The current state of affairs in the United Kingdom
As in the last Quarter's edition we have left the rough and somewhat bizarre impression of the current challenges facing the constituents of the United Kingdom summarized in the GEL cartoon which appeared recently on CybaCity.com and which we reproduce below. However we are pleased to say that the Great Effects Lab (GEL) on Portsea Island updated it for us to include the latest surge of confusion.
This cartoon is communicating a message concerning the past failures and accumulated outcomes of UK government policies, by using the common technique of an exaggerated image of economic crisis. However, on closer examination, and ignoring any partisan political bias, the messages contained within the cartoon's pollution cloud are, in general, factual. These details are slowly dawning on the constituents of the United Kingdom.
But the country now is facing a constitutional crisis largely moulded by politicians and political parties and their benefactors.
It is often stated by politicians that freedom, democracy and the rule of law are the cornerstones of our society and culture. However, the facts point to the gradual attrition of the constitution by political parties so that laws are becoming cornerstones for the support of groups of constituents and, in particular, political parties in power and their benefactors. As a result, we have witnessed in our lifetime the Conservative party an erstwhile "one nation" party exercising moderate policies becoming a source of innovation which is destructive to any notions of a unified nation.
The recent experience with the growth in financialization and the post-2008 financial crisis are useful indicators of just how this change has already progressed since the destructive outcomes are self-evident.
Macroeconomic policies including Bank of England monetary policies have overseen falling real investment, declining real incomes, declining productivity and large sections of the community heading for food banks. The balance sheet national accounts approach to national economic management completely ignores the strategic nature of productivity-oriented investments and as a result governments have substituted this imperative by flaccid "infrastructural initiatives to create employment" as a political expediency with absolutely no objective or evidence-based justifications for such investments in terms of the ability of the country to support reasonable real incomes in the future. HS2 is a case in point destined to constantly over-run its latest proposed adjusted budget...but it employs people. This is not the sort of thing that is installed as policy of a government that believes in freedom and enterprise
It is worth reminding ourselves of rational policies of the past that worked more effectively. Richard (Rab) Butler's Education Act of 1944 was a rational step in the right direction when a tripartite system of Grammar, Technical and Modern schools were introduced. The most important element was the technical school component where children received instruction in practical applied capabilities as well as academic. Broadly-speaking, the view of technical schools was that they were vocational in nature as opposed to being the model for all education. As a result they were seriously under-funded and the Grammar schools gained the image of being the example of what education should be as a totally academic educational environment where the sense of academic is lack of application. Let us just indicate that Rab Butler went in the right direction but not far enough.
Although, the years 1945 through 1965 were considered to be the "Golden Years of Keynesianism" it turns out that Keynesian policies were not applied during this period. Harold Macmillan was quite at home with economic planning and tripartite negotiations between industry, the unions and government since all concerned know that the "free market" entails unacceptable risks as witnessed with the 1929 New York crash and the Great Depression.
We then enter a strange period between 1965 and 1975 through Wilson and Heath governments. Anthony Crosland, the Labour government Secretary of State for Education in pursuit of greater "upward mobility" introduced comprehensive education in 1965. This was of course the wrong decision for three reasons:
Crosland was an intelligent individual but the comprehensive education initiative was more of a decision linked to the subject of social justice in providing all children with equivalent opportunities in life. However, like most schools in the country the basis for teaching was largely "chalk and talk" and very theoretical. The change should have been towards technical schools that had demonstrated that this form of education was more relevant to the needs of the economy in the fields of design, innovation and economic growth. For example, during this period, Thomas McNeill, the Headmaster of the Technical High School in Portsmouth which he built up from 1944 from a small start as the "Building School", initiated work with the City & Guilds in London on the newly formed Associated Examining Board based in Guildford, to introduce more technical subjects for O and A levels as a basis for qualifying for entry to universities and technical colleges. This ended up with the Technical High School competing with local grammar schools and gaining an increasing number of university entrants. This school was the first to introduce computers (Ferranti) and had metallury, masonry and woodworking, fibre glass boat production, physics and chemistry labs, an observatory, engineering drawing, geology and surveying courses. All students passed through this system no matter what their intellectual bent or vocational objectives be these biomedicine, engineering, or IT.
If Labour had been more imaginative the small seed planted by Butler might have transformed the quality of UK education over the following 50 years.
Heath made his mark by giving away British fishing resources to the EU and by abandoning Commonwealth country interests by signing up, over-eagerly, to membership of the then European Community.
After 1975, the most dramatic changes took place during the economic crisis generated by the steep rises in international petroleum prices and the ensuing state of slumpflation combining high inflation with rising unemployment. The drama surrounded the incapacity of main contending macroeconomic theories, including monetarism and Keynesianism, to create policy instruments capable controlling rising inflation and unemployment so as to guide the economy back to a steady growth path and income distribution. It is in this confusion, largely caused by economists having followed a wholly academic training and therefore not being able to identify effective solutions, that most economies suffered. As a result, major political party patrons, including large corporations and banks, effectively imposed policy solutions on an inept Thatcher regime. Financial regulations were loosened, privatization of many public activities was promoted including land sales held by government agencies. This initiated a major transfer of wealth towards political party patrons and away from the majority of the national constituency. It is notable that the Treasury, rather than give the proceeds of local authority kand sales to the local authorities concerned, kept the money.
Gordon Brown, fearful of the association of interest rate policy-induced disasters, such as house repossessions, ended up taking the decision of making the Bank of England "independent" in 1997. This removed any control over monetary policy from Parliamentary oversight let alone subject to voter approval in elections; the long term impact of this decision has been to concentrate macroeconomic policy into monetarism and the ills of financialization with decisions remaining beyond the control of normall democractic procedures and oversight.
The period 1997 through 2010 saw the introduction of PPP and expensive financial schemes creating a debt treadmill for the NHS, the Iraq war fiasco and the 2008 financial crisis, resulting from lack of effective regulatry oversight under the Bank of England ecosystem, where Gordon brown, for some reason has been praised for organizing a "solution" which turned out to be quantitative easing (QE).
It is worth noting that during the slumpflation crisis (1975-1990) two new economic policy propositions appeared:
Recent output by the Real Incomes School has explained why QE failed. QE arose largely through bullying and threats from banks and financial intermediation services including hedge funds, insurance and real estate interests. This was a repeat of the circumstances surrounding slumpflation in 1979. Conventional economists, schooled at the "best" universities could not offer, on the basis of their existing knowledge of economic theory any alternative. Most economists' theory was, and remains, honed by peer-reviewed publications by the very same economists occupying chairs or working for think tanks whose benefactors are mainly financial institutions or large corporations. So the breadth of knowledge and employment interests of many economists circulated within that domain dominated by the political party policy and financial services sector interests. The same nexus that controls a good part of the media. This has also had the impact of dampening down the levels of knowledge amongst the national constituency of alternative options for economic policies. As a result they based their decision-making on the querky someehat eccentric Quantity Theory of Money (QTM), an identity that has been around for since the 16th Century which purports to "explain" the relationship between money volumes and inflation. QTM-based predictions got the impact of the QE solution completely wrong. The document "Real Money Theory" explains why the QTM is completely out of date and flawed because it does not contain the critical variable which measure inflation, assets. This is why it could not predict what would happen under QE. QE failed to generate recovery and under the current government it continues to fail. The principal outcomes of QE over the last decade, prior to Covid-19, were falling real investment, real incomes and productivity and a massive inflation in assets (real estate, land, precious metals, and corporate shares largely based on corporate buy backs using cheap money) favouring party benefactors very much at the expense of the majority of the voters in the United Kingdom. The Bank of England whose main constituency is private financial institutions and its decisions remain beyond the reach of Parliament and any negotiation on policy only takes place within a club made up of the Chancellor, who is a major asset holder in his own right, the Treasury, overloaded with personnel closely connected to investment banking and the City, and the Bank of England.
As is self evident, a major shift has occurred where the constitutional provisions that operated under Harold Macmillan have largely disappeared and the concept of any negotiations between industry, unions and the government has been replaced by the "free market" which has not served us well.
When governments see prosperity and success as being linked directly to finance and asset holdings they no longer consider the individual or the real incomes of those employed by the "employment creators" who happen to be the benefactors and who have also benefited from QE support. This slide to a Soviet-type government arbitrary intervention to the benefit of party aperatiks, members and supporters is a shocking development. The epidemic in share buy backs funded by cheap QE funds is a reward scheme unrelated to production or productivity but simply based on speculation a la 1929. It is self-evident that the "management companies" selected to carry out a range of government-inspired initiatives from track and trace to HS2 suffer from top officials who are not particularly suitable because they are not of the domain of technologies and techniques they are attempting to manage. Those of these domains have enough tacit knowledge to understand what is required instinctively and do not have to learn on the job creating the havoc, over-spends and chaos witnessed. Very highly paid incompetents in charge is an affront to the many who could have done a better job at perhaps less than half the salary. This is not a class-based commentary but rather a statement of facts that, on a daily basis, become more apparent to the majority of the people in this country.
That the National Health Service (NHS) is on the table to support party benefactors, existing or potential, is, under our system, self-evident, this is always in the ambiguous "subject to interpretation" small print. To prevent the High Court becoming involved in any future disputes around such issues the government is moving towards curtailing the role of the Supreme Court in taking decisions over constitutional questions that affect the ability of government to transgress what are obvious requirements to most.
With the drift in constitutional abuse at the hands of British political parties and politicians, our foreign policy has often supported the USA's policies of "Humanitarian interventions" and "regime change" aiming to create the foundations of a democracy "on behalf of the people" of the countries who subsequently face so much violent destruction that they end up living in failed states. Politicians plead that this wanton destruction of so many lives, is what "keeps us safe". But our politicians have supported such foreign ventures of destruction and at the last count, since 1945, US foreign ventures have resulted in the deaths of over 20 million people worldwide, most of them civilians. Our governments and our embarrassingly obsequious politicians keep referring to "freedom, democracy and the rule of law" as some sort of value and yet were, in general, supportive of these immoral murderous campaigns.
In the wake of this image of uncaring and inadequate reflection on the needs to others, we see an unashamed return of Star Chamber tactics and the practice of "cruel and unusual punishment" in the treatment of Julian Assange as a political prisoner whose only act was to expose the truth. In this case the equally arbitrary denial of habeus corpus in the Julian Assange case is an international disgrace in a country that introduced this provision in 1679 that required a court to examine the lawfulness of a prisoner's detention and thus prevent unlawful or arbitrary imprisonment.
These revolutionary constitutional propositions and acts emanating from clear sighted people in England were an effort to clear this land of the sort of cruelty, aggression and the disastrous excesses that led to and were experienced in a Civil War. This created an international revolutionary movement, little recognized, leading to the development of equating constitution and the role of law with higher achievable ideals and therefore a basis for an operational civilized society of equals based on the exercise of mutual respect and normal expectations of behaviour shaping a community conscience. Arbitrary rule over the people was to be banished. This is why it is unacceptable that the current government treats these values as play things of no consequence or to be used only if and when it pleases them in a grotesque and irresponsible parody of governance. What is worse is that we, as citizens, who consider ourselves to be free, live in a country which is called a democracy and where the law and ineffective politicians and political system turns us into helpless onlookers on an atrocity in our midst as well as atrocities carried out under the instruction of "our" government on "our behalf" in other countries. The evolution of society, under the manipulation of political parties, is towards an imposed subservience to all to governments, government agencies and party benefactors. This is an attempt to reverse over four centuries of enlightened constitutional advances that have benefited people in all countries, if not in practice, at least in terms of aspiration.
The USA position in the Assange case is without merit and only follows an arrogant and blind vindictive intent directed at someone who has caused embarrassment to US agencies whose sole purpose is to uphold their image while ruining it, at the same time, in their unashamed brazen acts of gross intimidation of journalists and UK judiciary affairs. The operational logic of the US side is to force people to endure an outrage for fear of becoming conspicuous by rebelling against it since it is now established that instead of seeking the truth the US government will hurt those who point out or report truths. This stench of a ridiculous outsized hypocrisy needs to be cleared up.
Such governments and our own in the UK fear the truth and for this reason are attempting to close down avenues for people to seek and gain access to facts under the freedom for information provisions.
The British governments have cultivated, at various points, a class differentiation qualified by many different metrics and now disguised in the form of identity politics and dog whistle signals to gain popularity. This demagogic New Marxist idea was initially the foundation of Neil Kinnock's new approach to Labour with the notion of staying in power regardless. However, he turned out to be unelectable. So, this was taken up by Blair following Brown's courting of the City of London and Blair's "Clause IV moment" which was no more than switching the unions by asking, "Do you want 10 more years of Thatcherism?".
The Blair government, on 19% of the popular vote, therefore endured under our ridiculous first-past-the-post electoral system and dog whistle identify politics, surviving on the basis of declarations of intent to satisfy all needs while delivery, over the long term, became unsatisfactory to the degree of being destructive.
Under the current circumstance an unassailable Parliamentary majority by a party with just 150,000 members in the country, sees an out-of-control administration intent on freeing their destructive and arbitrary decision making from any constraints imposed by constitutional provisions.
This country faces a constitutional crisis which is undermining the rule of law, democracy and our freedom as a result of a pursuit of the maintenance of an unassailable arbitrary power of a factional minority.