Why Vince Cable should be sacked...

****

Because he says utter tripe like this:

"I am going to confront the old-fashioned negative thinking which says that all government needs to do to generate growth is to cut worker and environmental protections, cut taxes on the rich and stroke 'fat cats'. I'm completely repudiating the idea that government has to get out of the way. Government has a positive role to play."

Now I am one of those "backward" Tory right-wingers - you know the ones who believe in low taxes, less regulation, smaller government, devolution, localism and getting out of the EU. And yes, I know that more flexible employment laws result in higher employment. Vince should go check out what the ILO has to say on the subject:

EPL is significantly correlated with certain labour market flows across countries, such as labour turnover, inflow into unemployment, duration of unemployment and the share of long-term unemployed. The stricter the EPL is, the lower the labour turnover, the higher the inflow into unemployment, the longer the duration of unemployment and the higher the proportion of long-term unemployment in total joblessness are.

How much clearer do you want it Vince? 

And as for taxes, it's not just taxes on the rich we want cutting, it's taxes on everything. Taxes are a cost to business, the state spends that money badly and Vince's high tax environment reduces liberty and undermines personal choice.

Finally, I can think of no question in Vince's portfolio - not one - to which the answer isn't "government should get out of the way". I've never met a business manager who didn't bemoan the pointless paperwork, the daft regulations, the endless charges levied by some bureaucrat or another - it's these things that we want scrapping. We want to make it easy to start a business, easy to employ someone, easy to import and simple to export.

Vince is just another socialist, another who thinks he knows better than the market yet offers no coherent approach beyond "government has a positive role to play". We had fifty years of social democratic second-guessing - from Wilson, Heath, Heseltine, Blair, Brown and now Cable. Fifty years of getting those guesses wrong. Fifty years with rising levels of structural and long-term unemployment.  Fifty years of asset inflation fuelled by state-sponsored cheap bank lending. Fifty years of that "positive role" for government.

And it didn't work then, it isn't working now and it won't work tomorrow.


That's why Vince Cable should be sacked.


....

"We are all guilty...": some thoughts on Vince Cable

I was quite taken by the Vince Cable episode. Not because is revealed the scale of the twinkle-toed sage of Twickenham's self-importance and arrogance although that was very clear from the transcripts:

"Can I be very frank with you, and I'm not expecting you to quote this outside. I have a nuclear option, it's like fighting a war. They know I have nuclear weapons, but I don't have any conventional weapons. If they push me too far I can walk out of the government and bring the government down and they know it. So its a question of how you use that intelligently without getting involved in a war that destroys all of us."

Clearly the passing resemblance between Vince and a certain Yoda has gone to his head!

However, this isn't the thing that has taken me. I am fascinated by the manner in which the event - a gentle little honey trap on a self-important cabinet minister - has played out. Not only are we continuing to debate whether the "Coalition" is going to hold on but we are also discussing the ethics of the Daily Telegraph's 'sting', the nature of debate around the ownership of media and whether Liberal Democrats are now revealed as evil, blood-sucking monsters from the planet Tory!

Moreover, the entire affair yet again reveals the presumption - reinforced by the Wikileaks saga, the revelations about MPs expenses and a whole host of revelations within out newspapers - that much is conducted in secret and that people lie. Politicians lie, businessmen lie, trade unionists lie, footballers lie and film stars lie. Indeed, the only place where the truth remains untarnished is within the media, those stalwart champions of honesty and decency!

Put simply this is all rubbish. The sting on Vince Cable reveals his pomposity and self-importance and much of the Wikileaks stuff merely shows that is suits people sometimes to be a little duplicitous. And in doing so these people - be they diplomats, cabinet ministers or nine-year-old schoolboys - lie. They lie because we all lie - it's convenient, quick and most of the time pretty harmless. So-called transparency - whether through the theft of private information or through the recording of private conversations - serves only to change the basis on which we lie not the fact of our lying.

So when people clamber up onto their high horses over Vince Cable's revelations they serve no purpose other than to demonstrate the essential - and hideous - truth. The biggest sin isn't to lie, to cover up or to deceive. The biggest sin is to get caught out!

In the end we get the politicians we deserve - lying, duplicitous, double-dealing. As Heinz Kiosk would have out it....

"We are all guilty!"

....

Vince is right about business and competition - but his solution is wrong, very wrong.

We have to disagree with Vince don't we? After all his rhetoric about spivs and gamblers, his comments about capitalism, his anti-business stance - all these things make him wrong and bad?

Well not exactly. Indeed Vince's comment about business and competition is absolutely spot on:

Capitalism takes no prisoners and kills competition where it can, as Adam Smith explained over 200 years ago. I want to protect consumers and keep prices down and provide a level playing field for small business, so we must be vigilant right across the economy – whether in the old industries of economics textbooks or the newer privatised utilities and cosy magic circles in auditing, law or investment banking. Competition is central to my pro market, pro business, agenda.

Understand this dear reader - business is, to the very core of its being, anti-competition. As a businessman my aim is - or should be - to secure some form of monopoly or monopolistic advantage so as to get closer to the nirvana of maximised profits. Whether it's the market trader who objects to another swagman taking a stall in the covered market, the banker who persuades the regulator to prevent market entry or the steelman who bribes the government party to introduce protectionist anti-dumping rules. Or even the horny-handed farmer moaning about the inadequacy of subsidies. All these businessmen - and women - are not interested in promoting competition. They are interested in reducing competition - at least so as it favours their profitability.

Vince referred to Adam Smith who famously said:

People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices…. But though the law cannot hinder people of the same trade from sometimes assembling together, it ought to do nothing to facilitate such assemblies, much less to render them necessary.

And that was what Vince was on about - the last labour government (and governments elsewhere and before) facilitated a corrupting association between bankers, financiers and governments that allowed a vast conspiracy against the public interest to damn near destroy our economy. We allowed - just as we have done with health, with education, with agriculture and (increasingly) with social care - the production of the service to take precedence over the consumption of the service. Government has acted against the interests of the people and in the interests of rent-seekers (and spivs and gamblers) seeking to profit from monopolies of service.

We have forgotten what else Adam Smith had to say:

Consumption is the sole end and purpose of all production; and the interest of the producer ought to be attended to, only so far as it may be necessary for promoting that of the consumer.

I'm not sure Vince - with his faith in the power of 'better regulation' quite understands - almost always, regulation acts against the interests of the consumer by reducing competition, preventing market entry and stifling trade. So, while Vince is right about business not liking competition he is wrong about how to protect that competition:

But let me be quite clear. The Government's agenda is not one of laissez-faire.

And that's where you're wrong, Vince - if you want more competition you have to get Government out of the way, to stop giving in to special pleading, to break down the monoliths of health and education and to institute again a free-trading, free-market, laissez-faire economy. It will work - and we, the consumers, will be grateful for the wealth that our liberty brings.

....