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Tim Farron, farmers, and the free market.

Peter Welch — Fri, 21 Dec 2007 22:29:01 +0000

News that Tim was taking over the Agriculture brief sent me back to his article in Liberal Democrat News last week. It was a campaigning piece - his aim is to make the liberal democrats "the party of choice for UK farmers". And that is a great idea as far as I am concerned. One of the things I have found annoying over the years is our failure to communicate to farmers just what our policies are. There is a hugely important trade press for the farmer sector and we have many ways to get into it.

But (telephone) canvass farmers in many areas and you will find they don't know where we stand on the big issues like CAP reform. This is partly because we don't have a very clear or informed stance on these issues (and I will come back to this on my Euro blog). The big problem is that we haven't been great communicators. Tim can change that.

Sadly, Tim got a few things wrong in that article though.

He kicked off with the bold assertion that "if you want to see hard evidence of the failure and unfairness of the free market, then you need look no further than rural Britain" (meaning farmers, in practice).

This isn't my sort of language, and the idea that farmers operate in a "free market" seems pretty suspect to me. According to DEFRA statistics (sorry, no link to this) all the key categories of farmers except dairy farmers received (on aggregate) EU subsidies that exceeded Family Farm Income in 2003/2004 (the most recent year I have to hand). The situation is rather different for pig and poultry farmers who essentially fall outside the CAP. But a classic farmer with fields and a tractor was surviving (nominally at least) thanks to public subsidy.

Dairy farmers seem exceptional in terms of subsidy income - but this is because the support mechanism for dairy was the quota system - a massive scheme to restrict output (and thus maintain prices) across the EU.

So I find the whole idea that farmers are in the free market a little odd.

The second point Tim got wrong came in his second paragraph where he wrote of "the conclusion of the Office of Fair Trading (OFT) that there had been price-fixing and collusion between major supermarkets and the big dairy companies and that this price-fixing had led to profiteering to the value of �270 million at the expense of consumers and farmers".

This is a myth gaining credence in all polticial parties. But in fact the supermarkets were fined for getting together to pay the farmers more. This is from the Times report:

J Sainsbury said it would pay a �26 million fine to the OFT, which it said would help bring the investigation to a conclusion.

"We are disappointed that we have been penalised for actions that were intended to help British farmers, but recognise the benefit of a speedy settlement with the OFT," Mr King said.

"The price initiatives in 2002 and 2003, which were widely and publicly reported at the time, were designed to help British dairy farmers at a time of considerable economic pressure and public debate about whether farmers were getting a fair price for their products," he added.

In a statement, Asda said: "Everyone at Asda regrets what happened, particularly as we are passionate about lowering prices. Our intention was to provide more money for dairy farmers, who were under severe financial pressure at the time."

There may be scope for demanding more from the supermarkets (and changing the law) because this is not normally the way they behave. It is a relatively easy policy to explain at least. But if we are really going to face up to the realities of the predicament of farmers, we are going to need a critique of the impact of the (old) CAP and an understanding of the structural problems facing some parts of the industry.

Production-based subsidies (all but gone in the UK) encouraged farmers to produce more and so guaranteed a supply to wholesalers. Their impact can perhaps best be see with sheep production. Sheep farmers increased the number of animals they kept (the subsidy was paid per ewe of breeding age) leading to an overall increase in the national flock of about 50% between accession and the end of the millenium. And prices responded just the way they do in economics textbooks. Arguably the result was overgrazing in large parts of upland Britain.

The current situation seems to be that farmers are responding to the change in the subidy by reducing the number of animals they keep. This might lead to increased prices in the medium-term, but in the short-term destocking also serves to depress prices. The moral is that intervening in markets can cause as many problems as it solves.

But I don't seek to argue that going back to the market will solve the problems faced by all farmers. Arable farmers seem to be doing well out of the freedoms provided by a decoupled CAP and rising world prices. UK Dairy farmers have failed to gain anything much from the movement on world prices.

And some upland sheep farmers now seem to be only slightly linked to the business of food production. The main function of those Herdwick sheep that moved the hearts of the nation during the big BSE crisis is to keep the Cumbrian mountains clear of scrub and trees and to appeal to tourists - their owners are often tenants of the National Trust. They are not part of free market agriculture at all. They are in the entertainment industry.

The announcement looms

Rob Knight — Tue, 18 Dec 2007 13:54:05 +0000

So, the result of the Lib Dem leadership is to be announced shortly.

Since I haven't declared it yet, I ended up voting for Chris Huhne. But, in the final reckoning, I'm sure that both candidates are capable of doing the job that needs to be done. I could never get worked up in a partisan way about this campaign, simply because I can easily imagine either man leading us to success. The questions that interest me are not questions of the leader's personality. The situation of the Liberal Democrats as a party matters a lot more than the characteristics of the leader, especially when the choice is between two able, presentable and intelligent candidates.

Despite the occasional arguments about negative campaigning, there hasn't been a great sense of negativity about the election. Both Nick and Chris have talked about the need for ambition, and I suspect that they're going to have to work together to meet those ambitions. And, of course, the party will have to unite behind them.

It feels like a time of change now. Gordon Brown's government is growing increasingly discredited, and they have missed the opportunity to set themselves on a more liberal course, by continuing with ID cards and proposing an unnecessary extension of pre-charge detention. So, as we approach the changing of the seasons with Yule a few days away, we also approach a changing of the political season, with the New Labour era firmly drawing to a close. 2008 must be the year that the Liberal Democrats fight back, and put the liberal agenda squarely at the centre of British political life. To do that, we'll need to unite as a party, behind whoever emerges as leader later today.

SKY POLL: Too close to call or all over bar the counting?

Peter Welch — Sun, 02 Dec 2007 20:16:22 +0000

Iain Dale sees it as too close to call. The overall figures (all those mentioning a candidate) were 56% for Clegg, 44% for Huhne. In principle it is a sizeable lead but not out of reach.

The complication is that many people have already voted. YouGov put the figure at about 50% - and calculate that Clegg has a 58% to 42% lead among those who have already cast their vote.

If this is correct it suggests that Clegg has a lead of around 5000 votes in the urns (assuming around 32000 people have voted). So to win, Huhne needs a lead of more than 5000 from those voters still to cast their votes. What makes it difficult is that
a) they won't all vote (turnout last time was 72% - there are probably only 16000 votes to be cast in the election
b) Clegg still leads among those who haven't cast their votes (by 54% to 46% if one excludes the don't knows).

So if you accept the poll as representative, Huhne now needs a massive vote from the last remaining voters - he would need more than two-thirds of the vote from this bunch of voters. This poll cannot be used as evidence that the result is in much doubt (and this is the way Sky now report it).

You can of course discount the poll completely. No one knows how representative the Liberal Democrat members in the YouGov database are. and the poll last time around was hugely innaccurate (leading questions may have contributed to this). I'm normally a critic of YouGov, and perfectly happy to join in.

But some of the details of this poll ring true. The turnout to date looks about right, and I believe both leadership campaigns have identified a higher Clegg score in votes cast already. And I see that Mike Smithson responded to it by putting as much money on Clegg as the bookies would accept.

I'm a Clegg supporter and will be happy enough if the poll is correct. Indeed I think we will have had a pretty good leadership campaign: an attractive new leader who will worry both Labour and Tory parties, a credible opponent who has raised his profile, and of course an absolute blinder from the interim leader. We haven't had the tabloid coverage we had last time around. But hey, you can't have everything...

I second that emotion

Peter Welch — Wed, 28 Nov 2007 23:25:42 +0000

Just about the first people I ran into on leaving the leadership hustings yesterday were Stephen Tall and Rob Fenwick (moving spirits of Lib Dem Voice past and present). They asked if I felt inspired.
“Not really,” I said. “We have heard most of it already”.
But this morning (rising early to catch a flight) I found that I did feel inspired after all.

I won’t try to report on the proceedings in detail. Rob Knight has already done this for Manchester (scroll down the page). The three of us spent the rest of the evening in a pub that was heaving with Liberal Democrat bloggers and many of them seem to have reported what went on with quite impressive consensus. Alix, David, Tom and Rob all seem to agree that Clegg was better on the speech. On the question and answer section there wasn’t a clear winner but Andy Strange summed up my feelings on the session:

On a number of occasions Huhne was able to give a response that seemed to push the buttons of the activist dominated audience. He may have just shaded it on the clapometer. However, Clegg was from time to time able to deploy a rather neat turn of phrase.

Why did I feel inspired this morning? Three reasons really.

First I thought further about the Clegg speech – initially by wondering about the structure. It is essentially a list of five items: fear, powerlessness, social stagnation, globalisation, and the environment. I work with a lot of people influenced by ENA presentation styles, and they would never use a list of five (a division into two or three every time for the ENA/Grandes Ecoles people). So I notice things like this.

You could easily turn Clegg’s speech into a list of three if you wanted. Fear, powerlessness, and globalisation could be turned into one. But think about it: as a party we are big on logic and moral principles: if a mix of logic and moral principles were the way to victory, we would have won every election since 1979. But they aren't - not on their own. And here is a potential leader who frames the debate in terms of people’s emotions (three of his five headings). It isn't what we are used to, but I suspect it is what we need.

Second was the question and answer session. The questions (as David Boyle has pointed out) were a touch dull, and just a little quirky. Chris Huhne answered in best hustings style, trying to appeal to the tribe. Nick answered as if he were already leader (avoiding the charge of party arrogance), thinking through the ways we are going to have to adapt to move forward. One example of this was the reply to the question about what we had to do attract the youth vote. Nick didn’t try to go into detail, or hang a gimmicky policy onto the question. Instead he said (and I paraphrase) that there were a huge number of things we had to do, too many to discuss in detail, but that a lot of it had to do with having a more positive message.

I was never in much doubt that I was going to vote for Clegg. But I am now one hundred per cent convinced that we have a potential leader who understands that the way we communicate is going to have to be qualitatively different. I have had my James Graham moment":
I trust his instincts and am enthused by his questing nature; he is concerned that as a party we don't merely adopt the right policies but ensure that they resonate with the public.
I understand now that his talk about how the party needs to move outside of its comfort zone is more than empty rhetoric but carries behind it a well thought out programme for how the party must communicate its message more effectively.

Jetzt bin ich auch ein Cleggkopf!

I will be controversial now: I had a third reason for feeling upbeat as I walked through the chilly morning air to catch my flight. It seemed to me that Chris Huhne had effectively conceded that he wasn’t going to win the leadership contest. I had to replay the evening in my head to identify the moment – and let’s be clear, I am not suggesting that Huhne said he won’t win, or has even admitted it to himself. But the moment came when Huhne ended one of his own replies to a question by a quite detailed (and acknowledged) paraphrase of a section of Clegg’s speech. It struck me as an unusual thing to do, and the body language - at least from up on the balcony - clinched it for me.

I probably wouldn't have mentioned this if it weren't for the interesting piece that Antony Hook posted on a psychologist's take on the proceedings.

Of course the actual result may be different. But after the London hustings, for all the good qualities Chris displayed (and he is a better candidate this time around and clearly someone who can play a big role within the party), my personal view is that we would be making a big mistake if we didn’t go for Nick.

Near the beginning of this campaign, before I had made up my mind, an MP told me that we had a once in lifetime opportunity to pick Nick and realise our potential. At the time, this struck me as hyperbole. Now I think it was spot on.

But I don’t think it means that we just elect Nick and expect magic. Whoever wins this election, there is a lot of hard work ahead. The opportunities, though, are very great indeed.

"The Liberal"

Peter Welch — Fri, 23 Nov 2007 20:40:30 +0000

...it is that The Liberal isn't much good.

The latest issue seems to be an improvement though. As we don't have a leader at present (or atleast just an acting one) it doesn't waste time on telling us why he ought to resign (is there another way for Ben Ramm to get publicity?)

And there is pretty good review of Liberty: Is the future of liberalism progressive?, an IPPR book that was launched (an more or less sunk) at Harrogate. The theme of the editors is that liberalism is clapped-out and past it, and the importatn thing these days is to be progressive (which seems to mean NuLabour). Simon Kovar (for it is he) exposes much of what is wrong with the book and wraps it up like this

Today’s Liberal Democrats require above all a coherent liberal philosophical definition, and a narrative in continuity with the party’s rich and radical history. One positive aspect of this volume is that the strands of liberal thought are evident in the contributions of politicians as diverse as David Laws and Steve Webb: the nourishment of individuality, a critique of political and economic privilege and monopoly, and the fostering of liberal-democratic citizenship. Each of these strands has a social dimension, beginning with a commitment to education (a striking absentee from any collection claiming to strike new ground). Implicit in the subtitle is a question about whether the future of liberalism may be termed ‘social democratic’, or whether, at the very least, liberalism ought to concede the mantle of forward-thinking to social democracy. Is the future of liberalism progressive? No, it’s liberal.

You can read the whole article here.

Clegg and Huhne on Newsnight

Peter Welch — Tue, 20 Nov 2007 23:56:41 +0000

Chris got off to a poor start, telling us that we should vote for him because of his cv. Clegg told us what he wanted for the party. As a long time advocate of more hope and optimism in the Liberal Democrat message, I was impressed by this.

Chris then had to apologise for his dodgy dossier. He had clearly seen this one coming, and played a fairly effective routine (aided by Paxman) then using the old "break up the NHS" line to suggest that Clegg was causing confusion. However he had to concede that Clegg does not support a social insurance approach (at least I think he did).

But then - surprisingly - Huhne floundered on the economy and in responding to a question on Ming's (unfortunate) "soak the rich" remark. It was left to Clegg to produce the key point about cuts in income tax.

To the question "has there been too much immigration in the last five years" Clegg answered first: "no". Huhne then said "maybe" at some length. I thought he made some valid points, but it was hard to see what his overall point was.

Clegg then rejoined with the observation that "there are more Britons living abroad than foreigners living in Britain" and that there was no way the Liberal Democrats should be chasing the anti-immigrant vote.

This was the most interesting part of the discussion and I scored Clegg ahead on it - but I can well imagine that some will find Huhne's position more appealing.

On the inevitable coalition question undertandably neither wished to discuss terms. I thought Clegg did best in terms of listing issues and attitudes that he thought another party would have to take on board (and suggesting that no party willing to accept them existed). Personally I would deduct a mark for talking of a "a whole new style of politics" which doesn't seem to mean much to me. But Huhne failed to trouble the scorers on this one.

Do they like each other? Yes they do (or so they say).

What will stay in the casual voters mind? Well I doubt that many people have started looking for the Lib Dem website to sign up, but Clegg's message of optimism came over, reinforced by his emphasis on lower income tax for the lower paid, and his refusal to moan about immigration.

For Huhne I suspect the lasting impression will probably be his apologies for the dodgy dossier (he had to do this twice and literally put his hands up over it). He landed some sort of a blow on the NHS, but my impression was that he didn't leave voters with any clues as to why they ought to vote Liberal Democrat.

Overall I scored this a pretty clear win for Clegg - and possibly the best television exposure for the Liberal Democrats to come out of this campaign. But perhaps I am underestimating the force of negative messages.

Public Services and Leadership

Peter Welch — Tue, 20 Nov 2007 13:43:02 +0000

Clegg's speech on why he had got involved in politics – focusing on unequal health outcomes in Sheffield – was the first point at which the debate reached beyond our internal obsessions to touch the concerns of the wider electorate.

And when Huhne was forced to offer the evidence for linking Clegg to this claim

I don't go along with those Lib Dem MPs who propose American-style school vouchers or replacing the NHS with privatised health insurance.
(from Huhne's first campaign email)

all he had to say was "Well David Laws is one of your close supporters".

It was a weak point. Laws is one supporter among many (Phil Willis, Steve Webb, etc), has not been an advocate of "American style vouchers" in the past, and isn't proposing them as Education spokesman at present (his Orange Book chapter spent a great deal of time dismissing the Tory "patient´s passport" proposal). In any case, Huhne's historic views (from his time on the public services policy commission) were not far from the Laws position in the Orange Book.

In those days, Huhne wanted to see public services that were accountable to elected local bodies, but was happy to see provision of services coming from public, private, or "mutual" bodies. (Personally I always saw the "mutuals" element as a figleaf, but perhaps I am just cynical). The core of the proposals was the creation of a clear purchaser/provider split. The purchaser was to be a regional, elected body. The provider might be anyone.

David Laws took this one stage further in the proposals he floated in the Orange Book. He kept the purchaser/provider split that Huhne had backed, but also offered a choice in purchaser. Essentially every citizen could choose once a year which organisation would use their taxes to purchase their healthcare.
Just how close Huhne was to this can be seen from his 2004 article in Liberator. While restating his preference for the policy commission conclusions, Huhne wrote that

"David Laws suggests that people could opt in to a range of different providers rather like US style Health Maintenance Organisation (HMOs). Quality would be ensured by competition: if someone was dissatisfied with their HMO at the end of the year, they could switch to another.

"This is certainly a health model that a region could try out if it wanted to (and the commission stressed the importance of experimentation as a key reason for decentralising the giantist NHS)."

However Huhne was fairly dismissive of the HMOs, suggesting that their impact is limited and that insurance results in litigation costs. This is perhaps the big question about the Laws' proposals. HMOs are often seen as doing well in terms of encouraging preventive medicine (they have an incentive to keep down future health costs) and in encouraging innovation among health providers. But it is clear that the cost of disputes is an issue (at least in the US, it would be interesting to have more information on the Swiss experience).

Sadly Huhne's earlier commitment to public sector reform seems to have evaporated (see James Graham for an interesting take on this). His recipe for the public services now seems – according to his manifesto - to amount to little more than a wish for elected control. And this is nothing more than a Liberal Democrat piety. It is hard to resist the thought that Huhne has trimmed on this out of fear of upsetting that section of activists which still believe that there is nothing wrong with our public services that spending more money wouldn't put right.

Will this do?

No – and for reasons that Huhne knows full well.

If we are going to attract extra support – to become credible – voters are going to need to believe that we have proposals to improve public services. As Huhne himself has accepted, you can't push the tax take much above 40% of GDP, so there are only two ways to provide better public services: grow the economy faster than other parties, or improve the efficiency of the public sector (both is best, of course). (Improving efficiency upsets some people - but it is not about simply cutting costs. It is about providing the scope to keep services up to date).

There are only two available models for seriously improving the efficency of health services. One is to make use of a system of targets to compare performance and spread best practice. The second is to introduce some decentralised control of performance through some kind of market mechanism.

Liberal Democrats dislike the way both solutions have operated in practice – this one included.

Local control would be a good thing. But on its own it is not going to lead to more efficient services. Indeed, it might well lead to more conservative decision-making (where is the local politician who will close even those hospitals that really should be replaced?) it may very well lead to decreased efficiency. If it ever happens, expect to see it accompanied with a similar set of performance measurement to that we see in the NHS at present, or in local government, allowing Whitehall to pressure local politicians into making the unpopular decisions.

So we will need more to say on public service reform – and this is the point on which Clegg's commitment to look further at how public services are delivered is the harsh truth if we are serious about pushing for extra votes. The Clegg proposals for a pupil premium, mini-schools, and increased parental choice is a move in that direction in education (in this case accompanied by substantial extra expenditure).

Whether we have the courage to propose effective measures on health is another matter.

But the NHS would benefit from effective reform. One of the reasons so many small health units have been closing is that the NHS is addicted to large hospital schemes (the way we set up PFI schemes is part of the reason). Other European countries are much more focused on small, flexible and innovative health providers. We are probably already falling behind in ways that we won't identify until far too late – despite all the extra money Labour have pumped into the NHS. Liberal Democrats have everything to gain from an examination of all the options - and nothing to lose from having the debate.

CONSPIRACY THEORIES

Peter Welch — Thu, 08 Nov 2007 20:03:45 +0000

Perhaps it is because I have been enjoying Sunny's output for years now - and whatever party card he has or hasn't got in his pocket these days, I am pretty sure he is a liberal. And bloggers like Dave Hill are always good value too.

Is there a danger? Sure there is. The danger is that they confuse being liberal with not being a tory (as Jonathan Calder has pointed out). But there are plenty of people ready make that mistake without this site. The world is not short of liberal democrats who define themselves ideologically as simply "progressive". And I imagine that there won't be too many more just because Sunny has set up a new website.

Is there an opportunity? Reading around the articles, one of the themes is clearly "where did New Labour go wrong?". It is a good question, and one we need to answer ourselves. Our diagnosis of the ills of Britain under the Tories was not radically different from that of New Labour. What would we have done differently if we had been swept to power in 1997? Our critique of New Labour tends to be that they are control freaks, spinners, and centralists. It is fine as far as it goes, but it doesn't tell how it is that Labour have left so many out of the economic progress of the last decade, or why the small "l" liberalism of 1997 to 2001 turned into the small "c" conservatism of Brown's 2007 conference speech.

Okay, I've got views on this, you've got views on this, and we could probably agree on some of them. But watching the debate on Liberal Conspiracy might just help us sharpen our critique of New Labour. And when they work out what went wrong, my guess is that a good percentage of the particiapnts aren't going to see Labour as the vehicle for putting things right.

The War against Freedom

Rob Knight — Fri, 01 Jun 2007 10:28:25 +0100

Ban booze for under-21s

Peter Welch — Mon, 16 Apr 2007 20:46:03 +0100

That is clearly the way Jasper Gerard sees it, and in an article for the IPPR he has proposed that we should have much higher threshold for legal drinking. Russell Eagling at Centre Forum has picked up on it in his excellent news digest:

The idea was roundly dismissed in our office as I suspect it will be by most other readers. But the author, Jasper Gerrard, is not unknown to liberal circles. Indeed, he regularly bashes Labour's authoritarianism over issues such as the DNA database.

So why is an otherwise sound man putting forward this barmy idea?

In fact, Jasper provided the answer to this question in his column in the Observer yesterday.

Being no stranger to the devil's milk, I'd opposed 'booze crackdowns', despite observing the ravages of alcohol on somebody close to me. Well, if teenagers are mature enough to die for their country and bleed for the Exchequer, can you leave them gasping for a Bacardi Breezer? But then the IPPR think-tank invited me to investigate the effects of drinking on youngsters and I was forced to conclude the drinking age should rise to 21 - if only as an experiment - because we face an epidemic.

The number of medical procedures carried out by the NHS for alcohol-related conditions such as liver disease have doubled in a decade, to 262,844 a year. The number taken to A&E with alcohol-related injuries has also doubled since 1997, to 148,477 a year. This includes 8,299 under-18s, a 40 per cent increase in three years. Did you know - I certainly didn't - that 22 per cent of 11-year-olds admit they have had a drink at some point? By 13, children who abstain are in a minority. Moreover, 30 per cent of the population are bingers and 15 per cent of 16- to 24-year-olds are alcoholics.

His solution is more complex than simply raising age limets - but one of his arguemnts is "(r)estricting the drunken revels of young adults might just influence children".

I think it would be pretty hard to introduce - but a lot of people share his opinion* - and one of my personal eccentrciities is to believe that the minimum age of marriage (like the minimum age for serving in combat) should be set at 18.

Liberal Democrat policy on drinking (as far as I recall) includes support for strict application of the current age limit, requirements for drinking establishments to allow custmers to sit (stand up and you drink more) and power for local communities to close premises which disturb the peace. Should we go further?

I'm certainly tempted. But we are a nation of binge drinkers, and I am not sure that anything is going to stop that.

I used to live in Italy and my wife is Spanish, so I have a few benchmarks to judge British drinking. In Italy, I was always struck by the way that being drunk is just unacceptable in most Italian circles. In Spain, the problem of the botellon puts them nearer to our end of the spectrum. And that is not a comfortable place to be.

Changing a drinking culture is pretty tough, but Gerard is right to say that the sonseqwunces of binge drinking on health, on teenage pregnancy, and on crime and disorder are a heavy price to pay. Even the guy who served me those underage drinks back in the 1970s would agree.

One last thing, Russell described Jasper Gerard as "not unknown to liberal circles". This is something of an understatement: he is fighting a council seat in Sevenoaks for the Liberal Democrats. I hope he gets in.

*A majority would like the minimum age for drinking set at 19, with 40% saying 21 according to Peter Riddell and Populus.