Tag Archives: economics

Myleene Klass and Ed Miliband

Myleene Klass and political failure

Myleene Klass may be deeply confused about how the mansion tax will work in practice, but she probably isn’t the only one. As a supporter of land value taxation, it is no surprise that I think it is a flawed policy, but what’s really problematic is the way both Labour and the Lib Dems are attempting to sell it.

In many ways, Klass’s tustle with Ed Miliband sums up the problem. She seems to think that, as a tax which will only apply to properties worth £2m and over, that in parts of London that applies to garages. She’s wrong. The £2m figure was calculated to be as painless to as many people as possible. In fact, under Vince Cable’s original proposals in 2009, the tax was to apply to properties worth £1m and over. This was quickly adjusted following an outcry from Cable’s fellow South West London MPs who feared a backlash (and even £1m is a bit steep for a garage, Myleene).

The UK – and London in particular – has a real problem with rising house prices. Home ownership has reached extremely low levels compared to recent history and the fears of another housing price bubble, despite the views of fantasists like Danny Alexander, are very real. The UK ought to be having a very serious conversation about how it tackles this.

Instead, we try to kid ourselves that this is just a problem for the very rich. Hence the mansion tax’s £2m threshold. We ought to be having a national conversation about restructuring our economy to avoid property bubbles. We ought to be talking about a property tax which kicks in at much lower levels. But we’re too busy blaming everything on immigrants and the poor.

Meanwhile, our existing domestic property tax, the council tax, has not been revalued in England since 1991. If our politicians lack the courage to even do that, what hope is there for us to have a serious conversation about what’s needed.

Ironically, the Lib Dems in particular, are in a better place than they have been in years to make the case. 10 years ago, they were transfixed with the idea of scrapping all property taxes and making taxes on employment take up even more of the strain. Now they are making the case for more taxes on property and taking people out of income tax altogether. Yet there is no narrative connective tissue between the two. They aren’t making the case for a fairer society and stronger economy in which a hard day’s work is taxed less and wealth is taxed more.

Ignore policy for a minute, which is largely irrelevant these days in a world of coalition government. What a liberal party ought to be making the case for right now is a new economy with significantly different priorities. It can’t be done overnight, but it can be done over time, piecemeal. There can be a direction of travel. It can’t however be done by stealth; the public need to buy into it or it will fall apart after the first Daily Mail headline.

The mansion tax could be step one of a new economic plan; as it is, it’s a policy cul de sac. Assuming it eventually happens, it will probably suffer the same indignity as council tax, and never be touched again. Or worse, start going up by inflation to ensure that only a tiny minority ever pay it and its true revenue potential is never realised. It’s emblematic of the political malaise; instead of dealing with the big political issues of the day, we’re reduced to soundbites.

Star Wars card game

How JJ Abrams could severely hurt tabletop gaming

Typical. Just after I write a blog post praising Fantasy Flight Games, they go and do something that makes me wary. Yesterday, FFG announced their intention to be taken over by French board game company Asmodée. This comes just months after Asmodée took over Days of Wonder, publishers of the enormously successful Ticket To Ride board game (among many others).

The Days of Wonder/Asmodée takeover didn’t especially concern me as, despite their success with a number of product lines, Days of Wonder seems to have been struggling for some time to come up with another big hit; I can see how that merger could potentially be in their interests. Fantasy Flight on the other hand is a much larger company currently in its prime; it isn’t immediately obvious what they’re getting out of this, but I assume they have their reasons.

I’m especially nervous about this because Asmodée itself is part of the Eurazeo group, a publicly listed investment company with its fingers in a large number of different pies. To say the board game industry has had a fairly difficult relationship with the stock market would be an understatement. The most notorious example is that of Hasbro’s buyout of Wizards of the Coast and Avalon Hill. Hasbro began the 2000s owning the largest war games company (Avalon Hill), RPG (Dungeons and Dragons) and card game (Magic: the Gathering). It ended that decade having royally screwed all of them up, although Magic has since clawed its way back and D&D has just had a successful relaunch.

The problem is that PLCs’ main focus is on shareholder value, not necessarily on delivering good product for consumers. Add to that the fact that they almost always have to borrow to afford these buyouts and the focus within those companies inexorably becomes about profit. And if they don’t return the right numbers to keep the board happy, they have their work cut out explaining how their business works to a bunch of people with no knowledge of the industry. The result, if Wizards is anything to go by, is creatives getting the chop, gouging and a company which is less viable than it was before the takeover.

With all that said, as I said before, Fantasy Flight have always seemed like a sensible company which has learnt from the mistakes of its predecessors. It’s entirely possible that their current business model, with several highly successful product lines and more on the way, are the perfect fit for a PLC and that all this takeover will mean for them is access to resources and in particular capital to allow them to expand. There is a bigger question in continental Europe where a lot of FFG’s games are licensed to companies which are not part of the Asmodée group and what will happen to those companies (either merger or they’ll take a big hit being the most likely answer), but generally, this could be all steam ahead for FFG.

What makes me worry though is this: it has already been clear for quite some time that FFG have been lining their ducks in a row in anticipation for Star Wars: Episode 7. They currently publish or will soon be publishing three Star Wars roleplaying games, two Star Wars card games and three Star Wars miniatures games. Of these, Star Wars LCG and X-Wing are two of their biggest sellers, and the incoming Imperial Assault looks set to be as popular if not more so than these two. Like Disney-Lucasfilm, they have opted to ditch support for the prequels-era in favour of a line of products that very much harken back to the original films.

By December 2015, all these product lines will be very firmly established, and no doubt FFG are keen to have these games on the shelves of every supermarket, toy and book shop in time for Black Friday next year. No doubt, Asmodée’s takeover will help them in that respect (let’s ignore the plight of the specialist retailer here for a second), and there is a good chance they will be wildly successful. If, as everyone hopes, Episode VII is a hit and results in a new mega-franchise to rival Marvel’s (owned by the same company), then this could result in a significant boost for the company.

But there are two things that concern me here. Firstly, what if the new JJ Abrams’ film is rubbish? I’m sure it will make a lot of money either way, but a weak film will lack the sort of fanbase that FFG are hoping for. They’ll probably be safe for Christmas 2015 either way, but Christmas 2016 will be another story if the film is widely perceived to be another Phantom Menace. That potential will dry up and if any of those games are produced in large, unsellable numbers, a lot of money will be lost.

If the film is good, there’s still the question of what happens when the franchise winds down. Again, past precedent is not encouraging. Games Workshop almost collapsed in the mid-2000s when their cash cow in the form of the Lord of the Rings films came to an end. If FFG get big based on a film franchise, they are unlikely to be able to convert huge amounts of the mass market over to buying Twilight Imperium 4; they’ll be dependent on more franchises.

Under either scenario, there will come a point in which the company, while still profitable, will need to contract compared to its height, at which point the money men step in. And that’s when I get nervous. When Asmodée’s expansionist plans were limited to companies like Ticket To Ride, we weren’t looking at an investment company navigating its way through a boom (as distinct from a more sustainable period of growth). Now the fortunes of what amounts to a very large chunk of the industry is going to be at their mercy.

Hopefully, Episode VII will be a success and FFG will find the success it is hoping for for several years before it reaches that crossroad, by which point the relationship with the money men will have matured enough to avoid any panics making things worse during the inevitable lean years. But as of yesterday, an awful lot of my hobby suddenly became hitched to the fortunes of JJ Abrams’ film career, and so I’m nervous.

Shattered Remains card art (artist Matt Zeilinger)

Rotation and Tabletop Economics

Wednesday was a big day in the world of tabletop gaming. While in the UK we were having bonfires around the country, in Roseville, Minnesota Fantasy Flight Games announced a bonfire of the Living Card Games. Well, a light singeing at any rate. To any non-tabletop gamer, and indeed any non-LCgamer, this will probably mean absolutely nothing. But it’s an interesting response to a growing problem which the fans of these games have recognised for a long time.

Ever since I worked in a comic shop in the early nineties during the speculator boom (and arguably going back to when Games Workshop decided to change their business model in the late 80s and alienate fans like myself), I’ve always had an interest in how economics impacts on hobbyist interests. Tabletop gaming is currently going through a bit of a renaissance, with convention visitor numbers up, the number of games exploding, and games starting to enter mainstream consciousness. To what degree this period of growth will be sustainable in the long term is an interesting moot point, and there have been a lot of busts in the past. Reading the excellent four volume Designers & Dragons as I did recently, it was made painfully clear how vulnerable tabletop gaming – in that case RPGs – are to such cycles, and the severe consequences when the industry takes a dive. Fantasy Flight Games in particular appear to be on a high right now – they more or less owned Gen Con this year with a succession of announcements which had their fans – especially Star Wars gamers – frothing at the mouth. Past experience suggests that at some point someone is going to make a big mistake and for this to all come crashing down around our ears. The question is, when?

I don’t want to suggest in any way that Fantasy Flight’s announcement on Wednesday is an early warning that that crash is imminent; quite the opposite. In fact it’s a sign of something I’ve felt for a while, which is that FFG are a generally very cautious and sensible company that is all too aware of the risks inherent in the industry.

CCGs and LCGs

First of all, a bit of terminology. Living Card Games is a trademark of FFG which they use to describe their customisable card games and the business model they use to market them. The model itself is now being adapted by other companies as a sign of its success. Customisable card game may require a little more explanation for people not familiar with the concept.

Most people will know what a card game is, whether its poker or Uno. The most significant thing that makes customisable card games different is that the players have their own decks of cards which are kept entirely separate from their opponent’s. What’s more, while a standard deck of cards might be finite – 13 cards for each suit plus one or two jokers – the different cards that might appear in a customisable deck is potentially infinite. Before the game itself, players will “build decks” by selecting cards from a pool of cards that they own. They can customise their decks however they like, as long as they stick to certain restrictions laid out in the rules of play.

The difference between a Collectable Card Game and a Living Card Game is how players acquire that pool. The first customisable card game – and the first Collectable Card Game – was Magic the Gathering. This game and its hundreds of imitators sold players cards in the form of starter decks and booster packs. The business model was essentially cribbed from trading cards (or football stickers, cigarette cards or bubblegum cards depending on what you’re more familiar with): the cards came in randomised packs, with some cards especially rare and hard to find. If you want a full set, you would need to buy many thousands of cards (seriously; I recently acquired a bunch of retail packs of a long out of print CCG called On the Edge. I’ve ploughed through two boxes – 1,800 cards – and still don’t have close to a full set of the basic 270 cards).

The Magic the Gathering CCG model was wildly successful in the mid-90s until it all came crashing down, taking retailers, distributors and publishers with it. Since then, Magic itself has remained a strong contender and a number of companies continue to do good business that way, but the mania that surrounded it has died down. Fundamentally, there are people who hate it as a model and won’t go anywhere near it. Even Wizards of the Coast, the publishers of Magic, have recognised this and increasingly sell pre-made decks for more casual players.

Fantasy Flight dipped their toes into the CCG business but in 2008 decided to switch to the LCG format. In their business model, there are no randomised packs (let’s park discussion about draft play for now). Instead, they sell core sets, boxed expansions and cycles of smaller packs of cards, all of which contain exactly the same cards. What LCGs lose by abandoning the random factor they gain in an increased focus on optimising decks and keeping up with the “meta” (the groupthink of the player base in which certain cards and strategems fall in and out of favour as more cards are published).

Rotation

The LCG model has been extremely successful for Fantasy Flight. Beginning by reformatting their Call of Cthulhu and Game of Thrones CCGs to the new model, they currently publish six games – including the wildly popular Netrunner – and retired a seventh earlier this year. The announcement they made on Wednesday is in response to that success.

The one thing FFG are good at doing is supporting their successful games, and that means expansions. For their more traditional board and card games, that’s relatively straightforward: sell a game, offer players the options of expansions and they can pick and choose what they want depending on their enthusiasm. The prevalence of expansions aren’t a huge barrier to entry for board games; they give you more variety and options but since all players are playing with the same set, there’s no competitive need to buy expansions.

LCGs are different. If you don’t buy all the cards, you have a competitive disadvantage to the players who do. At least, in theory; skill and practice is a generally a far bigger factor. Nonetheless, that drive for completion is real. Right now, completing the Game of Thrones card game means acquiring the core set, six boxed expansions, and 72 smaller packs. Each of those smaller packs will set you back a tenner, meaning that if you want to buy everything available right now, you will end up spending just shy of £900. The other games are less extreme, but by the end of this year, relative newcomer Netrunner will consist of a core set, three boxed expansions and 18 smaller packs, costing just under £300. That isn’t just a challenge for players; that’s a challenge for retailers who only have so much shelf and storage space.

There’s also another problem, and a different economics. Fundamentally, the more cards in the pool, the smaller an impact each additional card will make. This is mitigated by FFG deliberately taking note of and attempting to disrupt the aforementioned meta from time to time. Thus, if they spot that a specific card is being used in all the winning championship decks, they will set themselves the task of coming up with a new card that will weaken the power of the old one. It’s one of the most exciting aspects of LCGs, which is that play in the real world has a direct impact on future releases. But over time, their ability to keep evolving the game in that way becomes increasingly limited as more and more options become available to players. At that point, the theory goes at least, the game will become less exciting; it will no longer be “living”.

I haven’t ever played the Game of Thrones LCG for precisely the prohibitive entry restrictions that I outlined above, but I understand that the problems with the metagame outlined above have become acute with that game. Rather than try to fudge it, FFG have opted instead to simply bring out a new edition of the game and be done with it. For the other games however, they have decided to introduce a new system called rotation. What that amounts to is the smaller packs over time being declared not tournament legal and falling out of print.

The most interesting thing about all this to me is how modest a change this new policy amounts to. Because rotation will only kick in when a game reaches its eighth “cycle” (a cycle is a set of six thematically linked packs), at which point the first two cycles will be taken out of circulation. With FFG pumping out slightly less than two cycles a year for each LCG, that means that cards will have a tournament life of around four years. Contrast that with Magic the Gathering, which I understand has a rotation cycle of roughly 18 months.

The total tournament legal card pool will remain huge. For us Netrunner players, we still have five and a half cycles to look forward to before our cards start becoming obsolete and I personally can’t even visualise what a card pool that large will look like. It isn’t obvious to me how this will especially lower the barrier of entry for new players, although I suppose it will at least encourage them to invest in the newer cycles and box sets and not bother with the older ones which have less tournament life in them.

I suspect, also, that in reality a game will have to be doing extremely well to actually reach the stage when a cycle is rotated out. Hidden amongst all the announcements on Wednesday is the news that rotation won’t actually affect the Call of Cthulhu LCG because they won’t be producing any new cycles for it; it’s a complete game. The same has already effectively happened with Warhammer: Invasion. The Lord of the Rings is a cooperative game and thus players don’t have to worry about tournaments. It is by no means certain that the other LCGs – Netrunner, Star Wars and Warhammer 40,000: Conquest – will survive long enough.

The Future

I presume that Fantasy Flight wrestled over this a lot before settling on a change that will have such a modest impact. While I don’t think it is a backwards step, I do think they have hedged too much to avoid alienating the existing fanbase. For all its flaws, Magic the Gathering offers far more frequent jumping on points for new players, which explains its longevity (20 years and counting). I suspect that once the concept of rotation has bedded down, they will tweak it more in favour of bringing in new players.

What’s fascinating is seeing a tabletop games company explicitly planning over a period of five years. This represents a level of maturity generally unheard in the industry. The business plan of most games companies seems to be: produce a new game on a regular basis and, if it’s a hit, rush out a series of expansions and spin offs until the cashcow has been squeezed dry. To be fair, an increasing number of companies seem to plan their release schedule 1-2 years ahead, but Fantasy Flight seem to have a bigger picture in mind. And it seems to be working for them.

You can especially see this in their Star Wars game range. They’re currently supporting 8 Star Wars games (counting the three RPGs separately despite their compatibility), and it’s clear that they’ve had quite a far sighted release schedule in mind. With the new films on the horizon, it’s increasingly looking as if their game ranges will be maturing at exactly the right moment; a completely unprecedented bit of marketing synergy (if you can pardon the expression).

The million dollar question is, how much is too much expansion? LCGs, while apparently cheaper than CCGs, expect their players to sink around £170 into the game every year, and rotation won’t change that. The X-Wing miniatures game, while allowing for more specialisation (i.e. in LCGs, you have to buy all the different “factions” which are available to play in the packs; in a game like X-Wing you can focus on a single faction or even a handful of specific ships), costs even more to buy the entire range, and that is about to be joined by two more miniatures games this winter. If enough players suddenly snap and stop buying product, these games could suddenly see sales plummet. It hasn’t happened yet in this case, but there are past precedents (such as RPGs in the early 80s).

Fantasy Flight themselves appear to be quite mindful of that, and produce games in modest print runs. What’s mildly irritating to us consumers in terms of product being out of stock all the time, makes perfect sense for them. But the downside of this approach is cost. This was drilled home to me when I attended the giant Spiel convention in Essen this year, where you can buy German board games intended for the high street for literally half the equivalent US games typically cost. The former is produced in print runs of 500,000+ while the latter is frequently produced at runs lower than 5,000. The reason FFG charge £12 for a pack of 60 cards is because they don’t want to be left sitting on thousands of unsellable packs and come unstuck in the way that so many of their predecessors have done.

I’ve already heard grumblings about how much better value AEG’s new Doomtown Reloaded customisable card game compared to its Fantasy Flight equivalents. The reason is simple: AEG are looking to break into the market and only have one game to support: they have both the capacity and the incentive to undercut FFG. As FFG grow, an increasing number of their competitors must be making the same calculation. And while I think FFG are too cautious to create a boom (and AEG are a veteran company – this is not their first rodeo), I’m not so sure about everyone else. That’s a cause for some concern.

This year, the US gaming convention Gen Con is believed to have eclipsed the German Spiel for the first time in terms of attendance figures. Even here in the UK, Games Expo has been enjoying exponential growth over the last few years (of course, these conventions are still tiny compared to the largest computer game cons). It very much looks as if we’re on the cusp of a boom. We’ll almost certainly see a market contraction at some point; the question is when, and by how much. In the worst case scenario, this could see high street gaming stores – already in long term decline – obliterated. But if the lessons of the past can be learned, the overall impact – with the rise of board game cafés and mainstream consciousness – could still be positive. FFG’s announcement on Wednesday suggests to me that at least one company is very mindful of the risks and rewards at stake.

Russell Brand and the Emperor’s new thong

Russell Brand holds aloft the cover to his issue of the New StatesmanSo, Russell Brand’s interview on Newsnight and New Statesman editorial has caused an awful lot of brouhaha, and I’d kind of like to join in. I find a lot of what he has to say on the subject of voting not only wrong but actually quite offensive. His assertion that my grandparents’ and great-grandparents’ generation were “conned” in fighting for the vote is simply factually not true, unless you consider the welfare state, universal education and a national health service to be a “con” (as far as I’m aware, Russell Brand is not an Ayn Rand aficionado).

The fact that we’ve just lived through the deepest recession since the Great Depression and not seen the level of starvation and grinding poverty that destroyed people’s lives in the 1930s suggests that, for the most part, democracy has actually worked out quite well for most people in a lot of ways. Combine that with Brand’s obvious hypocrisy (opting out of the political system he despises while very much opting into the capitalist system which he claims to equally hate – yet very much profits from) and casual misogyny, and you have a pretty loathsome end product. Instead of miscrediting Billy Connelly with the quote “don’t vote, it encourages them,” just once I would have liked to see him engqge with Gandhi’s equally miscredited “be the change you want to see in the world” – it is all very well calling for a revolution of the mind, but if that’s where it stays, what is the point?

Here’s the thing though. Siding against Russell Brand means siding with an awful lot of rather distasteful people. I might not agree with his prescription, but I agree with a lot of the sentiment and many of the people whose pious critiques of Brand’s position I’ve read over the last few days have been the very people who I think are part of the problem.

Piously telling Russell Brand that he’s wrong is one thing, but if you’re one of the people who subscribes to the view that the current voting system is fine and dandy, and that your political party should be slavishly attempting to fix itself in the centre ground, or jump on whichever populist bandwagon which might get you the next short term voting fix, then you actually have less credibility than he has. Voting and political engagement can make a difference, but in spite of such people not because of them. Most people in the political establishment are not democrats, but rather technocrats who spend their time actively seeking ways to shut down public debate, not open it up.

And voting, especially for young people, is a bit of a prisoner’s dilemma. For individuals, voting is a cost in time and effort. It’s only if a critical mass of a certain demographic start voting that they are likely to make an impact, and no-one knows in advance how many people it will take (especially with our broken and random single member plurality voting system). If like me you voted in 2010 in the hope that we were on the verge of seeing a fundamental shift in voting patterns, you can understand why it is hard for people get their hopes up that they are a part of something bigger.

The benefits of democracy are indirect, long term and fundamentally collective. It is ironic that a self-proclaimed lefty such as Russell Brand can’t get beyond the very individualist and consumerist mindset that he claims to want a cultural revolution to overthrow, but he is by no means alone. And the political establishment has done nothing but encourage precisely this mindset over the past 35 years. The fact that Brand and so many other wannabe revolutionaries are creatures of this atomisation of society may suggest that their ideas are not so radical after all, but it ought to give the establishment pause for thought because it has the potential to cause them a lot of problems.

Young people aren’t voting. More than that, it seems to me that an entire swathe of young people are effectively opting out. It’s no surprise as they are being systematically shut out of the economic system. Mainstream politicians are obsessed with forcing them to run in ever decreasing circles trying to find jobs which don’t exist, only to find that even if they succeed in that they will have none of the economic security that their parent’s generation take for granted. When I was turning 30, I was in a minority in my peer group of people who didn’t own their own house (admittedly, most of whom were dependent on their parents’ for support); now I don’t personally know anyone under 30 who owns property. I can however tell you tales of people forced to move out of their over-crowded HMO because the landlord insisted on putting the rent up by an exponential amount and the stress that substandard housing and long term unemployment is causing people.

All of this amounts to a massive deal for our society, yet if you take a gander on Twitter, you won’t find many mainstream politicians talking about it at all. Instead they are determinedly issuing blandishments with hashtags such as #ForHardWorkingPeople, #StrongerEconomy or #FairerSociety and, urgh, #coalicious.

In Paul Mason’s response to Russell Brand’s intervention, he predicts that we will see increasing social unrest over the next decade. It isn’t a new prediction; the BBC produced a documentary 10 years ago saying broadly the same thing. Such dire forecasts don’t have to be 100% correct to be a cause for concern and it certainly looks to me as if we are starting to see signs that it could be happening.

So, ultimately, it isn’t enough to dismiss Russell Brand’s views. If an idiot child starts proclaiming that the emperor has no clothes, expending so much energy to point out that, in fact, he is wearing an extremely snug bright pink thong is to badly miss the point.

What’s left of what I believe

XKCD strip on nihilism
NaBloPoMo November 2012The main reason I’ve allowed this blog to fall into misuse over the past couple of years is that I stopped writing about politics. While my original concept behind this blog was always to write in the intersection between politics and geekery, at some point – specifically in May 2010 – I decided I could no longer really afford to vent my undiluted spleen about the state of the nation and had to start being a little more diplomatic and careful about what I say.

The problem is, I’m a little all-or-nothing and being careful quickly lead to me saying nothing at all. I figured it would get easier once the spotlight was off after the AV referendum; it didn’t. I figured I could be much less careful after I’d quit the party and thus my views became instantly irrelevant in the media’s eyes, but at that point I acquired a new problem: how can I write about politics without it either coming across as or actually being score settling following my resignation? I exchanged one set of anxieties for another and sclerosis quickly settled in once again.

And so, here I am, writing a blog about politics – which once again is really all about me. This is my problem in a nutshell. All I can do is plead for sympathy from you, dear reader: after 16 years, quitting a political party really is a big deal. It’s a wrench. It is no surprise at all that nearly eight months on I’m still a little defined by it. But at least you now know why it is that I’d much rather be writing about comics or, if you’ve seen my tumblr, even more esoteric things.

My article in September about quitting the Liberal Democrats had an interesting response. It was surprisingly positive, but I found it strange how so many people told me that they either loved or hated it but didn’t really engage with the issues at all. I had several Clegg loyalists tell me how much they loved it; curious given that I was not exactly nice about him. My favourite response was from a friend who told me that he agreed with “35% of it”. It was a strangely precise figure, yet he wouldn’t expand on what he actually meant by it.

Most of the negative feedback I did get from it, other than the abuse, centred around the accusation that I was being cynical and didn’t have anything constructive to say. I think the latter was fair comment and pretty much sums up where I am politically at the moment, but there is a difference between cynicism and nihilism. I don’t think I am cynical – indeed my decision to quit the party was about as far from cynical as it was possible to get. I took the decision to walk away rather that to stay on the inside and just feel bitter about things. The fact that I don’t have a fully worked out alternative to what the Lib Dems, and for that matter, politics more widely, doesn’t make me a cynic – it just makes me average.

But yes, I am a political nihilist at the moment, and as someone used to having a cause I can assure you that’s far more of a problem for me than it is for anybody else. All I have is a few scraps of ideas about what a possible way forward might look like, and they can be summed up as follows:

  • Triangulation is a doomed strategy for any political party – doubly so if you aren’t either Labour or the Conservatives. The people leading the political debate right now are the outliers who are working outside of the political mainstream but are successfully shifting the centre-ground to their direction simply by being well organised and disciplined. Right now, sadly, for the most part that means the weird axis of economic libertarians and social authoritarians who are exemplified by the Tea Party in the US but operate in different forms around the world. They aren’t succeeding electorally, but they don’t really need to. Everyone else is dancing to their tune.
  • Capitalism as we know it needs to die. Not trade, not commerce, but the system which commodifies and seeks to squeeze wealth from everything from people to ideas and natural resources is utterly anathema in terms of what humanity needs to do to survive the next millennium. That means critically reassessing what we regard as capital and property and thus what we believe can and cannot be owned. I feel I’ve just used a load of meaningless words there, but it makes sense to me. In terms of specific examples this means a fundamental shift from income and sales taxes onto things like land value taxation, and a massive global crackdown on the drift widening intellectual property laws to mean that every aspect of our culture ultimately becomes owned by a corporation out to make a quick buck.
  • It’s too bloody easy to blame the politicians. Our politico-economic system and media have infantilised the public, but as information technology spreads so does the onus on individuals to accept responsibility for the health of their democracy and culture. We have the tools to create a much better world, yet most people just sit there like good little consumers waiting for someone else to do it for them, and consider passively shrugging about it to be the mature response for when they don’t.

Beyond that? I’m lost. I have no idea about how you take those notions and turn them into something tangible which has any chance of being implemented. But I’m thinking about it – a lot. And perhaps I should write about it here a bit more often.

More BBC pro-Labour propaganda

John Rentoul is outraged that the BBC have chosen to cover the publication of the government’s new report on equality with the headline “Rich-poor divide ‘wider than 40 years ago’.” He is of course correct to point out that the main increase in inequality over the past 40 years took place during the Thatcher years.

But the Harriet Harman approved wording that he picks out of the report’s executive summary is equally misleading:

The large inequality growth between the late 1970s and early 1990s has not been reversed.

It certainly hasn’t been reversed, but that suggests that it has at leasted been reversing. The reality is somewhat different.

I would refer you, dear reader, to page 9 of the report which has a handy graph showing both the Gini coefficient and the 90/10 factor from 1961 to 2007. What this graph shows is that both measures of inequality peaked in 1991, dropped a bit as we came out of recession and then hovered around the same level in the years following. Indeed, while the 90/10 scale shows a slight dip in inequality since 1991 (to 1989’s levels), the Gini coefficient was at an all time high in 2007.

Since 2007 of course, we have had a major recession. Inequality spiked in 1991 for this reason and so we have every reason to believe it will have spiked again between 2007 and 2010. It is quite possible that both scales will exceed the 1991 levels.

So not only have Labour failed to reverse Thatcher’s increase in inequality, they’ve failed to make any impact on it at all.

The BBC should indeed change their headline. I would suggest that it reads “Rich-poor divide ‘wider than 1997′”. John Rentoul won’t like it but it would accurately reflect the real failings of this Labour government.

Reporting back from the Fabians: What not to spend

The Fabian Society kindly gave me a media registration for their new year conference and I spent last Saturday at Imperial College mingling with the Labour Party faithful. I sadly missed Gordon Brown’s morning address but sat in on two discussions: “What not to spend” – a discussion on what public spending cuts the government should make; and “Tribes or causes: Can we campaign across party boundaries?” Both featured Lib Dem speakers, and I attended the former to keep an eye on Vince Cable and the latter to support Evan Harris (or should that be the other way around?).

What not to spend was, of the two sessions, the most frustrating. This was partially because there was no Labour Minister there to give us their perspective, partially because the Nigel Stanley and Janet Daley failed spectacularly to stay on topic and partially because Vince himself was being incredibly cautious. My hope that Vince might give us a tantalising glimpse of what he thought needed cutting, beyond that which the party has announced and reannounced over the past few months ended up dashed (despite his tantalising flash of leg in Parliament the preceeding week). And because the Cult of Vince seems to have extended as far as both the audience and the other speakers (I don’t think anyone breathed a word of criticism of him during the entire 90 minutes), he wasn’t even pressed on the kite flying list of spending cuts he flagged up in his Reform pamphlet last September. A man suggests means-testing child benefit and doesn’t elicit even a single squeak from a Fabian audience; what is going on? Indeed, the one area there did seem to be some tentative agreement on was the rolling back of middle class welfare.

Instead of talking about the current economic situation, Stanley and Daley preferred to continue a traditional left-right ding-dong which you might have heard in any political meeting at any point over the last twenty years. Both, I have to say, were much more nuanced and less dogmatic than they might have been, but neither seemed interested in really addressing what savings government needed to make. To be fair on Stanley, as a TUC staffer, it wasn’t really his job on the panel to do that, but I did expect to hear something substantial from Daley. She made a dig at the start about “not defending David Cameron’s economic policy because I don’t know what it is” yet pretty much the alpha and omega of her own economic policy seemed to consist of one word: “vouchers”.

“Vouchers” – whether they are vouchers for education, healthcare or whatever – have been a real rallying cry for the right in recent years. The aforementioned Reform think tank was for a while obsessed with them. Speaking personally, I’ve always felt it is a bit of a cop out of an argument. We’re constantly invited to believe that the key to the success of the Swedish education system lies in the voucher system, not in the amount of cash each of those vouchers represents, and to believe that, somehow, a voucher based on UK spending levels would have the same effect. I don’t buy it. I can see how they could be made to work in, say, an inner city area where the population density is sufficiently high enough to create a genuine market, but how it would work in a rural area is something I still haven’t found a satisfactory answer to.

Furthermore, while they might be a suitable topic for discussion in a debate about getting value for money from public services, I just can’t see how introducing them during an economic period where we are having to make cuts makes much sense at all. It won’t address any problems in the short term, and indeed the cost and bureaucracy that would be involved to establish the system would make it harder to introduce cuts.

The other area that troubled me was the aforementioned apparent consensus around the idea of scaling back the “middle class welfare state”. Some of this, I have very little trouble with. Creating a shorter taper for tax credits so that people earning £50,000 aren’t entitled to some tiny amount which is eclipsed by its own administration costs makes perfect sense. But that is the trouble with means-tested benefits. By contrast, there is a real danger in means-testing what few universal benefits we have left in the name of cutting costs. Partially, this is because you end up having to establish a whole new bureaucracy to administer the scheme, partially because it means that those most in need often end up failing to claim for it precisely because of that bureacracy, but also because it helps create a sense of solidarity between the comfortably off and the poor. As Sunder Katwala himself said at the Lib Dem conference last September “services for the poor will always be poor services“.

I hope that my concern about the comfort with this rhetoric proves to be unfounded and that things like child tax benefit won’t be regarded as low hanging fruit after the general election. But the way this idea seemed to be supported in the generality at the session did cause me some discomfort. It was the elephant in the room.

The Littlewood Effect… twelve months later

Mark Littlewood has articles on Liberal Vision and The Telegraph reminding us of his pamphlet The Cameron Effect last year.

That’s fair enough. It’s equally fair enough for me to point you in the direction of my rebuttal of that pamphlet.

What has changed in the previous twelve months? Mark is right to say that one thing that hasn’t, frustratingly, is the opinion polls. Nonetheless that is to ignore the fact that they went up for the local elections in June (and down for the European Elections). We have every reason to expect those figures to pick up as we head towards 2010 all else being equal. In fact, I think we have a lot of reason to be confident that things will pick up quite well during an election campaign. Clegg has finally moved on from his “calamitous” period and Vince Cable continues to get good press.

Does that mean that I am prepared to revise my prediction that the Lib Dems will finish the election with roughly the same number of MPs that it started with? No. I don’t see any evidence of a breakthrough this time around. But equally, I continue to regard Liberal Vision’s pessimism as misplaced.

Mark, it has to be said, has subtly shifted his position. Last year the focus was all on tax cuts; this year he has replaced this with more ambiguous language about “winning over those who are flirting with David Cameron’s Tories.” But the people switching to the Tories this time are not the ones clamouring for the Tories to adopt a small government, low tax agenda; indeed they are coming to the Tories precisely because they don’t think that is what Cameron is offering (they may be in for a surprise considering what the new Tory intake looks like). Ultimately, I don’t follow the argument that this is some kind of zero sum game between the Lib Dems choosing between soft Labour and soft Tory voters at all. Instead it is a mad scrabble for floating voters who are up for grabs by any party.

Mark may not have got his wish of the party adopting a position of overall tax cuts, but he should be consoled that the party is in favour of reducing taxes for low and middle income owners and that the party is united behind this position. This isn’t a policy aimed at the left or right (although the right may quibble with the tax increases we propose to impose to pay for them); it has far wider appeal than that.

Talk of tax cuts right now would almost certainly scare people right now and be scarcely economically justifiable; Mark knows this. So the question is, what buttons should we be pressing that would appeal uniquely to people currently in the welcoming arms of David Cameron? Should we be bolder in our talk about spending cuts than Vince Cable has been this week at a time when all Osborne can offer us is flummery and his characteristic whingeing? It is hard to believe that would make us especially popular.

The main thing that has changed is that the economic situation has got a lot worse. That’s bad news for those of us who would like to see greater investment in specific areas and bad news for those who would like to see overall tax cuts. I suspect the all out hostilities over the heart and soul of the Liberal Democrats will have to wait for at least another conference, something which is good news for the hedges outside the Bournemouth Conference Centre.

Quality of Life (2) – work and unemployment

This is the continuation of my series of posts in response to the Lib Dems’ Quality of Life consulation paper, the first of which can be found here.

Taking the next three questions in one go next:

6. Should there be compulsory limits to working hours? Can employees make a genuinely free choice to opt-out of the European working time directive? Is it liberal to restrict how much we work?

7. Would a more flexible approach to working make a difference to people’s happiness? How would this be achieved without creating unnecessary bureaucracy?

8. Should we incentivise part-time jobs through NI or other employment tax breaks, especially to encourage employers to create senior part-time roles?

I have to admit that I don’t have much of a problem with the current working time directive (i.e. 48 hours). Most countries have worked perfectly well without the opt-out and the 17-week reference period stops the rule from being silly. There might be a few areas where we might allow for some exemptions but the current blanket opt-out option, in practice, seems as meaningless as the rules of shop workers working Sunday shifts (I worked in a shop full time when these rules were introduced. I was formally told I had the right to opt out but it was made very clear that anyone who did would be looked at unfavourably in the future). If a compromise could be brought forward between the opt-out and compulsory options I’d be open-minded about it, and I would certainly be sceptical about a France-style 35 hour week, but I would have little problem with the current European law.

With all that said, I do think there is a lot we could do to make it easier for both employers and employees. Fundamentally, we tax work far too much in this country while leaving wealth almost untouched. While this is the case there will always be pressure on employers to employ fewer people for more hours (as opposed to more people for less hours) and pressure on staff to work whatever hours they can. The right to flexible working is all very well, but are making it has hard as possible for people to be flexible. A liberal government would consider changing this to be a priority. The poor record of the Lib Dems in this respect has been deeply disappointing.

The party’s move towards lifting the poorest paid out of taxation is a long overdue step in the right direction (it should be noted that this was party policy in 1997) but I would like to see us go much further.

The 1992 Lib Dem manifesto, which more than anything else is the document which made me join the party, contained a commitment to a modest citizen’s income. I believe we should revisit this policy.

How would all this be paid for? The only way I can conceive is by establishing a national Land Value Tax, something which has been Lib Dem policy for a long time but which we have been very lukewarm about in recent years. Instead of cravenly following public opinion on this one, it is time we started to make the case for a fundamental shift in the burden of taxation. I really do believe it is an argument that can be won.

9. Are they ways we can promote greater employee responsibility for their work, and/or involvement in deciding how they work? How could we encourage staff stake-holding?

All the evidence I’ve read – and personal experience – indicates that greater democracy in the workforce leads to a happier workforce and greater efficiency. It would almost certainly also help control out of control executive pay in a way that crude mechanisms such as a “maximum wage” could not.

Again, in the not so distant past the Lib Dems had much stronger policy on this and the time is right to rediscover our passion for “industrial democracy.” This means much more emphasis on obliging companies to consult their workforce, share ownership schemes and mutualism.

10. How could quality of life thinking shape our approach to education, training and career choices?

This is a huge topic and I am not an expert in education. I certainly think we need to broaden apprenticeship training in this country. A shift away from income taxes would encourage this, as would greater workplace democracy.

Vocational qualifications such as MBAs can be fearfully expensive. Some employers are better than others at helping staff cover the cost of these. A great many employers are simply too small. I certainly think there is a case for government subsidising these qualifications through small businesses and non-profit organisations.

11. Should we have more public holidays or increased holiday entitlements? Or even statutory education and training days where employees would be free to pursue skills related either to their current job or future employment prospects?

A few more public holidays would bring us up to the European average. I’m not convinced about the need for statutory training days as the need for these would vary enormously depending on the employee and employer.

12. Technological developments have changed the way we work and at times can contribute to unemployment as companies need fewer people to do the same work. Would it be better for wellbeing if we reversed this trend?

I didn’t realise Ned Ludd was on the working group! Technological developments certainly can lead to structural unemployment in the long term but if anything the experience of the past 250 years points in the opposite direction: we are working longer hours than ever and are able to afford a welfare state. Technology also creates new types of work and will continue to do so in exciting ways. The fact that fewer people are working themselves to death in factories and farms than in the past is a good thing.

With that said, it does bear repeating that while companies are free to make whatever capital investment they wish, labour costs come with a deadweight cost. We should be less concerned about technology putting people out of work and more concerned about ensuring that the two are put on a level playing field. Once again, this means taxing labour less.

13. How can we tackle the stigma of unemployment?

14. Should employment policy be refocused on creating a more flexible employment market with more active government intervention, like Denmark, where it is easier for the unemployed to find new work and consequently less necessary to have high job protection? How would this be achieved?

15. Can we better use unemployment as an opportunity for people to retrain and gain new skills?

Unemployment should carry a stigma and there are too many parts of the country where it doesn’t have enough of one. That isn’t to say we should ever write people off – quite the opposite.

Again, I think a shift away from taxes on labour would help increase the fluidity of the labour market (I know I sound like a stuck record here, but this is the problem with answering each question in turn). This, combined with a citizens’ income would reduce the disincentive within the benefits system to take on low paid work.

We also need to remove the barriers for internships and volunteer work. Currently in my experience the system all but discourages these by forcing people to do less than 16 hours a week and insisting on a paper trail. Yet such activity ought to be encouraged – even incentivised. We could even extend this to political parties: there are much worse things people could be doing with their time than actively working within their communities.

I don’t know enough about the Danish system. Since the working group is clearly looking at this model, it would have been useful to have an explanation, or at least a footnote for us to explore in more detail.

The week in Georgism

I still haven’t got my post-election blogging groove back. In the meantime, here are this week’s news referencing Henry George out there in the internets.

First, “The Silent Consensus” has a piece on the Daily Kos. He begins by quoting Thomas Paine:

“Men did not make the earth. It is the value of the improvements only, and not the earth itself, that is individual property. Every proprietor owes to the community a ground rent for the land which he holds.”

See also FDR’s Second Bill of Rights and the Progressive Mission and Resurrecting Henry George: The Case for National Housing Assistance. George also gets a brief namecheck on the Huffington Post this week.

Old Henry also appears to have been the inspiration for a sculpture garden in Fairhope, Alabama.

Over in New Hampshire meanwhile, Professor Richard England is making the case for a land value tax.

I’ve noticed a slight increase in talk about LVT stateside recently. Is it the start of a post-crash trend? Time will tell.