Tuesday, 18 February 2014

BEHIND THE HEADLINES

The latest inflation figures show a headline number below 2%, but it all depends what you buy...

 Source: Office for National Statistics
The Office for National Statistics do a professional job. When they want to measure inflation they naturally look at what people normally buy. They add greater weighting to the things that people buy more of, so a hike in the price of baked beans should show up more strongly that a similar rise in the price of Beluga caviar.

What people buy most of, however, are not necessarily the things that matter most. The biggest weighting goes to transport, which is worrying in itself, because it means that the largest slice of a household's spending does not provide a life-enhancing good, but merely defrays the cost of getting to work to earn money in the first place. The transport component of CPI has increased only 0.5% in the past 12 months, thanks to reductions in the prices of second-hand cars, petrol and diesel. These last rose to stratospheric levels a year or so ago and have now settled back slightly, which is just as well because vehicle repairs and spare parts have both risen faster than the average headline rate.

The slight increase in the cost of motoring will be little comfort to rail commuters who have seen an average 2.8% rise in fares across the network in January. They could, however, consider looking for an alternative route by sea or inland waterway, where fares have, according to ONS, fallen by 1.8% year on year. Journeys by water tend to be slow, so it's just as well that the price of recreation and culture has risen less than most. This, the second largest component of the index, includes those hand-held electronic games that would be just the thing to while away the hours on a leisurely, water-borne commute.

The third largest weighting goes to housing, including energy and water, which collectively have increased by 3.6% year on year, or getting on for twice the headline average. Not everybody has to travel, and electronic gadgets are optional, too, but everybody does need somewhere to live. If gas (up 6.7%) is too expensive perhaps they could burn books (up only 0.4%) or even board games, the price of which has dropped 0.8% in the year.

Restaurants and hotels (up 2.2%) come next in the weightings, ahead, surprisingly, of food eaten in the home. This, at 2%, has only risen a whisker above average. Best, however, to stick to bread and cereals (1%) and vegetables (1.4%), steering clear of meat and fish (2.6 and 3.2% respectively), as well as dairy products and fruit (2.3 and 2.4%).

In summary - people with the least to spend, who just want to eat and keep a roof over their heads, are still facing prices rising at nearer 3% than the headline 1.9%. Average figures work for average people, but this is something that almost nobody is.

Monday, 10 February 2014

KEEPING IT LOCAL

The unseemly blame game over the flooding of the Somerset levels is a good reason to return the power of problem-solving into local hands.

Photo nicksarebi Creative Commons
The apparent desire of the government, most recently in the person of Eric Pickles, the Communities Secretary, to politicise the floods in Somerset by blaming variously the former Labour government and the Environment Agency chairman, Chris Smith, who, as it happens, is a former Labour cabinet minister, may or may not be good for a short term headline, depending upon whether people believe what they are being told.

It is, however, a dangerous tactic, since it allows the impression to be created that the flooding of the Somerset levels is a consequence of a failure of political will, rather than relentless rainfall. It is highly unlikely that either a lack of dredging in the levels or even the  deep cuts to the Environment Agency budget is directly responsible. The problem is the sheer quantity of water collecting on land below sea level, which  has nowhere to go.

By suggesting that this is a political problem with a political solution, the government is in danger of writing a blank cheque against is own credibility. A flurry of highly visible, short-term interventions can be expected in the months ahead, whereas the interventions that are really needed are necessarily much longer term. If, as seems quite possible, the rains return in a year's time with a similar effect, the government will have nowhere to hide.

Having said that, it must be remembered that the Environment Agency itself (founded as recently as 1996) is a creature of the persistent tendency towards the centralisation of government in Britain in the past 30 years. Centralisation and politicisation go hand in hand, in a game of chicken and egg whereby central government, getting the blame for everything that goes wrong, seeks to bring control for that everything within its hands. Then, once it has control of everything, it rightly gets the blame when things go wrong.

The debilitating effect of this blame game is to leave everyone feeling disempowered. The government waves its cheque book pathetically, but everyone knows that its bank account is empty; the Agency, considered by many experts to have done well during the recent unmanageable conditions, is beholden to its government paymasters who kick it around like a political football; meanwhile, local communities and local government have been stripped of their powers to finance and manage flood protection measures in their own way.

What is lacking in all of this is self-responsibility, which can only operate at a local level where self is to be found. The Environment Agency may have a useful advisory role, but communities need to make and fund their own decisions, and then live with the consequences. That funding needs self-responsibility, too, with a major shift in tax-raising power away from central government towards regions and local communities. The connection between what people pay for and what they get is one of the things that keeps a community pulling together in the interests of all.

Tuesday, 4 February 2014

THE VALUE OF A MISSILE

Wikimedia / Creative Commons

UK defence secretary Philip Hammond is reported to be encouraging his junior ministers to lobby the shipbuilding unions, in order to put some backbone into a Labour party said to be going soft on the replacement of the Trident nuclear deterrent.

The idea is that the unions, who are leading the Keep our Future Afloat campaign for the future of naval shipbuilding at Barrow in Furness, will use their influenced in the Labour movement to maintain cross party support for the £80bn Trident renewal.

But what is the value of those jobs the unions are so worried about? How should we measure all the economic activity to be generated in the yards and bases where the new boats will be built and maintained?

It all depends whether the new submarines and their missiles are considered as a "good", or a "cost". Are they a good thing that those of us paying for them really need and value for their own sake, in which case are they something that, ideally, we would like more of? Or are they merely the whopping cost of a ticket to the top table at meetings of the United Nations?

Opinion polls over the years suggest no great enthusiasm among the British public for Trident or its replacement, while defence chiefs and at least one Conservative MP have questioned it relevance to the UK's defence.

GDP doesn't care about the usefulness or otherwise of economic activity. If there's money involved, GDP measures it, useful or not. But the unions, at least, should care, because work producing the things that people really want and need has stability and longevity built into it, whereas work viewed merely as a cost is vulnerable to retrenchment.

This distinction is crucial. Most jobs in Britain are now a cost rather than a benefit to the economy, in that the work done just circulates wealth round and round the system rather than producing any new wealth in the form of "goods" that people want and need. If the Trident replacement is lining up as a cost rather than a good, then the unions would be wise to think of swords and plough-shares: how can all the skills represented in the work force they represent at Barrow in Furness and elsewhere be re-applied in a more productive and life-enhancing way?

Monday, 3 February 2014

A PRISM ON THE PAST


To understand Britain's role in the First World War, look to Iraq


In his Guardian piece on the First World War anniversary last week, Simon Jenkins rightly challenges the celebration fever that is taking hold, particularly in political circles. The twentieth century wars have a peculiar grip on the British historical imagination, and the assumption that a victorious war is necessarily a good war is deep seated. And yet, for younger Britons, the Great War is almost as historically remote as the Crimean war is to their parents and grandparents, few of whom may properly judge the merits of a conflict better known for a disastrous cavalry charge than for its geo-political significance or moral justification.

How, therefore, may contemporary society place the events of 1914 and their aftermath in a meaningful context? One approach lies in the curious parallels between the origin and course of that  great conflict and those of the Iraq War, launched by a U.S. coalition in 2003.

Both conflicts had their origins in political murder. The shooting of Archduke Franz Ferdinand, heir to the Austrian imperial throne, by Serbian-backed Bosnian nationalists in 1914, may appear insignificant when placed alongside the three thousand or more deaths of 9/11, but context is everything in such cases and both outrages were exploited for political ends. German-backed Austria threatened Serbia, which was backed by Russia; Germany's contingency plan for a war with Russia called for the rapid neutralisation of Russia's ally, France. The path of least resistance for a German army invading France was via Belgium. Britain was a guarantor of Belgian neutrality. That is how a spat in the Balkans ended up being decided in the mud of Flanders' fields.

The political machinations that led from 11 September 2001 to 20 March 2003 (the day the allied tanks rolled across the Iraqi border) are still subject, in Britain, at least, to official enquiry, while objective historical analysis remains some way off. But the Belgian question is relevant. Lurid, government-inspired press reports of German atrocities in Belgium whipped up support for British participation in the continental war. The difference between these and the infamous dossier on Iraqi “weapons of mass destruction” is that atrocities were undoubtedly committed, whereas the weapons were found not to exist.

Both wars were anticipated to be of short duration. George W Bush declared “mission accomplished” in Iraq after 41 days, however fighting continued and allied troops remained deployed for a further eight years. The first World War was popularly supposed to be “over by Christmas” but did not officially end until the conclusion of the Paris Peace Conference some five years later.

The First World War was  not “asymmetric” in the modern sense exemplified by the secondary phase of the Iraq War, in which diverse mobile guerilla forces were pitched against a heavily armed standing army. But it was asymmetric in the sense that the technology of defence, characterised by the machine gun, was far in advance of offensive capacity, since the development of heavy armour and effective attack aircraft was still some way off.

For that reason, the First World War and the Iraq War both rapidly became “entrenched”, literally or metaphorically, and thus difficult to win. As the wars were prolonged, initial objectives were soon lost sight of, political rhetoric and propaganda fed the institutional reluctance to admit that things were going wrong and in both cases the national-political imperative of “winning” gradually replaced any strategic objectives while ruling out the possibility of negotiated settlement.

The most important parallel, however, and that which has, perhaps, the most to teach about both the past and the future, is the way in which neither of these draw-out conflicts managed to resolve the underlying geo-political tensions that caused them.

In relation to Iraq, the war has spun into a wider conflict with diverse pockets of anti-western interests, and judging by the colossal resources now invested in America's National Security Agency the American people, at least, are far from feeling any safer. The Paris Peace Conference represented possibly the greatest-ever failure of self-interested Western diplomacy, in which the terms of settlement exacted by the victors contributed not only to the rise of Nazism and its consequences but also to many unresolved tensions that have continued to unsettle the Balkans, the Middle East and elsewhere.

Britain emerged from the Conference with the “Mandate” for Iraq, a high-minded term for a form of neocolonialism that granted British interests a 75 year concession over Iraqi oil, and oil has continued to be a decisive factor in the way in which the western powers have engaged in the region.

More profoundly, however, it emerged from the conflict with a seal firmly stamped upon a union with the United States in which a moral difference, rooted loosely in a shared language, culture and common law, was tacitly asserted. As Bismarck had anticipated, and subsequent events clearly demonstrated, when push came to shove in the twentieth century Britain could rely upon the intervention of the U.S., and she has certainly repaid the favour when opportunity has arisen.

So much so, indeed, that it remains difficult to disentangle the true Western motivation for the invasion of Iraq since, on both sides of the Atlantic, the dimension of moral intent was simply assumed. For Britain's cheer leader, in particular, moral purpose was everything. Of all the unpleasant dictatorships that Tony Blair might like to have got rid of, Iraq's was the most do-able since it carried the guarantee of American support. When morality is the starting point, however, commercial interests such as oil and the military industrial complex come along for a free ride.

The Anglo-American exception that gives moral cover to the two states' military adventures is underwritten by the Second World War, with its simple narrative of good versus evil in which the evil was so evil that no amount of countervailing wrongdoing could dent the victors' credentials. Viewed through that rosy prism it is near-impossible to re-state Britain's involvement in the First World War in self-interested terms, but the prism need not, unless we choose, cloud our contemporary assessment of the confused motivations and failures of judgement that relate to Iraq.

The price of a “moral” war may be to lose perspective on human suffering. That, ultimately, is the parallel between the trenches of Flanders and the fire-fights and bombings of Iraq: people killed in the interests of an abstract and unnamed good that they can ill-identify and will never experience. Did the penny finally drop when the Commons voted last summer against military intervention in Syria? It may be too early to tell, but it is not too early in the context of the looming anniversary to reflect upon a more distant conflict in the light of Britain's recent, inconclusive and morally ambiguous wars.