Brexit and the waning days of the United Kingdom

[Tamas]

Fine, thanks, but I do wonder how this is going to address high inflation (I know I know, it'll go away on its own ).

On Channel 4 news somebody just said its either genius or bonkers. Honestly, seeing who the leaders are and how they came to power, what are the odds they are well-hidden geniuses who have figured out something the rest of the world thinks is bonkers will actually turn around the British economy in the midst of a global crisis? I mean seriously.

[Sheilbh]

Fine, thanks, but I do wonder how this is going to address high inflation (I know I know, it'll go away on its own ).

I suppose their view would be that's for the BofE - and the supply side reforms would have an impact on inflation.

I've said it before but one of Truss' advisers has said that interest rates probably need to go to 7% and rise quickly - they've probably been reading your posts

[Tamas]

Surely economic policy should account for inflation effects? Just because it is somebody else's responsibility, its reasonable to expect consultation and cooperation.

I know we are supposed to be eternally optimist that this latest batch of twats is the real deal but I am having serious deja vu about all the hopes around the major reforms Johnson announced (about every 3 months). And I don't seem to be alone in being skeptical.

[Tamas]

I imagine the way this thing went was Truss gave the order "I promised tax cuts and deregulation, deliver it!" so Kwarteng gave a thought of what his friends complained about when it came to taxes and regulation, and voila this mini budget was born.

I think that's the extent of thinking here.

[Tamas]

The chief secretary to the Treasury has also dismissed warnings that the pound could fall to parity with the US dollar as "absurd".

Chris Philp was asked whether the government would have to resign in this scenario, which economists have warned is possible after the Chancellor's tax-cutting mini-budget.

He told BBC Radio 4's PM programme: "I'm not gonna get into frankly slightly absurd hypothetical speculation.

"We only came into office two-and-a-half weeks ago.

"We've got a job to do ... We're going to make this country an economic success."

Philp, who has been a government minister for several years, was earlier ridiculed after claiming Kwasi Kwarteng's announcement had pushed up the value of the pound, moments before it dived to a 37-year low.

[Sheilbh]

I know we are supposed to be eternally optimist that this latest batch of twats is the real deal but I am having serious deja vu about all the hopes around the major reforms Johnson announced (about every 3 months). And I don't seem to be alone in being skeptical.

I think these guys are the real deal in this sense.

I remember in 2019 saying to friends that we hadn't seen a Tory government with a really strong majority doing what they want  before (too young to really remember pre-New Labour). But I've also spent the last three years saying that actually Johnson isn't terrifyingly right-wing and is basically a big spending liberal Tory and someone who doesn't have enough grip or attention of detail or work ethic to actually do things.

I think Johnson's leveling up and spending on infrastructure etc etc could work. But it would require Johnson to be a different person. The sense you get from Tories over the last 3 years is that they've wasted a big majority and done nothing with it. I think that's true.

My sense - and I could be wrong - is that these guys are the real deal. They have views and they are going to use their majority and do things. So that big Tory majority I've worried about for the last 3 years is going to be used.

In part I think this budget is about that on the political level.

I imagine the way this thing went was Truss gave the order "I promised tax cuts and deregulation, deliver it!" so Kwarteng gave a thought of what his friends complained about when it came to taxes and regulation, and voila this mini budget was born.

I think that's the extent of thinking here.

The IEA and the Centre of Policy Studies were literally ticking off their ideas today as they came up in the budget. I think it's striking that there's been people from Cato in DC defending the budget and seeming like maybe they had a little bit of foresight of what was coming.

I think what you're saying would probably be true of Johnson who was only interested in saying whatever he needed to to get over the room. I don't think that's the case here - I think this is a government that wants to use its majority (which I can sympathise with) and is ideologically motivated and planning to implement ideas and policies that have been circulating in those right-wing think tanks for years while they've been broadly disappointed by May and Johnson.

Edit: And you need a mini-budget to do the energy price cap. You can't suddenly announce £60 billion of spending over six months without a "fiscal event". But I think they wanted it to be about more than that - on that front mission accomplished, I suppose.

[PJL]

All the investment tax breaks the government are supposedly planning aren't a bad idea if they were properly funded (the same goes for the energy price freezes BTW). But because it's going to be funded by borrowing, it's going to push up interest rates. This not only affects mortgage rates but business loans as well, particularly for small businesses. So not only are the rich going to be far better off than the poor under this but there will also effectively be a profit windfall on the large oil & gas businesses paid for by small businesses.

[Sheilbh]

And the market's pricing in rates going to 5.5% - which looking at that chart from Ed Conway adjusting rates for affordability is about as high as the early 90s recession.

[Sheilbh]

Separately - most, though not all, of this sounds awful I feel like Brown has form for this - getting asked to do a big constitutional review that then quietly gets shelved, maybe under Miliband?

Labour may abolish House of Lords if it wins next election, leaked report reveals
Exclusive: Constitutional review by Gordon Brown also recommends devolving economic powers
Jessica Elgot Chief political correspondent
@jessicaelgot
Thu 22 Sep 2022 19.30 BST
Last modified on Fri 23 Sep 2022 09.59 BST

Labour is considering abolishing the House of Lords and replacing it with an upper house of nations and regions, as well as handing sweeping new powers to local regions and devolved nations, a leaked report has revealed.

The constitutional review by the former prime minister Gordon Brown, which has been seen by MPs and shadow cabinet ministers, recommends devolving new economic powers, including over taxation, and creating new independent councils of the nations and for England.

The review, seen by the Guardian, recommends:
    New tax powers for some devolved governments, which could include stamp duty.
    Powers for local people to promote bills in parliament via democratically elected bodies.
    A constitutional guarantee of social and economic rights.
    Powers for mayors on education, transport and research funding.

Brown also recommends a crackdown on standards in central government and parliament, including a jury of ordinary citizens – selected by ballot – being able to rule on complaints against MPs and ministers via a new integrity and ethics commission.

He recommends banning most second jobs for MPs, which the party leader, Sir Keir Starmer, has already announced, as well as new codes of conduct to replace the ministerial code, and giving the electoral commission the power to hand out larger fines.

The review has been subject to intense internal debate and several shadow cabinet ministers have privately expressed scepticism about some of the proposals, which are radical and far-reaching.

The measures are not expected to be agreed in time for the Labour party's conference and had been scheduled for a major launch later in the year.

Starmer hinted in his Liverpool speech earlier this year that the reforms would "allow devolved and local government to make long-term financial decisions. To reap the rewards of investment in their economy. That way you make sure every city, every town, every place takes ownership of their contribution."

The House of Lords would be reformed as an assembly of regions and nations, with a remit of safeguarding the constitution and with power to refer the government to the supreme court. Labour peers are being consulted on the proposals.

Local democratically elected bodies will be able to promote bills in parliament for local purpose, which the review said would allow English regional devolution to grow over time.

At the heart of Brown's recommendations is to give citizens a constitutional guarantee of social and economic rights, including a right to healthcare, education and social protection.

He recommends giving regions economic powers to be the centres of new industries, citing the examples of financial services in Canary Wharf, biopharma in Cambridge and video games in Dundee.

Mayors could get full powers over local training and further education budgets, as well as further powers over transport, infrastructure and planning. Local leaders could get the powers to allocate local investment for national research and development funding into local universities.

Local and devolved authorities would be given a minimum of three years' funding to give them certainty for longer-term planning.

Brown was commissioned to undertake the review by Starmer in September last year and the work has undergone a number of revisions. Starmer said the plans would set out a "fresh and tangible offer" to voters who had turned away from the party, especially to the Scottish National party in Scotland and to the Tories in the north of England.

Starmer promised it would be "the boldest project Labour has embarked on for a generation and every bit as bold and radical as the programme of devolution that Labour delivered in the 1990s and 2000s".

Brown has made significant interventions over the past few months on the cost of living crisis, including throwing down the gauntlet to Starmer to announce a freeze on energy bills, but going further and saying the government should nationalise energy firms that would not give consumers lower bills.

A Labour spokesperson said: "This refers to one of several early drafts. The commission has yet to take a view on all these issues."

[mongers]

Somebody told Kwarteng that Anthony Barber was the most high profile Tory chancellor of the last 50 years, so he though ' I'll tank that guy' .

[Josquius]

Sounds good to me. Though there is the obvious potential attack line of just trying to do what Blair failed /we already had a referendum on av thus all reform is banned forever.

[mongers]

'Liz Trusts Crazy Kwarteng.'

[Tamas]

It would seem we have already reached the stage of "replace East European health care workers with indentured servants from Nepal" :

https://www.theguardian.com/politics/2022/sep/25/plan-to-recruit-nepal-nurses-for-nhs-puts-them-at-risk-of-exploitation

Plans to recruit nurses from Nepal to help plug shortages in the NHS will expose workers to an "unacceptable risk" of exploitation and should be halted until safeguards are in place, labour experts have warned.

The UK has been accused of pressing ahead with a hiring spree despite concerns about abusive practices by Nepali recruitment agencies, which are notorious for charging illegal fees that leave workers saddled with debt.

The government-to-government deal, signed last month despite Nepal's status on the World Health Organization's recruitment "red list", will begin with an initial pilot involving about 100 recruits but could see thousands of nurses and other healthcare workers move to the UK from Nepal over the next few years.

The Department of Health has hailed the scheme as an "ethical" initiative that will allow for "managed" recruitment to plug UK shortages. A memorandum of understanding says workers should not be charged fees and that recruitment will be overseen by a Nepali government-run "implementation unit". But critics accuse ministers of turning a blind eye to abusive recruitment practices in Nepal. They say safeguards are needed to protect workers from exploitation.

More in the article

[HVC]

If you're going Asian nurses Why not do what everyone else does and use Philippino?

[Richard Hakluyt]

Already doing that, about 40,000 so far. Last time I visited London the area I stayed in was a "little Manila" in the making.