Election reflections

The recent election was the most depressing I can remember, with the parties trying to either bribe the electorate by making promises they must have known they couldn’t keep, or scaring us with terrifying stories of what was in store if we were foolish enough to vote for the other lot.

The Guardian, usually a cheerleader for Labour, described Ed Miliband’s “tombstone” stunt as raising an already high bar of stupidity to new heights.

However, daft as Miliband’s tablet of stone might have been, it was a minor blemish compared with Cameron’s pledge to pass a law to outlaw rises in income tax, VAT and national insurance contributions during the next five year Parliament.

That it is between these two that the British people had to choose only goes to demonstrate how far our politics have fallen.

At least one of the Labour leader’s close advisers was honest enough to admit (later retracted) that the words on the Edstone were not to be taken too seriously.

Presumably it was designed to stand in the back garden of No 10 as a constant reminder that governing the country is a rather more difficult business than winning an election.

The reality is that neither Miliband or Cameron could possibly know what might be coming down the track to derail their tax and spending plans.

After all, the 2008 financial crisis was not widely predicted (but see Living beyond our means) and there is no guarantee that there isn’t something equally nasty lurking in the bushes.

What we were electing was a government to navigate us through any storms and squalls that lie ahead.

So we should treat these promises of billions of extra public spending, zero tax rises and balancing the books with the contempt they deserve.

The three ladies in the contest – Nicola, Natalie and Leanne – all pledged an end to austerity.

This was a tactic that worked well for Syriza in the recent Greek elections and it was a huge success – in Scotland at least – last Thursday.

I suppose that it is only fitting that Greece, the cradle of democracy, should give birth to the novel idea that all that is required to achieve a particular goal is for a majority to vote for it.

What next? The abolition of gravity, or an end to rain during Wimbledon.

However, if you read the financial pages of the broadsheets you will notice that this abolition of austerity isn’t going down too well with Greece’s creditors, the most powerful of which, the IMF, is demanding that Mr Tspiris reverse the recent rise in the country’s minimum wage.

It is now touch and go whether Greece defaults and triggers a Grexit. As someone once said, government is a conflict between politics and economics and economics is the usual winner.

On the subject of the minimum wage, and the even higher living wage, Arthur Scargill’s socialist party outbid the rest by promising to set it at £12 an hour.

As someone who has employed a few hundred people in my lifetime, I can tell you that it is not what you pay them that matters, but what they earn.

As Mr Micawber nearly said – pay a man £20 an hour for £25 worth of output, result happiness. Pay a man £20 and hour for £15 worth of output, result bankruptcy.

Yet we have heard almost nothing from the politicians about the UK’s lamentable productivity performance over the past several years.

There are three main drivers of productivity – the skills and effort of the worker, the quality of the the plant and equipment at their disposal and the competence of the management.

It is no use having the world’s best bricklayer and a brand new mixer if the management fails to ensure that bricks are delivered to site in timely fashion.

One of the problems is that, because it isn’t part of the core curriculum, most people don’t understand economics. So politicians are able to make all sorts of rash promises without being called out.

Many of these promises are based on computer modelled forecasts of future economic growth, but, as the American economist J K Galbraith observed, economic forecasting was invented to make astrology look respectable.

This failure to accurately predict the economic future often leads to the claim that economics is not a science like, say, physics.

Up to a point this is true because if rather than promising to banish austerity the three women promised to do away with gravity they would be laughed out of court. But just because we don’t fully understand something doesn’t mean it doesn’t exist.

After all, until Galileo and Newton came along we didn’t understand gravity, but if you jumped off the top of Pembroke Castle in 1215 you would have hit the ground with the same force as someone repeating the experiment in 2015.

It is hard not to feel sorry for Ed Miliband as Labour luminaries like Mandelson, Blair and even his own brother, climb over each other to tell us he was a complete no-hoper peddling unpopular left wing policies.

Aside from the fact that just a few days earlier these same gurus had been encouraging us to install Red Ed in Downing Street, I think this analysis is wrong because Labour lost heavily in Scotland because it wasn’t left wing enough.

Indeed I would suggest it was Nicola Sturgeon who cost Labour the election by putting the wind up the English electorate at the prospect of a Miliband government under the control of the Scots Nats.

Of course, once Sturgeon realised that the Tories were playing on these fears, she could have toned down the rhetoric – instead she reached for the megaphone, because, despite all her talk of cooperating with Labour to lock Cameron out of Downing Street, a Tory government suits her ultimate aim of Scottish independence down to the ground.

As P G Wodehouse said: “It’s never difficult to tell the difference between a ray of sunshine and a Scotsman with a grievance” and, with the Tories in power, it’s grievances all the way down.

Think how different it might have been if the Scottish referendum had gone the other way. Instead of running around calling for an end to austerity, Nicola would be having to explain how she was going to plug the massive hole in Scotland’s public finances caused by the slump in the price of crude oil.

All in all, this might turn out to be a good election to lose.

The National Debt – up from £900 billion to £1,400 billion during the past five years of austerity – is set to grow even further despite all the Conservatives’ efforts to cut public spending.

The deficit (the rate at which the National Debt is growing) is currently just shy of £90 billion per annum and is not due to be eliminated until 2020 by which time National Debt will have climbed to £1600 billion+.

And all this depends on the world economy behaving itself in the meantime. But that is a long shot because it is on the life support machine known as Quantitative Easing (QE) – essentially money-printing by the central banks of America, Europe, Japan and the UK.

At some time the taps will have to be turned off and when that happens all hell could break loose.

And, regardless of whether or not it’s responsible, when the balloon goes up it will be the Tory government that gets the blame.