Parliament: more transparency needed

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As the Parliamentary Standards Bill limps towards royal assent before the summer recess, picked at and weakened by the government and committee stages, it seems a good time to reflect upon the transparency of government and politicians.
 
On Tuesday BBC Radio 4 broadcast “Expenses: The MPs’ Story", in which a series of MPs gave their accounts of the days and events surrounding the expenses scandal. Listening to the programme there was a sense that they were looking for sympathy or even to pass some guilt onto the public for overacting with such ferocity. As some MPs claimed at the time, there was a ‘McCarthy style witch hunt’ for MPs – well, what’s wrong with that? If somebody had robbed a supermarket, we wouldn’t decide to let them off in case we hurt their feelings – why should it be different for MPs?
 
People such as Anthony Steen MP (who is thankfully standing down at the next election), claiming that the public were simply ‘jealous’ of his big Balmoral-esque house, and Lord Foulkes represent what’s wrong with many politicians. They have forgotten whom they represent and why they are in Parliament, detaching Westminster from the rest of Britain. When people enter politics, they need to accept the transparency and public scrutiny that should come with it.
 
What we need from parliament, and what the Parliamentary Standards Bill will not deliver, is a total change in culture of politics. We need a system that looks out towards voters rather than looking inwards towards personal power and greed, only noticing the electorate every 5 years.
 
Daniel Finkelstein has written a piece in The Times arguing that we should be able to see into the personal dealings of our politicians, and I couldn’t agree more. Finkelstein says the people of Italy have the right to know the details of Silvio Berlusconi’s misdemeanours – and this is true – but I’d still rather have a lothario than a thief running Britain.

And in other news...

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and-in-other-news

It seems that even members of the animal kingdom are resorting to desperate measures during the economic downturn...

'"Definitely never been robbed by a monkey before," says store co-owner Jerry Duncan.'

Social mobility

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social-mobility

The report from Alan Milburn makes it clear that there is a lack of social mobility in modern Britain. It is in fact lower than it used to be. The grammar schools used to provide a ladder for talented people from poorer backgrounds, but most of these schools were swept away in a fit of egalitarian enthusiasm which resulted in a levelling down and the closure of opportunities.

There is less social mobility than when Labour took office. The key to social mobility has always been education, but despite an emphasis on "education, education, education," it has largely failed people of disadvantaged backgrounds. The government pressurizes universities to lower admission standards for people from poorer backgrounds, thereby discriminating against talented youngsters who happen to have middle class parents.

This is not the answer, neither a valid nor a fair one. The answer is to raise the standard of state schools so their students can qualify on merit. The way to do this is to forget egalitarianism and to allow a variety of schools to flourish, and enable parents of all backgrounds freely to choose between them, taking the state funding with them. We've published on this before, and will do so again. It has worked brilliantly in Sweden and will do the same here. Roll on a government which will implement it.

In defence of hedge funds

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Douglas Shaw of Black Rock spoke at a Civitas lunch this week on the topic 'In Defence of Hedge Funds'. Good luck to him. The industry is about to be overrun by an EU army of new regulations, which will knock any innovatory stuffing out of them. As investment businesses evolve and grow in the US, Switzerland, the Middle East and Asia, the stunted European hedge funds will look more and more like the evolutionary throwbacks of the Galapagos.

I don't know why hedge funds don't spend about a thousand times more on PR, because they have a positive story to tell. Their clients are all large, savvy investors, who probably know their business better than any regulator. There are about 10,000-odd funds, and the sector is diverse and highly competitive. Their leverage was only about 3x before the crash, maybe 2x now – much less than the 8x or so of the banks – so you can hardly say they are structured recklessly. And again, the institutions which lend them that money demand very detailed information about their risk and management profiles.

Oh, yes, they short-sell shares of basket cases like Northern Rock. But that just speeds up the demise of the inadequate, by making prices reflect what is really happening, rather than what half-blind regulators think is happening. It's not the cause of the crash. Indeed, after the ban on short selling came in, the markets continued to fall...and fall. Even the best hedge fund manager does not expect to be right more than two-thirds of the time, but the fact is that hedge funds tend to be more right than wrong – which is why their returns have well exceeded the market indicators and why government agencies, along with pension funds and all the rest, buy into them.

Still, the EU regulation is a done deal, apart from a few drafting points, so maybe it is past the time for 'defence'. Being the sole EU country with a truly global financial market, the UK will lose a lot more than others from all this. But then if the UK loses, the whole EU loses, and the US, Switzerland and the rest gain. But I repeat: why have these efficient, effective investment bodies not spent more money promoting their positive message? Perhaps they are just better at anticipating markets than at anticipating politicians. Well, they are learning the hard way.

Freedom Week at Cambridge

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freedom-week-at-cambridge

Last week was memorable for the 30 students lucky enough to win places at Freedom Week. Held at Cambridge in July, the week features lectures on the history of liberty and its relevance to the modern world. Organized by Jean-Paul Floru, Freedom Week is now in its fourth year. Its students stay at Sidney Sussex College, and have a packed programme of lectures, enlivened by social activities which include meals, receptions, punting and a barbecue. This year's event was agreed by those who attended to be excellent, featuring lecturers of very high quality, and with high level discussions both in the conference hall and in the social activities afterwards. It was helped by the weather, which stayed clear until the conference closed, at which point the heavens opened….

Living in a police state?

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living-in-a-police-state

Speaking at an ASI event earlier this year, David Davis posed an interesting question: "How do you know you are in a police state?" It is becoming an increasingly pertinent point. Accepting that we are not in a police state, at what point does it become one?

Of course, it is a question of semantics and one that may be a matter of opinion. Yet increasingly, perfectly sane and respectable people are using the term 'police state', a point of view that I am starting to have increasing sympathy with.

Living in London I would have imagined that it is a largely metropolitan dilemma; one that the shires would have escaped from. Yet reading the indomitable Henry Porter brings to our attention this case in Chatham High Street. The worrying trend of the state keeping increasing tabs on us, while we can’t even take a photo in public is profoundly worrying.

The slope is slippery and we must be watchful. The machinery for a totalitarian state must not be in the hands of even a benign power. As Andrew Porter states: "What is needed now is clear statement from the home secretary on the rights of photographers and the limits of police surveillance". It would be interesting to know where Alan Johnson and Chris Grayling stand on the matter.

Pondering on democracy

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pondering-on-democracy

On the surface of it, democracy appears to be a fair, agreeable way to run a country. But is it really as wonderful as it’s made out to be? The first thing to be contested with democracy is that it is as good as two wolves and a sheep voting on what to have for dinner. Perhaps from a utilitarian perspective, this would still be an idyllic system, but for lots of us (particularly the sheep) this is far from ideal.

It is, however, the nature of democracy, to be flawed on other levels. It is bound to be governed by short-term agendas. When a government comes into power, they have one term to impress the citizens. Any long-term policy will go unnoticed by the population. Similarly, governments will not have to suffer the long-term consequences of short-term policies. In fact, it is their opposition that is likely to suffer the consequences. Such a dynamic clearly does not operate in the interests of the country.

On this basis, it could be argued that government terms should be far longer than they are, arguably 20 or 30 years, so that they can implement, and see through long-term sustainable policy; although imagine the state of this country if the present lot remained in power for another ten years. Short of his ideal anarcho-capitalist state, Hans-Hermann Hoppe has argued that a monarchy would be better than what we have now: “Assuming no more than self-interest, the ruler tries to maximize his total wealth, i.e., the present value of his estate and his current income. He would not want to increase current income at the expense of a more than proportional drop in the present value of his assets." Indeed, a prosperous and secure society will raise the value of the king’s estate, so it is very much in his interest; but who is to say that the monarch would be so rational?

Unfortunately, every system of government tried has its flaws. I am quite undecided as to what is the best system. What I would argue is that to limit the flaws of any system in place, particularly those of democracy,  the power of the government ought to be kept at a minimum level. The less power the government has, the less propensity there is for them to make erroneous decisions.

1994: The beginning of the beginning

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1994-the-beginning-of-the-beginning

Tony takes power. How the Party must wish he was still around.

Charity, private schools and the public benefit

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It's entirely possible to argue with a straight face that private schools damage the nation. I may disagree with you, think your contention that everyone should be forced into the failing State sector absurd, but that would be my opinion, not an objective fact thrown up by the universe to frustrate you.

However, if we were to try and discuss the costs and benefits of there being a private school sector, we would at least agree that parents paying more money to have their children educated, money over and above the taxes they have already paid the State to educate their children, is a public benefit. No? Saving the State billions which it can spend upon other things is indeed a public benefit? Sure, maybe it's one we might need to offset against other things, but it is a benefit?

Not, apparently, if you are the Charities Commission:

David Lyscom, the chief executive of the Independent Schools Council, has tried, without success, to convince Leather that billions of pounds of taxpayers’ money that is saved by schools educating children privately is a “public benefit" in itself.

However, this is not the worst of what the Commission is no doing as it looks at the charitable status of all those private schools. This is:

The commission have not told us what the test we have to pass is.

When a bureaucracy will not tell you what the law is, when they insist that everything is simply to be left to their discretion, then we have left the rule of law far behind. Indeed, I would argue that in this situation we have left the governance methods of a civilised society far behind.

Apologies for my fundamentalism in such matters but just as I'm sure there are both costs and benefits to having a private school system (and on net, benefits) there are also costs and benefits to having a Charities Commission. If such Commission is going to start using Kafka as an operations manual then, on net, we'd be better off without it. Abolish it and force Dame Suzi Leather to work for a living for a change.

New Labour score an F

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Every year the marking, administration and validity of the SATs examinations seem to turn into a greater fiasco than the previous. This year thousands of papers will be sent back to the examiners due to sloppy marking. There are reports of students losing marks for spelling despite having no mistakes, and examiners taking marks off for undotted ’i’s whilst ignoring similar mistake on other candidates' papers.

The debate regarding the SATs is an ongoing saga in New Labour’s education policy and the lgonger it goes on, the more damaging it will be to young people. The validity of the grading system has been brought into question and people have naturally lost confidence in it. In time the system will become obsolete - how can teachers and schools authorities continue use the results of SATs to rate students and make important decisions on their futures if they cannot be certain the results are accurate?

We need to encourage more choice and diversity within our public examination system, rather than top-down control from the government who have their eyes set on headline statistics, and not the education of young people. A greater degree of privatization and autonomy would allow students to pick examination boards that had the best reputations for accuracy and exams that were tailored to their needs. In turn, employers would seek staff with qualifications from the most reputable and challenging exam boards.

This lack of confidence in our current qualifications system is already being seen with a growing number of candidates and schools opting to take the International Baccalaureate as opposed to the A-Level, which is all-too-often viewed as a ‘dumbed down’ or grade-inflated qualification. Clearly Labour are yet to fulfil their pledge on "education, education, education" – and they won’t as long continue to meddle in the system.