Adam Smith Institute

25. "Proportional representation is fairer than our present electoral system which can give power to minorities."

The argument for proportional representation is that it represents parties in the legislature in proportion to their support in the country, whereas a first-past-the-post system tends to squeeze out smaller parties and often results in a government which has less than 50 percent of popular support.

After listening to the theoretical arguments for proportional representation, look at the practical experience of it. It is under PR that minorities often achieve disproportionate power. PR tends to deny overall majorities, and to promote representation by smaller parties. Coalitions are the norm, with very small parties bargaining for their demands in return for support.

Proportional representation thus brings in the politics of what used to be called the smoke-filled room, of the deals struck in private between the political bosses. The first-past-the-post system may often bring to power parties with less than 50 percent of the popular vote. What it does not do is to give excessive power to very small parties. One has only to look at the disproportionate influence of the extreme orthodox parties in Israel. With only 2 or 3 seats they have exercised a major influence because their votes were needed to build coalitions. It's possible to have a 10 percent shift in opinion in Scandinavia, and see only some junior agriculture minister swapped for someone from another party.

A democracy should enable people to change their government. It is more about throwing out who they don't want than about electing the most popular. Proportional representation makes change difficult. Elections tend to bring small adjustments in the balance between the parties, and to result in coalitions of slightly different composition. There are times when a break from the status quo is needed. It happened in Britain in 1945 and in 1979, but it is doubtful that either would have happened under proportional representation.

And not a party in the traditional sense, but in the political. A recent addition to the political landscape (and to some extent a welcome one) is the UK Libertarian Party. It's so newborn that there’s little in the way of policy on their website, but we should be able to safely assume that it will be based on the idea of self-ownership and limited government, and most importantly: freedom! But does the creation of this party mean that the libertarians are moving towards becoming part of the establishment? Or is the establishment becoming more liberal, so that now is the correct time to expose the libertarian ideas to the public on a wider basis?

The most recent exploration of this theme came from the Libertarian Alliance, who've long been at the forefront of libertarianism in Britain. They recently asked the question in the inaugural Chris R. Tame Memorial Prize, "Does Britain need a Libertarian Party?" The winning entry can be read here and the author's answer is that there is no current need for a libertarian party. The author abhors the idea of libertarians becoming involved in the state machinery and argues that rather than squander time becoming part of the problem, libertarians should concentrate their efforts on spreading the ideas of liberty.

The arrival of Nick Clegg and David Cameron to the leadership positions of their respective parties has seen a sprouting of liberal (in its original meaning) ideas, albeit ones still couched in the language of the state. Perhaps a libertarian party can push them towards removing the state from people's everyday lives. It remains to be seen what can be achieved with a libertarian party, since as with any party it will be a mixture of all the creeds of libertarian thought. The problem is assembling policy that is truly libertarian, yet appealing to all within and without.

The surest way to make the state smaller is to explain and champion individual freedom and win the hearts and minds of the many. Hopefully a libertarian party will be able to help in that.

The arbitrariness of the Home Office work permit system is exposed by the decision to deny the footballer Nashat Akram the chance to play for Manchester City. The rejection came because Nashat is Iraqi, and Iraq is rated 72nd in the world rankings. Permits are only given to players from international teams in the top 70. This decision was made despite Nashat's remarkable performances in Iraq's surprise triumph in the Asia Cup, all the more remarkable given the disorder in his home country.

It is also not the first time the Home Office has been in the news over footballer's work permits. Jason Scotland (Trinidad and Tobago) and Mark González (Chile) were both denied permits, with latter being a deal worth £2.35 million. Perhaps the government is best left out of such decisions; at least until the mandarins at the Home Office can meet the fan's demand by scoring goals like Akram (see here and here).

As it would happen, Philippe Legrain, author of "Immigrants: Your Country Needs Them" will be arguing along these lines tonight at the Adam Smith Institute. If you would like to come, please contact Steve at This e-mail address is being protected from spambots, you need JavaScript enabled to view it or us call on 020 7222 4995.

It has been said that politics is the second oldest profession. I have learned that it bears a striking resemblance to the first.

– Ronald Reagan

Liberal-Democrat leader Nick Clegg has declared that he and his party will NOT support a referendum on the Lisbon Treaty, the one declared by many to be almost identical with the EU constitution voted down in France and the Netherlands. This is hardly surprising since I remember him on television at the time saying the "no" votes didn't count "because polls have shown that the French and Dutch voters didn't know what they were voting about."

So fundamental a shift in power clearly requires the consent of the British people. The continental tradition has long been one in which the political class is left to the business of government, while ordinary people get on with their lives, occasionally rioting to draw their grievances to the attention of their ruling élites.

Britain, by contrast, has enjoyed a more vigorous democracy, aided perhaps by a voting system that makes it easy for people to turf out governments, but mostly because of cultural and historical differences. It is a pity that Nick Clegg has chosen to ally himself with the continental style of 'ruler knows best.' Some had hoped he might head his party back toward liberalism and away from the statism it has embraced in recent decades. Alas, it is not to be, and marks a lost opportunity. There's something about European political union that makes otherwise sane politicians lose their reason. And their values.

I share Madsen's disappointment with Nick Clegg's refusal to back a referendum on the Lisbon Treaty (or EU Constitution, as honest people call it). Internationalism may be an important part of the Lib Dem creed, but there isn't much in the treaty that I would describe as 'liberal'. And it's strange that while the Lib Dems rightly back devolving more power to local government and individuals, they also support giving Brussels ever greater control over our lives and the policies that affect them.

On the other hand, Nick Clegg also made a very promising announcement on the future of the NHS yesterday, saying he would replace central government targets with 'personal entitlement's to high-quality care. A 'patient contract' would guarantee service and give people the right to private treatment if maximum waiting times are exceeded. As he put it in a Telegraph article, "That's how it works in Denmark – not to undermine the public system, but to guarantee individual care."

Quite so. Public services, in a sense, represent a contract with the public. In return for paying taxes, you are entitled to certain services. The trouble now is that the contract is neither explicit nor enforceable. If you get shoddy service in the public sector, there is not much you can do about it. You are certainly not going to get your money back. An enforceable patient contract, with an escape mechanism to the private sector, changes things. It ensures a high level of service for the individual, and it forces the public sector to raise its game.

Of course, we have been advocating this kind of thing for years (see Blueprint for a Revolution, for example) but it's always nice when politicians realise you are right. David Laws MP, the man in charge of Lib Dem public service reform policy, has promised radical thinking across the board, so let's hope there is more of this to come...

At last, Britain's Conservative Party is getting in touch with its masculine side. And doing very well as a result.

David Cameron spent a year turning his rather unpromising colleagues into something that more resembles a team, that seems engaged with the issues that affect ordinary people's lives, and that in part is almost human - or at least gives a convincing impression that it might be. Along the way he mightily irritated a number of Conservative supporters who picked up the message that health and education just needed more cash, louts should be loved, and tax cuts were right off the agenda.

None of it stopped the Conservative Party's drift eastward (or even east-southeast) in the opinion polls, but what a difference an election makes - even one which UK Prime Minister Gordon Brown bottled out of. Suddenly some real policies had to be produced. Particularly one or two that would induce Conservative supporters to get out and vote, rather than just stay home in disgust. Shadow Chancellor, George Osborne, picked a fairly innocuous one - that only millionaires should pay inheritance tax. And whoosh! Suddenly the opinion polls were going north-northeast. It's happened again. The Conservatives are now seven points in front of the Labour government, thanks in great part to their latest policy promise - getting the scroungers off welfare.

It's a policy almost as feeble as the inheritance tax one: the idea is that only after two years would people be faced with the choice of doing community work or losing part of their social benefits. Under the plans we put forward in Working Welfare, benefit claimants would face immediate work requirements – and if they did nothing, they would get nothing. Nonetheless, Conservative supporters (and quite a few others) are just fed up working hard and paying taxes when they see other perfectly able folk sitting around doing nothing on their money, so the Tory proposals have gone down well.

Some pundits say the Conservatives have to go back to being soft and cuddly so that they might woo over LibDem supporters. But the new approach seems to be working perfectly well, thank you very much.

If your best mates clubbed together and gave you £103,000 when you needed it, you'd remember it, wouldn't you? Remarkable, then, that UK Work and Pensions Secretary Peter Hain didn't. He's accused of not registering seventeen donations towards his campaign for the Deputy Leadership of the Labour Party, totaling this amount. His forgetfulness is all the more astonishing when you consider that his campaign far outspent those of his rivals. So this was a large wodge of cash that public standards watchdogs weren't told about. Even Tony Blair, with his £500,000 salary from J P Morgan, his book deals and the rest couldn't simply miss £103,000.

Until Peter Hain went into Parliament, I always though him honourable. I opposed many of his views - and his abrasive ways of promoting them - but you can disagree with people and still think them principled. Politics of course forces people to compromise on their principles, so I've less respect for party politicians - but that's still no reason to accuse them of being crooked.

No, what's going on here is more subtle, and even more worrying. It's not that Peter Hain is a single rotten apple that can be ejected from the barrel and all will be well. No, they're all at it. Millionaire supporters funnel funds to the Labour Party through third parties who don't even know about it: half of Peter Hain's missing thousands is routed through some supposed think-tank; donors are attracted by the suggestion, however faint, that there might be a peerage in the pipeline.

What's wrong is that people in politics, both politicians and perhaps even more so their staff, think that they are above the rules. That their mission is more important than some tedious bit of book-keeping. That they can shuffle large sums around and nobody will notice. That how they raise and spend their cash is of little concern to the public.

Unfortunately, we live in an age of transparency, where every move that political folk make can come under the media spotlight. It means they have to be completely straight in how they conduct their business. The legislation to clean up party funding has been in place since 2000. It's truly alarming that so many politicians think it shouldn't apply to them.

It's heartening to know that I'm not the only one sickened by the news that Britain's ex-Prime Minister Tony Blair has been snapped up by J P Morgan Chase on a salary of £500,000. For that, he's not even expected to pass his banking exams, merely advise them on the economic impact of globalization (something they'd be better just Googling) and introducing them to potential clients.

When the Blairs bought a £3.4m house, all the press wondered how they would pay the mortgage. Now we know. Even with tax rates of 40 percent, they could pay it all off in half the time it takes most people, and still have enough to live at twice the standards of most people.

I neither grudge nor envy Blair's money, and I'm sure that he's actually worth that to the bank. All he has to do is get some billionaire friend to sign up (and from his years of free holidays in the grand holiday homes of the rich and famous, he knows plenty of them) and he's earned his keep. What revolts me is the hypocrisy of it all. Politicians tell us how above it all they are, and then as soon as they leave office they get jobs with the industries that they were supposed to be regulating in a detached manner just a few months ago. There are rules to stop the most outrageous breaches, but if moving straight from being First Lord of the Treasury to being director of a bank isn't colourable, I don't know what is.

And I need hardly mention that Blair was a Labour prime minister. Aren't they supposed to believe in fairness and equality? Don't they tell us that the fatcats are appalling? Well, yes, they do. Until the cream jug comes round.

One idea which pops up a lot these days is that the government should be motivated by 'quality of life' in its policymaking, and not just economics. Some even say that gross national happiness should be the aim, rather than gross domestic product.

Well, it’s a nice idea, but why do people always think a higher quality of life requires more government? In their recent report for the Conservatives, Zac Goldsmith and John Gummer even suggested that our 'quality of life' would be improved by compulsory parking fees at supermarkets. Hardly.

The thing is, quality of life means very different things to different people. The one common theme, however, must surely be the freedom to pursue your own idea of happiness – and that means less government, not more!

My quality of life would be much higher if only the taxman didn't steal so much of my income, for instance. If I was ill, I would be much happier knowing I could choose which hospital or doctor I went to. If I had children, I would be happier knowing I could choose their school.

As a Londoner, however, the biggest changes to my quality of life would probably come about if the trains were deregulated and the tube privatized, and I could get into work more easily. Of course, if only central London wasn't ringed by hideous tower blocks (built by the government), and if only our land-use planning system wasn't so restrictive, I might just be able to live closer to the office.

Policies aimed at making us freer and wealthier increase our choices, and give us a better opportunity to pursue our own idea of a good life. Whatever government does, that should be the aim.

With Barack Obama's resounding victory in the Iowa Democratic caucus, Hillary Clinton's presidential nomination no longer looks so inevitable. Indeed, if Obama can follow through with a victory in the New Hampshire primary next week, he will replace Clinton as clear favourite for the Democratic nomination. Watching Obama's victory speech, it is hard not to be impressed, even inspired:

He is a remarkable speaker – more reminiscent of the presidents of Hollywood blockbusters than of the incumbent – and his appeals to hope, change and unity are what have brought so many young people, independents, and even disillusioned Republicans to the polls in his favour.

But being a good president requires more than just rhetoric, and now that Obama is no longer an underdog, he will need to firm up his policy positions if he wants to make it all the way to the White House. That said, he would be a very tough candidate for the Republicans to beat. A Hillary nomination would give them a much better chance of hanging on to the White House.

US politics is going to be fascinating to watch in 2008.

My true love sent to me: twelve drummers drumming. It probably means the twelve points of doctrine in the Apostle's Creed. The number of Gordon Brown's apostles is subsiding daily, after the sound of the election drums back in October proved a false alarm. Had he called an election then, he could have won it, though it might have been close. Now, I agree with Trevor Kavenagh of The Sun - he can never win an election again.

That's a good reason to suppose that the next UK general election will be as late as it possibly can be - in the first half of 2010. But I met Sir Robert Worcester the other day and he's still staking money on June 4, 2009, arguing that what goes down must come up, a year's a long time in politics, etc. Anyway, the prospect of overweening politicians losing their seats is always something to look forward to, whenever it comes.

Half asleep on Sunday night I was listening to a discussion on the radio about 'New Puritanism'. It's the ghastly mix of emerging social attitudes that says that it’s ok to bully people into thinking your way about anything 'bad' in others.

Take the smoking ban. There are, of course, those of us who believe that it is a load of authoritarian tripe, forcing the views of one group of people down the throats of others for no good reason. Then there are those who feel that people in public places shouldn’t be exposed to 'passive smoke' because it may damage their health. This is the old 'nanny state knows best' argument – we disagree,  but at least it's a coherent position. The New Puritans however took it one step further, banning smoking in private clubs for no better reason than they don't like smokers and don't think people should be free to choose whether or not to associate with them.

This attitude is showing up more and more and extends right to the top of government. The smoking ban, fuel taxes, 4x4 road tax, school until 18, bans on pistol-shooting and hunting with dogs, the old rules of John Stewart Mill that 'if something doesn’t hurt others you don't stop people from doing it', have been thrown out and replaced with, 'if something offends a leader writer in the Guardian then ban it'.

So if the country is now ruled by a 'Neo-Cromwellian' dictatorship of the 'liberal' elites, why did I fall asleep feeling so happy?

Well the thought occurs, every time in history that we have been taken over by a puritanical government it has been followed by a backlash of ridiculously hedonistic proportions. Think, Cromwell and the Restoration or Post-War Rationing and the 60s.

Viva, la revolution!

There is an interesting article in The Economist this week, which states "The Conservatives are doing well, but not well enough." That's probably a fair assessment.

The point is that despite the government's recent woes, and the sustained poll lead they have produced for Cameron's opposition, the Tories have not managed to really pull away from Labour. As The Economist notes, in 1995 Labour were scoring 60 percent, more than 30 percent ahead of the Tories. By contrast, Cameron's Conservatives are only averaging a ten-point lead, with 41 percent to Labour's 31. Of course, that is their best lead since 1992 and it represents a truly remarkable turn around from just a few months ago. But thanks to the structural unfairness of the British electoral system (the Conservatives need many more votes than Labour to win the same number of parliamentary seats) it is not yet enough to be sure of victory.

The main question for the Tories is, what can they do to propel themselves further ahead? The Economist points to two issues. The first is personnel - the shadow cabinet as a whole needs to perform better. Too many of them are completely unknown to the wider public, and do not seem to be particularly proactive. This is foolish: the Conservatives cannot simply hope for the government to lose the next election, they will have to work tirelessly to win it.

The second issue is policy. The problem is not, as is often suggested, that there isn't enough of it, or that it isn't detailed or radical enough. In fact, Cameron's policy commissions have provided him with a wealth of promising ideas, particularly on education and welfare reform (which may prove to be the most important challenges facing the next government). But what the Conservatives have not yet developed is an overarching theme or narrative that holds everything together and makes people understand just what a Tory government will be all about.

Ultimately, people vote for a vision, not for a handful of good policies. The challenge that remains for the Conservatives is making their vision the most attractive one on the market.

The party funding scandal that has engulfed the government will undoubtedly be used as an excuse for more regulation and more state funding of political parties. This is a mistake. The Labour Party is in trouble precisely because it has broken existing laws and been found out, not because there was not enough regulation to guide their conduct.

Indeed, what this new scandal should show us is that placing restrictions on party funding doesn't really work. More regulation does not produce better ethics, just as more state funding would not reduce political corruption – it would just make the taxpayer foot the bill.

In any case, British politics is not an industry awash with money, and all parties are under pressure to make ends meet. So why not go for a more straightforward approach and say: “Let them get it where they can”. The role of the law should limited to insisting on transparency.

The usual argument posed against this approach is that it would enable a few rich people to dictate the policy agenda. But political parties are ultimately driven by a desire to win power, and thus it is the will of the people that dictates policy (for better or worse). A rich man’s money is no good if it is conditional on the implementation of a programme no one wants to vote for.

It is also generally unfair to ascribe sinister motives to party donors. Like most people in politics their desire is to make the world a better place (as they see it), rather than to pursue a purely instrumental agenda. And when 'influence' is sought, it usually only takes the form of after dinner speeches or informal 'face time' with politicians.

Ultimately, if we try to regulate the finances of political parties, we are only setting ourselves up for disappointment. Letting the market do its thing is the only sensible way forward.