Remain campaign a victim of it’s own left liberal conceits?

A couple of thoughtful pieces to throw into the melee post-referendum. First Tim Harford in today’s FT

Here are four tenets of the trendy centre-left of British politics: first, soaring inequality means that ordinary people haven’t shared in the benefits of economic growth; second, rich people and big companies don’t pay taxes; third, gross domestic product (GDP) is a statistic that misses what really counts; and finally, economists are reliably wrong.

It’s really interesting to look at how these tenets skewed the debate not in favour of the centrist Remain camp, but away from it. In each case Harford presents facts which challenge the veracity of each one of those articles of faith.

In the case of income equality he argues that eaten bread has too quickly been forgotten:

…the gap between people at the 10th percentile and the 90th percentile actually fell between 1990 and 2013-14. Broadly, income inequality is a problem that emerged in the 1980s and has not worsened since.

He argues instead that poor growth is what’s really hitting pockets of those lower down. He goes on to argue that the denigration of GDP as a measure obscures the fact that a sudden hit to GDP will impact people on the ground.

And to the idea that economists don’t know what they are talking about (a new broadly held myth scaled up by the fact no one saw the crash coming), he has this to note:

The Institute for Fiscal Studies is full of experts on tax and household income; the Centre for Economic Performance studies globalisation, technology and education. Blaming these people for not foreseeing the collapse of Lehman Brothers is like blaming a brain surgeon for the spread of obesity.

This disappearance of the reliable expert is something connived at by both Leavers and Remainers intolerance of anyone who challenged their world view, presumably in the belief that as HL Mencken once wrote:

 “No one ever lost money by underestimating the intelligence of the great masses of the plain people.”

 

  • Declan Doyle

    So really it’s a case that nobody believes anything anymore? Zero trust amongst the masses in the political and economic establishment. This then is abused and manipulated by all sides in any given debate, thus exacerbating the problem. So who then is at fault and what is the solution? We certainly know the consequences.

  • Kevin Breslin

    The vast majority of Leavers came from Conservative strongholds anyway, much is made of a minority pro-Leave working class demographic that shifted the vectors for the result.

    The majority of Labour supporters and the majority of working class people across the UK actually voted Remain.

    What reforms are going to be introduced to improve the lot of working class people …?

    Don’t you think it showed a conceit for working class people who UKIP and many Leave politicians were so eager to hijack the voice of?

    I’d be wary of partitioning one half of the political class against the other on this tribal manner.

    I don’t see Jacob Rees Moog or Liam Fox or Theresa Villiers winning Labour Votes on the back of the Leave campaign or some tribal Leave compulsion to vote for them.

  • Megatron

    I thought Martin Wolf had a great article in the FT which says rather than inequality being the problem, the bigger problem is progress has slowed and has left people feeling worse off than their parents.

    That seems to touch on something important in my view.

  • Megatron

    Also the tabloid press (hardly the trendy centre left) is the bigger problem in my view and the biggest proponents of the tenets listed above.

  • Scots Anorak

    As I see it, the Remain campaign was supported by those towards the centre of UK politics, while Leave was supported by the hard left and the much larger populist right (with a charismatic leader tipping the balance). Portraying moderate centrist values as dodgily left-wing has been a constant theme in the Murdochian press, and this article appears to be no different.

    As for the “left-liberal” (they’re at it again!) verities listed, I recognise only the first two. The Leave campaign were the ones belittling the experts last time I looked — although it is also true that a warning of economic meltdown is likely to have little impact on someone who has been left behind by wider economic success. As for GDP, economic growth was approximately twice as high in the 1970s, when we were all that little bit more equal.

    I also suspect that inequality can be portrayed quite differently according to what one classes as the top group, i.e. the richest 10% or 1% — “We are the 99%” is the slogan, I think.

  • Zig70

    Got a link?

  • Nevin

    Here’s Martin Wolf on ‘populist rage’

    PS It might disappear behind a pay wall.

  • Gopher

    It is spilt milk now there was a disconnect, they had years to sort it out. Nobody believed the UK would leave so no one bothered to address the issues. Brexit concentrated on Brexit despite differences. Remainers hated each other as much as the Brexiters and fought the campaign on self interest side issues that the sum total of might have been greater than Brexit but it individually did not reasonate.

  • the rich get richer

    Out of touch , Arrogant, A lot of Bull from the Bullingdon (Cameron /Osbourne…don’t overate Bobo he is not treated seriously be British voters)Club

  • Nevin

    The Centre for Economic Performance could lose money were it to upset its sponsors, one of which is the European Commission. Perhaps Mencken would have had something to say about fiddlers and tunes.

  • Lex.Butler

    I usually find Tim Hartford’s views give a lot of light to contentious issues. His statement that income inequality has not worsened may be statistically true but isn’t how it’s felt on the ground. The huge number of people on zero hour or worse self employed contracts with no hope of saving money or building pensions or even a home wouldn’t agree. The growth of food banks is a more reliable indicator that levels if poverty not seen since the Thirties have returned. And resulted in Brexit.

  • Kevin Breslin

    There is still a disconnect between the elites and the working clases and Brexit has done nothing to bridge the divide.

    Many on the Leave side are Elites too.

    Elites will adapt and the non-elites simply wont have any sympathy for them.

  • Kevin Breslin

    Yet the exact same thing is happening in non-EU countries. There are food banks in Switzerland for crying out loud.

  • Kevin Breslin

    Nevin the Centre for Economic Performance gets no sponsorship from the European Union institutions or any body that is sponsored.

    All the bodies are UK based institutions set up by UK based people for UK based agendas.

    You are free to disagree with them but know at the end of the day you are disagreeing with John Bull Britons not Johnny Foreigners from Brussels.

  • Kevin Breslin

    Voters in Uxbridge and whatever might disagree.

  • Nevin

    Kevin, the list includes ‘the European Commission’:

    The European Commission (EC) is the executive body of the European Union responsible for proposing legislation, implementing decisions, upholding the EU treaties and managing the day-to-day business of the EU.

    CEP is part of LSE and LSE also receives EU funds.

  • David Crookes

    “The Centre current annual funding of £1.7m comes mainly from the Economic and Social Research Council (50 per cent), from the Anglo German Foundation, Department for Education, Esmée Fairbairn Foundation, Princes Trust, Rowntree Trust, the European Commission, Bank of England and from contributions from members of its Senior Business Forum.”

  • Kevin Breslin

    Oh please, the vast majority of those funding bodies are British, with British students and their British ideas.

    The vast majority of the money the London School of Economics gets comes from the Research Councils that Westminster fund and their agenda due to the Haldane Principle is steered by the academics and peer reviewed. 

    There’s absolutely no bar on a Eurosceptic economist getting EU Commission funding.

    And just in case you think British Eurosceptic financiers were infallible… The former chairman of Northern Rock funded the Eurosceptic Scientists for Britain group.

  • Gopher

    I beg to differ, Brexit means that any time there is a disconnect in future at a general election the capacity for a readjustment is there. That loosely translates presently to if immigration is not sorted out your out. That catch all excuse its European regulations is now gone. May’s first speech as Prime Minister was not so much an act of dissimulation but an acceptance of the new reality.

  • Kevin Breslin

    Vast majority of those bodies are British and there was British membership on that European Commission.

    In fact every other body is based in England and deal with British affairs as well as studying global economics.

  • doopa

    The top 1% are in a different zone to the top 2-10%. But most breakdowns give it in deciles. Very good breakdown for the states here: https://www.youtube.com/watch?v=QPKKQnijnsM

  • Kevin Breslin

    Oh please. We have net emigration here in NI some years but we still have tizzyfits over immigrants because there are people who want to be brainwashed by The Daily Express.
    It doesnt matter if no one wants to come to the UK. It doesn’t matter how sucessful police and border control are at catching international criminals. It doesnt matter how many terrorists are deported. Or how pasty faced the place is.
    There’s still people going to waste their lives fearing the immigrant bogeyman no matter what the government does.

    The British people voted for a tough right wing government, and it wasn’t to just be tough on migrants, but on poor people, benefit claimers, low earners, public sector workers, the disabled and the undereducated… oh and students.

    One of the main reasons for that is that unproductive British people are considered foreign to people living in middle class housing estates in Essex.

    We have gerrymandering that pretty much forces 1 of 2 main options and one of them is seemingly imploding because Brexit has done nothing to narrow the gap between Working English lefties and Middle England lefties… who used to rely on mutual hatred of the Tories rather than each other to work together.

    If Leave supporting politicans cared about the working classes, they wouldn’t have told so many obvious lies. They made more apologies in a week, than Nick Clegg did over raising tuition fees.

    Give us your votes, we’ll get what we want … You can’t vote us out until 2020 and many of us will retire and or become Lords by then. Many of us don’t care about immigration but we’ll milk your sensitivities so we can get power. We want to privatise the NHS, but we’ll say we have the ability to spend money we don’t have on the NHS, while we privatise it by stealth and use the new free trade deals the EU wouldn’t allow us to have to sell its assets and introduce a greater amount of foreign competition.

    UK politics eh!

    Voting before or after Brexit, the power of your vote hasn’t changed. If anything all that’s been done is that you lose access to an MEP who could debate and ally with politicians of the same ilk across a continent, for simply an MP who’s grounded to London.

  • doopa

    Income inequality was at its highest in 2009-2010 according to https://www.equalitytrust.org.uk/how-has-inequality-changed – not sure how that chimes with a problem “emerged in the 1980s and has not worsened since”. I’d be tempted to rephrase as has not significantly improved since. Which puts a less favourable spin on it (and is more in line with the trend).

    (Edit) Also just seen the claim about the fall between 1991 and 2013-2014 – based off the stats in the link above I’d argue it’s a fairly selective pair of dates to be choosing since most of the other selections would result in increases.

  • Gopher

    You have a disconnect you don’t believe peoples concerns are are real or you feel they are idiotic. What happened was people acted on those concerns. You impose your reality on to theirs, the thing is their reality had more votes. Its spilt milk now and it was preventable but the problem was as I stated in my opening observation of went wrong, Remain were too busy fighting each other instead of tackling the concerns so many people had in a unified manner. Now the reality as I state in my second post there is no firewall with Europe gone between the electorate and the Government. The issue today is immigration and I cant see that changing before the next election. Feel free to blame the press, the right wing, anyone you like but that is the reality and May understood it as her very first speech strongly suggests. The game has changed.

  • Kevin Breslin

    There is no “solution” to immigration …

    The biggest genocidal dictators on the planet would find it difficult to appease those with psychological immigration problems like you describe.

    Answering the migration problem is like asking how many Indians and Pakistanis need to be kicked until someone can get a job or get healthcare or get the heavy industries back.

    Tories whether Leave or Remain say they aren’t going to meet their immigration quotas, just read what Boris Johnson and Amber Rudd said today.

    Labour, say they’ll be tough on immigration and invest where the industries used to be, but the electorate think that if this is too good to be true, it probably isn’t.

    Northern Ireland is a perfect example of xenophobia to the max, small communities uniting to hate one group, then there are feuds between groups in those communities to hate one another, and feuds within those groups in those groups.

    We have lower net migration rate in Northern Ireland than Liechtenstein a rich non-EU state, we can’t blame immigrants, we end up being the migrants.

    There is no solution to a problem when hating groups of people is deemed the solution to everything.

  • samstone0123

    This is really simple. Those who voted chose to leave. Now they are told that they were duped. They may not agree but the minority have decided that these votes are, therefore, invalid. The chattering class may throw their dummies out but the result stands for now,. Mark my words, however. Terry May has already said that article 50 will not be invoked this year. Other EU agreements mature early in 2017 which make it very difficult for any member to leave without the support of the majority of other states. If article 50 is not invoked before March, watch how the UK media manages to show that there is no choice but to remain and to accept the TTIP.

  • Croiteir

    Personally I would support the analysis of Philip Blond in Red Tory

  • the rich get richer

    The voters of Uxbridge have shown themselves to have a great sense of humour .

  • Dan

    Game, set and match

  • Nevin

    Kevin, you’ve displayed your fallibility and gone on a rant about Johnny Foreigner. Well done!

  • Kevin Breslin

    My dyslexia overlooked the one body on the list that wasn’t based in England.

    Joeseph Rowntree Foundation and all the rest of them are familiar English bodies that fund fiscal research.

    As a European, I don’t consider the English some sort of “Johnny Foreigner” … perhaps you do.

    Maybe you need some Northern Irish economists to trust?

    How many of them predicted the global economic recession?

    How many American, Russian, Canadian, Swiss or Norwegian economists predicted the global economic recession?

    How many Eurosceptic economists actually predicted that Lehmann Brothers and sub-prime lending would lead to a credit crunch?

    Where are the objective economists on the Leave side?

    Did you read what this one had to say?
    http://www.chroniclelive.co.uk/news/north-east-news/mps-react-after-vote-leave-11269819

    Manufacturing and Agriculture in the UK outside the EU is virtually obsolete. How would that go down in East Belfast, North Antrim, East Antrim and Strangford?

    Is that who Leavers in Northern Ireland must be tribally affiliated to, because he has the guts to “speak positively about Brexit”?

    I know of one other, and his organisation went bankrupt under his management.

    What about the “economists” that said there was going to be £300 million a year for the NHS in Brexit, and flag waving Brits didn’t need to lift a finger after voting in order to get it, and then “suddenly realized” the next day … hmm there may not even be any, so we better put out a rebuttal.

  • Kevin Breslin

    Anglo German Foundation – British and German based, British and German funded
    Department for Education, – British based, British funded
    Esmée Fairbairn Foundation – British based, British funded
    Princes Trust- British based, British funded
    Rowntree Trust- British based, British funded
    Bank of England- British based, British funded

    And wo weren’t the British net contributors to the EU as well?

    I would call that Duece, if not advantage Me.

    😀

  • Kevin Breslin

    Also with regards to the “EU Immigration Problem”. It actually affects graduates like me more than working class poor people. I have to deal with the competition, you do not.

    The Immigration problem among working class people, particularly in Northern Ireland is psychological.

  • Sir Rantsalot

    “There is no “solution” to immigration …”
    Of course there is! The Australian model based in points/merit related to skills needed in the country. You get in if you have something beneficial for the Australian society. No waves of unemployable people to deal with.
    Problem solved wouldn’t you say?

  • Samarkand Tony

    “Here are four tenets of the trendy centre-left of British politics: first, soaring inequality means that ordinary people haven’t shared in the benefits of economic growth; second, rich people and big companies don’t pay taxes; third, gross domestic product (GDP) is a statistic that misses what really counts; and finally, economists are reliably wrong.”

    He’s not wrong – but he hasn’t gone far enough: those are the campaign-points of the crypto-Nazis, and are nothing more than thinly disguised antisemitic conspiracy theories. They had no effect on the referendum, one way or the other.

    In reality, all these people trying to pretend the country is massively split are just fantasists. We had a very, very close vote between those who think the benefits of the EU are not quite enough to overcome the monstrous way its run, and those who think they just about are enough to justify that. No-one bar a few nutters thinks the EU is actually good, no-one bar a few nutters thinks European integration is bad.

  • Samarkand Tony

    Well done, you’ve responded exactly how the neo-Nazis behind those conspiracy theories want you to respond to them, despite the flagrant lack of truth involved.

  • David Crookes

    Sorry to be tardy in reply: I’ve been involved in rose trials all day. Am I being really stupid?

    Kevin says, ‘…..the Centre for Economic Performance gets no sponsorship from the European Union institutions.’

    Nevin and I, adducing a statement made on the Centre’s own website, prove that the Centre is partly funded by the European Commission.

    By ignoring factuality, and by replying with a fuzz of unrepentant words, Kevin smashes his own racquet, and makes it impossible for us to treat him as a serious interlocutor.

    Here is how to argue.

    I say that there are no elephants in Poznan zoo.

    You furnish me with undeniable proof of the fact that there is an elephant in Poznan zoo.

    I apologize for talking tripe, and thank you for your correction.

  • Kevin Breslin
  • Abucs

    I personally don’t think it matters if the top 5% of people owned their own spaceship and could fly to the moon. I think it is more beneficial to concentrate on the absolute health and happiness of all sectors of society rather than concentrating on making people more ‘equal’.

  • Reader

    Kevin, that 20 billion over 11 years in the graphic – is that a gross figure like the 350million per week quoted by Vote Leave, or is it a net figure like the 160million per week that Vote leave should have used?
    For instance, does it include NHS, benefits and education?

  • Tim Harford is known for thoughtful statistical analysis, but his piece, as reported here at least, has the faint whiff of a straw man. He makes some interesting points. However…

    Soaring inequality is less about the gross performance of deciles between arbitrary dates than about the precarious nature of life at the bottom, as well as the disproportionate share of the economy being grabbed by the top 0.5% or so (the top 10% are not so much the problem). Whether you label the problem absolute poverty at the bottom from lack of growth, or to much of the economic cake being eaten by the top few, the resentment it caused was a factor in the exit vote.

    Tax avoidance is a perceived problem, but one that can best be dealt with on a multinational basis, which seems to be a remain argument. But the scale of the problem is not clear in the snippets we see here. However it’s not just about avoidance… its about tax cuts for the wealthy while the poor have their services cut. To some degree this is a political choice that contributes to the resentment that fuelled exit.

    GDP misses a lot of what is important to the real economy, and there is wide agreement on this. But nobody says it is a useless measure. That is a straw man. If it crashes (especially in the absence of a major revalidating of the economy), things are almost certainly going badly. But rising GDP does not necessarily mean the benefits of increased economic activity are being widely shared.

    And economists missing stuff… The country is full of universities with economics departments, whose job is to research the economy. It was not just a couple of think tanks that failed to spot the crash. Many Academic Economists have arguably been too imprisoned by their orthodoxies to notice huge structural problems with the economy. Of course it is possible that part of the problem is the way our press reports the work being done by universities. Still, we did not, and still do not, have a mature and informed debate on how the economy could be restructured to serve the common good, rather than, say, the financial sector and the GDP.

    This is the real post-Brexit challenge.

  • Broadly agreed, though there comes a point where a disproportionate share at the top can soak up so many resources that the absolute health and happiness at the bottom is compromised. And there is some research to show the high inequality itself contributes to poorer outcomes at all levels of society.

  • Kevin Breslin

    The EU immigrants are net contributors to the UK. If you want to factor EU emigration as a gross figure consider a fair proportion of EU migrants who leave are students, including post graduates and indeed seasonal workers who pay rent, and spend their money in this economy just like the rest of us, while adding their labour to the economy.

    Northern Ireland isn’t a net contributor and will be even less so enduring Brexit costs and Brexit cuts. It will lose money with lower immigration and that will lead to higher emigration.

    There would be more savings for both parties ending the union between Britain and Northern Ireland than than there would be spending money to deport the minority of EU migrants in benefits. Many of these longer term EU migrants are NHS workers and educationalists like university lecturers.

    They have no evidence to prove any of your assertions that there is any savings to be have cracking down on EU migrants with anything stronger than the UK’s emergency break procedure given the unintended consequences deterring skilled migrants from coming here. Isn’t it weird North Antrim has some of the lowest immigration rates but one of the biggest “phantom foreigner” problems. If there is economic damage to agriculture and industry I will imagine that phantom foreigner problem to get worse. Alas the foreigners will be overseas.

  • Abucs

    Yes i think that is right but we also have to look at how the wealth is being invested. Wealth is continually invested and created. If people do not do a good job of producing things which employs people and creates benefits for the buyers then their wealth will decline and they will slip down the ‘rankings’ with others taking their place.

    I think it is incorrect to think that the top 1% always stays the same people. By marriage, inheritance, inflation, tax, business shocks and bad decisions there is always the pressure for wealth to be diluted unless it is employed profitably which should benefit society.

    I agree that it is beneficial for society to agree to rules stopping power structures emerging which are more interested in keeping others down. One problem with an ‘equality’ orientated focus is that it tends to destroy the wealth that is invested in wealth creating enterprises.

  • Broadly true, again, though we’re in danger of straying off topic.

    But the power structures you mention may be a bigger problem that they seem. Monopoly positions are abused, and power and wealth consolidate and crowd out competition – especially where corporations are seen as having purely financial goals, without ethical obligations. Then there is lobbying for legislation that further entrenches privilege – consider Disney’s perpetual copyright extension regime (as old film copyrights approach expiry, the copyright period is extended by the US and the EU, and entrenched by trade agreements – which brings us back on topic, perhaps).

    The answer cannot be “equality” or destruction of opportunity – but limits on excessive inequality must surely be part of the solution. Power corrupts, and makes corrupt actors hard to restrain. They can (and do) turn their presses and TV stations on anyone who attempts to regulate them, and have their politicians stymie any attempt to rein them in.

  • Abucs

    I agree there should be restrictions on self interested wealth influencing law to limit competition.

    Regarding excessive inequality, i think if you look to see which leading companies of 50 years ago are still leading, then we will see that most have faded. New leaders are often created because of new industries and new technologies being introduced and mass marketed. These new leaders roll out wealth to society and help to make things better. If all goes well then they will be replaced as the top companies by the next round of good ideas and then the next.

    If the old companies are the ones with the new ideas then great, if not, then it’s still great, they will be replaced. Society will be enriched as long as the new ideas, seeking a maximum of money, with fair laws of competition, create mass produced wealth. This of course encourages people to participate in buying these products by creating their own wealth.

    Looking to cut into the leading companies at any one moment of time in the name of equality is risking the process of wealth creation that has been very successful IMHO.