What sort of Wales?

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In a curiously contradictory article on Nation.Cymru yesterday, Labour MS Mike Hedges started off asserting very strongly that Wales is neither too small nor too poor to be independent before launching into a list of reasons why we can’t afford it. We're too poor and we can't afford it sound remarkably similar propositions to me. Those reasons are all based, naturally, on a set of assumptions that most independentistas would challenge, but his underlying point that those supporting independence should produce some sort of budget showing how independence would work is not entirely without merit. Working out what it actually means, though, is a lot more complex: as is usual from those making such a demand, it seems to start from an assumption that independence would happen tomorrow and people should understand the implications of that before voting.

In truth, of course, independence will not happen tomorrow. There will be no referendum on the question unless and until there is a majority in the Senedd in favour of holding one (and, as Scotland has shown, even that doesn’t guarantee one). None of the polls for next May’s Senedd election suggest such an outcome, and even if they did, the largest party in favour has, rather strangely, already ruled out holding one for at least four years. So, the earliest that a Welsh government will even start a process of trying to hold a referendum is 2030, and the earliest date for a referendum is perhaps a year or two after securing agreement – optimistically around 2032. Assuming a positive vote, there would then need to be a period during which negotiations on the details take place – not just with the government of the soon to be ex-UK, but also with international organisations. There would also need to be a period during which the organisations, institutions and processes of an independent Welsh government were created – tax collectors, for instance. Some will see this as unduly pessimistic on my part, but I can see that interim period lasting for perhaps 5 years, meaning that independence would be in or around 2037. But a vote for independence is a vote for a different future, and the reality is that change will take some time even after that. So, while Hedges has a point in saying that people voting (in say 2032) should know what they are voting for, what they need is not an independence budget for 2026, it’s a budget for an independent Wales in around 2042. And for the sake of a decent comparison of alternatives, they need to be able to compare that directly with a budget for continued participation in the UK in 2042.

The problems in providing that comparison are large and obvious; both sets of figures would be based on a huge range of assumptions, all of which would be challenged by the ‘other’ side. It is, of course, possible for any independentista to produce something of an indicative budget for a future independent Wales without specifying to which year it would apply. It would take an amount of work and would be subject to the same caveats around the assumptions made. It would not, though, be a budget for ‘independence’; it would be a budget for the sort of independence favoured by those drawing up the budget. As one obvious example, some independentistas favour continuing to use sterling; others favour a new Welsh currency. The difference between the two in terms of the implications for decisions by the Welsh government is enormous.

The point is that what makes the difference isn’t independence as such. Independence isn’t the magic bullet that some supporters would like it to be, nor is it the millstone which opponents claim it would be; it’s merely an enabler which can be used in a variety of ways. When looking at the finances of a future Wales, what matters is what sort of Wales we want to see. Instead of making impossible demands for clarity and precision from those who support independence, opponents should be setting out how the union will solve, rather than perpetuate, Wales poor economic performance. Given their abject failure to date, it’s easy to understand why they don’t do that.

Assuming honourableness isn't always wise

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Once upon a time, I found myself managing part of a large outsourcing contract, with a customer who turned out to be, shall we say, a little difficult. The approach to anything they didn’t like was a combination of shouting and threats, and there was a lot they didn’t like and on which the contract was either silent or vague. In an internal meeting, I asked the guy who had negotiated the contract how on earth we’d got ourselves into such a situation where there was so little clarity on the detail, and his response was along the lines of, “We thought we were dealing with honourable people”. An interesting, if less than entirely helpful response.

I wonder if the framers of the 22^nd Amendment to the US Constitution may have been suffering from a similar degree of trust in the integrity of individuals. It seems to me to be crystal-clear that Trump is ineligible to stand again, yet he repeatedly holds out the prospect of serving a third term. But what’s not clear from the amendment itself is the actual mechanism for preventing him from standing. Can the US equivalent of the Returning Officer refuse to accept his nomination? Can the Chief Justice refuse to swear him in? Or was it just assumed that making his ineligibility clear was enough in itself? The issue would probably end up before multiple judges at some point. It’s probably academic, though. I don’t think that Trump has any intention of fighting another presidential election, even if the ravages of time (he’s not a young man and is clearly deteriorating both physically and mentally) throw at least a degree of doubt on whether he will be able to. He was quite taken with what Zelensky told him some months ago about not holding elections during a period of martial law – his preference is likely to be for a third term without the bother of an election.

The framers of the 25^th Amendment may have suffered from a similarly touching degree of faith in the integrity of individuals. Whilst they wisely foresaw the possibility that a president might need to be removed from office if he was no longer able to discharge the duties, including by reason of insanity, they don’t seem to have allowed for the possibility that those given the responsibility for deciding that the president was insane might be even madder, just better at completing an occasional sentence. Those US citizens – to say nothing of the rest of the world – resting their hopes on Vance and the Cabinet eventually deciding that enough is enough should be careful what they wish for. There is absolutely no reason for anyone to believe that the removal of Trump would end the nightmare.

The whole approach of governments the world over, including Starmer in the UK, seems to be predicated on an assumption that there will be an end to Trumpism in a defined electoral timescale. They need to be preparing a Plan B.

Peas in a pod

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Yesterday, the owner and proprietor of Reform 2025 Ltd revealed that he thinks the national minimum wage is too high for younger people and should be cut.  He has also previously talked about cutting benefits. With their shared determination to reduce the income and spending power of those on the lowest income in society, in purely economic terms Reform, Labour and the Tories are increasingly looking like peas in a pod. There is another thing they all share as well – a belief that the answer to everything is economic growth. How they reconcile that desire with the desire to reduce the purchasing power of millions of people is one of life’s great mysteries. Because here’s the thing – if you want consumption-led growth, people have to be able to consume, and that means having the wherewithal to buy goods and services.

Instead, they share a strange belief that enabling employers to reduce wage costs and freeing them from regulatory concerns will enable them to cut prices, thus making their goods and services more affordable. They simply don’t understand that making the lives of more people more precarious is a restraint on growth. They also seem to be blind to the experience that shows that employers reducing costs are more likely to simply declare larger profits than to cut prices.

It goes to the heart of one of the big contradictions of capitalism itself. Whilst individual capitalists want to keep their labour costs as low as possible to maximise their own profits, they also need other employers to keep wages as high as possible so that people can buy those things from which the cost-cutting capitalists wish to extract their profit. The idea, which seems to be deeply imprinted into the capitalist brain, that workers and consumers are two entirely separate groups and that impoverishing one of those groups has no impact on the other is sheer madness. It’s also what drives UK economic policy.

Poverty - a price worth paying?

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The military mind, to the extent to which that phrase is not an oxymoron, is a strange beast. It sees threats on all sides from people who want to invade and conquer, and the solution is always the same – more military hardware and personnel. To dismiss the conclusions of that strange beast is not the same as denying that there is any threat, it’s more that the threats aren’t the ones they want us to believe in. It’s true, of course, that some dictators actually want to expand the territories over which they rule – Russia’s dictator probably has eyes on more of his neighbours, although he’s almost certainly not mad enough to have learnt nothing from his costly behaviour in Ukraine. The USA’s dictator probably is mad enough to learn nothing from anything he does, and he too has designs on neighbouring territories.

There is, though, no serious threat from anywhere to invade the UK, and there is no country in the world which has enough resources to carry out a successful invasion and then to control and rule the territory afterwards. That particular threat is completely illusory – and it’s worth noting that there is little in the UK’s current military posture which is actually geared to prevent or resist a land invasion anyway. The threats are more subtle than that, and more guns and bombs will do little to prevent them. The question we should always be asking is why, exactly, would anyone want to attack the UK, and the only rational answer to that question is that they might be led to believe that the UK might otherwise attack them. Defence, in that context, implies an understanding of what might look to others like a threat and considering how to avoid that perception. As Simon Jenkins put it in the Guardian this morning in relation to China, soft power is more important than military power and “It is therefore absurd that the British government is planning to splurge billions more on defending Britain from a purely notional third world war [while] slashing the budget of its overseas cultural institution”.

There is another question which we should be asking ourselves, which was provoked by, even if it wasn’t quite the intention, the words of a retired general who said this week that we should reduce welfare spending to devote more resources to the military; and that question is very simple – who or what is it we are trying to defend? Reducing the spending power of the poorest in society to spend more on weaponry – clearly the implication of his words – means that he sees keeping some people in poverty as a price worth paying to defend us against his imagined threats. It illustrates clearly a dramatic difference in priorities. The problem we face is that most of our politicians seem to agree with him in principle – it’s guns before butter all over again.

Carts, horses, and the Chancellor of the Exchequer

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One central element of the Chancellor’s economic strategy is the pursuit of growth, as measured by GDP or GVA. Growth is good, according to her. But is that necessarily true – can some types of growth be more valuable than others – and can some types even be a bad thing? One element of her pursuit of growth is the suggestion that pubs, clubs and restaurants should be able to remain open until the early hours. It doesn’t necessarily follow that she is arguing that more drunkenness is a good thing from a health perspective (health professionals have certainly expressed their concerns), but she is certainly arguing that it is a good thing from an economic perspective. More spending on alcohol boosts GDP – that’s inarguable (although a more rounded view might just query whether there might be an impact on productivity and absenteeism). It’s the sort of position which someone gets into by looking only at narrow economic considerations.

There’s another sense in which it takes only a narrow view as well. Implicit in the proposal (which has clearly been inspired and promoted by the ‘hospitality’ sector) is the assumption that people have the financial ability to spend more money on food and drink, and the only thing preventing them from doing so is restricted licensing hours. That is simply not the reality for many: more money spent on meals and drinks out means less money to spend on other things. When money is tight, people make choices, and the result – in economic terms – is that an apparent boost in GDP in one sector leads to a drop in GDP somewhere else. Households aren’t like governments – they can’t simply expand the supply of money to purchase the available resources of food and drink.

Whether extended opening hours are a good thing or not is a separate question. The idea of restricted hours is an echo of a more puritan past, and if extended hours cause no problems for local residents and if proprietors can make them financially viable, then why not allow them to do so? But believing that creating more opportunities for people to spend is the solution to growth is putting the cart before the horse. For people to spend more money they first need to have more money: consumer-led growth depends on people’s financial resources. Yet much of Reeves’ programme seems to be directed at reducing those resources rather than increasing them.

Backdating laws is a dangerous precedent to set

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It seems unlikely that Katie Lam, who is, apparently, a ‘rising star’ in the Conservative Party, gave even a millisecond’s thought to Wales, Scotland or Northern Ireland when she called for deportation on a scale which would restore a sufficient degree of ‘cultural coherence’ to the UK. It’s hard to interpret ‘cultural coherence’ as meaning anything other than ‘white, English-speaking’ though. It’s racist through and through, but then perhaps what gives her that rising star status is an ability to find new words to express racism without explicitly referring to race. It’s pretty clear that any minority which doesn’t fit her definition must be kept as small as possible, and can never be truly ‘British’, even if she really means English.

One aspect of what she had to say is particularly concerning, in her call for people who followed all the rules, and have been living in the UK entirely legally, to be deported on the grounds that the rules were wrong at the time. The immediate impact would be felt by large numbers of families which would be torn apart if one member were to be deported – unless, of course, she’s also planning to deport UK citizens who were born and raised here along with one or both of their parents. The secondary impact would be the loss of productive workers across a number of sectors of the UK economy, including in particular (although not limited to) health and care.

There is also a third implication of her proposed approach. If it were ever to be implemented, it would mean that none of us could any longer be certain that what we did legally 10, 20 or even 30 years ago is not retrospectively considered to be a criminal act. Changing immigration rules retrospectively might well appeal to those of a racist bent, but it’s a dangerous precedent to set. That it is official Tory policy to backdate rule changes by decades underlines just how far that party has moved from its traditional respect for the rule of law.

The danger hasn't gone away

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As the dust settles in Caerffili, there is widespread relief that the threatened victory for Reform Ltd didn’t happen, despite what some of the polls suggested. But whether it really signifies a victory for ‘progressive’ views over conservative ones is rather harder to determine. One simplistic analysis I’ve seen suggests that adding the Plaid, Green, Labour, and Lib Dem vote percentages together and comparing that with the total of Reform Ltd, Tories and UKIP gives a ratio of 61% to 38%, a very comfortable margin. (It’s not entirely clear where Gwlad fits in this analysis, but at 0.3% of the vote, it’s hardly a significant factor. Where the Lib Dems sit is another variable, it may depend on who you speak to and whether there’s an ‘R’ in the month, but again, at 1.5% it’s not a huge factor.)

Everything depends, though, on whether those who voted for the Labour candidate can really be seen as ‘progressively minded’ voters. On matters such as immigration, climate change and economics, Sir Starmer’s Labour is moving ever closer to the Reform/Tory position; in policy terms they don’t deserve to be included on the same side of the balance as Plaid/ Green. If their 11% gets moved from one column into the other, the result looks very different. Plaid and Green on 48.9% compared to Reform/Tory/UKIP/Labour on 49.2% is no longer a victory of any sort, let alone a sweeping one.

We don’t know what exactly happened to Labour’s traditional vote, but we can assume that some stayed at home, rather than voting at all. Of the rest, the more ‘progressive’ elements may well have switched to Plaid as a block on Reform Ltd. But we also know that there has been movement from Labour to Reform across the UK; there’s no good reason to assume that some of that didn’t happen in Caerffili. Not all Labour voters are as ‘progressive’ as myth and wishful thinking might suggest. Those who were left are probably Labour’s hard core – ‘My party, right or wrong’ – and are, at the least, generally content to go along with Starmer. That gives no reason to place them in the ‘progressive’ column.

There is a danger of complacency – because Caerffili sent Reform Ltd packing, maybe they’re not the threat many feared. But that complacency is based on an outdated and romantic view of the average Welsh voter as inherently ‘left’ of the average English voter. The views of Reform Ltd, whether expressed directly by them, or by the Tory and Labour parties rushing to ape them, have taken root more than we might care to admit. The danger hasn’t gone away.

Sucking money out of the economy

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We won’t know exactly how much money Rachel Reeves is planning to suck out of the UK economy until she stands up and delivers her budget on 26 November. There is a sense in which the actual number matters little – the underlying principles remain the same. One of the big ‘ideas’, a term which can only be used loosely, is to cut spending on benefits. It is true, of course, that, if the government spends less on benefits, then the gap between spending and income will reduce, and (assuming that to be a ‘good thing’, which seems to be the position of both government and opposition), the overall government finances will look ‘better’ as a result. But the thinking of those looking at government finances – whether Reeves or the Tories – seems to stop at that point, as though government finances can be considered in isolation. In reality they can’t.

Reducing benefits reduces the spending power of some of the poorest in society, which – in economic terms – reduces overall demand in the economy. (To those not glued irrevocably to economic mantras, it also impacts people’s lives, health and welfare, but I don’t really expect either Reeves or the Tories to worry unduly about that.) One of the key differences between the Tories and Labour on this is that the Tories seem committed to ‘giving away’ part of the money saved in the form of tax cuts, whilst Labour seem more committed to larger reductions in the current account deficit. Superficially, in overall economic terms, reducing taxes decreases the size of the hit to the economy of that reduced demand, but that ignores the way in which the costs and benefits are distributed. Reducing the spending power of the poorest (which is what benefit cuts do) whilst increasing the spending power of the richest (which is what tax cuts do) means that inequality continues to rise. It’s where simplistic economic analysis starts to break down – the total numbers tell us one simplistic story about the overall impact, but the detail tells us that there are winners and losers. That detail is important. Well, to most of us it probably is. But most of us includes neither Reeves and Starmer nor the Tories.

Nose-holding might not always be entirely dishonourable

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The deliberations of the committee awarding the Nobel Peace Prize are secret. It’s just as well; it’s easy enough to imagine how much hilarity Trump’s hyped-up claims to have solved several wars (some of which the ‘participants’ didn’t even know had happened) would have caused the members. It’s also easy to imagine the extent to which Trumpian anger would have boiled over had that hilarity become publicly known rather than merely widely assumed.

It's probably reasonable to assume that his blatant campaigning for the prize might just have rubbed a few people up the wrong way as well: it’s not the way things are usually done. It’s hard to believe that a man who renamed the Department of Defence as the Department of War; whose government demands a stronger warrior culture and the abandonment of any rules of engagement which might prevent US forces from unleashing fear and intimidation; who is determined to unleash maximum lethal force on the streets of his own country; and who has taken to random extra-judicial killings of people in boats in international waters might not have struggled a little to be seen as a ‘man of peace’.

He might, though, have just the tiniest bit of justification in his jealousy about how Obama got the award so early in his presidency. What exactly had Obama done at that point to justify the award other than having learned to string a sentence together and avoid being called George Bush? Neither of those two things are entirely inconsequential, but they’re not exactly epoch-making either. Brokering a ceasefire between Hamas and Israel is no mean feat, although since it appears to have happened only because Trump effectively ordered Netanyahu to stop the bombing there are questions about whether it could have been done earlier. His expectation that he could announce the ceasefire one day and pick up the prize the next was always a long way short of realistic.

If the ceasefire holds and turns into a lasting peace, then maybe next year or the year after he might actually deserve some sort of recognition even while continuing to attract condemnation for many of the other things he does. He doesn’t understand the connectedness and maybe we shouldn't even expect him to; for him, the self-styled great deal-maker, every deal should be judged in complete isolation. It’s part of his natural transactionalism. There may even be a sense in which holding out the possibility of the prize which he clearly covets so much might encourage him to stick with the Israel-Palestine peace process for longer than his usual gnat’s length attention span. The probability of that happening currently looks very low, but if a nod-and-a-wink now made such an outcome more likely, might not a bit of collective nose-holding be worthwhile?

What is racism if not judging on skin colour?

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When I look at current leaders of the Tory Party, I don’t see a single white face. It’s a stupid, racist comment to make, of course. But is it really more racist than Jenrick’s comment that he didn’t see another white face on a visit to an area of Birmingham? How many people did he see, and in how big an area, over that fateful 90 minutes? Without such statistical context, it’s impossible to draw any meaningful conclusions about what it means for integration. How much bigger was his sample than the sample of one in the first sentence above? It’s worse than that, though. Suppose all the faces had been white, but they’d all been Poles or Romanians? How would he have known? And why would that have been more acceptable to him?

Both Jenrick and his party leader claim that his remarks weren’t racist, but leaping to a conclusion about the extent to which people are, or can be, ‘integrated’ into UK society (whatever that means – and other than dispersing them more widely geographically, it’s not at all clear that Jenrick knows what it means either) based purely on one visible characteristic, skin colour, is about as close to a textbook definition of racism as one can get. Maybe he really, genuinely isn’t a racist himself, but he knows that more than a few voters are, and he knows how to appeal to their prejudices.

By a curious coincidence (?), Handsworth, the part of Birmingham dishonoured by Jenrick’s presence, just happens to be next door to Smethwick, scene of an infamous electoral battle in 1964 which the Tories won on the basis of a campaign based on the number of non-white faces in the area. The Tory candidate that time round denied being racist too. It’s probably being excessively charitable to suggest that Jenrick might simply be too young to remember how well that worked for his party.