He talks about hostility to bankers here. This is a sick-making syndrome. The public is in a state of hysteria about this and politiciams feed the frenzy. For the last two decades the public - and the politicians - were quite happy to see 23% of our total taxation come from a successful banking system and didn’t acknowledge that this was the source of much of our prosperity, paying for much of the welfare state.
Now the banks have hit a rough spot and, instead of nuturing a national asset, the same unsavoury coalition is busily cooking the golden goose.
And a precis of today's Prime Minister's Questions
Christina
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BLOOMBERG 11.11.09
Politicians chose to put you in this mess
Policies can make Britain's financial and social problems worse - or better, argues Irwin Stelzer.
By Irwin Stelzer
The good news is that a series of mistaken policies has brought Britain to a sorry pass. The nation's finances are a mess, with public expenditure out of control and taxes headed up from levels that already threaten to drive entrepreneurs to more tax-benign jurisdictions; the education system is producing graduates unlikely to be able to compete in a globalised economy; the financial sector is in disarray, and banker-hostility seems to dominate the policies of all political parties [see intro -cs]; immigration policy, designed by Blair & Co to remake Britain into a multicultural society, has succeeded in unleashing xenophobia; and invitations and thank-you notes had best be sent via email because the postal workers' union has decided that it is more powerful than Arthur Scargill ever was.
The reason that it is good news is that policies which produced this mess can be changed. We are not dealing with some historical inevitability, or uncontrollable tsunami that has devastated the economy, or a plague that has wiped out or debilitated a portion of the population. The policies man has wrought can be changed. [provided the bankers haven’t decamped! -cs]
We have been here before, when the Civil Service believed its policy should be to manage decline in a way that prevented social upheaval. Then came Margaret Thatcher, policy reversals, and a period of growth that New Labour inherited, only to squander its benefits. In short, it is important to look not at what is, but at what can be for Britain, given sensible policies.
Remember, the British economy is the fifth largest in the world (rankings fluctuate a bit with exchange rate changes). It is home to either the first or second most important financial sector in the world (as a native New Yorker, I like to think that Wall Street tops the City in importance), a consequence of the fact that it lies in a time zone that makes it easy to do business anywhere in the world, and that its City folk speak the language of international business.
With a few aberrations here and there, its citizens and businesses benefit from the rule of law, something upcoming rivals such as China cannot claim. It ranks second in the world in the number of top universities, and its academics and politicians have won half as many Nobel prizes as the United States, despite having a population only one fifth the size, a number that holds even if we exclude the laughable Nobel Peace Prize from the count, and confine ourselves to literature, medicine, physics and chemistry.
Even in athletics, Britain matters, despite its reputation as a gallant loser concerned not with who wins but how you played the game: the UK won more medals in the 2008 Olympics than any country except the much larger China, US and Russia.
That Britain goes through long periods in which it fails to capitalise on these and other advantages there is no doubt – one need only look at the history of the past decade. But times they are a-changin', or so it seems, whether that change comes from a dethroning of Labour or a Mandelson-led realisation by Labour that change is necessary.
The dire fiscal condition can be changed, and the public sector brought down to a size that can be afforded, managed, and still produce the services to which citizens are entitled, given the tax burden they bear. With the possible exception of the Prime Minister, there is a non-partisan consensus that once the crisis is under control, if not before, the growth in public-sector pay and ongoing inflation of the workforce must end. Not easy to do, as successive governments in your country and mine have discovered, but a lot easier to bear than a visit from the IMF or a downgrading of the sovereign debt.
The post can be delivered, if the Government adopts policies that put the public interest above that of the trade unions. When the air traffic controllers in America went on strike in defiance of President Reagan, he fired the lot – and they never again worked in the public sector. Surely, finding competent replacements for mail sorters and deliverers is somewhat easier than finding replacements for air traffic controllers.
Yes, the education system is a mess. But we know how to fix it, drawing on schemes in America and Sweden that empower parents over the Ed Ballses of the world, and that allow teachers to enforce discipline and adopt learning methods appropriate to their students' varying needs and abilities.
Yes, immigration has caused tensions, but that's because policymakers refused to realise that immigration without assimilation will give rise to dissatisfaction among native Britons, and that the skewing of the welfare system in favour of new arrivals will lead to anti-immigration sentiment. That sort of policy is not easy to reverse, but America's success at assimilating arrivals from all over the world suggests that policies that welcome those looking for a hand up rather than a handout are within the ability of man to devise.
There's more: keeping criminals in jail rather than on the streets, taxing pollution rather than work and risk-taking, among other things. All aimed at allowing British entrepreneurs and workers to use the advantages here for the taking. Decline is a policy choice, not a condition. So is prosperity.
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POLITICS HOME NEWS 11/11/09
PMQS: Brown in "parallel universe" over unemployment, says Cameron
David Cameron has accused the Prime Minister of being in a "parallel universe" on today's jobless rates, which showed a record rate of young unemployed.
Speaking during today's Prime Minister's Questions, Mr Cameron accused Gordon Brown of failing to face up to recession and the scale of the budget deficit.
"The youth unemployment rate has reached a record high in this country, almost 1 million young people, that is 1m in 5m cannot find work - the Prime Minister once promised to abolish youth unemployment does he accept that he has failed?" he said.
He added: "He has given us the deepest recession since the war the longest recession in since war and the fastest rising unemployment".
Mr Brown insisted that there were more young people in full time education and work since Labour came to power and accused the Tories of proposing nothing to help those out of work.
"Every measure has been opposed by the party opposite - they opposed our summer school leavers guarantee, they oppose the New Deal... they want abolish the New Deal entirely," he said.
"Nothing they do would make unemployment lower - it would make unemployment higher".
However Mr Cameron, producing a leaked memo which he claimed showed government plans for 10% cuts in departmental budgets, said the state of the public finances left the government in no position to help the unemployed.
"Isn't it the case that state of the public finances is so bad that this government is planning deep cuts in every department including those responsibilities for helping the unemployed?”
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