David Clark has replied to my reply to his reply about Fiscal Conservatism and in the Black Labour. These things can rapidly get unwieldy, so I apologise for the length of this reply. We may be reaching the point that the only way to settle this beef is through a poorly attended speaker meeting.
David Clark's latest post bases his case that I cannot be a "True Fiscal Conservative" on the fact that a google search reveals that fiscal conservatism is an American term used mostly about American Republicans.
I don't quite know what to do with this pearl of information.
Perhaps I should show it to Kevin Rudd, who based his 2007 election on being a Fiscal Conservative. Or to former Swedish Finance minister Goran Persson, who famously said "If in debt, you are not free" when launching a major fiscal consolidation from the left.
Or to Paul Martin, Canada's liberal finance Minister and Prime Minister? Or how about Thomas Sargent, who might know something about it, being the trifecta of being a self described fiscal conservative, a US Democrat, and a Nobel Prize winner in Economics?
Sadly, none of these people are Orrin Hatch, so presumably they don't count. For David the Slim Shady argument is what matters. Orrin Hatch is the real Fiscal Conservative, the rest of us are just imitators. Well, if that's the case, then perhaps the Social Democratic Federation of 1881 are the only true Social Democrats and the rest of us can go hang.
When I gave vent to this point on twitter, David asked for an alternative definition. Handily, we give one in the first paragraph of our paper. It may not be perfect, but hey, why not start with what we wrote?
"Fiscal Conservatism" we say "simply means that those from whom the state borrows can have absolute confidence that it will meet its obligations to repay, come what may. This means adopting an approach which is careful, risk averse, and cautious".
Now perhaps this is an unastisfactory definition. Perhaps we should expand Goran Persson to say "If in debt, you are not free, so states should only create debt when there are clear benefits, and should reduce debt when they prosper and should always err on the side of caution".
Surely, whatever the inadequacies of our definition and whatever better definitions others can come up with, this is a more useful approach than treating Orrin Hatch as the lodestone to whom all with iron in their fiscal soul must be attracted to?
A large part of our paper makes the argument that the division David repeatedly makes between Keynesianism and Fiscal Conservatism is a false one.
Yet instead of engaging with this point, David simply repeatedly responds that it cannot be true. He says: "You cannot be both a fiscal conservative and a Keynesian any more than you can be both a Marxist-Leninist and an Anglican vicar". Why? Because Orrin Hatch might growl.
Well, OK. Fine. If you and Orrin say so.
Next, David asks why we don't describe ourselves as "True Keynesians". But we do, David, we do. In our paper we specifically said effective Keynesianism requires fiscal conservatism. We simply don't agree that the two concepts are locked in a combat to the death.
Can you sense my frustration with the circularity of this argument? We are not Fiscal conservatives, says David, because Fiscal Conservatives do not believe the things people like us believe in. If they do believe in them, they are still not Fiscal Conservatives, even if they take a conservative, cautious approach to the public finances, reduce deficits, pay down debt and do not engage in excessive spending in good years. Rudd, Persson, Martin, and all the rest? Just a pose.
This frustration boils over when we move from the definitional debate to the actual one.
First David attacks our suggestion that one option for a future fiscal target might be returning the budget to balance at the end of a concrete timetable as a dangerous lunacy akin to aligning fiscal policy with sun spots*.
Then, a mere two paragraphs later, he commends Francois Hollande for proposing to return the French budget to balance by the extremely concrete target of 2017 because "he can be reasonably sure that France will be at a very different point of the economic cycle".
If being "reasonably sure" that at a concrete point in the future you will "be at a different point in the economic cycle" is the test, I suggest any fiscal policy will pass it with flying colours?
As we said in our paper, I said in my post, and I say again here, there is scope for debate about what the best precise rule might be. You don't get to be soulless technocrats without wanting that sort of debate.
One option is a concrete timescale, with a clear budget balance position attached to a fixed date, as we and Francois Hollande (with David's clear approval) have proposed. This has the benefit of being a hard commitment and retaining total political control of the budget process, but has the weakness of being inflexible.
Another approach might be linking the deficit to the economic cycle, but with more rigorous external enforcement of where the government is headed, as we have also suggested, the Chilean government have enacted and David himself assents to. To make this work, however, you have to commit to giving up a lot of control over your budget. You must, in effect, give someone a veto power over your spending plans.
David is happy with this. So am I. David is also happy with our proposal for spending restraint. He is even happy with the SMF and my proposals for tax increases.
So what is David actually objecting to? For the life of me, I don't know.
It can't even be that he hates the word conservative, because his first post was about how he finds the term increasingly valuable for the left.
The only critique I can see is that after saying that he agrees with us on the need for tougher structural rules on Fiscal policy (while neglecting to propose any) and graciously agreeing with my (or rather, Ian Mulheirn's) suggestions on Tax increases to help close the deficit (while adding none of his own) David says we err by not re-envisioning Capitalism.
In his first post he said the error was that we "say nothing about the need for a different conception of capitalism". In his latest he tells us that there are many different models of Capitalism in existence, and he is right. But politics is not about picking models of capitalism from the rail, and seeing which one fits your ideal society most snugly. You have to have a way of getting there.
Want to create Rhineland Capitalism into the UK? Then you need an industrial policy to deliver it. (You need a hell of a lot more than that, but let's start with the basics) Such a major scale of Industrial policy costs money. We have argued for a switch of resources to support industrial policy, accepting that this will mean tighter constraints in other areas both in taxation and in spending. This is a practical step, one with consequences.
David believes the problem is mainly that the left has lacked the will to take on "entrenched interests" to get our destination. It's always those pesky abstractions that are getting in the way. Yet he doesn't set out how he would raise the funds from these entrenched interests, beyond the proposals we have made. I believe the problem for the left is not that we lack dreams, but that too often we find we are short of shovels to build the path to the promised land.
In his conclusion David says that the difference between us may simply be that he is "no longer willing to settle for a version of progressive politics that turns a blind eye to the country’s real social and economic problems in order to buy off the opposition of wealth and power in the pursuit of short-term electability".
His past psychology aside, this radical intent is undermined by the fact David has spent the previous posts and paragraphs setting out precisely how he agrees with us on fiscal rules, taxation, the need for spending restraint, the need to return the budget to balance a la Hollande and so on. If we are turning a blind eye to things in order to buy off the opposition of the wealthy and powerful, then so is David.
Or perhaps, we aren't motivated by such base concerns, and instead are trying to do as well we can with limited resources, imperfect knowldge and big problems. I supect this is equally true for us and for David, it's just that frustratingly, he just doesn't engage with how he'd do any of this, how much it would cost, what other priorities would suffer in consequence and reserves his anger for telling us he doesn't like the words we use to describe ourselves.
This leads me to a conclusion. Only one of us is fooling themselves into the pleasant belief they are more radical, more edgy, more progressive than they really are. It isn't me.
That he has such a pleasant daydream is David's business. I would not bring it up if I did not fear that such a delusion will lead to complacency in opposition and be self-defeating in government.
*I will pass over what I can only assume is a misreading of our view on Gordon Brown's golden rule. We said:
"The rules adopted by Gordon Brown were sensible in principle, they were too vague and too easily evaded in practice. In particular, linking borrowing and spending directly to the economic cycle – then making the timing of that cycle open to interpretation – was a mistake.
"Instead a future Labour government should commit itself to very clear fiscal targets. The precise nature of such targets is a matter for more detailed debate but one option might be a commitment to deliver a surplus on the public finances towards the end of a concrete timescale such as the lifetime of a single parliament."
In David's hands this becomes
"The first is your suggestion that linking fiscal policy to the economic cycle was “a mistake” and that future Labour governments should instead give “a commitment to deliver a surplus on the public finances towards the end of a concrete timescale such as the lifetime of a single parliament”.
I think the difference between the two points speaks for itself.
…in conclusion, 'fiscal conservatism' is an ill-understood phrase.
And the two of you should probably get a (seminar) room.
I think you make my point. Any term that embraces everyone from the Tea Party to the Swedish Social Democrats is surely pretty worthless. Apparently, even I’m now a fiscal conservative according to your definition, which is news to me. Perhaps it would be quicker to name those who are not fiscal conservatives. George Galloway? What about Gordon Brown? Is he a fiscal conservative?
I think that by using fiscal conservatism rather loosely as a synonym for fiscal responsibility you take a well understood term and rob it of any meaning. But we have probably taken this part of the argument as far as it will go.
You wonder what we are actually disagreeing about. Well there must be something, otherwise you wouldn’t be getting so het up.
I had three substantive criticisms. The first was on tax. It appears that we are now in broad agreement on this, but you should at least acknowledge that it had to be drawn out of you in debate. I still think it’s omission from In the Black Labour signified something, even if it was just defensiveness.
The second was about whether fiscal policy should be tailored to the economic cycle or a political timetable. Within a five year timescale you can make a reasonable judgement about where you will be according to the economic cycle, so the two don’t necessarily conflict. But ITBL suggested an open-ended policy of fiscal targeting to a parliamentary timetable as a matter of routine. You now seem to be arguing for a fiscal target aimed at achieving balance by the end next parliament only. I still don’t know whether you have changed your position or ITBL was badly worded, and you won’t say despite being directly asked.
The third criticism was that you conceive of reform as something primarily involving the state rather than the market and therefore give only a partial account of what needs to change if Labour is to succeed in putting its values into practice. I know that you want a different conception of the state, because ITBL says so. But I still don’t know where you stand on a different conception of capitalism, except that it’s difficult, which of course it is. At one moment you seem to be sympathetic, the next moment you become very testy with the whole idea, which suggests that you really think it’s eyewash.
Maybe it’s time for that badly attended speaker meeting.
Right. Here goes.
"I think you make my point. Any term that embraces everyone from the Tea Party to the Swedish Social Democrats is surely pretty worthless. Apparently, even I’m now a fiscal conservative according to your definition, which is news to me"
As Alan Beattie patiently explained to you, your favoured example – Orrin Hatch-, is not a Fiscal Conservative by your own definition. You affect to believe that all Fiscal Conservatism can mean is American right wingers. When examples of american right wingers behaving in non-fiscally conservative ways (Reagan!) and progressives embracing fiscal conservatism are given to you, you then say you are a fiscal conservative, but that it is meaningless.
It is not. The fact that the swedish social democrats, the ALP, the Chilean left and the Canadian Liberals all embraced fiscal conservatism has real meaning. For each, the decision to arrive at that position carried with it real policy consequences.
"Perhaps it would be quicker to name those who are not fiscal conservatives. George Galloway? What about Gordon Brown? Is he a fiscal conservative?"
Who is not a Fiscal Conservative? I would argue three groups.
1) those who genuinely believe there is no need for fiscal restraint or budget balance. You will find the McCluskeys and the Serwotkas here.
2) Those who believe that budget balance is a worthy aim, but all that is needed to acheive this are their favoured set of policies that either reduce income or increase expenditure. here you find the Tory tax cutters, the republican supporters of unfunded mandates, Ronald Reagan, George W Bush and the Michael Meachers of the world.
3) Those who claim to believe that budget balance is worthy, that spending restraint or tax increases are needed to achieve it, but who refuse to actually say anything, commit to anything or deliver anything that will make this actually happen, and who attack those who dare to suggest any such.
"I think that by using fiscal conservatism rather loosely as a synonym for fiscal responsibility you take a well understood term and rob it of any meaning. But we have probably taken this part of the argument as far as it will go."
Actually, it is the reverse. Fiscal responsibility is the meaningless phrase. The test is obvious. Who would be in favour of Fiscal irresponsibility?
"You wonder what we are actually disagreeing about. Well there must be something, otherwise you wouldn’t be getting so het up."
Not het up. Bemused and reluctant to let obvious mistakes slide..
"I had three substantive criticisms. "The first was on tax. It appears that we are now in broad agreement on this, but you should at least acknowledge that it had to be drawn out of you in debate. I still think it’s omission from In the Black Labour signified something, even if it was just defensiveness".
I really don't think you can take credit for not reading things I've written regularly before and then claiming to have "drawn them out in debate".
While I am aware of my own small stature, my views on this have been in the public domain repeatedly in the last six months. I am not responsible for the fact you didn't acquaint yourself with them before attacking me for views I don't hold.
For example:
http://hopisen.com/2012/the-impossible-sell/
or here
http://www.totalpolitics.com/articles/313382/labourand39s-task-to-regenerate-its-economic-plan.thtml
"The second was about whether fiscal policy should be tailored to the economic cycle or a political timetable. Within a five year timescale you can make a reasonable judgement about where you will be according to the economic cycle, so the two don’t necessarily conflict. But ITBL suggested an open-ended policy of fiscal targeting to a parliamentary timetable as a matter of routine."
You keep misquoting this. We suggested
"The precise nature of such targets is a matter for more detailed debate but one option might be a commitment to deliver a surplus on the public finances towards the end of a concrete timescale such as the lifetime of a single parliament"
I hate having to repeatedly refer you to what we said, but when this quote gets turned the claim that:
"You now seem to be arguing for a fiscal target aimed at achieving balance by the end next parliament only. I still don’t know whether you have changed your position or ITBL was badly worded, and you won’t say despite being directly asked."
It is impossible to answer a question based on such a basic misapprehension. You think you have identified a shift in argument from a) to b). Instead, we proposed a broadly version of a) as one of several possibilities of which b) is one.
Since consideration of one option does not preclude having regard for the benefit of others, the shift you think you have detected does not exist.
In addition, you appear to think the quoted sentence represented a unique commitment to only parliamentary term timescales rather than using parliamentary terms as one example of a concrete timescale which might be adopted.
What's more, I discussed the type of rule you mention at the time, you just haven't noticed. So in my post discussing ITBL on the day of publication, I said "There are various rules and structural steps that can be taken. One such rule, which I quite like, which isn't in the paper, would involve an obligation, policed by the OBR, to run a current spending surplus in any year when growth is projected to be over 2%. Other rules or structures may be more effective, or better constructed."
I've repeatedly said, as have my co-authors, that the precise nature of such a rule is a subject worhty of debate. With all such choices there are trade offs, so a straight "date" commtment as Hollande has made has the virtue of retaining sole democratic control, while a rolling/cycle based assessment means ceding power over budget envelopes to independent experts.
So it's not that I refuse to answer a direct question. It's that I answered it six months ago, and keep having to point this out to you.
"The third criticism was that you conceive of reform as something primarily involving the state rather than the market and therefore give only a partial account of what needs to change if Labour is to succeed in putting its values into practice. I know that you want a different conception of the state, because ITBL says so. But I still don’t know where you stand on a different conception of capitalism, except that it’s difficult, which of course it is. At one moment you seem to be sympathetic, the next moment you become very testy with the whole idea, which suggests that you really think it’s eyewash."
It is obvious to me why you need a different conception of the state in a time when demographic cost pressures are rising, expectations of public services are increasing and tax takes are low. It is clear to me that a greater focus on growth driving policies, and therefore a re-rodering of priorities of tax and spend, a weighting towards Busines investment and state infrastructure and so on become pririties for any progressive government.
As for a different conception of capitalism, I'm testy with your phrasing, not because it is eyewash, but because it is not even eyewash. You say you wish to "make capitalism functional to the needs of a just society". You say you want more "ambition and integrity"
Of course I'm for that end, and those values. I should imagine David Cameron and Nick Clegg would say they were too. But what do you actually mean by it? You still have not said, other than that you broadly agree with the policy choices we have set out over the last six months, don't like the phrase fiscal conservative and think we lack progressive ambition.
You tell me there is a vast body of literature on different forms of capitalism, as indeed there is, but you say nothing about where you stand on the choices and trade offs between them, what you would do to get us to your preferred end from where we are today, and how you would restructure fiscal and public services policy to get us there given limited resources.
Without an attempt to state at least something meaningful here, all we are left with is the replacement of hard policy choice with the assertion of banal platitudes as a moral good of it's own. This is what I find frustrating,
`'Maybe it’s time for that badly attended speaker meeting."
At least here we can agree.
Having ..hem hem ..parted on amicable terms from my employers I am starting my own business Hopi whist I await my top down re-envisioning ( wish us luck , its not all politics you know ). My feeling on this is that the connection between the rhetoric and the range of outcomes is so attenuated that it is more like a ballet than a balance sheet
You used the phrase" We need as bigger stimulus" on precisely 37 occasions, I counted ,so you are not really a fiscal Conservativ , you are a poltical pragmatist and thats fin . What you know is that Labour have the "How many beers " say/do problem . When I used to drink a fair bit in the City we callibrated the rhetoric/reality gap as follows.
A quick half = A pint and then a quick half
Just one = Two or three
Not staying = Getting home at some point
A few= Night in the cells
That makes you two/three beers to your opponents "Night in the cells" fiscally speaking .Both positions are probably not winning ones but one is a self aggrandising pose that can only harm Labour and which I threrefore applaud , well done Clarky.
Reminded me of Wendy Cope a bit , enjoy…
One man on his own can be quite good fun
But don’t go drinking with two -
They’ll probably have an argument
And take no notice of you.
What makes men so tedious
Is the need to show off and compete.
They’ll bore you to death for hours and hours
Before they’ll admit defeat.
It often happens at dinner-parties
Where brother disputes with brother
And we can’t even talk among ourselves
Because we’re not next to each other.
Some men like to argue with women -
Don’t give them a chance to begin.
You won’t be allowed to change the subject
Until you have given in.
A man with the bit between his teeth
Will keep you up half the night
And the only way to get some sleep
Is to say, ‘I expect you’re right.’
I expect you’re right, my dearest love.
I expect you’re right, my friend.
These boring arguments make no difference
To anything in the end.
Been away. Back now.
This is great sport, but I think we’ve both been a bit self-indulgent. I want to see if we can’t get to the bottom of the issues at stake.
On the definition of fiscal conservative, we’re obviously talking apples and pears, so any further discussion would be fruitless, so to speak. But it still isn’t clear why you chose to use the term at all. You believe that budgets should be balanced over the medium term. But since you agree that this position is adequately covered by the term ‘Keynesian’, why invite fiscal conservatism to the party? It seems to serve no descriptive or analytical purpose. I sense that you did it to give right cover to a left position, as Kevin Rudd used to do (I can’t find any reference to Goran Persson describing himself as a fiscal conservative).
I understand why people do this; I've even done it myself in the past. I just think it’s symptomatic of a defensive mindset that limits progressive politics. We should take from different strands of conservatism things that are genuinely useful in renewing our politics, but we shouldn’t use it as a presentational device.
On tax, I’m perfectly willing to accept that you take a progressive position. That makes it all the more mysterious why there was no hint of it in ITBL. Was there disagreement among the authors or was it perhaps an oversight, because even that would be significant? Again, I think it’s a product of defensiveness. You feel far more comfortable talking about spending cuts than tax rises for the better off.
On fiscal targeting, let’s put to one side the question of whether your position has changed and focus on what you said in ITBL:
“[O]ne option might be a commitment to deliver a surplus on the public finances towards the end of a concrete timescale such as the lifetime of a single parliament.”
This is the only fiscal target suggested in ITBL. All the interesting ideas about Chile etc. have been introduced by you since. Were you suggesting this as a one-off target for the next parliament or a recurring target for all parliaments? This is an important point. One is a plausible commitment based on an assessment of where we are in the economic cycle; the other is dangerous, even if you were just floating it as an example.
Finally, on the reform of capitalism, I realise why you want to move the argument on to issues of detail, but I want to resolve the issue of principle first. Do you think fundamental reform of capitalism is merely difficult, or do you think it is actually impossible or perhaps even undesirable? You raise valid practical questions, but I sense from your tone that there is more to it than that. You dismiss talk of a different conception of capitalism as “banal platitudes”, but the same criticism must surely apply to ITBL’s call for “a different conception of the state”. I think the contrast is suggestive of that same defensive mindset. You feel more comfortable talking about reform of the state that reform of the market.
There. I managed to through that without a single cheeky metaphor. I’m happy to carry on the debate without rancour. Like you, I enjoy a good political punch up, but there’s a point where it gets in the way.
I'm sorely tempted to say that a good political punch up only starts getting in the way when one of the punchers is flat out on the canvass, but I agree, a constructive and mature debate is far preferable.
On the definition of fiscal conservative, we’re obviously talking apples and pears, so any further discussion would be fruitless, so to speak. But it still isn’t clear why you chose to use the term at all. You believe that budgets should be balanced over the medium term. But since you agree that this position is adequately covered by the term ‘Keynesian’, why invite fiscal conservatism to the party? It seems to serve no descriptive or analytical purpose. I sense that you did it to give right cover to a left position, as Kevin Rudd used to do (I can’t find any reference to Goran Persson describing himself as a fiscal conservative). I understand why people do this; I've even done it myself in the past. I just think it’s symptomatic of a defensive mindset that limits progressive politics. We should take from different strands of conservatism things that are genuinely useful in renewing our politics, but we shouldn’t use it as a presentational device.
You say it's a presentational device. To annoy you by quoting Tony Blair, It's worse than that, I mean it.
Why introduce fiscal Conservtism to the party? First, because Fiscal stability is a genuinely useful good. Without it, we are more exposed to crisis, and less able to respond to crisis when it comes, and in crisis those we on the left seek to work for are hurt most.
So, if such fiscal balance and spare capacity is useful, it makes sense to take a careful , cautious and risk averse approach to the public finances in all times bar crisis. We quote Ed Balls, from 1997 on precisely this point.
However, it's not enough to talk, you actually have to be careful, cautious, and risk averse. You have to both say you're taking a conservative approach, and stick firmly to that when it plausibly seems a good idea not to.
We on the left have been historically bad at doing this unless we make explicit, binding commitments which we cannot changewhen it suits us to do so.
We are, I suspect natural optimists on the left. On fiscal policy, we need a strong dose of conservative pessimism. This, in sum, is why I stress conservatism, and why i find it more meaningful an approach than responsibility, or true keynsianism, or any other such phrasings.
We are all fiscally responsible now, because we have no choice. But will we all be equally conservative, careful and risk averse when the storm appears to be lifting? I want us to be, believe it will be better for the weakest in society if we are and therefore seek to secure the strongest commitment to such a path now.
On tax, I’m perfectly willing to accept that you take a progressive position. That makes it all the more mysterious why there was no hint of it in ITBL. Was there disagreement among the authors or was it perhaps an oversight, because even that would be significant? Again, I think it’s a product of defensiveness. You feel far more comfortable talking about spending cuts than tax rises for the better off.
Speaking for myself, I think there are two reasons.
First, beyond the immediate post crash fiscal crisis, we face a significant fiscal challenge as the UKs demography alters. This will create increasing cost pressures over the medium-long term.
Just to stand still therefore, will require significant spending increases, unless we make changes. I felt it was important to highlight this gap and point out that to achieve fiscal balance in the long run will require an awful lot of running just to stand still, which will involve spending restraint, which will in turn require a different structure of the state and state services.
Second I didn't think anyone needed a reassurance that the left regards raising tax levels (or reducing tax breaks) as a useful part of a fiscal deficit reduction package. I wanted to focus on spending issues, becuase that is the hard bit for the left, the bit we try and avoid.
Indeed, I have even suggested (in my 5 things post) that i twould be an interesting exercise for those to my left to consider what closing the deficit (and meeting future demographic pressures) entirely by tax increases would involve, not least because I think the scale of such a programme would reveal its impossibility and strongly negative consequences, and create the debate I think is vital about what kind of priorities and choices are involved in an extended period of spending restraint.
There's a political point here too. If the debate on this ground, it removes the temptation to revert to a sort of rhetorical fantasy, a land of cockaigne one has no chance of achieving with the resources available. Even ifthe left answer is raising an extra 50 billion a year in tax income alone, that is going to have significant consquences somewhere, whether in demand, the competiveness of the UK economy or in decreased private sector employment.
On fiscal targeting, let’s put to one side the question of whether your position has changed and focus on what you said in ITBL: “[O]ne option might be a commitment to deliver a surplus on the public finances towards the end of a concrete timescale such as the lifetime of a single parliament.” This is the only fiscal target suggested in ITBL. All the interesting ideas about Chile etc. have been introduced by you since. Were you suggesting this as a one-off target for the next parliament or a recurring target for all parliaments? This is an important point. One is a plausible commitment based on an assessment of where we are in the economic cycle; the other is dangerous, even if you were just floating it as an example.
I read it as a proposal for a fixed concrete term for budget balance, "such as the lifetime of a single parliament". To me, that looks like a single timeframe, not an infinitely renewed one. The concreteness of the date is more significant. I don't see the implicationof infinite renewal in that sentence that you do, rather an emphasis on the importance of a concrete, binding target that cannot be fudged.
Do you think fundamental reform of capitalism is merely difficult, or do you think it is actually impossible or perhaps even undesirable? You raise valid practical questions, but I sense from your tone that there is more to it than that. You dismiss talk of a different conception of capitalism as “banal platitudes”, but the same criticism must surely apply to ITBL’s call for “a different conception of the state”. I think the contrast is suggestive of that same defensive mindset. You feel more comfortable talking about reform of the state that reform of the market.
I don't think the banal platitudes critique applies, because we go on to say what we mean by a different conception of the state, and what choices that would involve- notably constraints on health and education spending in order to fund industrial and growth policy.
As for reform of the state vs reform of the market, I'm very happy to talk about industrial policy, private sector job creation, and banking structures and supervision. Where I'm less comfortable is that an assumption that changes here will lead automatically to what I might call "moral market" outcomes.
For example, on what basis can we assume a relationship in the UK between increased bank lending to small business and lower inequality, or an increase in manufacturing employment to higher median family incomes?
Further, if we shift the ultra high paid out of the UK economy and to Jersey, we may move the gini co-efficient, but are we really improving society in the process? Norway has a better gini score than us, but so does Bulgaria. It is the policy detail that defines in which direction the UK will go,
For the outcomes we seek, I prefer the detail, because it produces moral market outcomes that are real, not simply assumed to flow from changes that often strike me as unrelated. it also allows us to stress test what the consequences are, and prevents us from making claims which, on examination, turn out to be untrue, thus further eroding belief in the ability of government to improve lives.
I prefer the tone of this comment. But we are going round in circles. Everything you raise has been covered above so let's move it on.
What do you mean by 'a different conception of capitalism' and could you outline three practical steps, say, that we should take to begin our journey towards it?
Okay, Anthony. Peace in our time it is.
I can't agree that my points above have been dealt with, but I can't force answers either. I'm happy to be judged on the exchange as it stands.
I accept your challenge to set out what I mean by a different conception of capitalism, but I suggest the comments box of Hopi's blog is not the best place to do it. I will post something on Shifting Grounds in the near future. It may take a couple of weeks for me to find the time to do it properly, so please bear with me.
Perhaps you will also accept a challenge from me to do a piece setting out what you mean by a different conception of the state including three practical steps that would get us on the way.
In case no one had seen them, these are comments made this morning by Pierre Moscovici, Hollande's new finance minister. "I want to say things very clearly: François Hollande has always said it, we have to fight public debt, which is the enemy of France, we have to reduce the deficits so that we can secure the position of France … It is fundamental: a country that indebts itself impoverishes itself."
Good and fair enough. We're getting into interesting territory.
For what it's worth, I think we can and should reform capitalism and reforming the state is part of that. I don't buy the moral economy/common good/good society stuff because it seems to me to be rather vague and unnecesarily divisive (if you are moral then that creates an immorality against which you are fighting – predators? Who are these?). You end up with 1% v 99% sloganised politics which is clearly nonsensical no matter how many placards it ends up on. An economy of the common good at the moment would be one that was growing and enabling more people to make a living.
Happy to meet your challenge on how the state should change and three practical steps to it doing so.
As this is Hopi's space then perhaps he should have first refusal on publishing these pieces. Happy for it to be cross-posted on Shifting Grounds also.
That sounds like a plan. I'm happy with the idea of cross-posting and will get in touch when I have something ready. I will also address the moral dimension and why it's essential to a political economy of the left.
Happy to host, but believe this argt is so important to left it shouldn't on either side, be restricted to relatively obscure blogs. Perhaps a compass/class/shifting ground/labourlist/policy network/ progress debate based on our respective essays?
Hollande actually just copied somethingThe Swedish Prime minster Person stated over 10 years ago. Hollande is just a copycat in everything he does and he has not impressed me so far with his comments.