Author: johnredwood

I wish to write some pieces over the next few weeks on the future of the UK’s foreign policy and alliances. I do so because the future of our relationship with the emerging integrated state of Euroland is up for reconsideration in the General Election, and because many people in the UK are now tired of the US approach to the Middle East under the long shadow of 9/11. That too may change during the forthcoming US Presidential election.

The UK’s current stance is based on a central folly or misleading proposition – that the UK as a member of the EU, NATO and the Security Council has power by virtue of its membership of those bodies, and therefore has to keep compromising its own interests or beliefs to stay in or justify its membership of those bodies.

The truth is of course the opposite. Those bodies draw strength from the membership of the UK, to the extent that the UK is and remains a large world economic power, and to the extent that it continues to spend substantial sums on military force which it is prepared to use when necessary. As someone who broadly supports our membership of NATO and opposes our membership of the EU under the current terms and treaties, I wish to see substantial changes in the UK’s relationship with most international bodies, and a redefinition of the UK national interest and what we will do.

Once the UK has a new idea of what its national interest is, then it is easier to decide what new relationship we need with the EU, which type of NATO interventions we will join, and what defence forces we need.

At the high level, the UK’s first national interest must be to promote the prosperity, peace and happiness of UK citizens. This should mean we wish to promote free trade, democracy and peace around the world. Our second national interest must be to protect and ally with those of like minds and those who are formally under our defence umbrella. We need to recognise the limits to our military power, and make sure we have sufficient military might to deter aggression against us and those we wish to protect, and to carry out expeditionary interventions where appropriate. We also need to strengthen the potential of our political and moral influence, by avoiding conflicts which make us too partisan or compromised by those we would ally with.

I am no apologist for Russia. I do not support illegal invasions nor fuelling civil wars in third countries. Russia has not behaved well in Ukraine.
That does not make me a fan of the EU’s approach either. It takes two to make a conflict. The EU has helped destabilise Ukraine by its approach to the previous elected President and by its offers to the new government in Kiev. The EU has not clearly condemned shelling and bombing of civilians by the Kiev government in the way it has condemned Russian military support to the rebels or the bloodless occupation of Crimea.
Policy before the EU and Russian interventions in UKrainian politics was based on a long term rapprochement of Russia and the west, following the unpleasant cold war. That was a good policy, and the world will be a worse place if diplomats and governments are unable to get back to positive working together between Russia and the west. The west’s interests are not best served by a poorer and angry Russia, locked out from western financial markets.
I read that Russia and the west still do co-operate to some extent on Middle Eastern policy, where both sides have important interests in stability but have different reach and influence depending on the country concerned. The Middle East needs Russia and the west to work together for stability in that troubled and war torn area.
In Europe, the EU should seek to reassure Russia that it is not following ambitions to encircle Russia in any threatening way. NATO is a defensive alliance in Europe. Ruling out adding more countries to NATO would be a good idea. In Ukraine we need an agreement to leave Ukraine as an independent country, where both the EU and Russia can have access and some influence without either side seeking or gaining control or untoward influence over policy. We need to find a way to get rid of sanctions with promises of no further military interventions by Russia. It is time to talk to see what is on offer. Those who are sure Russia is out to invade other countries will dislike this approach. Perhaps the best way to tip Russia into a more militaristic foreign policy is to carry on isolating her.

I will be on the panel of BBC Radio 4’s Any Questions this evening at 8pm. It will be repeated just after the 1pm news tomorrow lunch time, for anyone interested.

All the main parties believe in equality of opportunity. There are various policies pursued to try to give people from disadvantaged backgrounds a decent chance in life. There is no disagreement about the aim.
All the main parties also agree that the tax and benefit system should narrow inequalities of outturn. All believe in taxing the rich more, and giving more benefits to the worse off. The political argument again is not about aim, but about the means and extent of the transfers.
The left like to portray the UK as a uniquely unequal society. The traditional method of measuring it, the Gini coefficient, shows the UK within the typical European range for inequality. We are more equal than Italy, Spain or Greece, but less equal than the Scandinavian countries. Our rating is almost the same as Switzerland’s, the richest European country.
If a country is too unequal or becomes more unequal because the poor are getting poorer, then it has a serious social issue which it needs to address. In the decade up to the financial crash under Labour there was a serious problem, with the lowest 10% of incomes not joining in the general advance in living standards enjoyed by all other income groups. If a country becomes less equal because it attracts some very rich people at the top, that is less of a worry. Compare the following two models:

In Group A the 9 people with an average income of £25,000 and an income range of £10,000 to £50,000 are joined by a tenth person with an income of £1 million. Income inequality has risen from a multiple of 5 to a multiple of 100, a huge rise in inequality. Average incomes have also increased, and no-one is worse off.Indeed, the nine can look forward to increasing their incomes by offering goods and services to the rich new comer.

In group B with 9 people on an average income of £25,000 with a range of £10,000 to £50,000, the poorest member of the group experiences an income fall to £8000. Income inequality goes up from 5 times to over 6 times. This does matter because the poorest has just got poorer. Average incomes fall.

Tackling inequality should be mainly about trying to get more people into jobs and once in a job into better paid jobs. The position in 2012-13 in the UK was far from satisfactory for the bottom tenth of income earners. This bottom decile earned on average just £3875 a year in income, and received £5868 in benefits to top up. This group of course included many people unable to work or unable to find a job, or on a pension. The importance of welfare reform is to get more into jobs, and I trust then to be more generous to those who are unable to work. All should participate in the general advance of real wages in the country through the tax and benefit system. Many more people are now in jobs, and wages are now moving up a bit. As the economy grows and as productivity rises, so real wages can improve more, and there will be more opportunities for people to move into better paid jobs. Both right and left should be able to agree on this.

When Labour launched their cost of living campaign fuel and energy prices were higher than today. A price freeze on energy was one of their main demands. They also wanted to see an end to prices rising faster than wages, something which happened on a grand scale in their last two years in office.

This week’s figures show inflation down to 1% and likely to fall further. Private sector pay has been going up by 2%. Fuel prices are down by 5.9% so far, with clear signs that the lower oil price will now lead to lower prices at the pumps for petrol and diesel. Retail sales were up 6.4% in volume terms in November for the last year, an impressive rate of growth.

The employment figures were also good. Unemployment is now down by 552,000 since May 2010. The economy has created 1.75m new jobs over that time period. Labour predicted rising unemployment and widespread job losses, something they had created in 2007-9.

Of course what we need are yet more jobs to cut unemployment further. We need more better paid jobs, for people to gain promotion and have a sense of progression in their work lives. We need many more months of pay outstripping prices. It is however welcome news that the UK has a relatively high rate of growth, that this is creating many more employment opportunities, and that the real value of average pay is on the rise.

Just as Labour’s forecast of another recession was wide of the mark, just as their forecasts of rising unemployment were wrong, it looks as if their cost of living crisis to be remedied by an energy price freeze is also being overtaken by the real world. It is much better that oil, gas and motor fuel are falling in price so consumers have more money left over for other items.