Wednesday, November 19, 2008

Jacqui Smith's Cunning Plan

Some of my Lib Dem Blogs colleagues have been unaccountably sniffy about Jacqui Smith's brilliantly clear and incisive analysis of the situation we have with sex trafficking and prostitution. Personally, I think it's brilliantly sensible, makes absolute sense, and the same strain of thought should be rolled out more widely to solve other problems.

For instance, sweat shops. We all know that the people who are buying garments cheaply from chain stores, without knowing that they haven't been manufactured by child labourers or otherwise exploited workers, are partly morally culpable, so why don't we make it illegal for them to buy these garments? Ignorance of the consequences of their actions is no excuse, and we can all agree that this is a stain on the conscience of our society, and action must be taken, etc.

Of course, the business lobby will suggest this will "unfairly" punish customers who buy many "legitimate products", by simply putting them off buying any products at all. But I think anyone with any sense will recognise that this is a sensible direction to go in. I mean, yes it's a shame to have an adverse effect on the livelihood of people in good, legal jobs on a living wage, but we shouldn't let that get in the way of cracking down on this great social evil. So lets bang up anyone who buys a cheap item of clothing that turns out to have been made by an eleven year old!

Phew, I'm not sure I could have kept that up much longer. I don't know how Labour ministers do it.

Seriously, is there anyone who can explain to me what the thinking on this policy is? Can you, dear reader, think of a single other instance where the same thinking would make much sense whatsoever? I can't. I mean, if people are being exploited, surely the thing to make illegal is the exploitation, and the best way to enforce that is to make said industry as transparent and open as possible, so that it can be suitably regulated and investigated. No?

Jacqui Smith should just be honest, and say that she doesn't like prostitution, and she wants to ban it. I mean, that's the only way this makes sense, because as an attempt to tackle trafficking it's fucking bonkers. But she's frightened of being honest, because she knows she'd lose the argument: it's the world's oldest profession and she'd just drive it further underground, etc. Instead, she fudges a policy together that achieves actually fuck all, is probably worse than either an outright ban or a destigmatisation and legalisation, but which allows her to muddy the political water on this just enough to get away with not doing anything that might be perceived as bold.

Tuesday, November 11, 2008

Cameron Tries To "Nudge" His Way Out Of Recession

The Tories have announced a plan today to give companies National Insurance breaks on employing people who have been unemployed for over 3 months. Detail on their website, but the gist is this:

It costs the government £8100 per annum in benefits payments and lost income tax receipts to support an unemployed person. So their proposal is as follows:
Private sector employers, who hire someone who has been claiming unemployment benefits for more than three months (13 weeks) and who has not previously worked for that company in the previous year, would receive a credit against Employers National Insurance Contributions. The credit would be worth £2,500 for full time jobs of 30 hours a week or more, or half that amount for part time work of 16 hours a week or more. It would be phased out beyond the higher rate tax threshold so that only basic rate taxpayers would be eligible for the full amount.
• To prevent companies making people redundant in order to replace them and claim the tax cut, the payment would only be available to companies that had made no redundancies in the previous three months, or for three months after claiming the credit.
• To limit the amount given in tax cuts to companies who are already growing rapidly, the tax cut would be limited to a maximum of 20 per cent of the workforce of any one company.
• The credit would be available for one year after the employee starts their new job.
David Cameron doesn't believe you can borrow your way out of a recession, it seems. Instead, he seems to intend to Nudge his way out of one. It's a pity, then, that in the words of Nick Clegg, "Cameron has drawn the fly on the floor". This doesn't help anyone who is already in a job. It doesn't help businesses who are struggling to keep employing the people they already employ. It doesn't seem likely to boost consumer spending all that much. It doesn't even seem likely to genuinely get all that many people back into employment. All it really does is tip the scales in favour of people who have been unemployed for over 3 months.

Let's look at this from the point of view of the people it's aimed at: employers (and note, in passing, that the last two Tory tax announcements - VAT delay, and now this - have been aimed at helping business, not people in the most direct sense).

To employ someone on minimum wage full time costs them about £11,000 (depends what hours they're on, so no point being too precise here). £5682 of that is above the Earnings Threshold, so National Insurance is paid on it, to the tune of 12.8%, or £727. So overall it costs the employer £11,727 to employ someone on the minimum wage. The Tory credit reduces that to £9227. Essentially, the Tories want to reduce the price of employing someone on minimum wage by 21%.

The significance of these credits only gets lower the higher the wage you're talking about. Someone on £20,000 costs their employer £21,891 to employ. That becomes £19,391, a cut of 11%. Or if you're on £30,000, it costs your employer £33,171, becoming £30,671, a cut of 8%. Much beyond that, the credits stop under the plan in question. So the jobs this is likely to have most impact on is those at the bottom end of the pay scale.

Fair enough. But now ask yourself this: Are you, a struggling company in the middle of a recession, going to set yourself back £9227 a year to employ someone who is currently unemployed out of the goodness of your own heart? I suggest that the answer is no. I suggest that most of the companies who are going to be taking people on in the next few years are the ones who had a pretty good chance of employing some extra people anyway: businesses who are just filling gaps left by employees leaving, or who are recruiting people they would have needed anyway. The Tories themselves admit that this would be true to some extent; the £2500 figure is based on an estimate that only ~31% of the jobs that would be created under this scheme wouldn't have been created anyway. I suspect it would be rather less than that, depending on how bad the recession gets.

Is it too cynical of me to suspect that this isn't really a Tory prescription for the recession at all? I reckon what this is is a bit of policy they had on the back burner as a remedy for long-term unemployment, which has been tweaked a bit and packed up in a shiny new box that says "Tax Cut!" on it, to cover up for the fact that the Tories, and specifically Gideon Osborne, don't know anything about the economy, really, and it has only become obvious to them relatively recently that the "responsibility ... sharing the proceeds of growth ... no irresponsible tax cuts" line wasn't going to cut it any more. Everyone else is talking tax cuts now, but they've got nothing much to announce, and the fiddly bits and pieces they'd come up with so far (Council Tax "freeze", Marriage Bonus, Inheritance Tax threshold to millionaire-friendly level, etc) were looking a bit shabby and tight-fisted in comparison. Hence today's policy.

It's a good job we've got an economic team who were able to beat the rest of the parties to it, despite the slowing effect of the Lib Dem policy ratification process, isn't it? We've had a revenue neutral package to really help people on low and middle incomes for over a year now. The way to create job growth is to give everyone a significant amount of their own money back. Spending goes up, jobs are really created, etc. Today's Tory plan does next to nothing to mitigate the recession.

Go back to your drawing board and try again, Gideon and Dave.

Wednesday, November 05, 2008

It's Not Over Yet

As Kos's map shows, the senate results are not yet in.

There is a post explaining what's going on with these races that are yet to be called here. The presidential result is already determined, so the electoral college predictions are largely academic (give or take an LDV mug).

But the Senate races are important. The Democrats had hoped that they might come out of this process with a filibuster proof senate. If they are to achieve this, the four yet to be called races all have to go that way. That's a tough call on the face of it. But lets just look at those a bit closer (from the Kos posting linked above):

We're currently at 56 seats with Sanders and Lieberman. We need a clean sweep in Alaska, Georgia, Minnesota and Oregon to win.

: With 99% of precincts reported, Ted Stevens (R) leads Mark Begich (D) by 3500 votes.

There are reportedly over 60,000 absentee ballots filed, so no one has called it yet.

Georgia: Saxby Chambliss (R) leads Jim Martin (D) 50-46. However, the Atlanta Journal-Constitution reports that over 600,000 early votes have not been counted. Martin led handily in early voting, so it's highly likely that Chambliss will end up below 50% and this will go to a runoff.

Minnesota: Norm Coleman leads by less than 600 votes now. All outstanding ballots will matter, and there's the possibility of a recount as well.

Oregon: Gordon Smith (R) leads Jeff Merkley (D) by 15,000 votes with 75% of precincts reporting. Not looking good.

So Oregon looks like a write-off, which is a shame. But even so, there is every chance of 59 Democratic caucusing Senators by the end of all this.

Minnesota could get nasty, with lawyers piling in on both sides. Al Franken is talking up his chances of changing the result:

The Associated Press uncalled the Senate race at about 9 a.m., saying they had prematurely declared Coleman the winner.

Franken said this morning that he intends to exercise his right to a recount.

He also said his campaign is investigating alleged voting irregularities at some polling places in Minneapolis, and that “a recount could change the outcome significantly.”

“Let me be clear: Our goal is to ensure that every vote is properly counted,” he said.
It will be some time before we know what happens there, with the recount not expected for some weeks.

Alaska looks, initially, bizarre. They seem to be about to re-elect a convicted felon, but as Kos point out, there are absentee ballots to be added. More importantly, even if Stevens wins, he is likely to be forced out of the Senate if his appeal fails, and that will trigger another election to fill his seat.

If Georgia fails to give Saxby Chambliss an overall majority (which looks likely), then that too will trigger another election, a runoff between the two highest voted candidates (the Rep and the Dem).

So in Alaska and Georgia, there is a significant chance for what remains of the Obama war chest to be put to good use trying to win a couple of extra senators, not to mention spending it on lawyers to help Al Franken's efforts to inch it in Minnesota.

We may not know for some time exactly what the Democrats' Senate position is going to look like. The only thing we can be sure of is that they seem likely to fall short of that all important 60 seats. Oh well.

Tuesday, November 04, 2008

US Election Night

Sofa and TV: Check

Several tabs in Firefox on laptop displaying various websites:
- LDV's liveblog when it arrives: Check
- Maron v Seder: Check
- to see how their predictions went: Check
- CNN Results page: Check
- Political Betting: Check

Popcorn with which to enjoy the looks on the inhabitants of Fox News's faces: Check

...yup, all set!