Trump and Brexit

As Trump makes clear, the UK can choose US rules or EU rules. Brexit is about having no say in either.

Of course every Leave voter is an individual with their own motives. But if you had to broadly characterise the two big issues that gave the Leave side victory in 2016, it was fears about immigration and a wish for greater sovereignty. Both were based on lies.

Immigration

You would not know it from the media, but people in the UK have been developing a more favourable view of immigration over the last six years. Here is a table from the latest National Centre for Social Research Social Attitudes survey on Europe.

In 2017, for those who expressed an opinion one way or the other, nearly three quarters thought immigration had a positive impact on the economy, and 65% thought immigrants enriched our culture.

Given this trend in attitudes, how did we vote to Leave? I keep going back this poll on EU immigration published in June 2016 which I wrote about shortly after it came out.

You can see it is consistent with the numbers above: people on balance think EU immigration is good for the economy and for British culture, and even for themselves personally. So why would they want to reduce EU immigration? Because they overwhelmingly thought EU immigration was bad for the NHS (and by implication all public services).

This, after all, is the line that Conservative and even some Labour politicians have consistently pushed, as have parts of the media with no comeback from most broadcasters. Before the referendum there were few stories about EU doctors and nurses, but plenty about migrants using the NHS. This concern was emphasised by the Leave campaign with the combination of the £350 million more for NHS claim and the prospect of being ‘overrun’ by Turkish immigrants.

The only problem with these claims that immigration reduces access to public services is that we know, with almost certainty, that the opposite is true: immigration creates net additional resources for public services. This is not complicated: they pay more in taxes than they take out because they tend to be of working age. But the myth that politicians and the media promulgate is that immigrants are somehow the reason access to public services has become more difficult, and they do this in large party to cover up the impact of austerity.

There was a final issue during the referendum that may have encouraged people to vote Leave. Even if they were positive about the EU immigrants that were already here, it just seemed sensible that the government should control their number. After all the government had set a target for net migration, and were having great difficulty meeting it. Yet the media never talked about the positive aspect of freedom of movement - the ability of UK citizens to live and work anywhere in the EU - and how that would end if we left.

Sovereignty and trade

I still talk to Leavers on both right or left who are convinced that the EU has taken away major elements of the UK’s sovereignty. One talked about “accountable democracy, sovereignty, independence, autonomy and freedom”. Yet when I ask for specific instances of a law or somesuch where the EU has compromised all these things, answer comes there none. There is a simply reason for this, beyond the propaganda, and that is that the EU is about harmonising regulations, and this harmonisation has brought benefits rather than pain to UK citizens.

International trade involves a form of cooperation with other countries, and international trade is good for both sides because it allows more efficient production as well as consumption of a greater variety of goods. The more we cooperate on rules and regulations, the more trade will happen. This harmonisation of regulations is like marriage: each side loses a degree of individual autonomy but we gain much more in return.

The thing about regulations governing networks of trade is that there cannot be too many of them, just as there cannot be many operating systems for computers. The whole point about harmonising regulations is to reduce their number of regulations, so firms do not have to produce lots of different goods which differ only in the different national regulations they meet. Which means that, if the UK wants to really benefit from the gains to trade, it has to choose one standard to match UK regulations with. And given existing patterns of trade, the UK only really has a choice between two: the EU and North America (NAFTA). Neither is likely to abandon their regulations in favour of what the UK may happen to do. (Equally third countries will never choose to harmonise on UK regulations rather than EU or the US.)

Translate this into Brexit, taking back control is like divorce, except in this case divorce from a partner you are still happy to be with (we happily trade with). To be honest, however, I’m not sure many Leave voters needed convincing of all this. As this poll shows, only 22% of Leave voters thought we would lose full access to the single market. Instead they believed the propaganda they were fed, that somehow their lives were being influenced in a negative way by the EU, and that they would therefore be better off after Brexit

Brexiters and Trump

While most voters were not very interested in regulations, many Brexiters certainly were. Most Brexiters are not very interested in immigration, but are interested in removing us from EU regulations and adopting much looser US standards. Of course they talked about ‘global Britain’, but it never made sense for the UK to set its own regulations for trade independently of both the EU and US. What they wanted was to get rid of EU regulations on labour or the environment which did not fit into their ideological framework.

To say, as I did here, that the Brexiters hijacked the EU negotiations, to make them about their own concerns rather than the people who voted, is not quite right. I think it is another example of deceit: getting what they want indirectly because what they want is not in itself popular. EU labour and environmental regulations are popular with most people. So the Brexiters could only achieve their goals through deceiving Leavers, and once more through our partisan or pathetic media they succeeded. After all, the first significant deceit, which was reducing the size of the state by making a fuss about the deficit, had been a big political success.

Normal US politics would want none of this. The US traditionally values the UK as part of the EU, and a jumping off point for their own corporations. Trump is of course not a normal POTUS. He is part of a right wing plutocratic elite that has captured the Republican party, and a good part of the Conservative party. Their aim is to spread his kind of authoritarian right wing politics as far as they can. Trump’s retweeting of Britain First islamophobic materials was no accident. One of his ambassadors has lobbied on behalf of former English Defence League leader Tommy Robinson!

I remember writing sometime back that Trump’s election was a big blow to Brexit. I thought, perhaps naively, that at least some Brexiters would think twice before becoming cheerleaders for Trump. I thought some might be concerned that far from doing trade deals, they would be concerned that Trump seemed more interested in destroying trade by placing tariffs on imported goods. If any have showed any concern I have not noticed. It seems instead that the Brexiters, along with the right wing press, really are the Republican party in the UK.

Theresa May

Stage one of the Brexit endgame that we saw less than two weeks ago was Theresa May at last standing up to the Brexiters in her party. I think she could and should have done this from the very beginning. That she didn’t do so reflects naivety about Brexit rather than strategy on her part. There are many clues that this was so, some of which are spelt out by Jonathan Lis here: getting rid of Sir Ivan Rogers was a huge unforced error that conclusively shows that she and her immediate advisors did not understand the task they had taken on. But it would be suicide for her to turn back from her new path now..

Trump’s attacks on her are another sign of how important her Chequers document is. Of course it is not a plan the EU can accept, but it represents her choice to finally stop the Brexiters turning Brexit into their ideological, Republican orientated plaything. She must know that her new opponents will not be appeased, and do not do compromise. I hope that Trump’s humiliation of her will help her see that global Britain was always a myth, and that the UK has to choose the EU rather than the US. She will need resolve as she is forced to compromise further to get a deal, although she will try to push at least some of that into transition.

Perhaps I am wrong about the final situation being BINO plus face saving for the UK: perhaps the EU will offer serious concessions for the first time in these negotiations. But it is foolish to believe that these concessions will in any way be advantageous to the UK, and somehow make Brexit worthwhile. What gain is there to be outside the single market for services, when exports of products from financial and creative industries to the EU is one of the UK strengths? What gain in there in restricting EU immigration, when most people now agree that immigration enhances our economy and culture, and economists know also enhance our public services. Yes, we would have more sovereignty: the sovereignty to make our lives worse with no compensations.

Whatever deal May finally does with the EU, and at whatever time, it remains the case that Brexit will do for UK sovereignty the opposite of what it claimed. It is better to follow EU rules than US rules, but with Brexit we will be following, with no say in how these rules are changed. It is a huge indictment of our political system that our Prime Minister and a majority of our MPs feel incapable of saying to people you were lied to, and following this course gives you less sovereignty than you had before June 2016. All we can hope for is that the Brexiters, in their new found position of Brexit rebels, will vote against the deal and let parliament, directly or indirectly, kill the whole thing off. The Brexiters will have caused enormous damage, but it would be poetic justice if they helped bring an end to Brexit.

Decreasing the size of the state is very unpopular

I last talked about this question from the British Social Attitudes survey in 2014. Here is the latest version of this longstanding survey question (source and exact question here).

A point I made in the last post was that the percentage of people wanting lower taxes and less spending has always been less than 10%. If you believe the survey, and I see no reason not to, there has since 1983 been no public appetite for reducing government spending in order to cut taxes.

All the action over time is between those who want things to stay as they are, and those who want higher spending and taxes. As public spending has been cut in recent years, so the number of people wanting more spending and higher taxes has increased. However that proportion is still not up to the level it was in the 1990s.

Does this survey suggest that half the population want a larger state, and hardly anyone wants a smaller state? That depends on what you mean by the state. The question actually asks about spending on “health, education and social benefits”, so it seems reasonable that this is what people are responding to. They are taking as given that the government in the UK provides these things, and are simply expressing their view about whether they want more of these goods and are prepared to pay for them. The question does not ask about whether these goods should be produced by the state or by private contractors working for the state.

When the public are asked about who should own and run various activities, there is clear support for more rather than less public involvement. (Chart source.)

These numbers are from last year, so the collapse of Carillion and the problems with the East Coast rail line are likely to push public opinion even further away from the privatisation ideal. Note that only about 10% want privatisation of the NHS, which has continued rapidly under this government. A government that reduces government spending and taxes, and pushes privatisation of the NHS, seems like a government of the few and not the many.

I remember being told how nervous the last Labour government was when they decided to raise NIC rates to fund an increase in NHS spending. They had committed to not raising the basic rate of income tax in order (they thought) to be able to win elections. Given the data above, you might wonder why. But then I remembered how the Labour PLP had decided that they had lost the 2015 election by being too left wing, again without any real evidence. Perhaps the lesson of these two poll results is that the gap between what people actually want and the received wisdom of the Westminster bubble is very large.

Austerity Confusion, or why the Tories are trapped by austerity

What do we mean by an end to austerity? There seem to be two meanings being used currently. The first, used by Conservative politicians in particular, is equivalent to what economists call fiscal consolidation: cutting spending (or raising taxes) in order to reduce the deficit (as a share of GDP). However when Labour say they will end austerity, I think they mean something even simpler: to stop (and reverse) cuts to government spending as a share of GDP.

The confusion has been compounded by two factors. First, Conservative Chancellors have mainly used cuts to spending rather than tax increases as part of their austerity programme. Second, they have also justified cuts to spending that were needed to finance tax cuts (corporation tax, inheritance tax etc) as austerity, which is a clearly not fiscal consolidation and is simply a reduction in the size of the state.

How do I know Labour do not mainly mean ending fiscal consolidation when they talk about ending austerity. Just look at their GE2017 manifesto. That involved various increases in current spending financed entirely by higher taxes (including corporation and inheritance taxes). This manifesto, which helped gain them such rapid popularity in the GE2017 campaign, was a proposal to increase the size of the state.

I explore in a shortcut piece for the London Review of Books how this ambiguity is a serious problem for the Conservatives. Even if they ended austerity completely (made no further attempts to reduce the deficit), Labour would be able to offer a much more attractive fiscal package to the voters because Labour are prepared to undo the tax cuts the Conservatives have made over the last seven years. 

How do I know such a package would be attractive? Here I reproduce my favourite chart from the latest Social Attitudes survey that I talk about in the LRB piece.

The ‘neoliberal’ line is in yellow at the bottom. In 2010 nearly 90% either wanted to keep the size of the state the same or increase it. It is why the Conservatives were forced to use what I call deficit deceit - pretending cuts to the size of the state were about cutting the deficit - to pursue neoliberal goals (see my last post). By using deficit deceit to reduce the size of the state, when concern about the deficit was bound to wane, the Conservatives have condemned themselves to current unpopularity as voters realise what they are losing.

Why didn't this stop the Conservatives winning the 2015 General Election? Here is a YouGov poll that explains why.

In 2015 more people blamed Labour that the Conservatives for spending cuts. This was translated into views about economic competence because the Conservatives, with the help of mediamacro, made reducing the deficit the key variable in judging economic policy. We are now in a period where this narrative still has an influence but it is no longer enough to win an election. The Conservatives dare not throw it away because many voters still believe it. They have become trapped by their own austerity policy and the reduction in the size of the state that went with it..

Do politicians need to pander to myths?

About UK politics, but raising some general issues about politicians and popular prejudices

Paul Bernal has a powerful post (HT Chris Dillow) where he says Labour lost the election long before 2015, by pandering towards three big myths: the myth that Labour created a huge deficit which required austerity in the midst of a recession, the myth of the ‘scrounger’, and the myth that Labour made a mistake in allowing excessive immigration. I obviously agree about deficits, I’m appalled at the hostility to welfare recipients stoked by the right wing tabloids and the harm done by inept reform, and I’m dismayed that politicians shy away from putting the positive case for immigration. For that reason I should agree that in England at least one of the three major parties should be standing up against all these myths. The Conservatives and Liberal Democrats helped manufacture the first myth, and the Conservatives contributed to the second and pander to the third (although some of their supporters would not favour costly immigration controls). Labour failed to combat all three.

The media have, predictably, reached a consensus about why Labour lost: it was too left wing, it was anti-business, it failed to be aspirational (it wanted to raise some taxes on the rich) blah blah blah. But as Peter Kellner and others have pointed out, there is no clear evidence for these assertions. Instead, they just happen to represent the things that much of the media dislike about Labour’s policies. Watching at least some of Labour’s potential future leaders, who the media as a whole describe as ‘modernisers’, fall in line with the media’s diagnosis makes the Parliamentary Labour Party look pathetic. Perhaps it is?

And yet, Peter Kellner also points out that being tough on scroungers and immigration is very popular. And these issues mattered for many voters. In a tweet about Bernal’s post, I asked was it better to lose telling the truth than lose being complicit in a lie? But it would be better still if a political party could tell the truth and win! Yet that seems a hopeless task. Jonathan Portes has championed the evidence on immigration, but as the BBC’s Nick Robinson put it, he would not get elected in any constituency as a result.

It is tempting at this point to blame the media for this state of affairs. In one sense I agree: I think newspapers should have a responsibility to tell the truth, rather than pander to prejudice when it suits their owners to do so. But in terms of practical politics this does not get you very far. One of the depressing conclusions that will be drawn from the election result is that it is fatal to stand up to Rupert Murdoch. [1]

Is it also true that cutting the deficit is widely popular? Here I think the evidence is less clear. I agree with John McDermott that perceived competence is vitally important, and not only in relation to self-interest. That is why Labour made a strategic mistake in not challenging with more force the coalition’s blatant myth making on the deficit issue. As Jonathan Hopkin and Mark Blyth point out, it is incredible how the blame for our current problems has so easily been transferred from the finance sector to fiscal profligacy, and not just in the UK. (But not so incredible if you follow the money, and take media power seriously.) 

Perhaps I can also make a very personal point here. As one of only a few academics who have written an academic paper on the Labour government’s fiscal record, which concluded that Labour profligacy was a myth, you might have expected Labour at some stage to have used some of the many words I have written on this to support their case. As far as I know they did not. Perhaps they were put off by some of the my criticism of other aspects of Labour’s programme. But this didn’t put off Alex Salmond, who was happy to quote my support of the SNP’s line on austerity, suggesting it had all the more force because I was not an SNP supporter.

Talking of which, I think there is one more piece of received wisdom that needs exposing, and that is Scottish exceptionalism. As I hinted at the beginning, there was one major UK party that did campaign against austerity, was pro-immigration and supportive of welfare. No doubt other factors also led to the huge success of the Scottish national party, but their position on these three issues didn’t seem to do them any harm, and in some cases probably helped a lot. This example suggests the answer to the question posed in the title is a clear no. 

It is generally presumed by the media, both sides of the border, that this is all because Scots are inherently more left wing than the English. But the evidence suggests differences in social attitudes between Scotland and England is not that great. The question Labour (or at least somebody) should be asking is why the SNP can avoid pandering to these three myths and win decisively, when the consensus is that doing the same in England would be electoral suicide.   

[1] Some people who comment on this blog say that when I voice concerns like this I’m being a bit passé, but on other occasions I’m accused of being anti-democratic! Somehow a politician choosing to delegate macro policy to experts reduces democracy, but allowing rich media barons to control the information that much of the electorate receives, and as a result have a considerable influence on politicians, is just fine.

UK immigration and social attitudes

In a previous post I speculated on how the disaffected voter could be both part of the UKIP story and also a factor behind the decline in the popularity of the LibDems. But what about UKIP’s two key policy areas: leaving Europe and stopping immigration?

As I noted last time, for most UKIP voters Europe itself is no big deal. It is an issue which will sit naturally with disaffected voters: if UK politicians seem remote to their interests, politicians in Europe will seem even more so. It is not an issue that a large number of voters will regard as all important in itself. Immigration is much more interesting. This post looks at what evidence we can get from surveys about voter attitudes towards immigration.

The first point to make is that a large majority of the UK public have always favoured tighter controls on immigration. (Interestingly, given SNP policies for an independent Scotland, a majority of Scottish voters also want less immigration!) What has changed over the last two decades has been the salience of the issue. (The charts in this post come from the three sources listed at the end.)

This chart is a little busy, but the green line is the number of people rating race and immigration as one of the top issues. The issue was nowhere until the end of the 1990s. Within the space of about four years its importance rose dramatically, and it has stayed as a key issue since around 2003.

The temporal link with actual levels of migration cannot be a complete coincidence.

Note that immigration from the EU only took off from 2004. So freedom of movement for labour within the EU, which is discussed so much in the media, is not the key to understanding voter concern about immigration.

Nor does concern about immigration appear to involve class. Any differences between the standard social classifications (A-E) and voter concern seems to be swamped by a common movement, as this chart shows.

There is, however, an understandable difference between income groups when they are asked why they are concerned about immigration. Those with low incomes tend to want to reduce immigration because of the perceived impact on jobs and housing, while those on higher incomes are more concerned about the impact on public services.

There are also two additional class related factors which do distinguish between voters attitudes towards the impact of immigration. The first is whether the voter has a university degree. For those that do, the majority believe that immigration has benefited the country both economically and culturally, while those without a degree think the opposite. Second, there is a clear correlation between concern about immigration and the newspaper people read. In addition, people seriously overestimate the extent of UK immigration, probably because of the impression they get from reading certain newspapers. To some extent this may be inevitable, as sensationalism like this or this may help sell newspapers to those who worry about immigration. However the fact that large sections of the UK press want us to leave the EU may mean that causality runs the other way, as I note below. (I do not see this as a simple right-left issue, as many on the right are against tight immigration controls.)

Location is also important. One widely reported result is that concern about immigration tends to be higher where actual levels of immigration are low. (An exception seems to be where asylum seekers are placed.) Many have noted that UKIP’s first MP is in a constituency where levels of immigration are very low. Chris Dillow mentions one poll that found that while 76% think immigration is a very or fairly big problem for Britain, only 18% think it is in their own area. Furthermore those with migrant friends were far more likely to be positive about the impact of immigration than those without.

So immigration for many is about a fear rather than perceived experience. The fear is fed not by official statistics but stories in the media. In that sense it is like crime. In the case of crime, the general perception is that crime is rising, even though for many years nearly every type of crime has been falling in the UK. This encourages politicians to focus on the appearance of action: most calculate that they are better off talking about 'cracking down' on crime than in celebrating its decline. With immigration, the political benefits of appearing to 'deal with the problem of immigration' are greater than arguing that, in average economic terms at least, immigration may not be a problem at all.  

Two things make immigration particularly toxic as a political issue. The first is that economic issues (jobs, housing, public services) can so easily be linked to it. However the first chart should warn against a belief that immigration concerns will disappear if real wages begin to rise. The second is the link with EU membership. While it is clear that public concerns about immigration became important long before immigration from the EU rose substantially, it suits those that want us to leave the EU to suggest that EU immigration is critical to public perceptions on this issue. For that reason, it seems unlikely that the political 'problem of immigration' is going to go away as long as the UK remains in the EU. 

If this last statement is true, there is an interesting implication. UKIP can continue to receive strong support by saying that they have the only certain way of 'tackling immigration', and this will be true whatever actually happens to the numbers (immigration is like crime). The question that then arises is whether the Conservative party can live with that. Promising a referendum and then staying in the EU may win the next election but it will not make UKIP go away. Instead the party may calculate that the only way of making the issue of immigration less toxic is to take the UK out of the EU. 

Sources for charts:

Oxford’s Migration Observatory, Ipsos-Mori and the British Social Attitudes survey.