Brexit and the waning days of the United Kingdom

[Zanza]

You are wrong. Levelling up means funneling money into Tory constituencies and marginal to make sure Tories get reelected.

[Sheilbh]

It's funny how people are analysing "levelling up". It's Johnson. It's an empty buzzword. Nothing of substance will happen.

You don't appoint Michael Gove to an actual department if you want nothing of substance to happen. You might not like it and he may saddle Johnson with a lot but he will do something (not sure what yet - but I imagine it'll be centralised).

You are wrong. Levelling up means funneling money into Tory constituencies and marginal to make sure Tories get reelected.

If it helps some of the areas that switched I don't really have a problem with that. I mean New Labour's regeneration program, which was transformative focused on overwhelmingly Labour voting post-industrial cities. It's just the Tories have some post-industrial constituencies now

Edit: Incidentally - as well as the fight over how Labour does leadership elections (which Starmer appears to have lost) the other bit of his plan to re-launch his leadership was a 14,000 word essay on what he stands for/his vision is etc for the Fabians. I'm not sure it's the best way to announce yourself to the public post-radio

[Josquius]

Labour focused on post industrial cities, the best places to spend money and all of which happened to vote Labour.

The tories are focusing on seats that voted tory. Ignoring seats equally or more deserving and of a similar profile that didn't.

Kind of different.

Also lots of shiftyness in how they're going about this. I've mentioned before about how much of a utter scum bag nw Durhams tory is, setting up his rail restoration project to fail (with labour to blame) from the get go. Its all about optics rather than doing something to help.

[Sheilbh]

Labour focused on post industrial cities, the best places to spend money and all of which happened to vote Labour.

The tories are focusing on seats that voted tory. Ignoring seats equally or more deserving and of a similar profile that didn't.

I think there's a bit of wait and see - there's zero substance so far.

And this maybe right economically - but even then New Labour spread the jam thin spending on lots of the smaller cities across say West Yorkshire and the North-West. I think the better approach would have been basically pour all that money into, say Liverpool and Manchester or Leeds and Sheffield plus the links between them as sort of regional cores.

But it's not just about economics - from all the Centre for Towns stuff we know that a bigger driver of frustration and anger with politics is in towns. Plus I just think spending money on areas that are below the national average is generally good and should be done whatever, even if it's not ideal.

More importantly though, things have changed. Of the ten most deprived council areas in the country - half have Tory MPs now in places like Burnley, Blackpool, Middlesbrough etc. If they get more money - that's good.

[Richard Hakluyt]

The government has announced that there is no risk of power cuts this winter; I have therefore ordered a couple of rechargeable lanterns.

[Sheilbh]

Just to flag this is what I mean by the UK having a pitiful amount of gas storage compared to the rest of Europe:


Having said that I think the worry about energy companies going bust is a little bit misleading. There was a reform in the Brown/coalition years to energy markets so basically a huge amount of energy companies don't produce any energy. They are basically middle-men who have a call centre and buy low on the wholesale market and sell high on the retail market. So we went from under 20 energy companies in the 2000s to 50-70 now. Some have been genuinely interesting/innovative like Bulb, but others are just middle men.

There is also a very developed way of dealing with your energy company/supplier going bust. This happened to me last year (and apparently every winter 5-10 energy companies go bust - though this year it's a question of maybe as many as 40 disappearing). I hadn't followed the news at all but the supplier I used went into administration, their customers (including me) were transferred to other suppliers by the regulator - all my debit and credit and account details carried over to the new supplier for at least that quarter and then they just asked for meter readings as normal but I think in that period you could also choose supplier if you wanted. It was - from my perspective - absolutely painless, I'd just get email updates every couple of weeks.

So I don't think the energy company thing matters, it's probably a bit of a red herring (unless a big supplier goes bust) - it's more whether we'll actually have enough energy that's the issue

But hopefully this will prompt government to speed up and increase spending on the transition from gas heating and cooking.

[Tamas]

Wow so our entire country is run on gas and we store what seems like a couple of days worth of it? You'd think people on an island would be more concerned about being cut off from the rest of the world.

[Richard Hakluyt]

I think most of the actual energy producers are coining it as the demand for their products is pretty inelastic. So much so that the government is contemplating a windfall tax https://www.theguardian.com/uk-news/2021/sep/22/windfall-tax-on-firms-profiting-from-gas-price-rises-an-option-says-minister .

I do hate windfall taxes though and would prefer a better regulated market......maybe a requirement for these firms to construct storage for example  ?

[Richard Hakluyt]

Gas storage was bigger when the former Rough gas field was used as a storage site https://en.wikipedia.org/wiki/Rough_(facility) , but that closed down recently and nothing has been done about a replacement.

(even with Rough storage was pretty low by general European standards)

[Sheilbh]

Wow so our entire country is run on gas and we store what seems like a couple of days worth of it? You'd think people on an island would be more concerned about being cut off from the rest of the world.

As I say it is incredible that we have this huge supply crisis but amazingly it doesn't actually seem to be particularly Brexit driven - it's other systemic failures instead

There's a combination of global factors and, as RH said on Private Eye, people have been warning about this for at least a decade but no-one fixed it due to a dangerous combination of very British complacency and NIMBYism (no-one wants a gas infrastructure near them) with environmental activism (why are we building any fossil fuel infrastructure).

I think most of the actual energy producers are coining it as the demand for their products is pretty inelastic. So much so that the government is contemplating a windfall tax https://www.theguardian.com/uk-news/2021/sep/22/windfall-tax-on-firms-profiting-from-gas-price-rises-an-option-says-minister .

Yeah I think it's primarily the middle-men companies that will go bust because they will run up against not being able to buy low on the wholesale market and, because of the price cap, not being able to sell high on the retail market.

I do hate windfall taxes though and would prefer a better regulated market......maybe a requirement for these firms to construct storage for example  ?

I don't mind windfall taxes for windfall events and I think covid is one for companies that did well out of it - and in a way this is a follow-on after-effect from covid (I understand one of the big drivers is a surge of demand globally as economies re-launch especially in Asia - so UK, German and French PMI data all reports supply constraints as the big issue). But an energy price spike also strikes me as something suitable for a windfall tax.

Maybe on constructing gas storage but we'd still meet issues with environmental campaigns - there's been a huge fight for the last ten years with industry pushing for gas as the base energy with campaign groups against that - and NIMBYism.

Edit: Also looking at the Wiki on Rough and they've looked at other old gas fields as storage but none have been economically viable as Rough wasn't - and nothing strikes me as more indicative of modern Britain that not building things that are actually necessary in case of emergency because they're not economically viable in normal/good times

Edit: basically I think when we get to the Dominic Sandbrook or whatever history of the 2020s it should probably be called "Well, well, well, if it isn't the consequences of my own actions"

[Tamas]

As I say it is incredible that we have this huge supply crisis but amazingly it doesn't actually seem to be particularly Brexit driven - it's other systemic failures instead

I'll trust you on this because you are better informed than me, but isn't it a tad bit suspicious that we have a gas supply crisis, a worker shortage in multiple industries, a minor/growing goods shortage and probably higher inflation than other countries, half a year after Brexit actually happened?

[The Brain]

As I say it is incredible that we have this huge supply crisis but amazingly it doesn't actually seem to be particularly Brexit driven - it's other systemic failures instead

I'll trust you on this because you are better informed than me, but isn't it a tad bit suspicious that we have a gas supply crisis, a worker shortage in multiple industries, a minor/growing goods shortage and probably higher inflation than other countries, half a year after Brexit actually happened?

You are levelling up. It can be a confusing experience.

[Sheilbh]

I'll trust you on this because you are better informed than me, but isn't it a tad bit suspicious that we have a gas supply crisis, a worker shortage in multiple industries, a minor/growing goods shortage and probably higher inflation than other countries, half a year after Brexit actually happened?

They are separate. The worker shortage and goods shortage (or possibly delivery shortages) are definitely linked to Brexit - though there is an open question about how much is Brexit, how much is covid and how much is systemic.

Inflation - maybe - the OECD has said that inflation is likely to remain higher for a couple of years. It's higher in the US than in the UK - I'm not sure about Eurozone countries. But basically during covid we shut down the economy and had the largest ever economic contraction - 20% in one quarter - which was a deliberate policy. Globally the ILO estimates that 3.3 billion workers (so not self-employed or sustenance farmers etc) out of 3.5 billion workers were either working under restrictions like lockdown orders to stay at home or furloughed - but globally 90% of the world's workforce has been under some form of restriction at some point in the last 18 months. And now as vaccines rollout and as other countries have got to a zero-ish covid state a large proportion of those economies are coming back online at a similar time and at a similar pace - that seems like it's almost designed to cause an inflation spike. I think it is realy striking as I say that PMIs across Europe are all mentioning issues with supply as their big constraining factor. There will be a Brexit impact but on inflation in general I think that is probably far lower than the global/covid factors.

But on gas I just read a couple of explainers in the Guardian and know nothing - but neither of them mentioned Brexit at all and I feel like if there was a Brexit angle, the Guardian would have found it
https://www.theguardian.com/business/2021/sep/21/what-caused-the-uks-energy-crisis

[Josquius]

 Remember back when we facing under evil comrade corbyn the lights going off and a cold winter?
Yeah...

The way energy suppliers are setup in the UK is simply ridiculous. Even more so than trains there's no reason for it to be privatised in this way. Those who actually generate the power selling it to the grid- sure I can get it. But the grid should then be under a single owner selling the energy onwards.... which it sort of is, there's merely these middle men doing nought but sell it from the grid.
Alas I doubt we'll learn from this crisis.

Hopefully out of this we'll see more heat pump funding projects? Alas will probably be too late for me, likely need a new boiler this winter.

[Tamas]

Sheilbh: Yeah we have lots of coincidentally synchronised crisis none of which are linked to the coincidentally synched Brexit according to the various narratives. What an unlucky country this is, accidentally hit by a number of unrelated issues right at the time when the stupidest decision of a generation came into effect.

Tyr, I don't think the number and type of suppliers have much to do with this. Our provider went bust early this year, we didn't have any hickup in our actual supply of course, just got a letter one day saying "BTW your supplier went bankrupt like two months ago, you are now with EDF, good luck".