Friday, 14 March 2008

Markets work shock

In a week that tends to be characterised by economic illiteracy its good to see a healthy dose of commonsense coming through in a poll in today's Times: most people think the Budget was pretty sensible, won't make much difference to them and that the government could do relatively little in the face of global economic trends. (sorry Clive - still can't do hyperlinks).  Which puts into perspective the yelps of the brewing industry that 4p on a pint will finish off large numbers of pub - and the emotion on either side of the 2p on fuel debate.

The interesting thing about listening to the news apart from the budget is how much prices are now an issue -- and just how big some of those price movements are.  From oil now over $ 100/ barrel - up by $80 since January 2002 to wheat prices more than doubling since the beginning of 2006 and iron ore prices sextupling since 2003.  To add some degree of scale -- that price rise in oil is eight times the implicit tax on carbon through the current variant of the EU emissions trading scheme.

These massive price shifts are sending signals that governments would never manage to get together the political constituency to impose as taxes -- whether that is to drive more fuel efficient cars, recycle virgin materials or stop wasting grain on animal feed, or the need to pay more for your pork or stop eating bacon butties. The only (and not insignificant downside) is that the beneficiaries of the price hikes are those who happen to have invested in oil or mining companies or arable farmers -and overcautious governments who missed the boat on the agenda see what could have been useful additions to the national coffers instead transferred to the people who were savvy or lucky enough to be holding the parcel when prices began to soar.

Of course prices can go up as well as down. The US department of agriculture is already saying that current high grain prices are a temporary blip as more land will be planted and pig farmers might take solace in that diagram [Cobb-Douglas? or is it cobweb? if only I hadn't rashly thrown out my first year economics notes in a once in thirty year cleaning frenzy last year --i Knew they would come in handy some time]that features in first term economics to show how the Chicago hog market never came into equilibrium - but in the long-run its hard to see how 3bn more people with the majority wanting western style resource intensive living standards won't put a bit of upward pressure on finite natural resources.

So the green movement might just have to start waking up to the market as friend rather than foe -- and the smart move might be to suggest to governments - and voters - that getting ahead of the curve and grabbing a piece of the action makes sense.

Tuesday, 11 March 2008

Much ado about nothing?

its Cheltenham week at the races and Budget week in the Treasury.  Newspapers are working themselves into a frenzy of speculation, special pull-out supplements are being commissioned, terrestrial channels are about to clear the airwaves and the IFS is working overtime to develop a series of decreasingly typical stereotype families to tell us how much better or worse off we are likely to be next year than against an index-linked base...

Let me confess straight away that I love budgets (need to be more upfront since I failed to declare my passion for AC in earlier blog)  -- or at least loved them when I was in the Treasury.  They were the biggest adrenaline rush ever to hit the then antiseptic corridors of 1, Parliament Street. The culmination of weeks of long hours, weekends of work, the day when HMT and the Chancellor was the centre of the world (and when there aren't crises to deal with, there are remarkably few of those), and a great excuse for parties and for betting on the length of the speech.  So its easy to see why HMT wants to maintain the budget mystique unmodernised - but also interesting to ask whether the Budget really merits the attention it gets and whether the Budget as event gets in the way of the Budget as good policy-making.

When we had more limited government it was easy to see why the Budget was a big event.  But it is no longer clear that the Budget really warrants the amount of time and effort the broadcasters devote to it.  There is much agonising over whether the Chancellor will go ahead with the 2p increase in fuel duty tomorrow -- I have no idea whether he will or not -- but when I ran fuel pricing in Spain for BP that was a decision that I made every week -- and the lunchtime TV schedules were not cleared for that.  95% of the Budget detail is for the partners of KPMG and PWC, 0.000001% of potential viewers and the number of people affected - or indeed able to understand - most of the Budget measures is far less than for statements by the Health Secretary or the Children Schools and Family Secretary.  We no longer have the twenty minutes on the MTFS (medium term financial strategy to readers under 45) that characterised the budgets of the Howe-Lawson era -- but it is impossible for either the viewer or the studio pundits to make any real sense of the changing forecasts announced by the Chancellor at the start of the speech. In terms of viewer relevance, viewer comprehensibility and impact it is just not clear that the Budget still warrants the deference it gets.

But second, it is far from clear that the Budget as event is the best way of making economic policy,  The secrecy is supposed to apply to market sensitive measures -- but the really market moving measures have to be announced before eight o'clock in the morning when the markets are closed - in the UK at least. But Budget measures - even with the advent of the PBR - are developed behind closed doors for no really good reason.  They look very anachronistic in an era when government has got hugely better at consultation and co-production of policy.  And this becomes more important not less as the Budget becomes a place to set government policy well beyond the narrow realms of tax policy - and as we use tax policy for wider aims than simply determining how we finance public spending.

And third, the Budget as event has the effect of creating more policy than necessary.  So worried have Chancellors always been about the Budget as non-event that the Budget itself becomes overstuffed with measures to appease every group and our tax code gets ever more complicated,  In the Treasury we used to dream of a Budget when the Chancellor stood up - said 5p on fags, 10p on whisky, nothing else changes and sat down. But in every Conservative budget we had an increasingly despairing search for budget lollipops -- to generate positive headlines -- most of which individually would never make it out of the policy starting gates. 

So maybe, once we put the tax system onto a proper statutory index-linked basis (that 2p is just money illusion after all), we could get to a position where the Budget is reduced to a written answer of "no change" and we would - with the exception of the accountants and tax advisers and other deadweight costs on the economy - all be able to focus on more interesting things instead.

But finally -- don't worry Evan -- will still be hanging on to your every word tomorrow.

Monday, 10 March 2008

Off the record

Front page news in the Sunday Times yesterday was the hunt for a Whitehall blogger -- the so-called civil serf publishing loads of indiscreet comments behind the scenes in Whitehall. The blog has now disappeared.... so I can't comment on the substance -but it is bound to raise the questions of whether civil servants should be allowed to blog.

You won't be surprised is that my answer is yes -- but that the civil serf should probably also be disciplined if not sacked.

The first thing to say is that there is nothing really new in the sort odd pernicious background comment that CS has been going in for -- but what used to happen between a senior mandarin and a lobby correspondent over a three course meal at Quirinale washed down by a lot of rather nice chianti has now, through the internet, been democratised. People not in Sue Cameron or Philip Stephens' rolodex now get a chance to give the inside dope now. Who can forget the hunt just before Christmas for the male permanent secretary being indiscreet in an Italian restaurant.. and one of my principal tasks as Press Secretary 12 years ago was to demand mandarin diaries to see who the upper echelons of the Treasury had been lunching as stories floated about chaos inside government. Now you don't have to have a knighthood to get in on the act.

But the second point is it doesn't make it right - for either category. But I don't think the answer is to gag civil servants completely. Its just conceivable that they may have interesting things to say. The answer should be to apply some simple rules.

First: go on the record. Blog away -- as long as its got your name on it (I know I could always claim that this is the blog of the "other Jill Rutter" - now working at the IPPR - and to be played by Scarlett Johansson in the movie and having a doppelganger can be either useful or embarrassing -- a number of times when working at No, 10 I had to explain that the front page denunciation of govt asylum policy in the Indie was not me but the other one...).

Second, hold people responsible for what they put in ... the rules of blogging should be the same as the rules for what you would say on a conference platform; in a speech;

And third, if what people put in shows that they cannot continue to have the confidence of Ministers then they need to take the consequences.

But the plus side is that we do need to develop a mentality of thinking in the civil service, We overdevelop the ability to produce defensive lines to take and radically underdevelop and undervalue the capacity to think interestingly about issues. And that benefits no one. Maybe having an interesting blog should become an entry level requirement for the senior civil service.

Saturday, 8 March 2008

The ego has landed

As earlier readers will remember my bedtime reading has been the Alastair Campbell diaries. AC clearly displays all the feature of the Microtrend "Long Attention Span" -- abridged diaries of 750 pages, marathon runner,,, nine years working for TB. But as someone who has never managed a diary that said anything other than "French homework" "guides" "dog ill" (and as you can tell that is not exactly recent... so here are some random reflections on the world of No. 10 as told by AC..

First though the really amazing thing is that despite AC being appalled by Hutton's request for his diaries they are amazingly personal -- if I had been editing it I would have deleted much of the home life sections.. but the other thing I am amazed by is the sheer amount of time AC must have spent recording people telling him what a great job he was doing... insecure - probably; egomaniacal - absolutely. I don't for a minute deny that within his own terms AC was doing a good job - but does he really need to write it down when he is that busy... and leave it in? maybe there were more psychological flaws around in Downing Street than we thought.

the second is the bizarre Jane Austen style world our leaders seem to inhabit. Worrying about clothes - Tony seems to have had some terrible outfits. Worrying what other people think of them. Looking to friends for help and support. Calling each other. Writing to each other. Does anyone else have the time for all that. And how they all go on holiday together somewhere in the South of France... and these guys are all so emotional -- so much of the time.

the third is the bizarre friends he keeps -- apart from the obvious (and omnipresent) PM - Peter Mandelson to you and me and PG - Philip Gould - his big buddies are Alex Ferguson offering a lot of political advice (was Tony Blair managing Man Utd at the same time), Alan Clark and Nick Soames... and most recent mention Brendan Forster. But no business people. No civil servants. And I had never realised Carole Caplin was around for quite so long... and was so important to the Blairs.

the fourth is how important Bill Clinton is to him and how much BC stays involved even after he steps down as President - even though he is also surprisingly positive about Dubya. But there is a passage near the end as AC tires of life in Downing Street when BC exposits on political strategy to AC and PM and AC (compare and contrast) drops his jaw at the biggest political genius of recent times..

the fifth is not so surprising having been in No.10 -- just how much time foreign affairs - the Balkans, then Afghanistan and then Iraq and Northern Ireland take up -- but seems to have risen to new heights under TB - and is matched by the other phenomenon -- the PM (TB not PM) is clearly completely detached form anything to do with the economy. Off the radar. And climate change gets its first mention on p 632 -- on the plane to WSSD in Jo'burg in 2002.

the sixth though is how irrelevant the civil service is to the Blair operation - a few mention of a few No, 10 Private Secretaries; a couple of times when the Cabinet Secretary is wheeled in; John Scarlett and some spooks as Iraq hots up -- but otherwise the civil service may as well not exist. Any idea of the Cabinet Secretary as an important player is not part of this script.

the seventh - and not a surprise - is just how much he hates the media without acknowledging any role in having been part of the sort of media we have -- or of the way he and the other Labour spinners used it against the previous government. Interesting to see how maddening AC found Charlie Whelan to deal with.

interesting too to read his views on Cabinet Ministers -- in particular his complete loathing of Clare Short from the start; despair at Mo Mowlem but clear on why Margaret Beckett was always regarded as such a safe pair of hands. But the person who emerges really well from the whole thing is John Prescott who comes over as a really solid and sensible player keeping his head when everyone else is in swooning hysterics.

So despite the length a fascinating if overemoting view of government, When we get to the real thing with added TB-GB, please leave out all the self-praise; too much personal info -- because just as you had to read Nigel Lawson to understand 80s economic policy, the real AC diaries will be read long after any TB autobiography for what really was going on in government.

on an (AC type) personal note, another major milestone this morning -- first time I put a sock on my left foot. Sounds minor but inability to put my socks on was the outstanding barrier to independent living - but does not signify new improved bendiness but the purchase of a nifty device called a "Sockaid" at the disabled shop in Bognor - a Blue Peter style contraption of a piece of plastic and two strings -- strange but effective.

Wednesday, 5 March 2008

Road pricing - RIP?

So the government has finally ruled out national road pricing for the time being -- rather than rely on the convention that all Ms Kelly's predecessors have subscribed to - that road pricing is a great idea in theory - but unfortunately always ten years (or about seven Transport secretaries) away.  Indeed when I did transport policy in the No 10 Policy Unit in 1994, road pricing was ten years away -- so we must have had it for the last three years...

Galling to see the people who organised the guerrilla attack via the No.10 website glowing at their victory. But the fact that this can be reported as a victory -- rather than as a defeat and a setback - shows how poorly we have framed the debate about transport in this country under successive governments.  And how much we allow transport policy to be held in the thrall of motorists without realising that it profoundly affects everyone's quality of life and in a space constrained island appeasing motorists is a zero sum game - but noone else is well enough organised to get 2 million people to sign a petition. So if the motorists are victorious, who are the losers.

The news about the decision on road pricing coincided with reading "Car Sick" by Lynn Sloman, ex of Transport 2000.  Not probably high on the reading list of the Downing Street petitioners.  But some quite interesting stuff on the way planning and transport policy has evolved here over the decades compared to other European countries.  One of the stories that most surprised me talking to my mother was about the badly behaved dog she had when she worked in London.  She told me that aforesaid candidate for Dog Borstal was allowed to roam around the streets during the day -- the fences in their garden in South East London weren't high enough to keep him in.  When I asked how a dog could patrol the streets of London as though it was a village in Rajasthan she simply said that there were no cars...and that was the mid 1950s.

One of the interesting wakeup calls to come out of Car Sick is how recent mass car ownership and mass car use is - why Bruno could have the run of New Cross without becoming roadkill.  But the second really interesting compare and contrast is with the cycling enthusiasts of Denmark, Germany and the Netherlands.  They were on the same track as us in the 1960s, redesigning cities around cars not people and seeing the same declines in cycling and walking as we did.  But the paths diverged some time in the mid-1970s - a function of the oil crisis, increased environmental and (maybe -- although it doesn't stop them smoking themselves stupid - health consciousness) and city planners started to invest in people as opposed to car infrastructure.  So the alleged cultural differences which get the Germans and Dutch on their bikes while we sit in our cars are actually the product of different policy choices.  And those choices have meant that some countries have managed to escape from having transport and planning policies dictated by motorists rather than all potential road users.

National road pricing may of course be less relevant here than lots of effective local schemes. It was never clear how you could combine a universal national scheme with widespread local schemes where local people reclaim their space and made it work for everyone - of all ages. And even for dogs. So it would be good if yesterday's announcement meant national road pricing is dead - long live lots of local road pricing. And while the person out of their car can enjoy more car-tamed environments, our petitioner friends can sit in frustrated tailbacks on the hard shoulder of the M1 wondering why no-one ever got to grips with managing demand for road space.

As a postscript, one of the other points in Car Sick is that there are huge amounts of ads for cars -- but none for cycling or walking or public transport. As a big consumer of daytime TV I can testify to the never ending diet of car ads between wickets in the cricket or at changes of end in the tennis - most of them telling me how green I would be by buying this car or another. But today they were joined by a totally bizarre and very annoying ad for public transport - funded by UNEP and the International Association of Public Transport. Enough to make me buy that Landrover Freelander 2 tomorrow.

Monday, 3 March 2008

Watching paint dry

have received a few complaints at the lack of medical updates on the blog. The truth is that I am in medical limbo - waiting for my new implanted hip to fuse with the bone is the medical equivalent of watching paint dry -- except there is nothing to see.. I can't tell if its going well or badly -- that has to wait for my consultant. I may be green or I may be amber. The big thing to avoid is re dislocating my hip -- which would be a definite red and I think I have avoided that as I am sure I would have noticed.

However six weeks (ie tomorrow!!!!) is a key milestone... I can start sleeping on my side which will be the biggest improvement in my quality of life since I ended the self-injection saga... I might even be able to start driving... (as long as I remember not ti run over my crutches which we nearly did the other week); I could start coming off crutches BUT that needs an X-ray -- and I have managed to hit consultant holiday time -- so that is delayed until 19 March and trip up to big city. In the meantime I have to stick to my partial weight bearing physio regime where within limitations I seem to be gradually getting more flexible. Toughest questions are when the physio asks whether I am better than before and I have to admit I did not spend my life in awe at how much or how little I could elevate my left leg while lying on my side.

The big discovery is swimming with the pensioners. I am now pretty confident swimming on my back and I also seem to do better front crawl that ever before - which is very gratifying (the big no-no is breaststroke as the frog style leg action risks undoing all the good of the op by making my hip pop out). What is really good for me is striding around the pool -- but that still feels a bit wobbly. But for half an hour I am liberated from crutchdom. Next update post consultant visit and hopefully can start the long process of retraining my muscles to support a straight leg....

Saturday, 1 March 2008

Compulsory reading

I used to think that every civil servant should be made to visit the Millennium Dome - to make sure they realised that it was not enough to hope that a misconceived project would suddenly come right and that things could go horribly wrong.  My latest candidate for the mandatory list is to read "The Great Deluge" by Douglas Brinkley (recommended in my appeal for reading suggestions by Tom Burke of E3G) -- about the week of Hurricane Katrina. 
When I lived in California I was always a bit sceptical about the handy earthquake advice in the yellow pages suggesting that every home should have three days of supplies available in case of a major disaster.  After all this was America -- a first world not a third world country and surely it was inconceivable that the USA could leave any of its citizens needing basic supplies for three whole days.  Against that complacent background, GD is a stunning wake-up call showing how badly bureaucracies can screw up.  Its a great antidote against the muddling through thesis.There are many villains of the piece.  First of all years and years of development which eroded the Louisiana coastline -- seemingly no politician since Theodore Roosevelt understood the role of the wetlands in protecting the cities.  All compounded by a rush to develop and a failure to maintain. Sustainable development anyone?
The second villain is corruption and cronyism.  I had been about to blog earlier on the massive tax that corruption imposes on poor countries after reading a book on India which suggested that only 30% of any funds made it through to intended recipient after everyone in government had taken their cut.  But GD shows that corruption can expose the poor and vulnerable even in the richest of countries - corruption as a reason why money voted for maintenance of the levees was not spent and they were hopelessly undermaintained at the time of Katrina hit; in the New Orleans Police department and cronyism in the appointment of the wrong person to run the Federal Emergency Management Agency (the infamous Brownie); in letting contracts to contributors not the those best qualified to meet needs.  But of all these the most pernicious impact was the Mayor of New Orleans concern at the impact of requiring what might prove to be an unnecessary mandatory evacuation on his business backers when there was still time to get the old, sick and poor out of the city -- and these were overwhelmimingly Katrina's victims.
The third villain is focus.  The absorption of FEMA into the department of Homeland Security meant that the big boss was only really interested in terrorism - a second 9/11  not a big storm.  And FEMA could cope with hurricanes -- and recover from wind damage -- but not flooding following a hurricane. FEMA was complacent because it had done well with the last four Florida hurricanes but those were ordinary hurricanes......and in a Republican state in an election year....
The fourth villain is a failure of political leadership - compounded by the intrusion of partisan politics in the struggle between the Democrat governor of Louisiana and the Republican president. And a Mayor holed up in  a hotel determined to put his own safety above any sign of caring about the plight of his citizens - a failure to be there.
But all that was made much worse by incompetence before the event - lack of preparation (buses standing in flood zones; failure to have any lists of vulnerable people; failure to have any plans to evacuate in many public facilities; a failure to think about how to contact people not tracking the eye of the storm through the internet or on TV and a failure to learn any lessons from a simulation exercise of just such a catastrophe a couple of years before - and then unconscionable bureaucracy after the event -- stopping help that was being offered getting through, compounded by a lack of imagination... about what people might need; how they might react. and one of the most bizarre lessons to come out of Katrina is how many people refused evacuation because they did not want to be separated from their pets -- misery compounded by pets not being allowed on the buses which finally arrived.
And throw into the mix the more peculiarly US factors of segregated neighbourhoods and an awful lot of weapons around which means when law and order began to break down it did so with potentially very deadly consequences.Lest this all sounds dire, it is -- but it is leavened by huge numbers of stories of amazing individual heroism, some real corporate social responsibility showing up the leaden footed Feds = Wal Mart. American Airlines and Coca Cola to name but three and some stunning acts of individual generosity which I think no other country would ever match.
So it might never happen here on this scale and in this way - but after reading this I will never treat our business continuity planning as a boring compliance chore - and we might want to send it to everyone we are asking to draw up an adaptation plan = and a good Christmas present for many of our friends in the Treasury.