Winner of the New Statesman SPERI Prize in Political Economy 2016

Monday 14 September 2020

Whether its COVID or Brexit, this government is continuing to fail terribly at everything it does. Will Conservative MPs do anything about it?

Testing failure

So for many visits to grandparents are off. No one should dispute that the government needed to do something after a sharp increase in the number of positive tests. However there is also no doubt that one of the factors pushing them to act was the partial collapse of the test and trace infrastructure. Stories of people being told their nearest test was tens or even hundreds of miles away, or that no tests were available, abound, and now we have leaks of hundreds of tests being thrown away because they cannot be processed and cases returning to care homes.

The specific reason for this failure remains unclear. Keir Starmer tried repeatedly at PMQs to get some explanation from the Prime Minister, but the best Johnson could manage is that demand was high. Which of course was completely unforeseeable with schools going back and other forms of increased mixing encouraged by this government. Matt Hancock at one point blamed people who were not meant to get a test being tested, which is the first time he has ever suggested that some people should get tested and others shouldn’t. At least the director of NHS test and trace had the decency to apologise.

As an aside, the inability of the Prime Minister to either answer straight forward questions or handle any kind of detail at PMQs is a sign of his own personal incompetence. His initial response to criticisms of how his government is performing is to suggest that somehow the leader of the opposition is unpatriotic to even question such things, and he comes close to suggesting that to be an opposition is itself unpatriotic, which of course is the typical stance of a autocratic populist. In other words PMQs are a clear demonstration of the kind of administration Johnson runs and his severe inadequacies. No wonder Cummings makes sure he avoids scrutiny on a scale far in excess of any  previous Prime Minister 

The underlying reason for the failure of the UK’s testing system, just at the point it is most needed, stems from this government’s decision to outsource the whole operation to private companies (but still calling it NHS test and trace in their usual duplicitous way.) Starmer has been right to highlight testing failures, but so far has failed to link it explicitly to the privatised system which many voters will not be aware of. This privatised system is also a big reason why the source of the failure is unclear: when you farm things out to private companies who then delegate to other companies, getting to the truth quickly is hard. The money would have been much better spent increasing the budget of local authority public health teams, and backing that up with government oversight that could get additional resources to hotspots quickly.

Looking at France, Spain and some other European countries, it may be tempting to conclude that nothing could have stopped a rebound in cases. If you are tempted to think that way, consider New York, where there is no sign of any rebound. As Miguel HernĂ¡n suggests here, New York has so far avoided a rebound by having more tests, more tracers, and being more cautious in opening up social consumption like eating out. Sunak may come to regret his £10 off meals idea. But Spain and France, as with last time, were a warning to the UK. And just as last March, the UK government took no notice and made things worse, 

It is just so typical of this government that at the moment they are having to restrict individual freedom partly because of the failures with their own testing system, they announce a grandiose scheme to test everyone everyday, or something like that. At a cost of £100 billion, which is the same order of magnitude as the annual NHS budget. From the people who gave us a testing system that cannot get enough tests today, do we think that this £100 billion will be spent wisely? Even if it works, will it be value for money, will it detract from getting the current testing regime right, and will it be quickly superseded by a vaccine. Johnson’s record on these things (Garden Bridge anyone?) is not good, but like all autocrats he loves grand projects, and there is nothing we can do to stop him wasting yet more public money.

Breaking the law

The decision to break the Withdrawal Agreement (WA), an international treaty, is quite shocking but it shouldn’t come as a surprise. As I noted at the time, Johnson only got the ERG to agree to his deal because his partners in crime told them it could all be changed later. Either the ERG was being duped, or they were being told the truth, and with Cummings and Gove running the show it was always likely they were being told the truth. Of course it makes a nonsense of everything Johnson said during the election about his deal, but this is the Vote Leave team that lied through their teeth to get the result they wanted in 2016, so why not do it again in a General Election? If his track record counted for anything, the media would ignore every word he says. (Oh, and ministers are almost certainly breaking the ministerial code,but don’t expect that to worry them.)

What we don’t know is whether this is a piece of theatre to detract from pandemic failings and taunt Starmer at PMQs with being a Remainer, or their idea of a negotiation tactic, or the start of a futile and costly trade war. I think we can discount the first possibility. Although this government is in continuous campaign mode, this explanation seems unlikely because, as Chris Grey observes, this move has been in the planning for months, and as I suggest above was thought up before the last election.

Putting down domestic legislation allowing the government to break the WA may be the government’s idea of putting pressure on the EU to get a better deal. In reality it will make the EU less likely to trust anything the UK says and determined to drive a hard bargain. Brexiters have never understood how you negotiate when you are the weaker partner. The damage to the UK from this negotiating tactic goes well beyond the EU negotiations, and includes what is left of our international reputation and a US trade deal.

The third and most worrying explanation is that Johnson has decided that no deal is his preferred option, and hoped this action would make the EU break off negotiations. The fact that they had every right to do so suggests he doesn’t fear no deal. The problem with blowing up the negotiations by revoking the WA is not just the short term disruption and the longer term hit to UK industry, although all that is bad enough. By breaking the WA the government is threatening to reopen the Irish border issue, and that could lead to a full blown trade war.

Everyone with any sense knows that there has to be customs checks between the UK and the EU. The Withdrawal Agreement puts those checks in the ports on the Irish Sea - between Northern Ireland and the rest of the UK. The only other place those checks can be is the border on the Irish mainland, and anyone who wants to retain peace in Northern Ireland wants to avoid that. (Gove, however, compared the Good Friday agreement that gave Northernn Ireland peace to appeasing the Nazi’s in the 30s, so he has no worries on this account.) But if the UK fails to impose the necessary checks on the Irish Sea, what is the EU going to do? They will not just give in and accept a border on the mainland.

The same applies to state aid. If the UK decided it was going to subsidize some part of UK industry to gain a competitive advantage over EU industries, the EU’s ultimate sanction is to impose tariffs on the goods or services that these subsidized UK companies produce. As Northern Ireland is in the same tariff zone as the EU, it cannot apply that sanction to any Northern Irish company, so any such company (whether based in Northern Ireland or not) has to be subject to EU state aid rules. If the government is saying they didn’t understand that at the time they signed the WA then they are not fit to govern, but in this case they are just lying as usual.

If the EU will not accept a border on the mainland, what will they do if the UK refuses to put one in the Irish Sea? The ultimate sanction the EU has is to restrict exports of UK goods into the EU in some way or other. Ending the WA in the absence of a deal can only mean the beginning of a trade war with the EU. The UK cannot win such a trade war, because the EU knows it will hurt the UK much more than it will hurt themselves. Perhaps that is the outcome Johnson relishes, so he can pretend to emulate his hero Churchill. But would the party that got rid of Thatcher over the poll tax really stand by as whole UK industries collapsed, and farmers dumped the produce they could not sell in Whitehall?

The Conservative Party

Johnson, Cummings and Gove are all very different from Trump, but their actions are similar to Trump’s. They are happy to override or destroy every element of our pluralist democracy, but are incompetent at government. Until now they have got away with it because they were popular with enough voters and very popular with their base. Most Conservative MPs will suffer most things to retain power, including a Prime Minister that likes suspending parliament. They chose Johnson knowing all his faults because he was the man who could save their seats and keep their power.

However the failures of government that occurred before recent events have had an impact on this government’s popularity among voters, and I suspect these latest events will continue to eat away at their support. Many Leavers will be annoyed that something they voted to get done is back in the headlines again, and voters can see the faults with the government test and trace system. If the government provokes a trade war, then we will see how far manufactured nationalistic bluster can carry voters through economic disaster.

Conservative MPs now have a choice. Do they go down with the sinking ship that is Cummings/Gove/Johnson as it destroys the fabric of UK democracy and becomes steadily more unpopular because of its failures, or do they call a halt to all this. Things are not going to get better, because these three are incurably incompetent as well as destroyers of democracy. The time to call a halt is now, by telling Johnson that Cummings has to be confined to campaigns and kept well clear of government, and the internal market bill that breaks international law must be withdrawn . If they don’t, the Conservative party becomes the party of law breaking that despises democracy. It will go down the rabbit hole that the Republicans have in their blind support of Trump.

There is some puzzlement about whether Johnson represents an end to neoliberalism as the dominant ideology of the party. I think that is the wrong way to think about what is happening. Neoliberalism contains a dynamic that tends to lead to autocratic plutocracy sustained by a culture war. Conservative MPs and the cabinet remain fundamentally neoliberal, as is evidenced with the UK’s test and trace system. If there is a change, it is from abandoning the attempt to squeeze the state to reduce taxes that austerity represented, to a belief that the state is a pot of gold that certain companies can plunder.

What about spending lots of money to create a tech giant, as Cummings seems to want? Does that represent an end to the idea that the state should not try to pick winners, which among neoliberals follows from a distrust of the abilities and motives of government. Not really, because it will be Cummings rather than any kind of government apparatus that is doing the picking, and it is the idea of an individual (Cummings) rather than a movement. It will be a bit like our privatised track and trace: a lot of money wasted in failure that will make certain individuals - including associates of Cummings - richer. Politics under a plutocracy always involves the mad ideas of those in charge: just look at Trump. The key question of the moment is whether Conservative MPs will allow this to happen.

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