are many blog contributors who forecast a surprising UKIP vote, but the pollsters have UKIP on 14%, more or less.The usual explanation for this is 1)that the pollsters’ methods are flawed 2) they are deliberately reporting low support to lower UKIP’s morale.
        But, 1) surely they take great care to see that obvious errors are remedied and 2) they have no stake in demeaning a party (except Ashworth?). A wildly inaccurate prediction can only weaken their own business.
        On the whole, I am inclined to feel they have slightly underrated UKIP support, but not by a dramatic amount. I guess (and that’s all it is) UKIP will gain 18%, which on the whole will only give them a very few seats.

        Reply If UKIP poll at 10%, the bottom of their current poll range, that’s around 3 m votes, so UKIP supporters would expect to meet and know some other UKIP supporters. To win outright a party is going to need well above 10 million votes, far more than polls for UKIP indicate or doorstep canvassing indicate.

        • Leslie Singleton
          Posted May 4, 2015 at 6:18 pm | Permalink

          Eh? to Reply–Who bar you is talking about an outright or indeed any majority for UKIP (just setting up a straw man to knock him down), It will be a huge step forward if Farage gets in with a few others. I have long been happy with that prospect. Let’s hear it for variability which I am fairly certain will be high.

        • Mondeo Man
          Posted May 4, 2015 at 6:24 pm | Permalink

          Reply to reply – at least 3 million people without proper representation in parliament and held in contempt by the broadcast media and political class.

          Don’t you think that’s a bit dangerous, John ?

          Don’t you think that something ought to be done to remedy this democratic deficit before it gets out of hand ?

          A reminder that 18% is more than the LibDems, Greens and SNP combined.

          The Tories have gifted this country to the Left.

        • Mike
          Posted May 4, 2015 at 10:05 pm | Permalink

          The polls are weighted by newspaper readership, which itself only accounts for about a third of the electorate nowadays.

          Even the results of the polling are then weighted by previous vote share ( 3% at the last GE).

          For a start kippers don’t tend to read the papers. Very much an online tech savvy bunch. Secondly the polls are only tapping into the old tribal ‘if I read the Sun I will vote tory’ nonsense.

          Also note that all the polls put lab + con on 68-70%. I’ll eat my hat if they do, the lab + con diminishing vote is a historical trend, wouldn’t surprise me to see it in the high 50s this time around.

          Bear in mind too that the pollsters have a product to sell. By saying it is close they guarantee more polls with the same flawed methodology.

          Reply. Dream on

    • alan jutson
      Posted May 4, 2015 at 7:53 am | Permalink

      reply-reply

      No your Party is not the only one who will give a referendum on the EU or leave.

      I absolutely agree that you are the only realistic choice of party with the likely power to put forward the motion, but then you are also the Party who have many members who also will vote for staying in, no matter what the results of a promised referendum.

      Where there is a better chance of UKIP getting elected in some constituencies than Conservative, then voters should vote for UKIP to keep Labour or LibDems out, then at least you will be sure of a vote for both a referendum to be held, and for a vote of out if negotiations are poor.

    • Hope
      Posted May 4, 2015 at 8:39 am | Permalink

      JR, get real. We all have respect for your intelligence and analytical mind. Your reply is simply ridiculous. Mondo Man makes some very good points. People out here are already frustrated they cannot get their child into the local school, cannot get a doctors appt, cannot visit the dentist, or are viewed on a need basis for housing against people who have just arrived here! This will turn into civil unrest. There is only so much people can take, add brutal physical violence and terrorism against the indigenous population in your own country and sensible people will completely loose faith in the govt to take appropriate action for everyone’s wellbeing. That is if they already have not done so.

      Clegg, Cameron and Miliband are incapable of even cleaning up the standards at Westminster! Yesterday pictures of Labour MPs addressing a segregated audience after years of forcing equality rubbish down our throats and prosecuting people as quickly as possible to suppress free speech. In contrast to her husband at the segregated meeting, Harman driving around in a pink bus banging on about equality for women! You could not make it up. The low regard the public holds politicians is thoroughly deserved.

    • Denis Cooper
      Posted May 4, 2015 at 8:50 am | Permalink

      I work out that with the present rate at which the Italians are ferrying immigrants from Africa into the EU their numbers could easily exceed 2 million before we got control of our borders back, and as we are already seeing the UK is the preferred destination for many of them.

      http://www.theguardian.com/world/2015/may/03/thousands-migrants-rescue-med-weekend-operations-libya-italy-mediterranean

      “More than 5,500 people rescued off the coast of Libya on Saturday and Sunday in more than a dozen separate operations led by the Italian navy”

      5,500 divided by 2 multiplied by 365 multiplied by 2 = 2,007,500.

      As can be seen from the pictures accompanying that article, many of these people are not from Libya but much further south.

    • Brian Tomkinson
      Posted May 4, 2015 at 9:15 am | Permalink

      Reply to reply,
      How convenient that you forget that German Chancellor Angela Merkel considers the free movement of persons sacrosanct and told Cameron that earlier this year. There can be no control over immigration whilst the UK remains in the EU. You must know that, but for party political purposes you like to pretend otherwise.

    • Qubus
      Posted May 4, 2015 at 9:47 am | Permalink

      JR,
      Your party may be the only one offering a referendum; the problem is that the public don’t really believe that it will be an honest offer. Cameron will find some way of evading it. In any case, he is clearly in favour of staying in the EU and will therefore go to the negotiating table without any real hope of success. Add to that that half of the UK is afraid of the turmoil that would be created by exit: many think that we are now in it too deep to get out.
      Let us hope that common sense will ultimately prevail and that there can be some sort of last minute agreement with Ukip. This would be far far better than a Labour + left-wing parties stitch-up.

    • Chris
      Posted May 4, 2015 at 9:56 am | Permalink

      Reply to reply by JR:
      How many times does the EU/EC have to tell you that there will be no renegotiation of fundamental principles e.g. freedom of movement?

      Perhaps Cameron does not want to renegotiate this anyway, but he suggests to the electorate that he will. How dishonest.

      The only people being honest in this debate are those in the EU/EC who make it crystal clear that they will not veer from the founding principles of the EU. Tinkering at the edges will be permitted but this is not what the electorate wants. They want radical change will not be forthcoming.

      JR, you keep posting that if they do not offer you the changes you want you will vote to leave. Why keep up the charade in the first place that fundamental change, such as freedom of movement, can be negotiated?

    • Reply to Reply
      Posted May 4, 2015 at 1:01 pm | Permalink

      With respect John you may be offering to renegotiate with the EU but they are not offering to listen. Renegotiation is a dead end cul de sac for those who wish to stay in the EU but want to get some sop out of the EU with which they can con our electorate into thinking that our relationship with the EU has changed. We can see through it.

      There is only one way to negotiate with the EU, and that is from a position of strength, not as some supplicant crawling on it’s knees. A referendum on the reality of our relationship now, on an in/out question provides that strength. If the answer is out then we apply Article 50. Only then do you begin negotiating with an EU that has had it’s mind concentrated on the issue. The issues are then only trade and areas of cooperation. We would be negotiating as a sovereign power , not as an already castrated beggar. The conservative party needs to wake up and get real, you are talking like a bunch of Sir Humphreys.

      • Mondeo Man
        Posted May 4, 2015 at 6:29 pm | Permalink

        Reply to Reply – and there is only one way to negotiate with the Tory party.

        From a position of strength.

        Threaten to take your vote away and make sure you mean it.

        • Mondeo Man
          Posted May 4, 2015 at 6:30 pm | Permalink

          Reply to reply to reply to reply.

          Calling yourself reply to reply was a nasty trick, reply to reply.

    • Timaction
      Posted May 4, 2015 at 4:29 pm | Permalink

      Mr Cameron said a few days ago that he wants freedom of movement for workers to remain but take a few benefits away for 4 years. He lied that there are as many Brits working in the EU as them working here. We know that the majority of Brits are living in Spain, France and Cyprus. A significant percentage are retired and no burden to the locals, paying for themselves and their public services, unlike we are having to put up with. That won’t achieve anything like what the public are demanding. We don’t want open borders to the 485 million people of the EU and another few million abandoning Africa to get to the EU and then Britain with our open borders! We are a small, very overcrowded island Nation being betrayed by the Legacy parties who know what we want and are openly defying us.

  5. Alan Wheatley
    Posted May 4, 2015 at 7:05 am | Permalink

    The most recent figures I heard said that although GDP has recovered back to pre-crash levels, GDP per capita has not. This would seem to be, at least in part, why people are saying they are not feeling a recovery.

    Reply The real value of take home pay is above 2007.

    • Paul
      Posted May 4, 2015 at 8:48 am | Permalink

      It’s down to definitions which have been abused. Austerity, for example, is not a few reductions barely above the inflation adjusted amount.

      People think “recovery” is something like the Labour boom years where money was being thrown about like it was free. Those days are gone, probably for ever.

    • Qubus
      Posted May 4, 2015 at 9:48 am | Permalink

      I understand that GDP per capita has risen by about 50p.

      • Lifelogic
        Posted May 4, 2015 at 12:56 pm | Permalink

        Even 50p is surprising given the anti business, expensive energy, tax borrow and waste and over regulatory approach this dreadful Cameron Coalition.

        • Lifelogic
          Posted May 4, 2015 at 12:59 pm | Permalink

          Also it does not allow for all the addition debt the Coalition has piled up against our future while as Cameron dishonestly puts it they have been repaying the debt.

  6. Sandra Cox
    Posted May 4, 2015 at 7:36 am | Permalink

    Before I can even think about today’s topic, I have to raise, yet again, the subject of the erosion of democracy, and the scale of fraud within our electoral process.

    This has been the most disgraceful, undemocratic election campaign I have witnessed (rivalling the unsavoury tactics employed by politicians and the media prior to the EU referendum in 1975). One of the remaining few rights we retain (for now) is the ballot box and I am at a loss to understand why the Conservative Party has made hardly any attempt to stamp out the fraud that we are still witnessing as we approach the 2015 GE.

    An article in Telegraph 5 Apr 2005 (note, the date is not a typo):
    “A judge launched a blistering attack on the postal voting system yesterday and the Government’s failure to recognise and tackle widespread corruption.
    Finding six Labour councillors guilty of electoral fraud at last year’s council election in two Birmingham wards, he said the episode would “disgrace a banana republic”.”

    “Richard Mawrey, QC, sitting as a High Court judge, said the councillors were responsible for a “massive, systematic and organised fraud” that was supported by the local Labour Party.”

    “He attacked ministers who dismissed warnings about vote rigging in the forthcoming general election as “scaremongering” and said the system that Tony Blair was encouraging the public to use was “hopelessly insecure”.”

    The Telegraph 3 May 2015, following the recent court action brought by four members of the public, reports police are starting a fresh criminal investigation in Tower Hamlets in light of “new material” in the 200-page finding by the election judge, Richard Mawrey.

    John, with only a few days to go before the polling booths open, I don’t think the £500,000 funding that the government recently divided between 16 problem areas is going to cut the mustard – do you?

    Still, let’s hope that in the future the Electoral Commission and police take more seriously the concerns of voters and investigates any suspected fraud rather than expecting members of the public to do their jobs for them! I certainly hope these institutions will be held to account by all our future MPs.

    John, many thanks for hosting this blog – a bit of a safety valve amongst today’s political chaos.(Comments on Wokingham voting patterns left out ed) may I wish you well in your own campaign to return to Parliament.

    Replt The last government introduced individual voter registration which was a major attempt to create honest voting records.

    • Qubus
      Posted May 4, 2015 at 9:51 am | Permalink

      Yes, JR, I do hope that you are successful personally (and your party too) on Thursday.
      This website is a breath of fresh air.
      Keep up the good work.

    • Sandra Cox
      Posted May 4, 2015 at 11:39 am | Permalink

      Reply to reply: It has taken five years to make a start, leading to the need for additional last-minute funding; the next Parliament definitely needs to get a grip on the Electoral Commission and the police.

      Failure by the authorities to investigate past allegations of serious misconduct for fear of being labelled racist is bad enough, but how is all this going to affect future whistleblowers if Miliband’s and Cameron’s proposed blasphemy law (currently winging its way from the EU, no doubt) is in place?

      By the way, I’ve just seen a good article on Conservative Home on this subject.

      • Dame Rita Webb
        Posted May 4, 2015 at 2:50 pm | Permalink

        Who wants to bet me 50p that a load of voters are going to get locked out the poling stations this week just as they were five years ago? JR passes the buck and says its down to the council to sort out. These people cannot even organise timely bin collections. Incidentally there is a nice article about postal voting irregularities in the current edition of “Private Eye”, no need to guess which party is up to its neck in it.

  7. Kenneth
    Posted May 4, 2015 at 7:36 am | Permalink

    Mr Redwood, your last sentences sums it up: “damaging those they are trying to help”.

    That is the socialist disease.

    Rent controls result in a higher bar for new tenants and less rental supply which ultimately increases rents.

    Price controls push the cost from one to consumer to another consumer (domestic mobile phone users are now paying higher bills to pay for the jet-set who have their roaming charges capped).

    More labour regulation throws people out of work (every Labour government in history has increased unemployment).

    Higher taxes result in lower yield.

    etc etc.

    • Lifelogic
      Posted May 4, 2015 at 12:48 pm | Permalink

      But the left know Full well it will not work to help these sections of the community, they just use it to try to con (or buy) voters.

    • Mondeo Man
      Posted May 4, 2015 at 6:45 pm | Permalink

      Landlords are, of course, in it for themselves.

      They are not providing a service. They are providing a self funding asset portfolio for themselves, often on a loan paid for by the renter.

      They are helping to drive up property prices. At the bottom end the ‘industry’ is propped up by welfare to landlord subsidies and mass immigration.

      The renter is having to pay more in rent than he probably would in mortgage.

      The Tories lose out (good, they deserve to) because the home owner society reduces with every generation.

      I’m with Labour on this one.

      People don’t want landlords.

      They want to own the homes they live in. Tories should understand this. So why don’t they ?

    • Mondeo Man
      Posted May 4, 2015 at 6:48 pm | Permalink

      “Rent controls result in a higher bar for new tenants and less rental supply which ultimately increases rents.”

      It should help to bring down house prices to levels more affordable to tenants.

      Is that a problem, Kenneth ?

      I’d rather see more home owners than landlords and it would be good for the Tory party too.

  8. Richard1
    Posted May 4, 2015 at 7:57 am | Permalink

    Miliband is still in complete denial over Labours over spending and over borrowing when in office. John Humphries, to his credit, has just become -as far as I’m aware – the first BBC interviewer apart from Andrew Neil, to challenge Labour over their over spending. Mr Humphries pointed out that the OECD has made clear that the UK was much worse placed for the financial crisis as Labour took the UK into the crisis with one of the highest structural deficits in the developed world. Miliband attempted to obfuscate but in the end fell back to talking about ‘investment’ as Brown always used to do. Labour can of course also be blamed for the monetary and regulatory policy which caused the financial crisis in the banking sector. But where people must be very clear is Labours over spending and over borrowing was absolutely a ,ajar contributor to the economic problems which the Consevative led govt has had to sort out.

    Reply yes it was a good interview, with special emphasis on trust

    • Denis Cooper
      Posted May 4, 2015 at 10:00 am | Permalink

      Well, the country would certainly have been better placed to withstand the bust if the Labour government had adopted the Tories’ proposal to “share the proceeds of growth” during the boom years. However that was a fairly mild criticism of Labour’s spending at the time, rather than a forthright denunciation.

      Viewed dispassionately the problem is that when the good times are rolling nobody can reliably predict how long they will last.

      On a personal level I was over-pessimistic and sold shares too early, although I still maintain that it is better to sell too early than to leave it too late, while on a political level the Tories were far too early with their predictions of impending disaster; then finding in two general elections that the voters were unconvinced by this, and that some even believed Brown’s claim to have abolished Tory boom and bust, they partially backtracked.

      And here to give a longer historical perspective, Brown could only make his claim to have abolished Tory boom and bust because there had in fact been boom and bust under the previous Tory government, and he could only get away with that claim because the Tories had lost their longstanding reputation for economic competence, and as we know that was directly connected with the pro-EU and pro-euro inclinations of those controlling the Tory party.

      I note that the Tory manifesto for this general election is also predicated on the assumption that whatever good times we are having now will continue to roll for at least the next five years, which may or may not turn out to be the case.

      • Richard1
        Posted May 4, 2015 at 5:47 pm | Permalink

        Yes boom and bust has most of all to do with leverage in the banking system. It’s still far too high both in the UK and Europe. There can be little doubt that had Major /Clarke not been replaced by Blair / Brown the Country would have been much better placed to withstand the crisis. It is also possible that had bank regulation not been taken by Brown out of the BoE – which determines monetary policy – the BoE would have sat up and taken notice of the highly risky bank capital structures before they did. We will never know, but we can and should blame whoever was at the wheel at the time.

    • stred
      Posted May 4, 2015 at 10:39 am | Permalink

      Humphries allowed Milliband to say that Labour would save the country from cuts in the NHS, without asking what the Labour manifesto proposed and pointing out that the Conservatives and UKIP propose to spend much more.

      • Timaction
        Posted May 4, 2015 at 4:39 pm | Permalink

        …………..and UKIP’s is the ONLY costed manifesto where we clearly explain how we’ll fund the increase in the English (International) NHS.

        Simple things like massively cutting foreign aid (£12 billion), EU aid (£14.5 billion), HS2( £65 billion ish), revise the Barnet formula, stoopping health tourism including aids treatment for anyone who can get here (£2 billion)! Countless billions in savings to help the British people, 900,000 who are using food banks.

        We’d also guarantee our own security by properly our military (2% GDP) and its veterans would be looked after. The police would be funded properly to ensure our safety in these dangerous times.

        Good old patriotic common sense ideas and outlook. Shock horror, we’d also ensure our borders were secured and only allow those that benefited our Country would be allowed here with an annual cap.

  9. Ian wragg
    Posted May 4, 2015 at 7:59 am | Permalink

    2 million new jobs.. 1.5 million to immigrants. No infrastructure to cope
    Hospitals and schools in crisis and still they come pouring in. I estimate another 100,000 since the last announcement.
    We are losing patience John and I haven’t heard anything in this most spectacularly managed campaign which is likely to change the situation
    As a vote for you implies I agree with your policies I have no choice but to vote UKIP.
    This is despite being a staunch Tory for 40 odd years
    There is no longer a Tory party just a wishy washy social democrat mob with no connection to the real world.

    • Dame Rita Webb
      Posted May 4, 2015 at 3:03 pm | Permalink

      “The Guardian” reported recently that senior Tory MPs have been told to form a praetorian guard around Dave as of Friday morning. This being on the premise that there will be another election in October. Are these people stupid? No majority and he should be out on his ears. Dave failed to win against the most corrupt government since Walpole’s, he is given the run around by Milliband and he deserves another shot? Ian do not shed a tear the Conservatives are not going to be around for much longer.

    • Timaction
      Posted May 4, 2015 at 4:40 pm | Permalink

      Everyone is saying the same!

    • matthu
      Posted May 4, 2015 at 5:26 pm | Permalink

      Well then, you know what to do.

      ”So this is our contract with you. I want you to read it and – if we win the election – use it to hold us to account. If we don’t deliver our side of the bargain, vote us out in five years’ time”. David Cameron, 2010.

    • Mondeo Man
      Posted May 4, 2015 at 6:56 pm | Permalink

      “As a vote for you implies I agree with your policies”

      Mark my words, Ian. It will be taken as such.

      Any Ukipper lending their vote tactically to the Tories should be aware that it will be used to slap Nigel Farage down.

      The man deserves far better than than.

  10. Denis Cooper
    Posted May 4, 2015 at 8:08 am | Permalink

    “The polls show either a Conservative government or a Labour minority with SNP support on a vote by vote basis.”

    Given the margins of error on the polls, and the uncertainties about how votes cast will translate into seats won, there are a lot of possible outcomes – Cameron leading a purely Tory minority government, or a coalition with the LibDems and possibly Ulster MPs which would still be a minority government or could just scrape an overall majority, or Miliband leading a purely Labour minority government or a coalition with the LibDems which would still be a minority government or might have a small majority.

    I think we can rule out either the Tories or Labour forming a coalition involving the SNP to get an overall majority, and whether a Labour-led minority government would need SNP support on a vote by vote basis would entirely depend upon the attitude of those leading the Tory party.

    If they wanted to use their MPs to force Miliband into the arms of the SNP then of course they could that – and indeed they are now implicitly threatening to do that, in effect they are trying to blackmail the electorate into voting Tory – even though it could hardly be in the national interest.

    Alternatively, it would only require the 280’sh Tory MPs to abstain from a vote to neutralise the 50’sh SNP MPs, who could not defeat Labour’s 280’sh MPs without the help of the Tories.

  11. Richard1
    Posted May 4, 2015 at 8:23 am | Permalink

    Anyone wondering what Miliband /SNP would be like should have a quick look at President Hollandes France. (Miliband has previously expressed admiration for Hollande). The latest data show GDP growth of 0.1% for the last quarter and unemployment over 10%. The French manufacturing sector is described as being ‘in reverse’. Hardly surprising. No-one I know wants to invest a cent in France if theres a choice. It could easily happen here.

    • Lifelogic
      Posted May 4, 2015 at 12:53 pm | Permalink

      It could indeed and Cameron with his non Tory approach is making it rather likely. Perhaps he will just be saved by the uselessness of the landlord thief to be Mr Miliband and the appalling thought of the SNP robbing England further.

  12. petermartin2001
    Posted May 4, 2015 at 8:46 am | Permalink

    “This approach was tried by Mr Hollande in France, with very poor results. ” ??

    “this approach” could well mean attempted forced govt deficit reduction too. As France is in the EZ it is supposed to comply with the 3% budget deficit rule. Of course, it doesn’t have the same economic space to manoeuvre as the UK. The UK still has its own currency. France doesn’t. So we aren’t really comparing like with like.

    The irony of it all is that having our own currency allows us to run whatever deficit we like. The UK runs a deficit which is twice what would be allowed under the euro rules. If the UK were in the EZ George Osborne would have to report to some middle ranking German civil servant who would veto an unapproved spending here or a tax reduction there. We don’t need that.

    Having that higher deficit means that the level of UK unemployment is half that of French unemployment.

    So why the big drive to reduce it? It’s really not a problem for either us or our children. We haven’t had to repay our parents’ generation’s deficits and neither will our children have to repay ours.

    Politicians have learned, the hard way, that fiat currencies are best left to float. They rise and fall according to prevailing economic conditions. The same is true of government surpluses and deficits. They need to be allowed to float too. That lesson has not yet been learned. A Government surplus is a non-government deficit. To the penny so they aren’t at all the big bad monsters we are led to believe they are.

    Government is not like a business. Its deficit doesn’t equate to a business loss. If it did the the USA would have been declared bankrupt years ago. Despite what many believe there is no way the USA can be considered bankrupt or anywhere near close to it. The same is true for the UK too.

    The government deficit, or non-Government surplus, is only a problem if inflation is a problem. With inflation as low as it is, it’s no problem at all.

    • Ted Monbiot
      Posted May 4, 2015 at 9:16 am | Permalink

      A post which can be summarised as saying, just keep the QE process going and keep printing money until we are all rich.

      • petermartin2001
        Posted May 4, 2015 at 1:54 pm | Permalink

        A better summary would be that Government should just concentrate on keeping inflation under control , on the one hand, and keeping the economy functioning at close to full capacity on the other. Deficits, surpluses and currency exchange rates should be allowed to float. They’ll naturally rise and fall according to prevailing conditions. They’ll just take care of themselves once the economy is restored to good health.

        Yes, we will be rich. We are already rich compared to previous generations. They would have found it hard to believe that it would be possible to increase GDP per person by a factor of more than 5 since the end of WW2 and still be experiencing economic difficulties.

        But somehow we’ve shown them that’s entirely feasible.

        • Ted Monbiot
          Posted May 4, 2015 at 7:21 pm | Permalink

          How can you float a deficit!
          Its a conscious decision made by Governments in their spending reviews and budgets.

          By debts and deficits, onward to wealth for all.
          Sounds like an Orwell slogan to me.

          • petermartin2001
            Posted May 5, 2015 at 5:40 pm | Permalink

            “How can you float a deficit! Its a conscious decision made by Governments in their spending reviews and budgets.”

            That’s where nearly every politician, including most Chancellors, get it wrong. Governments can only make a “concious decision” about the extent of their spending and the rate at which they set taxes.

            They can’t determine the extent to which those taxes will be paid. If governments reduce their spending they will also reduce their taxation revenue. That’s sometimes necessary when inflation is the main problem.

        • APL
          Posted May 6, 2015 at 6:09 am | Permalink

          petermartin2001: “Government should just concentrate on keeping inflation under control ”

          You are joking, I think?

          9000% inflation since 1913, most of it occurring post 1950. If that’s what you call ‘under control’….

          But in any case, official government policy is to foster and encourage inflation.

    • Qubus
      Posted May 4, 2015 at 9:55 am | Permalink

      We need to reduce the debt because of the massive amounts of interest that we are paying on it.

      • petermartin2001
        Posted May 4, 2015 at 1:28 pm | Permalink

        We aren’t paying massive amounts of interest. Less than is typical in the post war period. See the graphs on Wikis page on UK National Debt.

        Many commentators on this blog have actually argued we are paying too little and that interest rates should rise to encourage more saving. They complain than interest payments barely cover inflation and they do have a point. Ultimately if savers wish to lend then someone has to borrow and ultimately that has to be government.

        Governments are only in deficit (it spends more than it earns) because the non government sector is in surplus (it spends less than it earns). That is the case penny for penny. It is a simple matter of accounting that total spending equals total earnings.

        So if Government reduces its spending, and the non-government sector spends the same, or less, then total earnings have to fall too. That’s just simple arithmetic.

        • Ted Monbiot
          Posted May 4, 2015 at 7:24 pm | Permalink

          It is perfectly possible for private sector to grow or shrink independently of the State increasing or decreasing its spending or taxation policies.

          • petermartin2001
            Posted May 5, 2015 at 5:55 pm | Permalink

            Yes you’re right. It is possible. The way to do it is by lowering interest rates which encourages the private sector to ‘borrow’ the money it needs for its expansion. Borrow isn’t really the right word. The commercial banks simply create new money when they lend in the form of asset/liability pairs.

            The liabilities tend to stay in the economy increasing levels of private debt, but the assets are taxed away by government or disappear overseas to pay for our net imports.

            So a reduction of interest rates acts in the short term like a Keynesian stimulus but soon runs out of steam as debts build in the economy. That requires yet another reduction in interest rates. We’ve reached the end of the line with that idea as they’d have to go negative to have any further effect.

            But, and I kid you not, even though it would mean eliminating physical cash and having exclusively electronic money, some economists are seriously discussing that possibility!

    • Denis Cooper
      Posted May 4, 2015 at 10:06 am | Permalink

      “If the UK were in the EZ George Osborne would have to report to some middle ranking German civil servant who would veto an unapproved spending here or a tax reduction there. We don’t need that.”

      But even outside the eurozone we have that, albeit in a diluted form.

      “We haven’t had to repay our parents’ generation’s deficits”

      Of course we have, even if we have used fresh borrowings to do it.

    • Richard1
      Posted May 4, 2015 at 10:13 am | Permalink

      Oh well that’s ok then, let’s abolish tax and just borrow – run a deficit of 50% of GDP instead of 5% as now, and have an ‘investment’ party as well with wind farms and More HSs carpeting the country. Spot the flaw in that?

      • petermartin2001
        Posted May 5, 2015 at 6:08 pm | Permalink

        The flaw?

        Yes. 50% is too high and would result in excessive inflation.
        On the other hand 0.5% is too low and would crash the economy Greek style.

        So just like Goldilock’s porridge, 5% is just about right at the moment!

  13. Brian Tomkinson
    Posted May 4, 2015 at 9:02 am | Permalink

    JR:”The polls show either a Conservative government or a Labour minority with SNP support on a vote by vote basis.”
    They don’t show that at all. They show, at best, your party not having a majority and relying on other parties for support just like Labour. That is if you believe the polls which more than ever have been used as a propaganda weapon in this election campaign, as you so ably illustrate today.

  14. acorn
    Posted May 4, 2015 at 9:02 am | Permalink

    There is little point in trying to rebut such a post on this site. Where there is a near-religious belief that a sovereign fiat currency issuing government, has to borrow and/or tax its own previously issued money, BEFORE it can spend. Along with the concept that taxation actually, physically, pays for anything.

    To answer the question, we only really have what the OBR and the IFS are telling us; politicians only ever speak in riddles with a forked tongue. Currently, the government is running a deficit of 5.7% which is funding the net import bill of 5.5% of GDP. Resulting in the private sector (households and firms together) more or less in balance (but these two could be lending and borrowing from each other).

    By 2018/19, the Conservative plan is to have a government surplus of 0.3% of GDP, with households and firms together, paying 3% of GDP to pay for the government surplus and the import bill. The thing is will they be doing it with increased earnings or increased debt. IMO the households will be doing it with debt.

  15. sjb
    Posted May 4, 2015 at 9:04 am | Permalink

    JR wrote: Or do you want to hand the keys back to the people who crashed the car in the first place?

    Sir Nicholas Macpherson, Permanent Secretary to HM Treasury:
    ‘The 2008 crisis was a banking crisis pure and simple. Excessive risk had built up in the system; the regulators failed to appreciate the scale of that risk or to address it. As he [William Keegan] puts it, it was “a failure of the Group of Seven economic policymaking Establishment”, myself included. Inevitably, countries with bigger banking sectors, notably the UK, were worse affected.'[1]

    [1] Civil Service Quarterly 19 March 2015
    https://quarterly.blog.gov.uk/2015/03/19/mr-osbornes-economic-experiment-austerity-1945-51-and-2010-reviewed-by-sir-nicholas-macpherson/

    Reply The Chancellor was chairman of the tripartite regulatory system Brown set up. I warned and asked them to void the crash, but they ignored good advice.

    • acorn
      Posted May 4, 2015 at 6:34 pm | Permalink

      There was no car crash and JR knows it. The 2008 crash was a banking crisis. Unfortunately, the Banks had far more brain power than the amateurs in the government. Which ever bunch of amateurs were in government, the outcome would have been the same.

      The banksters were lobbying hard, with Conservative party support, to deregulate the finance industry. Who knows what promises were made to which individuals elected or appointed but they got what they wanted and the rest is history.

      reply. It was a huge failure of regulation thanks to the Labour government

  16. oldtimer
    Posted May 4, 2015 at 9:13 am | Permalink

    It is clear that Miliband government, propped up and manipulated by the SNP would be a disaster for the UK. A glutton for punishment, I watched the Scottish debate last night in which members of the Scottish public put questions to the four leaders – SNP (Sturgeon), Labour (Murphy), Conservative (?) and LibDem (?). It only served to confirm my worst fears about the current state of Scottish politics. It is trapped in its own bubble, like Westminster politics, with little or no appreciation of the outside world except that those south of the border are expected to pay up for Scotland. At the end the presiding broadcaster asked the audience how they thought the politicians performed. They were not impressed. No doubt the best format for interrogating politicians is the QT format when they are quizzed one at a time, with no other politician present as in the last Cameron, Miliband, Clegg appearance.

  17. Bert Young
    Posted May 4, 2015 at 9:27 am | Permalink

    Some time back Norman Tebbit urged the Conservatives to come to a deal with UKIP ; he believed it would be a certain election winner ; I agreed with him then and I regret Cameron turned the suggestion down . Today we face a very stark choice – do we want Milliband with the greedy nationalistic SNP lurking around , or , do we want the Conservatives led by the deeply unpopular and untrustworthy Cameron .

    I live in a safe Conservative seat area and if I do make my protest vote for UKIP it will be for nothing ( and for a candidate who has provided no detail whatsoever about his background ). I am not and never have been in favour of socialism – whatever its form ; I have always subscribed to a system that believes in rewarding effort and recognising those who strive to achieve . Evolution is all about survival of the fittest ,so , when my vote is cast this week , this will be my guiding influence .

    • JoeSoap
      Posted May 4, 2015 at 6:18 pm | Permalink

      Well it is a choice between 2 risks:

      Voting UKIP, there is a risk that Cameron won’t get his majority. There will be a period of difficulty, and the worst outcome would be Miliband struggling along, looking like an oaf, trying to do some leftist things and facing ridicule both from the Parliamentary right and left. But this could well be accompanied by a rightist grouping under non-Cameron leadership representing 60% in England (20% UKIP, 40% Tory) pushing for 1 EVEL, 2 Eu referendum and 3 an eventual UK referendum of Scottish Union membership. By 2017 we could have all that we want and more as Miliband’s government loses traction…

      Voting Conservative, it will be the same old same old – Clarkism Conservatism, rumbling towards EU integration, if a referendum happens the dice will be loaded etc. etc.

      If you’re true to your beliefs rather than tribal and unthinking, Option 1 has to be worth the risk for the future.

    • Mondeo Man
      Posted May 4, 2015 at 7:01 pm | Permalink

      Bert Young

      Voting for what you feel and believe is never wasted.

      Otherwise they will never get the message and the tactical voting of the past is why we have the LibLabCon today.

  18. Shieldsman
    Posted May 4, 2015 at 10:25 am | Permalink

    We are told a large percentage of the electorate cannot make up their minds for whom to vote.
    Little wonder with two untrustworthy politicians making rash promises they can never keep.
    Cameron’s 2017 EU Referendum. The question never asked or answered – how many Eurosceptic MP’s would he need in Government to force the passage of a Referendum Bill using the Parliament Act.
    A large wing of the Conservative Parliamentary party are Europhiles including Kenneth Clarke and David Cameron.

    Miliband casting in stone ‘Controls on Immigration’. How will he achieve that?
    If you read Miliband’s and Cooper’s speeches they are highly critical of Cameron’s record on immigration. They fail to appreciate that his hands were tied by the Lisbon Treaty Freedom of Movement Article as they will be.
    Cooper – “Fair movement rather than free movement”. “Change is possible, if we negotiate in the right way rather than the megaphone diplomacy the Prime Minister has been pursuing that seems designed instead to drive us towards the exit door.”

    Rachel Reeves is proposing changes to the benefit rules both here and across Europe so that countries can require people to contribute for longer before they receive support.
    Then without agreement, surely it would be discriminative to treat Citizens of  member states differently.
    Labour have the fanciful idea they will argue for reform in Europe to create an EU Migration Impact Fund within the existing EU Budget to provide more help directly for those regions which have seen the greatest increase in population as a result of EU migration, to pay for public services such as school places, extra medical staffer housing investment.

    Can you see that being agreed to?

    So both parties are making promises on immigration which require renegotiation of the Lisbon Treaty and the approval of the other 27 member states, probably beyond their skills

  19. Denis Cooper
    Posted May 4, 2015 at 10:55 am | Permalink

    I saw excerpts of the exchanges between Murphy and Sturgeon described here:

    http://www.scotsman.com/news/politics/top-stories/scots-leaders-debate-labour-won-t-consult-snp-1-3762220

    and there seemed to be genuine anger on both sides.

    Murphy asked this question, in the context of a minority Labour government:

    “Nicola, are there circumstances where you will vote for the Tories against a Labour Budget?”

    but of course another, parallel, question would be:

    “John, are there circumstances where you will you vote for the SNP against a Labour Budget?”

    I think that unionist Tories would have to ask themselves whether it would be in the national interest, by which I mean the interest of the British nation, the citizens of the United Kingdom as a whole, either to force the unionist Labour party into any form of dependency on the separatist SNP, or to precipitate another general election.

    I get the strong impression that many people have already had more than enough of this general election, and they would not thank whichever party caused another one before at least several years had elapsed.

  20. Bazman
    Posted May 4, 2015 at 11:34 am | Permalink

    Who will take the 12 billion in cuts John? Not the rich donors thats for sure.
    This says different the Tories blaming Labour for falling wages is also a bit rich.
    http://www.bbc.co.uk/news/business-25977678
    As I have said consistently companies will not share their profits with the workforce and this idea that the more profits these insider companies run for the benefit of the few will somehow improve average persons lot is for the birds. Massive subsidies for them via the benefits system is not sustainable.
    Under the Tories we have seen massive numbers put into low paid insecure work with reliance on food banks at an all time high. Their use is well documented, so no free food nonsense from small mean minded Tory supporters.
    As we have seen when they are confronted by these facts have little to say and why they do have to say is deluded lies which is easily debunked.
    The 12 billion in cuts to the welfare and tax credits will see millions in poverty and private company profits down.
    Toryism is a deluded religion for old men or men that are born old that is against any progressive change or building of infrastructure that benefits the majority and not for such projects as the pointless London garden bridge for elite corporate scroungers. The real parasites in this country not immigrants doing minimum wage jobs whilst lying Tories tell us most benefit claimants do not work. They have took £160 quid a month in tax credits and put up VAT in my case along with giving us massive costs for transport and everything else. The sooner these lying fanasists such a Duncan Smith and Cameron along with their sad demented supporters such as lielogic the better it will be for us all.

    Reply Many people now have higher incomes thanks to more jobs and better paid jobs from the successes of the last five years. Conservatives seek prosperity for all

    • Mondeo Man
      Posted May 4, 2015 at 7:07 pm | Permalink

      Bazman – Your use of ‘old’ in the pejorative sense.

      Highly distasteful.

      Especially so in an age where there are many scandals involving abuse and neglect of the aged.

      I can see how your nasty Leftist view of the aged manifests itself in nasty behaviour with nasty outcomes.

    • Anonymous
      Posted May 4, 2015 at 7:10 pm | Permalink

      Bazman

      Who does say that immigrants are parasites ? Who ? Show us.

      The country is full. We are claustrophobes, not xenophobes !

    • Ted Monbiot
      Posted May 4, 2015 at 7:29 pm | Permalink

      You need to vote Labour Baz and then all your complaints will be solved.

  21. forthurst
    Posted May 4, 2015 at 12:39 pm | Permalink

    “Politicians have learned, the hard way, that fiat currencies are best left to float. They rise and fall according to prevailing economic conditions. The same is true of government surpluses and deficits. They need to be allowed to float too. That lesson has not yet been learned.”

    It is now seven years since Gordon Brown both crashed our economy and “saved the world”. When will the good times, when we can afford to pay down the debt and make our way in the world, without continuing to sell off the family silver, arrive?

    An economy in which the government continues to spend more, borrow more, than it receives in taxation, an economy which fails to generate by trade and income from abroad, enough to cover its imports and outflows of rent from foreign-owned assets in this country, is not a healthy one, not one that can easily survive a sigificant reduction in activity or employment, not one that is sustainable indefinitely, even by allowing its fiat currency to float down and down.

    When an economy is in in a chronic state of negative imbalance due to government overpending and a failure to generate foreign income, it requires more than an economist’s shrug of the shoulder; it becomes the duty of government to take corrective action; wasting money on foreign aid, HS2, green crap, elective wars,
    bureaucracy, quangocracy, subsiding foreign corporate employment of low wage earners imported from abroad, a parasitical banking sector, neoliberalism in general, should be phased out and replaced by a new focus on value added training and unsubsidised employment, by getting out of the EU and trading with the whole world, freely, including the EU, by taking back our once mighty fishing industry, by giving our farmers the freedom to produce as any other business: a good doctor does not prescribe tablets to hide a patient’s symptoms when he knows surgery can cure the disease.

  22. outsider
    Posted May 4, 2015 at 3:07 pm | Permalink

    Dear Peter Martin:
    I note from your website that you wish to promote “Modern Monetary Theory”. This seems to be concerned entirely with cyclical economic management on the basis that advanced economies need continual deficit spending to operate at full employment (except when there is rising inflation).
    Implicitly, long-term economic growth is autonomous as illustrated by the famous kinked straight-line graph of US real GDP per head.

    There are problems with this:
    1) Long-term growth is not autonomous anywhere except the US, which is a very large, resource and land rich economy with relatively low imports and exports. Growth may also be autonomous in the world economy but historic figures are not available. In smaller economies, such as Britain, France or Japan, it depends, among much else, on high levels of private investment to bring in technical and organisational progress. Public infrastructure spending is not enough.
    2) Wynne Godley, the pioneer of sector balance analysis, pointed out that government deficits mean trade deficits, other things being equal. A large persistent trade deficit in one country (like the UK) brings either a falling exchange rate or ever more of the country’s economic assets being sold abroad, along with the future streams of profit, rent or interest. Both result in domestic real income per head falling.
    3) In a country such as the UK that is heavily exposed to international trade, anything other than runaway inflation is no longer an accurate indicator of the cyclical state of the economy. You will recall that inflation topped 5 per cent at the depth of the recent recession, largely due to rapid rises in the world prices of oil, metals and food. Inflation is now being depressed by a reversal of these global price movements.
    4) Labour costs are also being held back by large and growing imports of cheap labour. This, combined with a humane welfare system, has probably reversed the great fall in the equibrium level of unemployment achieved from the mid 1980s, when high structural defcits were abandoned. At a guess, I would suggest that the true cyclical government deficit will probably be zero in 2015-16. Any deficit will probably be entirely structural.

    Do I also detect one inconsistency in your argument? You say that “we” did not have to pay the burden of war and reconstruction debt. If we is taxpayers that is true, but is very largely thanks to inflation. Yet you conclude that deficit spending now is no problem at all because inflation is low.

    • outsider
      Posted May 4, 2015 at 3:26 pm | Permalink

      Sorry, I seem to have disconnected this reply to PeterMartin2001 (at 8.46am)

    • petermartin2001
      Posted May 4, 2015 at 9:18 pm | Permalink

      Dear Outsider,

      I’d just make a few points.

      1) Cyclical economic management isn’t necessary if we don’t have economic cycles. These cycles are usually caused by bad management of the private credit generation. Replace that by good management and we don’t have the cycles.

      2) Wynne Godley, the pioneer of sector balance analysis, pointed out the link between government deficits and trade (or current account) deficits. There’s no evidence of that ones causes the other. Rather, they just cause each other. Therefore, if we are concerned about the former we can’t ignore the latter.

      3) A large persistent trade deficit in one country (like the UK) is brought about by the exchange rate being kept high by the sale of government bonds. Not assets. If the government were to stop selling bonds the exchange rate would fall making those assets cheaper for overseas buyers.

      4) The phrase “we” did not have to pay the burden of war debt, would apply to loans issued in pounds but not dollars or gold. We, as the post war generation, couldn’t send real goods and services back in time. We consumed them ourselves just as every generation does. We would have paid for the reconstruction though as that happened after the war. But that reconstruction created new jobs for us, and new prosperity for the post war generation. If there was any repayment involved it was achieved by the growth in the economies of all the countries involved.

      4) You raise a valid point about the definition of inflation. If a commodity, for example, becomes scarce the price of products using that commodity will rise. That process has to be recognised as different from demand-pull inflation. If governments react by applying economic contractionary measures nothing is achieved except higher than necessary unemployment.

      5) Deficit spending is now no problem because inflation (ie demand-pull inflation ) is very low. If deficit spending were too increase too much that could change and it could become a problem.

  23. petermartin2001
    Posted May 4, 2015 at 3:58 pm | Permalink

    Conservatives have been very clear about the overall pattern of spending, tax revenue and borrowing for each year of the next Parliament

    Yes, but the conservatives were also very clear, but wrong, about that in 2010. But deficit reduction turned out to be a much more intractable problem than was anticipated.

    As we well as being clear, it’s necessary to be right too. We now have a budget deficit of about 5% of GDP and a trade deficit, or more accurately current account deficit, of about, er, 5% of GDP. Is that a co-incidence? Well, no it’s not. The two figures don’t have to be exactly equal. If the economy is net saving money then the current account deficit will be higher, if its net spending money, by borrowing more, then it will be lower.

    But it’s rare for there to be a huge difference.

    Until forecasters learn this very simple and observable accounting identity they will always get their forecasts wrong. Is there any chance of a current account surplus and therefore a budget surplus in the next Parliament?

    I’d say there isn’t any chance at all no matter who wins on Thursday. But we’ll see who turns out to be right in five years time.

    • Ted Monbiot
      Posted May 4, 2015 at 7:35 pm | Permalink

      So lets think what might happen if the State was to completely stop spending any money on overseas aid and then used that money to reduce the deficit.
      Are you telling us we would automatically get poorer due to reduced State spending?

      • petermartin2001
        Posted May 5, 2015 at 9:16 pm | Permalink

        Government aid is a definite cost to the taxpayer. Money spent on aid abroad could equally be spent on aid at home. To spend it on aid abroad is a political decision which I wouldn’t disagree with provided it is in ‘sensible amounts’.

        So let’s say the Government wanted to reduce that aid or even stop it. Let’s also say the economy is running at close to full capacity and that aid money is used to buy products from the British economy. If it is spent domestically, instead, then those goods and services are consumed locally so we end up richer. If it is not spent at all, then those goods and services (or an equivalent amount somewhere else in the economy) of course don’t get sold. Although we are neither rich nor poorer our economy is working at less than its potential capacity. Which may be good, temporarily, if we have an inflation problem. But not so good for any workers who lose their jobs.

        That’s still true even if the aid money isn’t spent in the local economy. If its in £ and spent in someone else’s economy, the recipients will then either have to spend those pounds in the UK economy or purchase gilts. In which case the government gets them back and can respend them on something else.

        We really just need to think in terms of resources and goods and services, rather than money per se, to analyse these kind of puzzles. Aid does mean a transfer of economic resources, but if there weren’t that aid those resources may simply not be created.

  24. margaret brandeth-jo
    Posted May 4, 2015 at 5:19 pm | Permalink

    There isn’t anything else to be argued about. Whilst the people on this site continue to argue about everything , the only thing which matters is the cross on the paper. John is right: the ideas and plans aren’t any good without enough votes to take them along.
    I don’t wish to pedantically compete , give references , play at being an arguing solicitor, although I do take note ; the convolutions won’t take us down the long and winding road to success without enough voters who will take a chance.
    Many think that if a majority isn’t reached and a coalition is formed with the lib dems then that referendum would be stopped. We can’t forsee that but what is the plausible alternative.

  25. turbo terrier
    Posted May 4, 2015 at 5:55 pm | Permalink

    The answer to the question is:-

    For the self employed one man bands across the country not a lot.

    Been there, done it, made the video and got the shirt.

    Socialism just doesn’t work.

    As an old un it never has and never will.

    All that will happen the hard working self employed will pay the price for all the promised freebees. We can’t run or hide.

  26. Chris
    Posted May 4, 2015 at 6:43 pm | Permalink

    Very significant news that the Bow Group has apparently endorsed/recommended voting UKIP in constituencies where the Cons can’t win, apparently acknowledging that the Conservative Party under Cameron is highly unlikely to win a majority now. On Breitbart London.

  27. Brian Tomkinson
    Posted May 4, 2015 at 7:40 pm | Permalink

    I am pleased to see that The Bow Group’s chairman, Ben Harris-Quinney has endorsed UKIP candidates in seats the Tories cannot win. In an announcement to the group’s 10,000 members today he said: “We recognise the need to keep Ed Miliband out of Number 10, and the best way to do this is for Conservative voters to lend their votes to Ukip, who are best placed to beat Labour in many areas.”

  28. fedupsouthener
    Posted May 4, 2015 at 9:23 pm | Permalink

    Just been listening to the expedition in the ARtic where they are going on about disappearing ice. This is another prelude to scary stories about global warming etc. Just build a few more turbines and everything will be fine. when are we going to accept that the environment will change whether we like it or not? It has been happening for hundreds of years and still will. Let’s just spend money on living with it rather than thinking we are clever enough to beat it. Still, I’m sure Clegg has all the answers to the problems, bless.

  29. Mike
    Posted May 4, 2015 at 9:55 pm | Permalink

    So Mr Redwood…

    I do so hope you are still convinced that Ukippers will vote in their droves for the tories come Thursday…

    Will make it so much the sweeter for those of us imagining the tantrums and stomping of feet once the results come in. 🙂

    Reply I have made no forecast, merely pointed out what the polls and betting are saying

  30. rick hamilton
    Posted May 5, 2015 at 5:16 am | Permalink

    Late to the discussion and far too late to change any minds I suspect.

    All I can say is that Labour has ruined our economy three times in my lifetime, once with industrial disaster thrown in for good measure. A fourth time will be too much to bear and I will move back to the other side of the world, where politicians talk like businessmen instead of social workers.

    Socialism is an economic failure everywhere and the more extreme it is the worse it gets. North Korea, Cuba, the old USSR for starters. China has ditched socialism – no welfare state there. It has almost bankrupted Venezuela, despite huge oil reserves. Now France is suffering from the disease and the SNP yearns to create the same mess in Scotland.

    Labour voters must be thinking only of themselves, which is of course their privilege, but please – Bazman and others – do not blame the Tories when Labour repeats yet again its well practised destruction of our international competitiveness.

  • 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.

  • John’s Books

  • Email Alerts

    You can sign up to receive John's blog posts by e-mail by entering your e-mail address in the box below.

    Enter your email address:

    Delivered by FeedBurner

    The e-mail service is powered by Google's FeedBurner service. Your information is not shared.

  • Map of Visitors

    Locations of visitors to this page