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Showing posts with label lies. Show all posts
Showing posts with label lies. Show all posts

Tuesday 7 June 2016

Voters believe that even if they did exercise their right to leave the EU, the politicians wouldn’t obey them.



Aditya Chakrabortty in The Guardian


 
‘Voters believe that even if they did exercise their right to leave the EU, the politicians wouldn’t obey them.’ Illustration by Matt Kenyon


Neil was speckled with paint from his trousers to his spectacle lenses, and had come straight from work to the vape shop. When I asked which side he’d be backing in the EU referendum, he projected as if addressing a rally. He wanted everyone to know he was damned if he was going to vote. “It’s an illusion that we’ve got a say in it. We don’t live in a democracy. The day of having a common working man standing for us here or in Europe – it’s over.”

We were in Pontypool, south Wales. As a valleys boy (“I smell of sheep”), Neil had been brought up Labour. But now, “It’s all lies, isn’t it?” Then came the sins: Blair “a big liar”; the political class in the pockets of the bankers.

It was the refrain I kept getting last week across south Wales – and have heard in many other regions too. That dissolution in old loyalties, that breakdown in trust, runs wide and deep – and it already marks the referendum on 23 June. Opinion polls show that voters believe that even if they did exercise their right to leave the EU, the politicians wouldn’t obey them. This is what a democratic crisis looks like.

Although journalists often remind us that this is the first vote the British have had on Europe in 40 years, they rarely dwell on what happened last time round. Yet the torchlight of history shows just how much has changed. While today’s polls show leave and remain neck and neck, the 1975 referendum on whether Britain should stay in the European Economic Community was as good as won before it was even announced. The then prime minister, Harold Wilson, led a coalition of the establishment – all three parties, the unions, the business lobbies, the press – and emerged with a 2:1 majority to stay in.

Europhoria” is how the Guardian reported the results. Its leader began: “Full-hearted, wholehearted and cheerful hearted: there is no doubt about the ‘yes’.” Imagine anything even close to that being said in two weeks’ time – after months of sullen and sour campaigning, of close colleagues branding one another “liars”, “luxury-lifestyle” politicians and “Pinocchio”.

“Wilson would never have asked a question of which he couldn’t be confident of the answer,” says historian Adrian Williamson. Contrast that with David Cameron, who once claimed he wanted to be prime minister because he’d be “rather good at it”, but now resembles a short-tempered supply teacher struggling to control his own class.

Panicked by a fear of Nigel Farage and the ultras in his own party, the Tory leader has staged a referendum for which there was little public appetite and which he may now, incredibly, lose.

Months were spent trailing a deal that the prime minister was going to strike with Germany’s Angela Merkel and the rest – a rewriting of the rules that was going to form the basis of this referendum. You’ve barely heard about that deal since.
Posed a question few of them were actually asking, voters have wound up raising their own. Why haven’t my wages gone up? How will the kids get on the housing ladder? When will my mum get her knee replacement? All good questions, none of which are actually on the ballot paper. The likely result is that on 23 June, many of those who do vote will try to squeeze a multitude of other answers into one crude binary.

In 1975 Roy Jenkins, another son of Welsh coal and steel, explained the result as: “The people took the advice of people they were used to following.” Classic Jenkins, but also an expression of the classic role of mass political parties. When they had millions of members, both Labour and the Conservatives served as the brokers between the people they represented and the “experts”, the authoritative midpoint between ideology and empirics.

Neither party can claim to be mass any more, least of all the Tories – low on members, bankrolled by hedge funds and the City. This creates what Chris Bickerton, politics lecturer at Cambridge, calls “the crisis of political mediation”.

No longer claiming the same democratic legitimacy as their predecessors, Cameron and George Osborne have had to borrow their authority from other sources: Mark Carney and the Bank of England, the International Monetary Fund, the Treasury. These technocrats, much cited by broadcasters and jittery remainers, are one of the two main sources of authority in our democracy. The other is the post-truth brigade, as channelled by Boris Johnson and Michael Gove, who advise voters to ignore the nuance, trust their gut – and blame migrants or the Brussels fatcats.

British democracy in 2016 comes down to this: a prime minister can no longer come out and say something and expect to be believed. He or she must wheel out a common room-full of experts. He or she can expect to be called a liar in the press and by their colleagues. He or she can only hope that some of what they say resonates with an electorate that has tuned them out.

And mainstream politicians have only themselves to blame. Over the past three decades, Britons have been made a series of false promises. They have been told they must go to war with a country that can bomb them in 45 minutes – only to learn later that that was false. They have been assured the economy was booming, only to find out it was fuelled by house prices and tax credits.

New Labour pledged an end to Margaret Thatcher’s unfairness, except that – as the Centre for Research into Socio-Cultural Change has shown – the richest 20% of households scooped as much of the income growth under Brown and Blair as they had under the Iron Lady.

Britons were told austerity would last five years, tops – although we will now endure at least a decade.

And the people of south Wales were told new industries would replace the coal and steelworks. Looking out of the shop window, Neil remembered how Pontypool on market days like today would be “rammed”. Now it was half-empty. “It’s dead now, because they took what they wanted,” he said. “Thatcher smashed the unions. There used to be coalmines all around here. Boosh – we’re out of here. They’ve moved on.”

Cameron and the rest of the political class are learning a lesson the hard way. You can only break your promises to the public so many times before they refuse to put any more trust in you. After that, you have to rely on Threadneedle Street and the Treasury to corrode their own finite reputation for impartiality.

Whichever way the ballots go on 23 June, the public will continue returning a vote of no-confidence in Westminster for a long time to come.

Thursday 12 June 2014

Lies, damn lies, and Fleet Street stories about Kevin Pietersen


News-International-office-007

For months now, most of the mainstream cricket press have patronised and belittled England supporters who’ve dared to question their line on Kevin Pietersen.

We’ve said that too many hacks are:

(a) Prejudiced against Pietersen.
(b) In hock to the ECB.
(c) Far too ready to accept the ECB’s anti-KP spin as gospel truth.
(d) Instead of asking proper questions, have just believed any old rubbish Paul Downton has told them off the record.

They’ve not liked it one little bit. “Keyboard ranters” is how Derek Pringle describes the likes of us bloggers and Tweeters. The fourth estate see us impudent, paranoid, deluded, and in the grip of conspiracy theories.

They say we should shut up and be grateful for their privileged insight into the real workings of English cricket. In their minds, we must accept that KP is a bad man because…because they say so. They know the inside track, goes the claim – although they couldn’t possibly divulge the details.

Unfortunately for Her Majesty’s Press, the whole charade has today blown up in their face. The edifice has collapsed.

Yesterday, Sun cricket correspondent John Etheridge boasted this exclusive:


But there was a tiny problem: it was complete bollocks. As KP himself quickly made clear, by producing a photo of himself with the very presents he had supposedly forsaken. 

LIES from this morning! Who briefs you, John? Care 2 check ur facts instead of misleading the public?

Sunday 12 May 2013

Lies, damned lies and Iain Duncan Smith



The way the work and pensions secretary manipulates statistics is a shaming indictment of his department's failings
IDS's claims slammed
The work and pensions secretary, Iain Duncan Smith, was reprimanded by the UK's statistics watchdog over his claims about the benefits cap. Photograph: Ian Nicholson/PA
When you see rottenness in a system you must ask: does it come from one bad apple or does the whole barrel stink?
The rank smell emanating from the coalition is impossible to miss. At first sniff, it appears to come from the blazered figure of Iain Duncan Smith. It has taken me some time to identify its source, because appearances deceive. From his clipped hair to his polished shoes, Duncan Smith seems to be a man who has retained the values of the officer corps of the Scots Guards he once served. Conservative commentators emphasise his honour and decency. They speak in reverential tones of his Easterhouse epiphany: the moment in 2002 when he saw the poverty on a Glasgow estate, brushed a manly tear from his eye and vowed to end the "dependency culture" that kept the poor jobless.
Duncan Smith's belief that the welfare state holds down the very people it is meant to serve is pleasing to Conservative ears. To maintain his supporters' illusions, he has to lie. Last week, the UK Statistics Authority gave him a reprimand that broke from the genteel language of the civil service. The work and pensions secretary had claimed that his department's cap on benefits was turning scroungers into strivers – even before it had come into force. "Already we have seen 8,000 people who would have been affected by the cap move into jobs." How sweet those words must have sounded to Conservative ears. The government was forcing the feckless to stop sponging off hard-working taxpayers. (Taxpayers are always "hard working" in British politics, in case you haven't noticed. We never try to get by doing the bare minimum.)
The figures did not show that, the statistics authority said. More to the point, they could not possibly have shown that. Duncan Smith's claims were "unsupported" by the very statistics his department had collected.
If this were a one-off, I would say Duncan Smith "misspoke" or "lacked judgment" or, in plain English, that he was an idiot. If every politician who spun statistics were damned, after all, parliament would be empty. I would use stronger language; indeed, Andrew Dilnot, the chair of the statistics authority, is thinking about sending his inspectors into the Department for Work and Pensions (DWP) because Duncan Smith is a habitual manipulator.
As journalists know, Duncan Smith's modus operandi is well established. His "people" – all of them scroungers, not strivers, who sponge off the taxpayer from their Whitehall offices – brief reporters with unpublished figures. The Tory press uses them, and, as theFinancial Times explained, when his spin doctors meet an honest journalist, who asks hard questions, they end the call and never ring back. By the time the true figures appear on theDWP website , and informed commentators can see the falsity, the spin, the old saying applies: "A lie is halfway round the world before the truth has got its boots on."
Before the benefit cap, it was the work programme, which is meant to provide training for the unemployed. The statistics authority criticised the "coherence" of Duncan Smith's statistics and, once again, the manner in which his department presented them to the public. Far from being a success, the programme found work for a mere 8.6% of the desperate people who went on it. Meanwhile, Jonathan Portes, director of the National Institute of Economic and Social Research and a former chief economist at the Cabinet Office, has convincingly demonstrated that the Tory claim that "more than a third of people who were on incapacity benefit dropped their claims rather than complete a medical assessment" is false and demonstrably false.
Numbers are stronger than words. When the powerful lie with statistics, they do so in the cynical knowledge that the public is more likely to believe them. But the manipulation does not just tell us how sly operators view the credulous masses, but how they see themselves.
The UK Statistics Authority has a fine phrase that guides its mathematicians: "Numbers should be a light, not a crutch". Duncan Smith does not wish to shine light on his policies, for he fears what he may see. He uses his twisted figures as a crutch instead, to help his dogmas hobble alongFrancis Wheen once said that the one fact everyone believes they know about a public figure is always wrong. Whatever they think about his policies, the public assumes that Duncan Smith is a gentleman. He is anything but.
Portes thinks there is no wider decay in British government beyond Duncan Smith's department. I am not so sure. The British right is riding off with the loons. Like the Republicans with the Tea Party, the supposedly mainstream Conservatives have decided to woo Ukip rather than fight it. To show that they are "listening", they must pursue policies that make little sense and invent the evidence to support them.
Welfare is already at the centre of the deceit. Duncan Smith's duff data always suggests that the unemployed are on the dole because they are workshy, not because there are no jobs for them to find. If he were to admit for a moment that the distinction between strivers and scroungers was meaningless and all of us could be in a job one day and out of it the next, the rightwing argument on welfare would collapse and then where would the Tories appeal to angry, old white men be?
It is not just Duncan Smith. The health secretary says he will stop foreign "health tourists" costing the NHS hundreds of millions. He has no reputable evidence to support that figure. David Cameron says he wants tax breaks for married couples, when there is no evidence whatsoever that they encourage lovers to marry.
The policies may not work, the ills they seek to combat and the benefits they hope to reap may be illusory. But fear holds Conservatives in its grip and the general election is drawing closer. When pressed, they say that they want to "flag up" their support of marriage, "signal" their dislike of scroungers or "send a message" to illegal immigrants.
Our language has been so corrupted by the euphemisms of advertising and public relations that we no longer realise that what they mean is that they intend to lie.

Tuesday 2 April 2013

10 lies we're told about welfare



Has someone made Jim Royle a policy adviser? Millions are being made poorer while we're fobbed off with porkies
Protest against the government's bedroom tax
Protesters against the proposed 'bedroom tax' gather outside Downing Street in London. Photograph: Matthew Lloyd/Getty Images
Welfare reform, my arse. Has Jim Royle parked his chair, feet up, telly on, in the corridors between the Treasury and the Department for Work and Pensions? Employing him as adviser can be the only explanation for the utter rubbish that boils forth from this government on welfare.
Who else could have dreamed up the bedroom tax, a policy so stupid it forces people to leave their homes and drag themselves around the country in search of nonexistent one-bedroom flats?
That one has to be the result of too many hours in front of Jeremy Kyle (no offence) with the heating on full and a can of super-strength lager. It seems as if that is how this government views ordinary people: feckless and useless – poor, because they brought it on themselves, deliberately.
Maybe the cabinet is confused. Twenty-three millionaires in the one room can get like that. But do you know what, enough. Let's call this government's welfare policy what it is – wrong, nasty and dishonest.
Off the top of my head, I can list 10 porkies they are spinning to justify the latest stage of their attack on our 70-year-old welfare state.

1. Benefits are too generous

Really? Could you live on £53 a week as Iain Duncan Smith is claiming he could if he had to? Then imagine handing back 14% of this because the government deems you have a "spare room". Could you find the money to pay towards council tax and still afford to eat at the end of the week?

2. Benefits are going up

They're not. A 1% "uprating" cap is really a cut. Inflation is at least 2.7% . Essentials like food, fuel and transport are all up by at least that, in many cases far more. Benefits are quickly falling behind the cost of living.

3. Jobs are out there, if people look

Where? Unemployment rose last month and is at 2.5 million, with one million youngsters out of work. When Costa Coffee advertised eight jobs, 1,701 applied.

4. The bedroom tax won't hit army families or foster carers

Yes it will. Perhaps most cruel of all, the tax will not apply to foster families who look after one kid. If you foster siblings, then tough. But these kids are often the hardest to place. Thanks to George Osborne and IDS, their chances just got worse. And even if your son or daughter is in barracks in Afghanistan, then don't expect peace of mind as the government still has to come clean on plans for their bedroom.

5. Social tenants can downsize

Really, where? Councils sold their properties – and Osborne wants them to sell what's left. Housing associations built for families. In Hull, there are 5,500 people told to chase 70 one-bedroom properties.

6. Housing benefit is the problem

In fact it's rental costs. Private rents shot up by an average of £300 last year. No wonder 5 million people need housing benefits, but they don't keep a penny. It all goes to landlords. 

7. Claimants are pulling a fast one

No. Less than 1% of the welfare budget is lost to fraud. But tax avoidance and evasion is estimated to run to £120bn.

8. It's those teenage single mums

An easy target. Yet only 2% of single mums are teenagers. And most single mums, at least 59%, work.

9. We're doing this for the next generation

No you're not. The government's admitted at least 200,000 more children will be pushed deeper into poverty because of the welfare changes.

10. Welfare reforms are just about benefit cuts

Wrong. The attack on our welfare state is hitting a whole range of services – privatising the NHS, winding up legal aid for people in debt and closing SureStart centres and libraries. All this will make life poorer for every community.
Some call these myths. I call them lies. We are being told lies about who caused this crisis and lied to about the best way out of it. But I know one thing to be true: this government's polices will make millions of people poorer and more afraid. To do that when you do not have to, when there are other options, is obscene. That's why I'm backing union Unite'sOurWelfareWorks campaign in its efforts to help highlight the truth about our welfare state.

Tuesday 20 December 2011

Europe's gutless collapse


By Reuven Brenner

The US and European financial crises have this in common: too much credit was advanced at too low prices to households in the United States and to governments in Europe. In the US, the recipients did not have either the collateral or the prospect of revenues to pay back creditors. In Europe, the governments, with their present institutions, cannot create enough taxed wealth to pay back the debt with their current institutions, taxes and regulations.

In both cases, the recipients of the loans either lied through their teeth or deluded themselves (and delusions can be powerful when they serve one's interests). In the case of mortgage recipients in the US, few did any due diligence about their future ability to pay or about the mortgage-backed bonds.

In Europe, the move toward the European Community and the euro started with lies (or delusions of German rescues). Recall that the Italians called 1987 the year of il sorpasso, since suddenly 18% was added to their gross domestic product (GDP). The politicians claimed that this number reflected part of their undeclared, unmeasured incomes.

Why 18%? Because this was the number that allowed Italy to conform to the European Community requirement of debt/GDP ratios. The European bureaucrats were aware of much undeclared incomes in Greece too. Eventually they sued the Greek government for the false national statistics.

The result? To this day in both countries some 30% of incomes are undeclared in a variety of imaginative ways, often hidden by these countries' intricate customs, traditions and systems of patronage.

The national governments will not have an easy time changing such deeply rooted arrangements. Too many complex taxes, too many regulations, and too much corruption "on the top" resulted in ingrained perceptions that governments are wasting the money and that the courts are unreliable, rationalizing the culture of tax evasion. Why should hard-working people pay taxes when politicians and the rich get away with murder?

As it is in private life, start relationships with lies and they are unlikely to last or to end well. No trust, no finance; diminished trust, finance at a higher price. It is not rocket science.

But if all this was known, why were lenders willing to advance massive amounts of loans to these irresponsible, unaccountable entities?

Whereas in the US the case can be made that it took some time until it dawned on some that things were going awry, in Europe's case the issues surrounding Italy and Greece were well known. It was no secret that the continent was divided into "junk countries" and others where the tribe - the German one - could be called on for sacrifices and fulfilling duties, as was the case after the reunification.

Who made the mistakes that led to offering the loans to these profligate entities, aggravating mispricing of credit around the world and failing to correct the errors?

After all, the rationale for capital markets is simple: when all parties are held accountable, they correct mispricing faster than any other institutions that supply capital. There are only two other main entities that supply capital in every society: families and governments. The first is unlikely to correct mistaken allocation faster because of emotions. The second is unlikely to correct mistakes faster than arms-length financial intermediaries because a wide variety of political considerations get in the way.

So what went wrong in the presumably accountable financial institutions? Improper fiscal, regulatory and monetary policies. When combined with political considerations, however, none were considered "mistakes" by large segments of academics, central bankers, and politicians.

China illustrates in an extreme way the main difficulty with the finding solutions, but it is not dissimilar to what now confronts Europe too.

Most people agree that communism, as once practiced in the Soviet Union and China, was a colossal mistake. Tens of millions of people were killed, generations were made miserable, and talents and resources became severely mismatched. How do you correct for such mistakes? What is the path from totalitarian societies to more open ones backed by rule of law and equality?

There are no unique answers. There are no theories, no models, since the countries do not have either the legal precedents or the personnel to create, interpret and enforce them. Governments may emulate a successful country, but that too can take a generation or two.

China bet on a strategy of keeping the monopoly of the communist party, but allowing part of its population to integrate with the West. To achieve this integration, they pegged their currency to the US dollar, thus allowing dollar prices to guide the drastic restructuring. What was the alternative? Since accounting, balance sheets, prices, costs under communism were all fiction, the new government needed an anchor, and dollar prices served as such anchor.

Since wages in China were much lower than in the US, employment and exports expanded quickly. The country rapidly accumulated trillions of dollar assets. The Fed's low interest rate policy from 2004 and on distorted China's massive flow of trade to the US and its purchasing of Treasuries.

One could make the point that if the Chinese Communist Party opened up its domestic financial markets more rapidly, dispersing power and allowing entrepreneurship to thrive, the financing of the housing bubble could have been significantly mitigated, if not avoided, even with the pegged currency. Was the US able to use its negotiating powers at the time to force China to open its domestic markets more quickly? I believe so - though this option wasn't pursued.

The main point though of the above example is not to regret some foregone opportunity but to show that there are no models describing either how exactly countries should correct their political mistakes or how other countries should react while countries go through such transitions. There are no roadmaps and general theories for successful transformation: using negotiating power matters.

The European crisis
The financing of profligate, unaccountable governments, sanctioned by rating agencies and the Bank of International Settlement in Basel as being "riskless", brought us to the present situation. The solution for the eurozone required a drastic change in domestic policies cajoled by the European Union. After all, the EU knew all along about the extensive black and grey markets and the intricate patronage. Solutions were known too: simplified taxes, simplified regulations, more accountable governments.

Note that these solutions have very little to do with financial markets. They are a matter of political leadership. The political and financial institutions of China, Italy, Greece, and so forth shaped intricate institutions and habits and will not be altered because some economist or politician disapproves of it or devises some new technical models. Changing these is a matter of political leadership.

Unfortunately, such leadership is today nowhere in sight. If it does not emerge, bankruptcy, a distant second best, will bring about the changes. It is a distant second best because it could involve an extremely disorganized process, whose political outcome is unpredictable. What could then be done now while we wait for the Club Med countries to put their houses in order?

Since the European banks are at the center of the present crises, the best solution would be to emulate what happened in the US banking system in the 1990s. Namely, let them raise money by selling their loan book.

Banks would be much smaller. Ownership of non-investment grade loans would be much more dispersed. If the US banks could diminish their ownership of such loans from 80% in 1994 of their assets to 20% by 2009 (the balance distributed in a variety of collateralized loan obligations), there is no particular reason why Europe cannot achieve the same in much shorter time.

No need to implement a myriad of regulations. Disgorging debts from the zombie banks would also mitigate the much discussed "too large" or "too interconnected" to fail issue. Pension funds, insurance companies, and sovereign funds could offer the capital for such purchases.

But this takes guts, which are lacking in both Europe and the US. Yet again, I sound like Machiavelli waiting for his prince who never came.

Let's hope that he will emerge in 2012.

Reuven Brenner holds the Repap Chair at McGill University's Desautels Faculty of Management. The article draws on his books Labyrinths of Prosperity and Force of Finance.