Yanis Varoufakis: Adults in the Room

A review of Adults in the Room, My Battle with Europe’s Deep Establishment, by Yanis Varoufakis, formerly Greek finance minister, which I’ve written for the blog, Brave New Europe – a blog by the way which I’d highly recommend.

Cross-posted from https://braveneweurope.com/

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How far should economists engage in day-to-day politics?

“Researchers have an obligation to society to take positions on questions on which they have acquired professional competence,” says French economist Jean Tirole[1]. But how does an academic do this when media are not, in Tirole’s words, his ‘natural habitat’?

Yanis Varoufakis, in his recent incarnation as visiting professor at the University of Texas, Austin’s School of Public Affairs, took more than a position. He became a politician. He doesn’t share Tirole’s constraints: “…my resignation of 6 June 2015 [as Greek finance minister] was due precisely to my peculiar commitment not to sign any agreement I could not defend as an economist, politician, an intellectual and as a Greek.”

The step into politics was a big one. But Greece, after 2008, was, and remains, in crisis. No country has a more acute sense of its own sovereignty and identity, as the troika of the Eurogroup (of finance ministers), the European Central Bank and the IMF were reminded in January 2015, when Syriza, the radical left party, took power, and the Greek public once again took to demonstrating in Syntagma Square.

“Adults in the Room” (a phrase coined by Christine Lagarde, managing director of the IMF) is Varoufakis’s highly personal account of his brief tenure as Greek finance minister: six months of negotiations between January and June 2015, during which time he initially had the backing of his prime minister, Alexis Tsipras, for a radical stance which held out the threat of leaving the euro, and a full Grexit, if the EU and the IMF didn’t agree to renegotiate the debt.

Friends who discussed the book in a reading group were divided: some were exasperated by the repetition as negotiations inched forward. Others saw it as an epic tale. Varoufakis is a skilled storyteller who allows the events to speak for themselves.

Meeting Jeroen Dijsselbloem, president of the Eurogroup and finance minister of the Netherlands, on 30th January, Varoufakis told him that there were only three options available (he recorded meetings on his phone):

“One was a third bailout to cover up the failure of the second [in March 2012], whose purpose was to cover up the failure of the first [(May 2010]. Another was the new deal for Greece I was proposing: a new type of agreement between the EU, the IMF and Greece, based on debt restructuring, that diminished our reliance on new debt and replaced an ineffective reform agenda with one that the people of Greece could own. The third option was mutually disadvantageous impasse.

You do not understand, Jeroen told me, his voice dripping with condescension. ‘The current programme must be completed or there is nothing else.’”

There is also Thomas Wieser, Dijsselbloem’s deputy, to take into account. As president of the working group of officials behind the Eurogroup meetings he was, in Varoufakis’s words, ‘the most powerful man in Brussels’. Wieser circulated an unsigned ‘non-paper’ (a nice Orwellian touch) which made it clear that Greece should expect to receive no money owed to it by the European Central Bank, nor any loans agreed under the previous government… but it was still expected to meet its debt obligations in full. There might be an extension of the existing bailout agreement, a temporary appeasement, “but this would be conditional upon Greece taking a ‘cooperative approach’”.

The hidden agenda, the obstacle that ultimately overpowered all Varoufakis’s proposals, however clever, was that the French and German banks, which had invested so heavily in Greece, would always be given priority. Their governments had invested too much political capital to allow otherwise.

No bailouts, no haircuts, no debt renegotiation.

We’re down to the roots of the ‘deep establishment’, beyond prime ministers or presidents, finance ministers, EU commissioners, the Eurogroup of ministers (Commission president Jean-Claude Juncker doesn’t even have a walk-on part), down to the level of a working group which, taking its lead from the two most powerful EU governments, sets the mood and calls the tune.

Varoufakis in his account of the 30th January meeting with Dijsselbloem uses the phrase, ‘an agenda which the Greek people must own’. Sovereignty is not an issue he addresses directly in ‘Adults in the Room’, but in his 2016 book, ‘And the Weak Suffer What They Must’ he argues that the dismantling of sovereignty could ultimately lead to the dismantling of Europe. Varoufakis is a passionate European: his Democracy in Europe Movement, launched in autumn 2015, focuses on a much more open exercise of power within the EU.

But even the closed structures of the EU can be overridden. When Prime Minister Tsipras loses faith in the Brussels negotiating process he begins direct discussions with Angela Merkel, the German chancellor, and is quickly impressed ‘by her diligence and mastery of the Greek programme’. They should, she suggests, sideline their finance ministers Wolfgang Schäuble (a supporter of Grexit) and Varoufakis. Their discussions led in July 2015 to a third bailout agreement.

As for other participants in the skirmishes, Christine Lagarde is let off lightly on a personal level, with her integrity and goodwill just about intact. But not the IMF itself, which backed the third bailout against its own better judgment. Emmanuel Macron as French economy minister is peripheral to the negotiations, but always supportive of Varoufakis.

There are many who argue that Varoufakis’s confrontational approach made the ultimate settlement between the Syriza government and the EU worse. And, had debt renegotiation been taken seriously by the EU, another issue would have come to the fore: how far Varoufakis and the Syriza government would have voluntarily accepted privatisations, cuts in pensions, labour reforms etc.

Varoufakis not only had to contend with practised stone-wallers and the deep establishment, he also had to deal with a press that portrayed him as a dilettante. To quote The Economist (25 March 2015):

‘Mr Varoufakis’ lifestyle … is embarrassingly close to that of the rich Greeks he castigates for avoiding taxes by stashing cash abroad …he lectures his euro-zone colleagues and shows little interest in the detail of reforms demanded by Greece’s creditors…. as a fellow professor puts it: “Unlike his predecessors Yanis isn’t interested in managing the economy. What he really enjoys is brinkmanship.”’

Varoufakis had a conversation in 2012 with Larry Summers (former US Treasury Secretary), who argued that there were “two kinds of politicians, insiders and outsiders. The outsiders prioritise their freedom to speak their version of the truth. The price of their freedom is that they are ignored by the insiders, who make the important decisions.” And the insiders? – they “never turn against other insiders and never talk to outsiders about what the insiders say and do.” Varoufakis replied to Summers that he would behave “like a natural insider for as long as it takes to get a viable agreement on the table.”

In the end Varoufakis never stood a chance. To be a fully accredited insider he would have had to accede to the insiders’ working methods and conclusions. The Syriza party were self-designated outsiders until their leader and prime minister brought them in. Tsipras to the surprise of many ultimately had the insider mentality. Varoufakis did not.

[1] Economics for the Common Good, Princeton UP, 2017

Swift, clean victories

There’s an intriguing book just published by military historian, Lawrence Freedman, entitled The Future of War: A History: it focuses on (to quote the Economist review, 20th October) ‘how ideas about future wars could be fought have shaped the reality, with usually baleful results’.

‘Swift, clean victories’ have long been ‘baked into concepts of future war’, WW1 being a prime example. It would all be over by Christmas. In our own time we’ve civil wars rather than wars between nations, urban and guerrilla war, and hybrid, cyber warfare. Wars feed on themselves, self-perpetuate as they ever did.

Freedman’s message to policy-makers, the review concludes, is to beware those who tout ‘the ease and speed with which victory can be achieved while underestimating the resourcefulness of adversaries’.

I’m reminded of the current Brexit discussion. First create your adversary, as we’ve done, and then under-estimate his capabilities, and all the while assume that radical change, and even outright victory (and it would be seen as ‘victory’: we are combatants), can be achieved quickly.

I’ll bring in Richard Thaler here, recently-announced winner of the Nobel Prize for economics, and developer of ‘nudge’ theory. Thaler understand choices ‘as battles between two cognitive forces: a “doer” part of the brain focused on short-term rewards, and a “planner” focused on the long-term’. For Daniel Kahneman a related divide is exemplified in the title of his bestseller, ‘Thinking Fast and Thinking Slow’.

Our instinct for short-term success overpowers our planning instinct, we always want the quickest route, and we fool ourselves into thinking we have the wherewithal, the strategy, the materiel, to get us there.

There is, it seems, an inevitability about this process. There’s a quote from Steven Pinker, writing about Kahneman (Guardian, February 2014): ‘he gave me a comment that really sat with me: he noted that the idea of human nature with inherent flaws was consistent with a tragic view of the human condition and it’s a part of being human that we have to live with that tragedy.’  Pinker also argues that ‘we have the means to overcome some of our limitations, through education, through institutions, through enlightenment’.

I’ll take him at his word on ‘enlightenment’. There’s another side to human nature, as inherent as the flaws that Pinker alludes to, that takes us beyond  the ‘doer’ and the ‘planner’, the fast and the slow. Practised down the generations, put simply it’s self-awareness, living in the moment, bringing our reason, our planning instinct, to bear on our immediate or short-term actions.

In the spirit of zenpolitics,and in the absence of any apposite zen koans to hand, I’ll quote the 13th century Turkish (though born in Afghanistan) mystic, Rumi (I love the langauge): ‘…your inspired reason goes forward without obstacles/at the careful and measured pace of a camel’.

As for over-reliance on reason: ‘Discursive reason’s a vulture, my poor friend:/Its wings beat above a decaying corpse./The Saint’s reason is like the wings of Gabriel: …’

I’m touching on a vast subject here. Two Nobel prize winners on the one hand, three-millennia-old tradition and practice on the other. They don’t need to be in conflict, and both would warn against the pursuit of ‘swift, clean victories’.

 

The British press – a view from the Netherlands

I’m not claiming what follows is original in anyway. I’m quoting extensively from an article in the November edition of Prospect by a Dutch writer and journalist, Joris Luyendjik.

He writes with real insight on Britain in Europe, or Britain out of it, but it’s his comments on the British press that strike home. It’s what many of us in the UK think, but too few dare to say. If we do, we invite confrontation, and too many of us are too nice and too polite, and the press ride roughshod.

He and his family came to live in London ‘as fellow Europeans, but when we left this summer to return to the Netherlands we felt more like foreigners: people tolerated as long as they behave. At best we were “European Union nationals” whose rights would be subject to negotiations—bargaining chips in the eyes of politicians.’

He quotes a working-class mother, the day after the referendum:

‘She had used the referendum to try to smash that expensive middle-class toy called the EU and it had worked. At last, for the first time in decades, those who felt like life’s losers openly defied the winners, and carried an election. Now her country would have £350m a week to spend on the number one worry for people like her: the NHS…’

He continues:

‘…that scene on the morning after the referendum encapsulates my disappointment with the country. Not only the division, but also the way it had been inflamed. Why would you allow a handful of billionaires to poison your national conversation with disinformation—either directly through the tabloids they own, or indirectly, by using those newspapers to intimidate the public broadcaster? Why would you allow them to use their papers to build up and co-opt politicians peddling those lies? Why would you let them get away with this stuff about “foreign judges” and the need to “take back control” when Britain’s own public opinion is routinely manipulated by five or six unaccountable rich white men, themselves either foreigners or foreign-domiciled?

Before coming to Britain I had always thought that the tabloids were like a misanthropic counterpoint to Monty Python. Like many Europeans, I saw these newspapers as a kind of English folklore, laying it on thick in the way that theatrical British politicians conduct their debates in the House of Commons. Newspapers in the Netherlands would carry on their opinion pages articles by commentators such as Oxford scholar Timothy Garton Ash—giving the impression that such voices represented the mainstream in Britain. Watching QI before coming to the UK, I remember seeing Stephen Fry banter with Jeremy Clarkson and imagining the former was the rule, and the latter the exception. Living in London taught me that it is the other way around. George Orwell is still correct: England is a family with the wrong members in charge….

Until the tabloids are reformed and freed from editorial interference by their plutocratic owners, the rageful misunderstanding that I saw in the school playground will not go away. Tabloid readers will sometimes see through the bias on particular issues and against particular people, as many did when they voted for the demonised Labour leader Jeremy Corbyn in June. But when it comes to Europe and the world beyond, the campaign of chauvinism has been so unremitting, over so many decades, that it is much harder to resist. And as things stand, the journalists at those publications could never come out and admit that they have misjudged Brexit—that would mean not only losing face, but very likely losing their job. Indeed, where is the investigative reporting about the exact quid pro quo when Rupert Murdoch or Daily Mail editor Paul Dacre come out in support of, say, Theresa May? Most British journalists, with a few noble exceptions, are too terrified of the press barons to pursue such questions.’

It’s worth repeating that last line:

‘Most British journalists, with a few noble exceptions, are too terrified of the press barons to pursue such questions.’

Luyendijk also brings our entrenched inequalities into his argument, our class system, along with our adversarial culture (true of many, but not of all), our superiority complex… You don’t have to agree with everything he says – though there’s substance to his arguments.

But on the British press, he’s spot on.

Have we had enough of experts?

Experts have taken a beating recently, in both the academic (focusing on peer review) and political spheres. Focusing on politics, the issue of trust has been brought to a head by the Brexit debate, and Michael Gove’s infamous comment that ‘people have had enough of experts’.

The economy, immigration, sovereignty are central to the Brexit debate. But informing all three is the issue of how expert knowledge is conveyed. Brexit is of course only one focus, though it has become obsessive. What of climate change, migration, overseas aid, crime and punishment? All central to the public discourse, all areas where views tend be to be personal and strongly held, and resistant to argument.

Wider issues relating to post-truth (wilful miscommunication), a malign press, and the use and abuse, and multiplicity of opinion, on the internet, are also relevant – but my focus here is on how expert knowledge,  and how political the subject has become.

I found an article in Prospect (August 2017) by Helen Jackson and Paul Ormerod helpful. (All quotes below are from the Prospect article.)

Last year, in the referendum debate, ‘many members of the public formed an impression, whether fairly or not, of experts attempting to settle an important and emotive matter over the heads.’  There’s a fault line between the ‘people’ and ‘those who think they know what’s good for them’.

Why has this divide developed? The independence enjoyed by central banks has been, Jackson and Ormerod argue, a contributing factor. Huge faith was vested in their predictions, until the crash came.  Likewise, the end of the Cold War led to a ‘a narrowing of disagreement’ in politics, the sense that we were managing the economy, rather than debating bigger issues.

I’d add austerity to the mix, which as a post-Crash remedy has had the status for many as holy writ, whatever the social cost, and one of the reasons for the Tory debacle last June was a widening of the anti-austerity base to include many Brexit supporters. Above all, in a Brexit context, we have immigration, where public sentiment is impervious to counter-argument.

On the left we have Corbynite populism, picking up on austerity, and swinging to a far extreme of public spending based on unrealisable funding projections. Critical commentary from economists is disdained. (There is of course a far left, neo-Marxist resurgence here as well, a coming-together of the Cold War-era faithful. But that’s another story.)

But, Jackson and Ormerod argue, the backlash against experts is still principally associated with the right. ‘The more educated, liberal-leaning section of society needs to understand why this is. It is not because, as is commonly assumed, the right is simply the political wing of the dark side.’

(‘The more educated, liberal leaning’ … these days even language like this can raise hackles – education can be held against you.)

The right argues that political choice, however well-motivated, is ultimately based on economic self-interest.  Noble theoretical aims – or simple good intentions – go awry in practice. Jackson and Ormerod cite ‘public choice theory’ as developed by Nobel-Prize-winner James Buchanan in this regard, arguing that ‘the Buchanan analysis can easily morph into the intransigent view that pursuing any collective goal will lead to empire-building bureaucrats, who also fall prey to “capture” by self-serving lobbyists’.

(So opposition to expertise morphs into opposition to the big state – and we have the phenomenon of the attempted post-Brexit takeover of the Tory party by the libertarian right. Also, the American right’s position on climate change and healthcare.)

Whatever their political persuasion, ‘expert elites’ (‘elites’ is also a contentious word these days!) are happiest operating at arms-length from the electorate. They see themselves too readily as a class apart.

To combat this, ‘evidence-based thinking …must (be) subject(ed) to more “sense-checking”, (we) must give thought to what a wider public would make of it’. This can be easier said than done when both public and the popular press demand easily-understood arguments and, wherever possible, certainties.

Paul Johnson (of the Institute of Fiscal Studies) touched on this point in his talk (‘Making Choices’) at the Cheltenham literary festival last night. The public don’t want a range of possibilities, they want a straightforward yes-no answer to a question, and that’s what our media interviewers and commentators try to cajole out of them. Nor are they allowed changes of mind, however justified or well-argued.

It’s a black-or-white world and experts hoping to contribute subtle or balanced argument to public debate can have a mighty task on their hands.

 

 

The story so far – fifteen months on the disaster trail

The shadow over politics, the Brexit shadow, is one vast distraction. I feel I have to escape the shadow before I address other political subjects. But those other subjects – they’re all impacted in some way by Brexit, not least by the uncertainty associated with Brexit.

Take the environment, for example. UK environmental law is tied into European. Projects are EU-financed, standards, ideals, aspirations are shared. I remember at Finistera, at the end of the Camino, last autumn, noting how environment projects there were funded by the EU. I’d shared the Camino with many nations, and I loved that confirmation that many nations shared those standards, lived by a common framework. We know that Brexit free-traders cosy up to climate-change deniers, are casual about man-made changes to the environment – human ingenuity, they argue, has coped, and will always cope. All hinges on that one word ‘cope’.  Does the world we have around us, and that we’re projecting for our futures, mean that we’ve ‘coped’?

Human rights – the European Convention on Human Rights, which followed on from the UN Convention, and unlike the UN Convention is legally enforceable. Before the European courts. So for that reason we should exit it, according to Theresa May. As Philippe Sands (author of the remarkable East-West Street) pointed out when talking at the Cheltenham Literary Festival last Sunday, more than any other country we – the UK – gave Europe the convention. It was a British inspiration. Hersch Lauterpacht, who pioneered so much (beginning life in Lviv, in modern Ukraine: he left in the 1920s, his family were wiped out in the holocaust), was latterly a Cambridge professor.

Farming policy: how will policy change, how will farmers be financed, once we exit the EU, and exit the Common Agricultural Policy? CAP funding is based primarily on the amount of land farmed , so big farmers (mostly Tory supporters) benefit most. On the other hand, to quote a Scottish hill-farmer in a Reuters report: ‘The bloody-mindedness of the French or the Irish in standing up for agriculture was not just standing up for their farmers but brought a good deal for us as well.’ Post-Brexit, where will the money be directed? We are promised ‘a major policy overhaul’. Will the acreage farmed continue to dictate funding?  How might our landscapes change? Will the much-hyped new trade deals bring in cheaper farm imports , with knock-on effects on farm prices – other farming countries have more clout than we do. And what of cheap farm labour from Eastern Europe?  Michael Gove wants to prioritise the environment in any new scheme. But we’ve no idea how that will work out in practice, and legislation will be fast-tracked through parliament – fundamental changes pushed through with minimal public debate.

The Cheltenham Literary Festival has brought to the town an impressive range of politicians, journalists, singers (Peggy Seeger), mountaineers (Chris Bonington), sportsmen (Mike Brearley, Jonny Bairstow), TV stars, performers, poets, novelists….

Among the politicians was Chris Patten. I’ll leave his words to speak for themselves.

Referenda ‘are fundamentally anti-democratic in our system and I wouldn’t have anything to do with them’. (I can’t recall Patten’s exact words in Cheltenham – I’m quoting from another interview he gave.) Leavers in the Brexit campaign peddled a dubious notion of sovereignty (‘dubious’ was his polite word in Cheltenham – I see that elsewhere he’s spoken of ‘all this ideological crap about sovereignty and taking back control’). Brexit itself is ‘the single most calamitous act of self-harm in my lifetime’.

Philippe Sands, also at Cheltenham, put the remarkable achievement that the EU represents in the context of the preceding centuries of war. How casual can we be to turn our backs? He mentioned that Boris Johnson has been a friend for thirty years. How, he wondered, do you sustain such friendships in present times? Brexit has brought the obsessive tendencies of the further reaches of the Right, and Left, to centre stage. The centre ground of rational idea-based, truth-invigilated debate, is out of fashion.

Boris’s dad, Stanley, has written a novel. He and Vince Cable, also a new novelist, were a Cheltenham double-act. Boris’s novel assumes a Russian plot behind Brexit, enough to bring Brexit down. But he himself has changed sides from EU-supporting environmentalist to that contradiction in terms, a Brexit-supporting environmentalist.

Vince Cable outlined how higher education, the number of foreign students in the UK, intra-university cooperation across Europe were being threatened by Brexit. Stanley’s response, ‘Vince may be right, but he may not be.’ That was the limit of his response.

‘He may not be’ – that is standard Brexit-speak. You don’t need to address the detailed argument. It’s enough to suggest these days that’s there’s another point of view, however weak. And that point of view gets equal billing. The climate-change debate over again.

Jeremy Hunt, health secretary, is a one-time Remainer, now a Leaver – the damage, he suggests, to the economy that leaving was supposed to cause hasn’t happened. Is he now a convert to the hard-Brexit free-traders’ prognosis of a free-trade nirvana which will somehow subvert a world where protectionism and self interest are ever more asserting themselves? Or the Hammond soft version?

As the economy,  we haven’t left yet, we’re in a phoney-war period, a state of suspended grace which might just allow us to pull back from the brink – but the brink is too enticing. That itself is another aspect of Brexit – how supposed conservatives, the slow and steady incremental movers of politics, overnight become practitioners of brinkmanship.

Brexit is not only a bizarre course in terms of the economy, it is extraordinarily damaging to the democratic process, not just by giving referenda precedence over parliamentary democracy (so we have the question, can an act of parliament over-ride a referendum result – where does sovereignty lie?) but by polarising debate, taking out the common ground that most of the Right and Left shared until 2015.

Not only is the common ground not shared – it’s now scorned. So the John Majors, Chris Pattens, Nick Cleggs – they are old-school, flag-wavers of a different age. That would apply to me, and to most of my peers …

 

Walking for charity with Melanie

We’ve been out walking, 10km (not miles, that’s the way it is these days), for ‘Walk the Wards’, a charity event to raise money for local hospitals in the Cheltenham area. (My partner, Hazel, is a volunteer on the oncology ward at Cheltenham Hospital.)

There’s something wonderfully positive about such events. I’ve run marathons for charity, but this was more laid-back, more focused – one charity, not many, and walking, so time to think, and no crowds to cheer you on, just mud (too much rain overnight) and a sense of common purpose.

The mood continues into the afternoon, this afternoon, Sunday afternoon. It’s drizzling outside.

It was drizzling – raining – at Woodstock in 1969, when the singer Melanie came on stage for her first-ever performance to a big crowd. The audience were lighting candles to beat back the rain. (We had imagination in those days!) She came away, as she said, a celebrity, and with the chorus of ‘(Lay Down) Candles in the Rain’ in her head. ‘I left that field with that song in my head, the anthemic part.’

Lay down, lay down, lay it all down…let your white birds smile/at the ones who stand and frown./Lay down, lay down, lay it all down…let your white birds smile/at the ones who stand and frown.

We were so close, there was no room, we bled inside each /other’s wounds.

We all had caught the same disease..and we all sang, the songs /of peace.

I wasn’t at Woodstock, but I listened and lived it back in 1969. Listening to Melanie singing Ruby Tuesday (in the bath, after the walk!), and that catch in her voice – something of the old optimism came back to me.

Today’s walk, ‘Walk the wards’, did a little bit of the same. Brought back the optimism.

In this overly negative, too often backward-looking era, with Barack Obama a memory (though still an inspiration), we have to hang on to the ‘can-do’, make it new, share it with our kids and their kids.

Another Melanie song, ‘Peace will Come’:

And my feet are swimming in all of the waters /All of the rivers are givers to the ocean /According to plan, according to man …

Oh there’s a chance peace will come /In your life

Each generation feels the push-back, each new generation has to push forward, all progress is slow, but if the older generations can find it in them to join with the younger, as I did with my two children, very grown-up children, last year, opposing Brexit in Trafalgar Square, then there is hope…

And yet… a mention of Brexit slips in. Many walking today will be Brexit supporters. Nothing is ever simple.

Brexit – the new promised land

Buddhism has neither a god, nor a promised land – for many that is, but not for all:  adherents of the Pure Land teachings within the Mahayana tradition believe that by reciting the name of Amithaba Buddha they can achieve rebirth in a western ‘pure land’.

Deriving any kind of political conclusion from spiritual belief is always high risk. But there is a ‘promised land’ mentality abroad at the present time, and curiously it’s taken hold of the right of the political spectrum – the day-dreams, the political unrealities which typified the Left for so long are now the prerogative of the Right.

There is it seems a world out there, beyond the western horizon (beyond the sunset), where we can trade freely, without restriction, without regulation, where self-interest becomes the common interest, where supervisory bodies not least governments touch so lightly that we’re hardly aware they’re there. We in the UK, we’re free traders at heart. Once we set the example for the world by going it alone. Others followed. And they will do so again. We were, we still are, exceptional.

We achieve this by a simple stroke, a referendum, from which there is no turning back.

Our history, our unwritten constitution, is full of errors, U-turns, crises, but the parliamentary system has always allowed for corrections, changes of tack, a self-correction mechanism.

But true belief and true believers allow no compromise.

There is a rigidity to belief systems, and referenda are a classic way of embedding practices and beliefs. Cooperation and compromise become, as we’ve seen over last year, much harder. We are on dangerous ground.

Likewise the USA, where exceptionalism, of the American kind, is also closely woven into the debate. A continuing danger lies in the presidential control over appointments to the Supreme Court, and the way appointments can sway the Court in the ever-more-polarised national debate. The Citizens United decision in 2010 effectively allowed super-PACs to spend unlimited amounts in support of political parties or candidates, as long as the money wasn’t paid directly to the candidate. There is now no restriction on what money can buy in American politics, and no limit to the levels of vituperation, and with much of the press in the UK in the hands of over-wealthy men with overt political agendas we are running the same risks here.

The US Congress has many famous examples of cross-party cooperation, of a movement to consensus when the times require it.  The UK likewise. But money polarises, and likewise referenda. If one side dig deep to defame the other, if one side claim that a referendum has once and for all and forever decided an issue – what scope can there be for coming together?

The ‘pure land’ mentality belongs in the spiritual sphere. It is pace Dawkins, Dennett el al, a natural aspiration of mankind. But it has no place in politics.

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A brief coda. Paul Johnson (director of the Institute of Fiscal Studies), writing in The Times, reminds us how once a big government project (for example, the NHS IT system) is underway ‘its momentum can carry it through almost any amount of evidence it is not working’. He continues:

‘The serial inability of governments to define, manage and deliver big projects can only be sobering in the context of the attempt to deliver Brexit – the biggest project of them all.’

At what point does a promised land become a fool’s paradise?

The fantasies of free trade

Walking and swimming, conjuring turtles (see my last post) and building castles… since the Brexit vote politics have been more a burden, less a pleasure – how we (as country and individuals) might hold on to our sanity while others attempt to build castles in the air.

Brexit has many castles, most of them air-borne, from the immigrant threat to free trade. Closing down on one, on the free movement of labour, runs directly counter to a fully libertarian approach to free trade – if this was a board game, or a novel, I’d want to see how it all worked out. As political reality, I hope not to.

Focusing on free trade, last week we had ‘From Project fear to Project Prosperity’, a report from the free-trading supply-siders ‘Economists for Free Trade’, chaired by one-time Thatcher adviser, Patrick Minford. Matt Ridley in The Times (21st August) pours praise upon them. We hear the old shibboleth, ‘Fortress Europe’, curiously used to describe 28 countries which have taken down the barriers and practise the four freedoms – goods, capital, services, and labour. Ridley argues that ‘external barriers are pure self-harm’, and you’d have thought that he’d take the EU as a shining example. Instead he focuses on the tariffs the EU imposes on non-EU countries – apparently the tariff on unicycles is 15%. What he totally and wilfully fails to recognise is that free trade isn’t a level playing-field, but self-interested countries seeking common ground on which they can co-operate – not for another’s interest, but for their own. We hear from Brexiters about countries keen to reach trade agreements with the UK – but on whose terms? On ours, on the UK’s?

Garvan Walshe on the Conservative Home website is helpful on the subject. (There is an awful lot of sanity still left in the Tory party – but the sane too often these days are the quiet and the cautious.) In trade between countries, ‘the distance relationship is paramount’.

The effect of that decision [the referendum]  is to forego [the EU’s] economic benefits, and they can’t be replaced by shallower trade agreements with other countries, because they are too far away. And while there could, as Minford suggests, be economic gains from deregulation, they won’t happen while Britain´s politics is moving leftwards … Far from bringing benefits through other trade deals, leaving the EU erects an enormous trade barrier with the rest of our continent. Economists for Brexit should have renamed themselves Economists for Protectionism.

Back to Matt Ridley: ‘…after Brexit, Britain should try unilateral free trade, no matter what everybody else does’. This would Economists for Free Trade argue benefit the British economy by as much as £135 billion a year. (Compare the NIESR – leaving would cut our total world trade by a quarter.) The Minford report assumes that we’d reach an agreement with the EU broadly comparable to what we have now, and a level of de-regulation which simply won’t, and shouldn’t, happen in the current climate.

Ridley is also guilty of a selective use of history, an old bete noire of mine. He quotes Sir Robert Peel in the 1846 Corn Law debate – ‘we should cease haggling with foreign countries about reciprocal concessions’. He argues that ‘the closer countries get to free trade, the more they thrive’ – and quotes Britain in the period 1846-80, and Hong Kong and Singapore today. In all three cases the circumstances are radically different – Britain in a period after 1846 when we could dictate the terms of world trade, and two city-states (treating Hong Kong a city state) operating as low-tariff entrepots.

Ridley also attempts a distinction between the Roman civil law ‘prescriptive, rules-based system’, and a ‘better’ common law (and distinctively English to his mind) approach, ‘which is principles-based, outcome-focused, consumer-friendly’. He continues: ‘Because of our history and the nature of our economy Britain can be an effective champion of this challenge.’

The risk is all ours.

We are back, happily for my argument, to ‘castles in the air’. There is no hard evidence that ‘free trade works’, no hard evidence that supply-side economics will deliver any of the benefits (above all increased tax revenues on higher output, and collective benefits deriving therefrom) it claims.

And finally… Adam Smith. Ridley tries to corral him into the Leave camp: ‘As Adam Smith put it, describing the European Union in advance, “in the mercantile system the interest of the consumer is almost constantly sacrificed to that of the producer”.’

‘…describing the European Union in advance…’ – this is populist and emotive junk.

The founders of the Adam Smith Institute don’t do much better: ‘We both take the view that the UK now has the chance to trade freely with the rest of the world, since it will no longer be locked inside a protectionist bloc of diminishing economic and political significance.’

The EU isn’t doing too badly at the moment, and it carries political clout – the ‘diminishing economic and political influence’ will all be ours if Brexiters have their way.

Impermanence

We conjured a turtle on a Cornish beach last Sunday, and slates gathered on the beach were scales for its back. Five hours later, in the gloaming, I watched the incoming tide, the waves creeping, maybe one in three or one in four, a little closer, until they trickled into the ditch we’d dug around the turtle. The shell held out a little longer, maybe ten minutes, until a small wave sloshed gently over the top, and then the undermining was really underway. By the time I took my leave, reluctantly, ten minutes later, there was barely a hump to be seen, as the tide pushed further in.

Impermanence… I’ve also been walking the coast path, from Trevose Head to Morgan Porth, and back, the same terrain, yes, but different perspectives, as if two separate journeys. The coves bite deep, and the caves and sink-holes provide sounding-boards for the waves. The rocks break and twist, as the strata and lines of weakness, and all the vagaries of weather and climate over many millions of years, dictate. And yet it all seems so permanent. Even the flock of oyster-catchers, which piped on a rock platform far below: they were there both outward and inward, though inward the black-backed gulls had flown.

Looking down on Bedruthan Sands from the cliff top, the sand was fresh-swept – the tide bites the cliff, no soft or littered sand, and four girls were playing boule, and their cries just carried to me. The waves which had been a high surf were lapping low, or seemed to from my elevation, and all seemed … well, yes, permanent.  I didn’t want to walk on, and lose that sense of forever.

I found a grassy slope, and sat and looked out to see, blue under blue, aquamarine closer in, where it shallowed, and the rippling smoothness extended in a great curve around me. Another cliff, another cove – snorkellers were taking advantage of low tide and swimming out to a sandy beach.

Where the cliffs come down to Treyarnon beach there’s a steep gully which you can swim through at lowest tide. This, my imagination tells me, is what they do, what I could do, as the observer, every day, and yet – such moments, such times, are rare. The tide will rise, the mists sweep in, and the storms, and the winter …

Joy and a gentle melancholy combine, and a sense of peace, and fragility … that sense of living in the moment, and yet living forever.

 

 

Conservatism – selling out to the new right

I began this blog eight years ago in a mood of optimism. Obama’s ‘yes we can’. Maybe we could find common ground across the political divide, enough to take agendas of enterprise, economic growth, internationalism and social justice forward together. We knew of the new right’s machinations, but didn’t foresee how their path to power might work out. And how conservatism would be re-interpreted, and buy into the politics and the moral neutrality of post-truth. To take a few examples:

# Referenda: the idea seems to be abroad in some circles that referenda results are for all time. Referenda if used at all, and they are too easily manipulated (by money and media) to have any significant role in any serious democracy, must be reversible, in the way that parliamentary legislation is reversible. It is extraordinary and irrational to think otherwise. And against conservative tradition…

# Conservative vs radical: it is no less remarkable how the Tory party has moved so far right without realising it, mirroring the Barclay brothers Daily Telegraph agenda and adopting the manners and demeanour of the Paul Dacre Daily Mail. We could indict the Conservatives under the trade descriptions act. (Tory – from the old Gaelic toraidhe, meaning outlaw. Altogether a better description.) The old Tory party, going back to Macmillan, Heath, even Thatcher, believed in the great British unwritten constitution, the wheels turned slowly, radical change and revolution were disdained. We have now arguably the biggest leap in the dark outside of wartime in two hundred years.

I am now the conservative. I’m not sure I like my new role too much – there’s too much in the world to be radical about.

# Economic forecasts from outlier economists such as Patrick Minford, given press and media coverage as if mainstream. Compare the wiser counsels of the FT and the Economist. Curious now how many rely on the Telegraph City pages: that’s a subject in itself.

# Assumptions that post-Brexit we will dispense with the ECJ – the European Court of Justice – and still achieve some kind of trade deal. Set up a separate quasi-judicial body? Are the EU for a moment likely to acquiesce in that?

# ‘Recent’ poll data suggesting wide support for a hard Brexit – quoted as fact in the media (including The Week) – when the data dates back to April and has been wilfully misinterpreted.

# Finally – diversion away from the issues which should be engaging us. Not least the tragedy (see recent reporting in The Times, and all power to them ) almost on our doorstep in Libya. 700,000 migrants camped and waiting. This is a crisis for all Europeans, and one so far which the EU, 28 countries with clamorous electorates, has simply failed to come to terms with.

Here in the UK we are obsessed by Brexit, preferring to close our borders physically, morally and politically. Rather, we should be in there, facing up to the crisis, putting forward proposals. Advocates within Europe, within the EU.

Suggestions, for example, for a wall across southern Libya, or funding repatriations… maybe or maybe not viable … but where are we?

Sidelined, irrelevant.