Wealth tax. Just because Nick Clegg proposed it doesn't mean its a bad idea.

    “Don't strangle the goose that laid the golden egg”, pleaded the Tory MP, Bernard Jenkin yesterday after the Liberal Democrat leader, Nick Clegg, called for a wealth tax. Now, where exactly is this golden egg, I wonder? Could it be in the City of London, where some very wealthy people laid an egg of another kind recently that brought the country to its knees. Perhaps it is in British manufacturing, which has dwindled to 11% of GDP. Or have the golden eggs perhaps been deposited in feathered nests abroad?

It is astonishing that anyone still subscribes to the myth that the enrichment of the few leads to the prosperity of the many. It just doesn't happen. Wealth does not “trickle down” to the rest of society from the troughs of the very rich – if anything the reverse is the case. It is sucked up through the concentrations of asset wealth held by the top 1% in property, shares, bonds. The story of the last three decades is that the wealthy have become immensely, shockingly, incomprehensibly richer while the middle has been squeezed and the poor remain pretty much as they always have – at the bottom of the heap struggling to hold their lives together.

What goes up... Mobility isn't very social

 I’ve always been just a little suspicious of people who advocate social mobility as a cure for society’s ills, as the answer to  inequality.   It isn’t.    When Nick Clegg said last week that social mobility is “the badge of fairness in society” he is missing the point.  The very image of “social mobility” is one of those loaded metaphors like “housing ladder” which implies that we can can make it to the top if they have enough drive and are given the right opportunity.  This has always been a myth.  

The Great Lib Con

  It’s called the Great Lib Con.   You voted for an end to foreign wars, nuclear power, Trident and for a more positive attitude to immigration and Europe.  You got a Tory government.  On Tuesday,  many liberal-left voters in Scotland were incoherent with rage when they discovered that they’d actually voted for David Cameron when they thought they were voting for Charles Kennedy.  How the F@@k did that happen?  I’ll never vote Liberal Democrat EVER again! were some of the more moderate comments on the new political order.  

  Now, as someone who urged tactical voting to change the electoral system, I suppose I have to take my share of the blame for this.  Before the election, a number of people asked me if there wasn’t a danger of “letting the Tories back in” if they lent their votes to the Libdems.  My reply was if we took that attitude, nothing would ever change.  We’d be left for ever  with a reactionary two-party duopoly in Westminster.

   

 Bumping up the Liberal Democrat vote, which  seemed to be building nicely during the campaign thanks to Nick Clegg’s TVcoup,  seemed the surest way of delivering a fatal blow to the corrupt and undemocratic Westminster system.  But tactical voting isn’t an exact science.  The Liberal surge faded fatefully on polling day, and that fatally weakened the third force.  Labour rejected a “coalition of losers” and the rest is history. 

   So, am I eating my words in the cold aftermath to the Great Lib Con?  Is it humble pie time for misguided, too-clever-by-half hack?  Perhaps - but I’m not alone: electoral reformers like Billy Bragg have also been seen with pastry crumbs on their chins.  Others, including journalists on the Guardian and Independent newspapers, have been eating hats and running naked down high streets.  No, I really didn’t expect that there would be a formal coalition between the Tories and the Liberal Democrats.  My forecast was that there would either be a Tory minority administration after a hung parliament, or a Liberal-Labour progressive alliance.  In the end - ha ha ha - we got the Nick and Dave show.  George Osborne in charge of the public finances.  Iain Duncan Smith in charge of welfare.   Liam Fox with his finger on the nuclear trigger. Five non returnable years of Conservative government. 

   It was a shock certainly.  If you think Tory government is the end of the world - and who knows it might come to that - then you’re probably right to think that we’ve all been lib-conned.   But the inconvenient truth is that the coalition deal, if you study it, is actually a rather good one.  It wasn’t just the five cabinet seats or the fifteen junior ministerial posts.  Or the referendum on AV, which isn’t actually proportional representation.  No, reading the document, I can understand why the Liberal Democrat negotiators were astonished when they saw what the Cameron Tories were offering them.  An elected House of Lords with PR, curbing the power of the executive in the Commons, repealing Labour’s anti-civil liberties legislation, reforming the banks, the £10,000 tax threshold, scrapping ID cards, tax powers for Holyrood, no third runway at Heathrow, etc.  Also, the Liberal Democrats negotiated opt out on clauses things like nuclear power, married couples allowance.  

  Yes, the penalty  is that the Libdems have to sit - metaphorically at least  - alongside the “nutters” as Nick Clegg described the Tories' far right partners in the European Parliament.  Libdems will have to accept a cap on immigration, the renewal of the Trident missile system, savage cuts in public spending, probably withdrawal of benefits from many lower income families.  There may be all manner of nasties lurking in the Tory in-tray that we don’t know about.

  But was there an alternative?   The Lib-Lab progressive realignment that we all talked about was a non-starter, and not just because Labour MPs like Tom Harris and Douglas Alexander refused to sup with the hated Nats. On Tuesday it became clear that there was not only a deep mistrust of the Liberal Democrats on the Labour benches, but a profound antipathy to thoroughgoing political reform. Senior Labour figures like John Reid and David Blunkett ensured that no deal would be struck by launching very public condemnation of the talks even as Labour and the Liberal Democrats were sitting in Number Ten trying to find common ground. This wasn’t isolated indiscipline either: the ex-ministers were clearly speaking for many on the Labour backbenches. 

   No guarantees on electoral reform or the rest of the reform agenda were forthcoming.  So, what were the Libdems to do?  Accept no deal from Labour or a great deal from the Cameron Conservatives? Difficult choice, I know - and one I’m glad I will never have to make.  The Tory offer was carefully calibrated to deliver genuine and far reaching reform in exchange for stable government - stable Conservative government. The Liberal Democrats may end up as human shields for Tory cuts, and they have a hell of a job justifying themselves in Scotland.  But here’s a thought: Alex Salmond only managed to secure power, and the first nationalist administration in history, by doing a deal with the Tories.  Sometimes, party leaders have to deal with the devil. 

  

  Last week reminded me a little of the 1992 general election when everyone expected the Tories to be wiped out in Scotland, and they returned with an extra two Scottish seats, as well as retaining control in Westminster.  There were howls of anguish and gloomy forecasts of the end of civilisation as we know it.  Five years later the Tories really were wiped out, such was the force of the Scottish tactical vote against them.   That led to an irreversible process of constitutional reform which led to Scotland regaining its parliament after 300 years.  

   I’m not saying that’s going to happen again. But what we can say is that the process of political and constitutional revolution that was begun in the Scottish Parliament has now moved south.  Westminster will be radically changed under this coalition. And so will Scotland,  because the Calman reforms and other constitutional changes, will take us much further down the road to federalism.   Of course, many suspect this Lib-Con deal was cooked up before the election by two public schoolboys seeking to edge Labour out of power for a generation. But if so, all you can say is that Labour fell for it hook, line and plonker. 

A Very Civil Partnership.

   It was like a crazy dream, a comic fantasy.  Nick and Dave hugging on the doorstep of Number Ten.  Prime Minister and Deputy Prime Minister of the UK.  As the day wore on my fingers were numb from pinching myself.    There they stood among the foliage of the Downing St rose garden, joking away,  like Ant and Dec in a trailer for I’m a Liberal Democrat Get Me Out Of Here.  Except the Cleggies aren’t going to be allowed to get out of this game because they’ve agreed to a mandatory, five year, non-returnable term of office. And it’s no secret who’ll be eating the bugs in the bush-tucker trials.

   It was all wildly improbable, but Clegg and Cameron seemed to carry it off.  The nation’s press suspended disbelief just long enough to listen to their joint message about the new politics. About giving power back to the people, about going green, helping the disadvantaged and revoking all those nasty Labour offences against civil liberties like ID cards and snooping wheelie bins.    The Westminster hacks were puzzled, though, by the mechanics of coalition governance.  Who’ll control the spin-doctors? Who ‘ll control the civil service?  What happens when there’s a by-election and the two parties have to start fighting each other?  Who takes questions at Prime Minister’s Question Time?  If the phone calls at three am, who’ll answer it?

 Never has the Westminster village seemed so parochial. These issues of coalition protocol were mostly resolved ten years ago during the first Holyrood coalition. The new politics has just filtered south.  Coalition only looks strange because no one in Westminster looks beyond College Green.    The Libdems also work with Tories and others in big councils like Birmingham. One suspects that the Liberal Democrats played a blinder in the negotiations with the Tories largely because they’ve had long experience of doing coalition deals in Scotland. 

  

   And there’s no doubt that Nick and co did play a blinder in those five hectic, sweaty, adrenaline-soaked days following the general election.  It was a poor election result for the Libdems, who actually lost seats, but they still got an amazing result from the Conservatives:  five cabinet posts, the deputy prime ministership, a referendum on electoral reform, ten thousand pound tax threshold, banking reform, fixed term parliaments, an elected House of Lords,  freedom to abstain on nuclear issues and marriage tax breaks.  You wonder where the Tory manifesto went. Green investment bank, Tobin tax on financial transactions, pupil premium, more powers for Holyrood.  It was a real deal, which could  change  British politics for good.  Unfortunately, it came from the Tories. 

  This will almost certainly split the Liberal Democrats. When the Cleggies find themselves having to defend the deficit reduction programme and savage cuts to public spending to their party conference there will be blood.  Some Libdems think it’s not so much a coalition as a suicide pact, in which they have to shoot themselves first.  But knowing the risks, Nick Clegg still grabbed the Tory offer on Tuesday after he’d satisfied himself that Labour wasn’t serious about any “progressive alliance”.   Now,  Labour insist it was the Libdems, not they, who sold out the rainbow coalition; that the “personal chemistry” between Clegg and Cameron was down to the Liberal Democrat leader being a natural Tory who always wanted to do a deal with his public school chum.  Certainly, Nick Clegg had great difficulties relating to Gordon Brown, whom he regarded as a political neanderthal.  But it was Labour’s manifest lack of enthusiasm for a coalition that unsealed the deal even before the negotiations got underway.    The succession of senior Labour figures like John Reid, David Blunkett who went on TV saying that any “coalition of losers” would be undemocratic and unstable and would - shock horror - involve talking to nationalists and other political vermin.     It wasn’t the numbers that was the problem - all the parties were losers in this election.  No, it was visceral hatred of Alex Salmond all  Liberal Democrats that scuppered the great broad left realignment. Tribalism is alive and well in the Labour Party.

   Also, Labour had clearly lost the will to govern. Tired and emotional, the thought of going to all the effort of cobbling together a multinational coalition was just too much.   Never has a government seemed to happy to lose office.  Gordon Brown practically skipped out of Downing Street, wreathed in smiles, no doubt thinking about the booby traps he’s left concealed in the cabinet in-tray.  David Cameron, by contrast, almost stumbled into Number Ten, with no grand phrases or air of destiny.  Compared with Margaret Thatcher, with her quotes from St Thomas Aquinas, Cameron looked like an estate agent who’d come to look the property over and give a valuation once he’d inspected the loft. 

   As the furniture vans arrived to take away the football posters and books on post neoclassical endogenous growth theory,  Labour MPs looked forward to an easier life in opposition.   Honing their invective against the “Tories little helpers” and the “yellow Tories” .   Labour MPs believe that the Lib-Con alliance will crack in exactly fifty days, when the Tories’ emergency budget unveils the true horror of the cuts to be inflicted on the public sector - on local government, social services, non-front line health etc.. The very public sector that employs most Liberal Democrat voters. The public sector unions will be out on the streets within weeks and Labour will be joining them on the picket lines, fighting the Tory-Liberal cuts.   Cleggie! Cleggie! Cleggie! Out! Out! Out! 

    In Scotland, Labour are going back to their constituencies to prepare for government after the 2011 Scottish elections. All those ex-Labour Scottish Liberal Democrat voters  are horrified that they ended up with a Tory government and many will never vote Libdem again.  Alex Salmond’s enthusiastic advocacy of the “progressive coalition”  concealed just how  poor a result Thursday was for the nationalists who, far from winning 20 seats, emerged one with fewer than when the campaign began.    With Labour on the march in Scotland, the SNP will have to have to fight like hell to win re-election    But one thing we can say for certain, whatever the Holyrood result:  neither of them will be eager to form a coalition with the new pariahs of Scottish politics: the Liberal Democrats. 

Clegg: The knives are out.

 I don’t know - you turn your back for a few weeks and what happens? they go and break the mould of British politics. Again.  It sometimes feels like I went to sleep and woke up in 1983, the last time the Liberal Democrats -  or rather the SDP-Liberal Alliance -  were in mould-breaking form.  Didn’t quite happen back then of course, even though they won 26% of the general election vote against Labour’s 28%.  Our iniquitous electoral system awarded the SDP-Liberals just 23 seats against Labour’s 203 -  showing just how the Westminster electoral system serves to keep the two big parties in power.

   Will it be different this time? Well yes, I think it just could be - if only because of the loathing of so many British voters for the Westminster way of politics. The mood really is ugly out there; party workers on the doorsteps all testify to it.   Voters are furious and desperate for a change; for a chance to kick at the whole corrupt, sclerotic and incestuous Westminster system.  If the Libdems can surf this tide of resentment, then the mould could, perhaps, stay broken. 

    Of course, a lot hangs on Nick Clegg’s performance in tonight’s edition of The Good, The Bad and The Ugly (you choose).   Can Superclegg on Sky repeat his performance in last week’s ITV debate, which propelled the Libdems into a solid second place in most UK opinion polls ?  Or could he turn out to be the Tim Henman of British politics?  Well, it shouldn’t be too difficult for Clegg since his performance wasn’t actually all that strong last time, as he himself has conceded.  The Liberal Democrat leader apparently had to console himself with a lonely cigarette after he left the ITV studio because he thought he’d lost. 

    It wasn’t Clegg’s delivery, which was competent but sub- Obama, but the fact that he wasn’t Brown or Cameron that was his real strength.  Clegg seemed to many viewers to be the best available boot to use on the backsides of the big parties.  The fact that he was new (to most people), less polished and even a little geeky was a positive advantage.  People don’t want folletted smoothies or speak-your-stats machines any more. They want someone who sounds authentic, real, more ordinary, even a little confused.  These are confusing times. 

   They probably liked the general sound of Clegg’s policies as well.  Not renewing Trident, bashing bankers, scrapping the Lords - what’s not to like?  Stricter rules on parliamentary expenses, fairer electoral system, scrapping the Barnett Formula (ok, we’ll draw a veil over that) abolishing Labour’s illiberal anti-terror laws, which make it potentially illegal to wear tee-shirts criticising Tony Blair. But I don’t believe it was really Liberal Democrat policies that made the difference - most people are too sophisticated these days to pay much attention to election manifestos which they assume are wish-lists or lies.  They just want someone they think they can trust, or who might cause an upset. Someone who isn’t a product of Westminster; a politician who isn’t a politician.  

   And the great problem for Clegg tonight is that people are beginning to realise that a politician is exactly what he is.  In fact, Clegg is a classic career politician - a former lobbyist and political bag-carrier who became an MEP before he stood for Westminster.  We’ve learned a lot about Mr Clegg this week- that he’s half Russian, half Dutch; that Louis Theroux was his fag at Westminster school (allegedly); that the ex-Conservative minister Leon Brittan thought he was a natural Tory.  Clegg it emerged, has claimed £84,000 on parliamentary expenses to do up his second home,  including paying chaps to prune his fruit trees.  According to the Daily Telegraph, he has been accepting donations into his personal bank account, a practice the former parliamentary standards commissioner, Sir Alistair Graham, has described as "irregular". 

    Conservatives warn that he is a supporter of the euro who wants an amnesty for long-term illegal immigrants,  and intends to release 60,000 prisoners. The Daily Mail claimed he'd compared Britain unfavourably to Germany under the Nazis.   My own view is that this assault on Clegg’s political character largely misses the point.  British voters are more liberal than politicians give them credit for.  They don’t really hate Europe and immigrants; welfare scroungers or foreigners. British are generally decent moderate souls who want to hang bankers and politicians from the highest lampposts, but in a nice way. 

     David Cameron will certainly target Clegg’s europeanism and his unilateralism in tonight’s foreign affairs debate, as will Brown.   But the most serious charge against Clegg is that a vote for him is really a vote for Brown or Cameron; that his destiny is to let the Tories or Labour back in. Clegg insists that he can ignore “desperate” Brown and crawling Cameron - but the electoral reality is that, on present showing, the Libdem leader will have to help one or the other into office even if Clegg doesn’t want a formal coalition.  Indeed, the Libdems may have no choice but to allow Cameron the chance of forming a government, if only because the Tories will probably have the largest number of seats and it will seem perverse to keep Brown in power after his rejection at the polls. Recall how the Scottish Liberal Democrats found they just couldn’t keep their former coalition partner, Jack McConnell,  in power in Holyrood in 2007 after Labour lost to the SNP. 

   It is of course grossly unfair that the Liberal Democrats should lose out just because their votes are evenly distributed across the country. If we had a fair system, it would be the Liberal Democrats who would be looking for third party support.   If nothing else, this election should be the death knell for the First Past The Post electoral system,  which has perpetuated the old party duopoly.  I’m tempted to say that electoral reform alone is a good enough reason for voting Liberal Democrat in this election. 

      Why, even Alex Salmond, said as much in at the SNP manifesto launch when he urged voters to back the LibDems to ensure a ‘balanced parliament’.  He meant in England, of course - in Scotland the latest Ipsos Mori poll puts the SNP  ahead of the Scottish Libdems.  But a lot of voters in Scotland are likely to draw the logical conclusion and vote Libdem in marginals like Edinburgh South or Aberdeen South.   When Alex Salmond promised to deliver 20 seats in Scotland at the general election we didn’t realise he meant Liberal Democrats.