In praise of ‘anti-business snobbery’

Post for LabourList
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This afternoon, David Cameron gave a speech condemning what he called “anti-business snobbery”. This comes after months of self-pity in the business community over rescinded bonuses and the ‘responsible capitalism’ agenda.

This is likely to find a receptive audience in parts of the Labour right, many of whom have spent much of the past 18 months trudging around assorted conferences and events wearily rolling their eyes and waving uninspiring documents that urge the Labour party to match George Osborne every step of the away in his quest to be “relentlessly pro-business”.

The trouble with all this, and with the Prime Minister’s speech, is that in modern day parlance ‘pro-business’ is more often than not a proxy for the total abdication of critical faculties in the face of anyone with a bit of money.

Running through Cameron’s speech is the familiar premise that what is good for business elites and profits is always and inherently good for social progress and the economy at large. This logic has run through the approach politics has taken to economics over the past 30 years, as successive governments went weak at the knees at the sight of anyone calling themselves a ‘business leader’. The corollary is that all the state can do is remove countervailing forces to the ‘creative destruction’ of capital and just shadow it in awe – skill workers up appropriately, provide a basic safety net, and so on.

But all this is just not true. Three different phenomena that have emerged in the past ten years prove it so. Firstly, the unchecked growth and detachment of the financial sector from the real economy, leading directly to the financial crisis, deficit and drying up of credit for small businesses. Secondly, the separation between ‘wealth creation’ and wage growth, and the resulting explosion in inequality and damage to domestic demand. Thirdly, the slow polarisation of the labour market whereby middle income jobs are increasingly outsourced or replaced, leaving a bulk of low-paid, un-unionised jobs at the bottom and a tiny professional-managerial elite at the top; in short, a ‘social mobility’ ladder with the middle rungs knocked out of it. On top of all this, energy and train companies have turned their respective markets into effective cartels.

Some of this is the result of technological change it would have been hard to prevent. But much of it is a result of decades of deference to ‘business leaders’, an unshakeable faith that what is good for them is eventually good for the rest of us, and the hands-off approach to the private sector and globalisation which flows from it.

But none of the resulting damage should even come as a surprise to any progressive. It is in capitalism’s DNA to maximise profit and short-term ‘shareholder value’ by pushing down labour costs and wages. While there remains no coherent alternative to capitalism, this profit motive is regrettably necessary – but it should not be allowed to go unchecked or unquestioned. The business community is an interest group like all the rest. If we let their leading lights dictate economic policy, we’d be reducing the top rate of tax and abolishing the minimum wage. Does anyone outside of top two tax brackets think this is really the route back to prosperity?

It is the job of the CBI and their ilk to scaremonger and threaten – on the rare occasion the left has the confidence to persevere we find it is a rouse, as it was with the minimum wage in the 1990s. It’s only an outburst of ‘anti-business snobbery’ which forced Tesco to pay a wage and offer a job to the unemployed – I haven’t noticed their business model collapsing overnight. Similarly, the austerity agenda (complete with cuts in corporation tax) endorsed by our business establishment has proven a total failure.

A fair and functioning economy needs entrepreneurs, yes, but it also needs workers on decent wages with decent security and job prospects. This is a caveat we too often neglect when we fetishise ‘wealth creators’. Real wealth creation should be a collaboration. If someone wants to found the next Apple or Dyson, fine – good for them – but it is the role of the state and organised communities to ensure they pay tax, good wages and don’t try to monopolise the meaning of public good. If that makes me a snob, then sign me up.

Four reasons why 'the squeezed middle' should be at the heart of Labour's thinking

This appeared on LabourList

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Four reasons why 'the squeezed middle' should be at the heart of Labour's thinking

With the budget fast approaching, the Deputy Prime Minister’s moves on the personal allowance last week make it clear that the government is making a push to be seen to stand on the side of those on low and middle incomes. This is a demographic Ed Miliband has until now been able to make his own, and must now move quickly to reclaim.

We shouldn’t be surprised that the government confident enough for a land grab. Ed’s own approach on this subject over the past year has been a bit frustrating. He introduced the squeezed middle to our political lexicon, but that is largely where it’s remained. Beyond one speech, he hasn’t built on it or fleshed out its implications, just flung it into the odd soundbite or interview. Hence it’s become a sort of ephemeral buzzword; a phrase used to describe the world, but not change it. Neither is a “blitz of interventions” on it enough, as his aides promised. He needs to put it at the heart of everything he says and does, as the problem which ‘responsible capitalism’ seeks to solve rather than just as a point of reference.

This is not because, as some have argued, it is some buzzy catch-all phrase, but because it’s a serious economic phenomenon affecting the lives of low-to-middle income earners across the country (e.g couple earning between £12,000-30,000 per year, or a family with three kids on £20,00-48,000). The average wage has been flat in real terms since 2003. The Resolution Foundation’s recent findings highlight again that these people are now badly struggling, just about keeping their head above water – most are struggling to pay bills and are having to cut back, and inevitably feel the pain of inflation, wage freezes and cuts even more acutely.

For Labour, the faltering living standards of this group are also a real political phenomenon, spanning the whole of the country, including the South and the Midlands where the party’s greatest challenges lay. The much cited Southern Discomfort series found ‘the squeezed middle’ “hold the key to Labour’s recovery” in these areas; around halve of floating voters say they do not have enough money to make ends meet. While some move up the earnings scale, many stay put – they remain the centre of gravity on the income spectrum.

But what should all this mean in practice? A hazy appeal to these people is not enough – Ed has to put them at the forefront of his strategy, especially on the economy. They need to be at the heart of every reaction to events, every press release, every PMQs, every speech. He shouldn’t be afraid to define the group if pressed, but it would also appeal to many others who feel like they work hard, pay taxes, but get little out of it. This would open up space for a distinct and coherent alternative to the Tories, in a number of ways.

1. A simple argument on the economy which resonates.

The fact is, most people are broke. Stagnating wages play a big role in explaining this, and are a significant underlying weakness in the economy (as Bill Martin and others have argued) – they have left consumer confidence perilously low, with obvious knock on effects for productivity and employment. Miliband should point out that the Tories’ economic approach is failing because the scale of their austerity measures take yet more money out of ordinary people’s pocket – the very people who drive the economy – for instance the VAT rise, cuts to child benefits and tax credits. This shifts the focus of the economic conversation away supply-side fetishism and on to what we have – a demand crisis.

2. Bold, short-term policies which also address the party’s economic credibility.

Shockingly, most polling shows the views of ordinary voters are not the same as Westminster insiders. Most are not besotted with deficit reduction time-tables (hence ‘too far, too fast’ polls well in abstract) they just don’t trust the Labour party with their money, unfair as it may be. It’s this which the Tories have exploited to push their message as the only credible approach. But there are more progressive ways of neutralising this issue. Labour should advocate a cut to the bottom rate of income tax as a means to stimulate the economy. This must be costed; so Ed should suggest partially doing so through increasing the top rate of tax by the same basic amount (e.g 2p on the top for 2p off the bottom) – then challenge the Tories to oppose it. A more vocal campaign for a living wage should be his next step, as a means of making work pay. This, on top of Labour’s other work challenging train and energy companies, would hammer home the message that the party’s economic priority is the back-pockets of ordinary people, not the wealthy elite. This is the surest route back to economic trust, not trying to out-posture the Tories on cuts.

3. Some coherence on cuts

If Ed wants to stick to his underlying position on cuts, there needs to be more logic to those he supports and those he doesn’t. Putting those on low-to-middle incomes at the heart of Labour’s thinking would mean opposing those cuts which most directly add to the squeeze on these families (for instance child benefits, housing benefits and tax credits) while supporting them in areas where they have the least impact on this group and thus on demand (for example, International Development or Defence). This doesn’t obviate the need for touch choices, but protecting living standards should replace the more scatter gun approach adopted thus far.

4. Long term vision (which goes beyond just spending)

The squeezed middle also lends itself to a long-term argument for the run up to the next election. At the heart of the this pithy phrase lies the failure of an entire economic model. Even when the economy was booming in 2003-2004, growth had stopped translating into wage gains for many ordinary people. They were working harder, but gaining less. The benefits were increasingly skewed towards the top: while the share of GDP going to low-to-middle income earners steadily declined over the last 30 years, it soared among the top 10 and 1%. For all the growth in the last eight years and in the next eight (if any), average real disposable household income will likely stay around the same. Neither is growth in new industries or technologies per se bound to aid employment – well paid working class and lower middle class jobs have steadily been sucked out of Anglo-Saxon economies (as the story of the iPhone in the US illustrates), replaced by more insecure, lower paid work. It is to this backdrop, to fill the gaps and make ends meet, that many have borrowed up to their eye-balls.

This is the most significant long-term trend occurring in theUKtoday. Finance-led growth, the decline of trade unions, and a hands-off, self-regulatory approach to the market and globalisation have all played a major part in getting us here. For a generation, all of this – the dominance of big money, inequality and excess at the top – has been sold with the promise that the benefits will ‘trickle down’. Now, for the heart of our working population, that trickle has dried up. Livelihoods and the economy at large are being now undermined. New Labour’s more redistributive measures mitigated the effect of this, but never re-shaped it. A return to the old growth, in the long-term, won’t be enough. The system is broken, and there’s an obvious need to re-think the entire way we do capitalism in this country.

Unlike other party leaders, Ed at least gets this, and has a critique of modern capitalism which accounts for it. His ‘responsible capitalism’ agenda is a good start, but he needs to state the problem more clearly: it is not an abstract issue of morality, or heart over head, but efficiency, real jobs and building an economy which serves everybody. Neither does this have to all be about spending – to the vogue question, ‘What is Labour about when there’s no money?’, pre-distribution should be the answer – getting up stream to better shape economic outcomes. Greater economic organisation in the workplace, a more active state ‘picking winners’, the separation of casino and high-street finance, national and regional investment banks, the protection of industry from predatory takeovers, new procurement rules, measures to deter outsourcing, and much more all have a role play a role.

But no space for any of this can really exist unless the broader trend it seeks to address is more widely known and prioritised. Inconsistency, not ideology, has long been Labour leader’s biggest problem – picking themes up, making a speech, then not building on it. He has done well to redress that over ‘responsible capitalism’ and bankers bonuses, but he now urgently needs to build that within a bigger argument about living standards, and hammer away at it day after day. For Labour, the way to the British people’s hearts is through their wallets.

Review: The Purple Book and Tangled Up in Blue

Shorter version of this is on the Fabian's Next Left blog

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Any willing provider? Labour's new anti-state chic. A review of the Purple Book andTangled Up In Blue

The Purple Book: A Progressive Future for Labour, Robert Philpot (ed), Biteback, 2011.
Tangled Up In Blue: Blue Labour and the Battle of Labour's soul, Rowena Davis, Ruskin, 2011.

Perhaps the most striking thing about the years following the economic collapse of 2008 was the absence of new ideas on the democratic left. Labour's election defeat confirmed for most that something had gone awry with modern social democracy. Most agreed that approaches to state and market had been ill struck, and that the economy had become too dependent on the City. But these axioms never gave birth to much in the way of renewal. All the while the Tories were stitching together their own story, re-casting the crisis as one of overspending and inefficiency, co-opting Britain's other allegedly centre-left party along the way.

It's amid this impasse in 2011 that Labour's multi-coloured insurgencies have emerged, offering their own readings of the past, present and future. Chief among them have been the Purple Book, organised by Progress, and Blue Labour, lead by Maurice Glasman but resuscitated from his misdemeanours here by Rowena Davis. Although many Progress members may now balk at the suggestion, the two actually started life closer than is often recognised. A number of the Purple Book's contributors and cheerleaders (e.g Caroline Flint, Tessa Jowell, Philip Collins) were involved in the first wave of seminars and publicity that gave rise to Blue Labour. They've since sensibly gone their own separate ways, but retain their shared starting point that the root of Labour's woes lay in becoming too centralist and remote; “administrative, elitist and technocratic”, as Davis puts it. Both claim to be interested in returning to Labour's decentralising tradition, and both eschew 'big state' Fabianism, top-down universalism and public spending as the solution to all of societies' ills.

As befits its organisers, The Purple Book approaches this argument in a considerably more slick, metropolitan way. At its best, it is far more thoughtful, practical and self-aware than many of its critics have given it credit for. It hangs together in a way few anthologies do, and is more astutely conscious of itself as an electoral strategy than its rivals. There are plenty of interesting ideas on the value of co-operatives as a means of spreading social control over public services (Caroline Flint, Steve Reed and Paul Brant's sections on housing are surprisingly engaging) and on revenue-raising at a local level.

The trouble with it is, at times, it feels like a new language is being adopted to advance a familiar agenda, which is essentially one of marketisation. The passage on public services that Paul Richards approvingly quotes from Blair's memoirs is interesting in this respect:

“...we have fashioned a template for reform: changing the monolithic nature of the service; introducing competition; blurring the distinctions between public and private....and in general trying to free the system up, letting it innovate, differentiate, breathe and stretch its limbs.”

Richards adds the only problem with this approach is it didn't consider social ownership in the mix. But he never really explores whether Co-ops should be prioritised above private providers, for instance, just that services should be removed from monolithic central state control. This ambivalence is made explicit by Alan Milburn who, on education, says:

“There need be no single model. There could be academies or trusts, parent-owned or community controlled, run by social enterprises formed by teachers or by chains run by voluntary, or for that matter, private sector bodies.”

The impression gained through the book is not of a central state endowing local communities, but of diversification and the state “letting go” as an end in itself. All this is fine if one believes in it, but it's difficult to know how it differs from the current government's 'any willing provider' approach to healthcare. Co-ops are in the mix and are to be encouraged, sure, but what of the potential for conflict between different providers? Surely a Co-Op couldn't hope to compete with private providers in terms of outcomes; does the state inherently privilege Co-Ops in the contracting process to balance this out? What are the rules applied when opening services to tender? What if no local group – or demand for co-operative control - emerges? None of these questions are ever really explored satisfactory, apparently lost to the contributors' reforming zeal.

A similar frustration stalks you as you read the books' sections on political economy. Tristram Hunt's contribution is fantastic, by far and away the best of the bunch. It wisely focuses on 'pre-distribution' and the need for the state - in smart, considered ways - to get 'up stream' and shape a more equitable distribution of the benefits of growth, as opposed to simply redistributing through the tax system. But this more bold, hands-on approach with the market is never matched or built on elsewhere. The living wage, pay multiples, greater democratic organisation in the workplace, regional or national investment banks - all are examples of small, fairly inexpensive things that can be done to achieve the more balanced economy the book talks of, but nothing like it is ever touched on. Instead we get a few nods to more “strategic” industrial activism from Peter Mandelson, but what this means is left fairly vague. Would it mean, for instance, protecting local communities from predatory takeovers of local industries such as Kraft's of Cadbury's?

Throughout there is often simply an unwillingness to leave well-worn comfort zones and suggest anything that might appear 'anti-business' or 'old Labour'. Instead the book frequently retreats into public service reform, or constitutional issues, as if the past 5 years hasn't happened. At the end of the book, editor Robert Philpot lists its recommendations – there are around 10 pages on reforming the state, and just 1 on reforming the market. But what the UK has seen is surely not a failure of the big state, but the market – or at least, the state's relationship with it. How else to understand the financial crisis, or the de-coupling of growth from wages?

In short, it's not that 'leaving the big state behind' (the books' promotional strapline) feels like the wrong prescription for the UK's problems – it's that it's the wrong diagnosis. When Patrick Diamond argues that “social democrats need to acknowledge that state intervention has left a multitude of social and economic ills untouched”, he writes as if we've just experienced 30 years of post-war Keynsianism. Nor did Labour lose because it was too statist. Philpot triumphantly reveals 1 in 4 of Labour's lost voters saw 'government as part of the problem not the solution' – but what of the other 4 in 5? Nobodies arguing there's a thirst for a Soviet-style command economy, but there is room for a positive case to be made for the state in the market, actively shaping it not least so that it puts money in the pockets of ordinary, hard-working people. A brash anti-statism simply neglects the challenges of our time.

A similar misreading pops up through the Blue Labour story, as documented in intimate and intelligent – if at times slightly breathless – fashion by Rowena Davis. It holds at its heart the mantra that “relationships are transformative”; that organising local communities is the best means by which to achieve social change. But instead, to Glasman, Davis writes, “the modern Labour party...seemed obsessed with expanding the state”. This would be fine were it just a piece of posturing, but it leads Glasman to sweeping statements (“the model that we had in 1945 of universal state based [provision]... lead to massive erosion of solidarity”) which can in turn beget frustratingly rigid policy conclusions.

Take Sure Start centres. Blue Labour, says Davis, wouldn't open more of them, because it believes they've become “a means of...free childcare” while both parents are at work, not of promoting relationships. Instead, Glasman wants the state to facilitate neighbours taking turns to look after each others kids. But Sure Start centres more often serve as a space where parents interact with and help other parents, picking up tips or sharing support as well as receiving it from staff. They foster exactly the sort of relationships that Blue Labour values in a more effective manner than ad hoc approaches. The idea that universal state services are always an anathema to social solidarity is simply false – as the public support the BBC or the NHS further shows.

This belligerence denies a more important, complicated conversation about when, where and how state services get it right in promoting relationship, and how they can change to get it right more often, rather than just cease. Here Davis tellingly notes that traditional social democrats were the only under-represented sections of the Labour party during Blue Labour's formative seminars - Sunder Katwala couldn't make it, and no Brownites were involved. It's difficult not to conclude that greater dialogue with the schools of thought Blue Labour sets up such antagonism to (particularly Fabianism) could give more nuance, and less divisiveness, to its conflict with 1945.

Yet there remains much to engage with about Blue Labour, and Davis convincingly argues that it has been received rather lazily by parts of the media (the reaction to Glasman's recent intervention serves as a case in point). Unlike both the Purple Book, and Philip Blond's Red Toryism, Blue Labour is rooted in a powerful critique of free markets, seeking to organise communities “against the dominance of capital”, on their high street and their workplace. This lends itself to plenty of thought provoking policy prescriptions. It has cogent ideas, for instance, on shifting the UK towards a more skills based economy, and its ‘a third, a third, a third’ model of public services (wherein, for example, a school would be run equally by the state, parents and staff) avoids a lot of the ambivalences of the Purple Book.

It’s also no surprise to learn from Tangled Up In Blue that Glasman wrote probably the two most rich and evocative Labour speeches of recent years - Gordon Brown at Citizens UK and David Miliband’s Keir Hardie lecture, both among the best either have given. There’s a certain magic and humanity to the Blue Labour language, of organising and action, that transcends the Think Tank generated jargon of our time. So much so in fact that its advocates occasionally slip by you a slight (and sad) exaggeration of the appetite among the public for getting involved in local decision making, something common to the Purple Book too. Oscar Wilde, afterall, famously said “the trouble with socialism is it takes too many evenings”, and Davis does in turn seem to over-state the influence of both Cameron’s ‘Big Society’ and Brown’s Citizens UK speech had on the electorate.

Nevertheless, it's imperative that Fabians engage with the strength and weaknesses of these two books. Social democrats shouldn’t allow ourselves to be boxed in as reflexive defenders of the state. Not even the most ardent among us can deny that occasionally government ends up feeling top-down and transactive, or that services need to be shaped by those running and receiving them. Neither should we dismiss the power and energy of community activism as only to be harnessed for winning election campaigns; sometimes you need to govern in poetry, too. But there is an urgent need to push back against the bogeyman-esque depiction of the state that at times animates Purple Book and Blue Labour thinking. We need to articulate a vision of the state that's not in opposition to organised communities, but in constant partnership with them, providing a bulwark against the dominance of capital and the dysfunction and alienation which accompanies free market capitalism. How’s that for a New Years resolution?

Christopher Hitchens: a tribute

(Also on LeftCentral)

“More Bosnia, less Iraq”. So went a text sent by Christopher Hitchens, who died from cancer last week, to Stephen Fry in late November. Fry was orchestrating a make-shift discussion at the Royal Festival Hall with Hitchens’ more famous friends on his ‘loves and hates’, with Hitch himself following online after falling too ill to participate. As George Eaton noted, at an event which already eerily felt like the dry run of a funeral service, it seemed like Hitchens was trying to edit the first draft of his own obituary.

Alas, to no avail, it would appear from reading much of the reaction since Friday. But if it’s fitting that Hitchens died in the same week as the Iraq war came to a formal end, then it’s no less so that he went in the same week as Vaclav Haval, the great Czech dissident who authored his countries’ overthrow of Communism. For whatever one thinks of his position on Iraq (and I disagree with it), Hitchens leant his vociferous support for the war with the same logic as he did to Haval and intervention in Bosnia, and it must be reckoned with on that basis.

Indeed as is often the case, what made Hitchens such a great writer was the same as that which made him such a great thinker. That is, pure moral clarity. He was an absolutist, to the point of utopianism, about totalitarianism and tyranny. He approached all debates from this perspective alone. No excuses or equivocations, no relativism or self-doubt – and it showed in the beautifully sure flow of his writing and argument. He never wasted a word. He was funny. And above all else, he loved the fight. Watching him marshal his points in a debate, duck and weave, taunt and torment his hapless opponent, was like watching Mohammed Ali at his pomp.

Yet he rarely appeared shrill or just provocative, because his brand of Manichianism came supported by a formidable grasp of human history, culture and politics. He could reach deep into the annuls of literature or history and pull out an obscure reference or anecdote that would light up his argument, often instantly putting his opponent on the wrong side of the debate. He has many impersonators who mimic his style, but who without the substance show themselves up as pointless provocateurs, usually in slave to some private-school boy prejudice or other (see Douglas Murray, James Delinhpole, Oliver Kamm; perhaps even Martin Amis, for anyone who’s read The Second Plane).

Certainly, he was no more infallible than the rest of us. His rhetoric could slip into saloon-bar boorishness, and he often took too much pride in disregarding the full policy implications of the positions he would take (“I rather tended to assume that things of [the] more practical sort were being taken care of”). But we desperately need writers like Christopher Hitchens: rootless, belligerent, informed idealists. Authors who can file a well-researched despatch on some obscure going-on from around the world, but beautifully locate its place within the broader battles of human good against evil. People who see, as Haval put it, “politics as morality in practice.”

Even when you disagree with Hitchens, writers of his ilk make you work like no other, in your own mind, to justify it. They hold our feet to the fire, shaking us from the comfort of our certainties, stopping us from getting so mired in nuance, ‘contextual’ or ‘structural’ explanations – so blinded by our own predilections – that we excuse and euphemise crimes visited upon those we should call friends.

It’s this which defined his split with many leftists, one which opened up long before Iraq. Hitchens consistently skewered those who too often couldn’t get out from under their own ‘anti-imperialism’ and ‘anti-racism’ to show solidarity with victims of regimes and ideologies hitherto understood only as virtuous bulwarks against Western hegemony. In order to patch up the resulting tears in their neat worldviews, some on the left consistently proved willing to trash as ‘stooges’ dissidents who fell out with the wrong people. From the anti-Soviet intellectuals in Eastern Europe, Rushdie, the Bosnian Muslims and Kosovo Albanians, all the way up to Aayan Hirsi Ali – Hitchens was at his best when agitating on their behalf, reminding us that sometimes “The very first step that we must take is the acquisition of enough self-respect and self-confidence to say that we have met an enemy and that he is not us, but someone else.”

Hitchens kept the Trotskyite stridency of his youth but – amid the evaporation of the Soviet Union – stripped out the materialism and replaced it with culture, namely the ‘clash of civilisations’ thesis. Writing of his reaction to September 11^th, he said: “It was exhilaration…. Here was a direct, unmistakable confrontation between everything I loved and everything I hated. On one side, the ethics of the multicultural, the secular, the skeptical, and the cosmopolitan…On the other, the arid monochrome of dull and vicious theocratic fascism. I am prepared for this war to go on for a very long time. I will never become tired of waging it, because it is a fight over essentials. And because it is so interesting.”

If his principled support of abandoned dissidents proved the worth of this framing – of seeing “politics as morality in practice” – then ultimately Iraq seemed to show the pitfalls. Perhaps coagulated in the furnace of debate around the war, his stridency was re-cast into dogma as he ended up equating support for Kurds and Iraqi trade unionists with support for the Bush administration’s misadventure. More than this, he came to see the conflict as a continuation of the interventions of the 1990s, filtering out their substantive differences – not least who was undertaking it, and for what reasons. So in thrall with the romanticism of the fight against Saddam, he neglected the complex, real-world politics of sectarianism and tribalism which were to engulf post-invasion Iraq.

One final consequence worth noting of Hitchens’ journey from materialism was his almost complete absence, in his later years, from the debate over economic and social questions. What did he think of the downfall of Lehman Brothers? Of the sub-prime mortgage boon? Of Greece? Or even the healthcare debate in the U.S? Here we missed his voice, but like many a 68′er who had accepted ‘the end of history’, he had rather left behind the tools with which to make sense of the tumult in modern capitalism.

Nevertheless, for most of his life, Hitchens helped define a generation of political debate. There was, you might say, something of the Arthur Koestler about him. On the surface he could appear a dilettante, bumping from cause to cause, fight to fight, exchanging various visions of utopia along the way. Ultimately he was more substantive than Koestler, and a better writer. Like him, however, Hitchens’ journey and the mosaic of arguments he had with himself and others comes together to tell the story of our time. Over the fall of the Soviet Union, liberal interventionism, 9/11, Iraq, Islamic extremism and religion. His famous head-to-head in New York with George Galloway in 2005 is etched on the mind of an entire flock of young people who came of political consciousness around the time of the ‘war on terror’.

Hitchens didn’t just take part in the battle of ideas; he was defined by it. He was there, he lived it; helped shape it. That is the essence of a true public intellectual, and it’s a struggle to think of a writer alive who can hope to match up to his importance. We will feel the weight of his absence for a long time to come.

‘The Sports Direct Arena’ is a symptom of a sick game

Also on LabourList

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The news isn’t going short on stories to shock or depress us at the moment, so you’d be forgiven for letting the re-naming of a football stadium slip your attention. But the announcement that Newcastle United’s St James Park is to be re-christened ‘The Sports Direct Arena’ should alarm even those who don’t like football. It tells us a lot about what the game has become, and by extension a bit about the country we live in too.

The move, undertaken by owner Mike Ashley to “showcase” sponsorship opportunities, is so offensive because it flies in the face of everything the game is supposed to be. Clubs have always drawn support from afar, but most have their roots in local, often working class, communities. A football club is a focal point of a town or city; match day throws together in common interest people who have never met or have nothing else in common as well as old friends and family. A lot of father-son relationships have some of their formative moments at football games.

At heart football is about collectivism – us against them – and relationships. A football stadium is a public space. Its name is obviously a part of that – it’s a common reference point throughout generations, usually synonymous with local history or geography. Corporate sponsorship of new stadiums is bad enough, but what Ashley has done is the outright commodification of 120 years of history, and of something that by right belongs to Newcastle and Newcastle United supporters.

Unfortunately, it hardly comes as a surprise. Like much of our economy as a whole, the Premier League is increasingly dominated by business and governance models that privilege rampant maximisation of short-term profit at the expense of everything else. Hence the cold, unfeeling language NUFC used to justify the sell off to horrified fans: the old name was “commercially unattractive”, adding with a note of optimism that re-branding “presents would-be sponsors with the opportunity to acquire both the naming rights and shirt sponsorship deals”.

This way of running football inevitably leads to a shriveled view of supporters as just spectators: atomised, passive consumers whose loyalty to the brand is to be squeezed through price hikes, dodgy cup ticket schemes and the like. And increasingly this just goes towards servicing debts, or ends up in the owners’ pocket.

As a result, many top level football clubs have become detached from their support base and cut off from their community. Working class communities surrounding most grounds still exist, but are frequently priced out. Others are put off by sanitisation: the proliferation of reserved corporate tickets, boxes, the banning of drinking on terraces and the refusal to consider safe standing. All this exists in the name of ‘enhancing spectator experience’, but all limit atmosphere, participation and togetherness. To be fair, lots of football clubs do some good work in the community, but it feels more like corporate social responsibility. It doesn’t run through their ethic.

It doesn’t have to be this way. Just as it’s a false choice to say we can only have Britain’s current model of capitalism or Soviet-style central planning, so too it’s disingenuous to present the only alternative to football today as a return to the violent, rickety old terraces of the 1980s. Fans need to be better integrated within the running of clubs to act as bulwarks against the dominance of business interest. At the very least every club should have a supporter’s representative on the board, as the 2009APPFG recommended. But the long term vision should be to transform football governance entirely, ensuring majority fan ownership.

In Germany, at least 51% of every club is owned by supporters, while strict financial rules limit spending and wages to a proportion of turnover. This helps keep ticket prices down – a Bundesliga season ticket is 25% of what it costs here – discourages financial recklessness and predatory takeovers, and creates a more genuine match day experience (including safe terracing). It’s not a panacea, nor does it not always prevent over-commercialisation. But it does ensure democratic control and accountability. If 51% of Newcastle United had been owned by the fans, would the Sports Direct Arena ever have come into being?

While Labour’s creation of Supporters Direct in 2000 to support fan ownership was a good move, it remains under resourced and unsupported by the necessary wider governance. Supporter run clubs are confined to the lower leagues. Labour has widely swung behind democratic forms of ownership within public services and business. So why not extend it to the top levels of sport, and vocally back a wholesale transformation of the way we do football in this country?

None of this has to lead to deterioration of the game on-the-pitch. The current Barcelona team is one of the greatest of all time, and is supporter controlled. 7 of the last 17 Champions League winners have been fan run. There is nothing inherently wrong with there being big money in the game. That is very difficult to stop. The trouble is our footballing economy reflects our political economy. Huge amounts of capital fly into the game without the structures, organisation or regulations to prevent its domination of everything.

This can’t be solved by laws or regulation alone. Fans also need to be more organised and involved, beyond just demanding billionaire tycoons take over their club every time they get beat (Manchester United’s ‘Green and Gold’/MUST model is a good place to start). But politics can do its bit too.

I love Football, it’s bloody great. Walk from neighborhood to neighborhood in almost any city in the world and everything will change around you, but the one constant will be football – on the streets, in the parks, in the pubs. Those on the left should never underestimate it as a force for good, and its capacity for healing division and alienation. But while fans may spend an unhealthy amount of time thinking about football, football doesn’t spend enough time thinking about them. It’s an increasingly unrequited love affair, as the Sports Direct Arena shows, because Football has become so up-rooted from the ethos and communities it was set up to serve. We need to bring it home again.

A quick post on Ed Miliband's £6k fees proposal

There is a lot of bewildering gubbins going around about Miliband's pledge to cap tuition fees at £6k instead of £9k. I can't say I'm any great fan of the idea. He could have gone a lot further (to say, £3-4k) if he'd simply said he'd limit or reverse cuts to HEFCE's budget, which is what gave rise to £9k fees in the first place - instead, his proposals work within those cuts (I assume because he didn't want to be dragged into an argument on deficit reduction).

In any event, that doesn't stop me from scratching my head at some of the accusations being levelled at the proposals. Chief among them is that they only benefit the very rich. To my knowledge this argument first made by Graeme Strachan Cowie, and was later taken up by Stephen Tall. It has since proved very popular among journalists and Lib Dems in the Twittersphere.

Roughly it seems to go like this, deep breath now:

Student A and student B are graduating from University. Student A earns a starting salary of £25k, rising to £140k after 30 years - the point at which the debt is wiped. Student B has a starting salary of £50k, rising to £200k after 30 years (my guess is the number of people this applies to is negligible, but it's the example of a high earner given by the author, so fine). Under £9k pa fees system, the total sum of money owed at the end is such that, because of the way repayments are structured, student A will never repay it all before the 30 year wipe-out point. However, student B will earn enough to pay all of his total debt back before the 30 year limit kicks in. Therefore, high earning student B will ultimately end up paying more back to the Treasury than lower earning Student A, who will hit the 30 year brick wall (It's in this rather dog-eared, round-about way that people argue the new system is akin to a graduate tax).

Cutting fees to £6k, however, does not reduce the overall amount owed enough to stop Student A from hitting the 30 year limit at the same amount paid as under £9k - £24,940, using the MoneySavingExpert calculator. High earning student B, however, still pays it off before 30 years (as with 9k) but this time he pays less in sum to the Treasury because he owes less. So...in this way, Miliband's proposals are just a cut for the richest. Goddit?

Except I may be missing something, but this argument strikes me as completely missing the point.

Firstly, it is a total red herring anyway to look at the absolute amount paid. Under either £6k or £9k, low earners will be saddled with fees deductions from their payslips for the bulk of their working life, while the highest earners may be free of them in 15 years, for instance. For this reason, the system is not the same as a graduate tax. The fact that most will hit the 30 year limit is not a sign of how progressive the system is, it is a testament to how unaffordable the total amounts are for most people under any kind of reasonable repayment system.

Secondly, and most importantly, the internal logic of the argument is barmy. If followed through it can only lead, somehow, to the strange Orwellian position where members of a party who used to oppose all fees end up arguing that the higher the fee, the more progressive. Afterall, given repayment rates are linked to salary rather than the amount owed, and apparently it's the absolute amount paid back by different earners that matters to Graeme, why stop at £9k per year fees? Why not raise them to £10k, £12k, £18k, for instance? That way, lower earners (student A above) will hit the 30 year limit at the same amount paid, but top earners (student B) will end up paying even more in absolute terms to the Treasury. I'm sure Universities would welcome the investment, too!

The answer is, or should be, because fees that high will likely deter people from applying to University in the first place. And that's my point: Graeme's entire argument is the definition of looking down the wrong end of the telescope. It is based on the faulty pre-supposition that "...the headline figure [of debt] is of zero relevance to the majority of graduates, for whom repayment matters". Most research shows this is rubbish, especially when it comes to kids from working class backgrounds.

Whatever way those defending the Coalition's changes spin it and blame the NUS/Labour (delete as applicable) for confusing prospective students, the headline fee of money owed will always matter under a loan system. People will always be able to tot it up beforehand, and they will always consider it debt - even if the repayment system is structured differently. The scale of the sum will always be weighed up against the perceived benefits - and indeed the Government's whole marketised language around fees being an 'investment' encourages this. The higher the fee, the more working class parents will likely come down on the side of discouraging their kids from going to University - especially those more prone to ambivalence because there is no family history of individuals going to University, which is a lot of them.

To my mind a proper graduate tax (with lots of caveats and strings attached which I won't go on about now) is the only way to avoid or limit this, outside of funding HE entirely through general taxation. But unlike Graeme's post, Miliband's proposals are based on the right assumption - that headline amounts matter in terms of attracting students, and cutting it is therefore a slight improvement on the Coalition's plans if ultimately unambitious, and a retreat from his previous position.

As for many of the others citing Graeme's post approvingly, burying their head in such minutiae seems like just the latest attempt to avoid seeing the wider picture, and the horrific Tory cuts that form its backdrop.

Labour's 50p test

Little blog I wrote during the week but forgot to put up! Also on Labour List.
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Labour's 50p test

Rarely have two-a-half pages of A4 attracted as much vitriol as Shaun Woodwards recently leaked memo. ‘Naïve’ and ‘suicidal’ were two of the nicer things said of Woodward, who suggested Labour could make headway in arguing that the Conservatives have abandoned the centre ground in favour of “major strides back towards their ideological roots”. But what if, on one issue at least, he has a point?

This week's letter to the FT from economists calling for a cut in the top rate of tax has not come out of nowhere. Pick up almost any edition of the Evening Standard or Times this summer and briefed across nearly every dispatch from Westminster you'll see George Osborne laying the ground for scrapping the 50p rate. 'It raises no money', 'it's anti-growth' and 'it drives away business' have lead the way in terms of Treasury explanations so far.

As ever, though, the Chancellor's main motive is probably political – he thinks that it'll divide the Labour party, and unfortunately he may be right. Ever since its introduction, the 50p tax has been a shibboleth for some of those on the right of the party agitating that Labour are positioning themselves as too left wing or ‘anti-aspiration’. In the last 10 months alone, Alan Johnson has gone renegade and said it should be scrapped, while Blair himself made his opposition clear. Then there’s ‘friends’ of David Miliband who, at the height of uncertainty of his brother’s leadership in Spring, helpfully whispered to the Mail: “David thinks taxes are too high. He would have pledged to repeal the 50 pence top rate of tax. He opposes the top rate tax because it sends out all the wrong signals to the business community.”

But on this issue the Tories, and those who would wish to ape them, are way out of step with the public. Poll after poll show voters of all stripes vehemently against cutting tax for the top 1%. YouGov found that 59% of people oppose the move, with even 50% of Conservative voters against it (23% strongly). 57% told ComRes that abolishing the 50p rate would show we’re not “all in this together”. This is hardly surprising. Those who think the 50p tax is ‘anti-aspiration’ simply haven’t grasped how our politics have changed in the last fifteen years. Not only are people now feeling squeezed by stagnating wages, government cuts and tax rises, but the hugely disproportionate gains made by the most wealthy have left a huge gulf between the middle and the top. Most voters can not even countenance earning over £150,000 a year.

Notwithstanding the moral case against cutting the 50p rate in times like these, the economic arguments for abolishing it are entirely without foundation. There is not a jot of evidence in today’s FT letter to support accusations that the rate is deterring investment. It is all supposition. In fact, as Touchstone have argued, all attempts thus far by the right to argue the 50p tax drives away business have been based on flimsy surveys and outdated assumptions. As for the amount it raises, current Treasury estimates (being reviewed by HMRC at the Chancellor’s behest) suggest the top rate will bring in £12.6bn. That not an irrelevant sum of money. In fact the true figure may even be higher than the estimates, based as they are on old Treasury models. Duncan Weldon has also argued that there are grounds to believe the rate was behind the 18% increase in tax revenue in January from the year before.

One of the main reasons growth is flat is because consumer confidence has gone down the toilet since last year. And it's the government's austerity rhetoric, combined with underlying wage stagnation, that has driven it there, with cuts compounding the misery. The idea that the solution to our ills is to shovel more money in the direction of the rich is zombie economics. It’s a policy without any grounding, far to the right of where the British people are, based on outdated Westminster parlor games and failed neoliberal dogma. And it’s imperative that all those on the centre-left say so with one voice.

There will be some on the Labour side who will worry that the public will only hear a ‘tax cutting’ message from the Tories, regardless of the details. But if Labour sticks united to its message in opposing this move then it will help entrench public feeling that this is a tax cut for the richest at a time when everyone else is hurting. It will call the Tories bluff and leave them standing as the party whose first priority is to cut at the top to the detriment of everybody else, exposing them as something much of the public have always suspected: the party of privilege. From there, Labour could shift the debate towards relieving the tax burden on those on low and middle incomes. But all this requires cohesion and unity, from all ranks of the party – no jittery dogwhistle politics or off the record briefings.

Labour did this effectively before the last election on Tory proposals to raise the inheritance tax threshold. In putting aside misplaced anxiety about being seen to wage ‘class war’ and facing the Tories down on the policy, they successfully turned it from an idea they were initially too afraid to do anything but mimic into a commitment Cameron couldn't spend enough time running away from.

Above all, then, the 50p debate is a test for Ed Miliband. As it stands the Lib Dems will likely waive the cut through in exchange for concessions elsewhere, leaving the Tories with a free run at imposing what would be one of the most unjust economic moves of modern times. If Miliband believes the 50p rate should stay and that it should be permanent, he should have the courage to say so: firmly, loudly and consistently, facing down all those in his party who state otherwise. If he really believes it’s a “matter of fairness”, he should hold it up as one and run with it. No half measures.

Unfortunately, his first PMQs after the summer break was not promising – the Labour leader could easily have raised poor growth and pointed out that the Tories only solution is a tax cut for Britain’s wealthiest 350,000 people. He could have exploited coalition tensions on the issue. Instead, he ducked it. Miliband and the people around him have made a point of telling everyone that the party can help shape the ‘new centre ground’ which New Labour ignored; his aides are constantly briefing journalists that he admires ‘The Spirit Level’ and such like. But words alone are not enough – on the 50p rate, he urgently needs to match them with action.