Lying takes skill, amoral scum tend not to have skill

If you think your very survival depends on telling lies it is very unwise to commit your thoughts to print without taking a little peek at the rushes to make sure you are not making a complete pigs' breakfast of the whole thing.

Gordon Brown has lent his name to a simply astonishing piece of mendacious codswallop in today's Sunday Mirror. It's necessary to put it in context. The Shadow Health Secretary said that ring-fencing government spending for health and overseas aid in 2011 would mean cutting the total amount spent by all other departments by 10%. He was not setting out his own party's position, he was using the current government's own figures. In 2011 Gordon Brown's government would have to cut spending by 10% across all departments other than health and overseas aid if it kept to the spending commitments it has made but excluded health and overseas aid from reductions. That is a fairly simple proposition. The government has said how much it intends to spend. It has not said how it intends to spend it. But if health and overseas aid are not to suffer reductions the amount available to all other departments will be 10% less than it is now. What's difficult about that?

In today's article poor Gordon has turning himself into pitiful Gordon. He claims that his spending plans are different from those Mr Lansley was talking about. That is a blatant lie. It doesn't stop there. Then he says the purpose of cutting government spending is to provide "a £200,000 tax cut for the richest 3,000 families". What a stupid line. Is it really his case that the Conservatives would hunt for the 3,000 richest families in the country and arrange things so that they each pay £200,000 less in tax? Has anything more absurd ever been written by a serving Prime Minister?

Then he made his worst mistake. He wrote this: "David Cameron ... would actually make the recession worse, by slowing public spending at exactly the time we need it most." How very insightful that sentence is ... or is it? The reduction in spending of 10% over all but two departments relates to 2011. Does pitiful Gordon think we are still going to be in recession in 2011? If he does it conflicts with everything he and his puppet Chancellor have said on the subject. Or was he saying that cutting government spending this year would make the recession and/or the consequences of recession worse? If he meant the latter he should have saved some ink because the Conservatives are not in power this year so his point has neither form nor substance.

When you start lying it is very difficult to stop. Were government expenditure (save for health and overseas aid) to be cut by 10%, as Labour plans, that reduction could be effected in numerous different ways. Stopping funding for all quangos and charities would achieve something like the reduction pitiful Gordon wrote into the last budget. Yet in his article today he says it "would mean" reductions in the numbers of teachers, police officers, soldiers and university places. That is another blatant lie. There is no scope for misunderstanding here, it is a lie. Were he an honest man he would have written (with a disgraceful amount of spin, albeit honest spin) that such a reductions would be equivalent to the cost of the number of teachers, police officers, soldiers and university places that he mentioned. But he did not say that, he said it "would mean" actual reductions in those fields. A disgraceful, deliberate lie by a man who wouldn't know how to tell the truth if his pathetic sham of a life depended on it.

To make sure there could be no doubt about the depth of his dishonesty he wrote this extraordinary sentence in winding up what must be one of the shabbiest pieces ever submitted by 10 Downing Street to the national press: "They will cut the services you and I rely on so that they can redistribute resources to the 3,000 richest estates in the country." Let's start with a simple question, one even a supported of pitiful Gordon might be able to answer. What services relied on by pitiful Gordon himself will be cut even on his fairyland view of what a Conservative government might do? Hmmm, that's a bit of a toughie. Maybe he means schools for his children; no it can't be that he'll just arrange for them to go to a private school at public expense as his predecessor did. Maybe he means ... no, the list is already exhausted.

"...redistribute resources to the 3,000 richest estates in the country." That is an absolute corker. On no possible basis of fact can it be asserted that keeping to pitiful Gordon's own spending plans - involving as they do sucking a greater and greater amount from everyone in tax to pay for the unprecedented debt his incompetence has accumulated - will result in anyone getting richer. No doubt one could take the cash value of the cuts pitiful Gordon plans and pretend they will be paid to the richest 3,000 families in the country and calculate that each of the 3,000 will receive £200,000 in Monopoly money, no doubt fairy dust is a more appropriate currency in the world of pitiful Gordon. But no one is planning to cut the taxes payed by anyone and no one is planning to give hand-outs to rich people.

The man has descended to the sewer. At long last his words have reached the level of his moral compass. He is a shocking piece of scum, utterly dishonest filth, unfit to lace his own boots let alone anyone else's.

Meanwhile, back at the recession ...

While we have been distracted by MPs being paid by us for giant topiary bathplugs and the exposure of the true weakness of Gordon Brown's grip on power, our old friend the recession has been carrying on doing its own thing. Jobs have been lost in huge numbers in the manufacturing, service and retail sectors. House prices have levelled-out temporarily due to the annual Spring rush but remain well above realistically affordable levels. Increased activity in the housing market will provide a small knock-on boost for manufacturers and sellers of carpets, furniture and washing machines.

In the last week news has come of 800-odd jobs going at LDV, with thousands more at risk in associated businesses, 700 at Hewlett-Packard and more than 1,600 at Lloyds Bank. These are the headline-grabbers but there are many more coming from the closure of, and cost-cutting in, small businesses. There is clearly a long way to go before the effect of all these redundancies works its way through the system. In the meantime other businesses will be affected by the loss of spending power by those who have lost work (and tax revenues will fall).

When asked in an interview last week why he refuses to call a general election Gordon Brown said he was busy dealing with the recession. We have heard a lot of references to "steering the country through" and "leading the fight again" recession in recent months but the reality is that there is almost nothing he or any politician can or should do. There is a reason LDV is closing - it cannot make vans that people want to buy at a price that makes a profit. There is a reason Hewlett-Packard is shedding jobs - it doesn't need them and cannot afford to continue employing them. There is a reason Lloyds Banking Group is closing its Cheltenham & Gloucester-branded branches - it cannot afford to keep them open. What can the government do about any of these cases? The answer, of course, is absolutely nothing other than offer subsidies and hope that, by some miracle, keeping loss-making enterprises open will turn them profitable. It is no surprise to find the trades unions arguing for exactly that to be done but it is a wholly futile exercise which simply increases losses in the long run.

We are in recession because our economy was unbalanced, being kept afloat by hot air and unaffordable credit. There is no escaping the fact that a contraction was necessary, the only question is how large that contraction needs to be before balance is restored. No one knows the answer now any more than they did a year ago because the national economy is not one big thing it is an aggregate of millions of little things. Mr Smith in Brighton and Mrs Jones in Birmingham might earn similar salaries and have similar debts and expenses, but one might choose to reduce their debt and the other might not, or both might, or neither might. These personal decisions affect consumer demand are wholly unpredictable. Similarly, the effect of reduced demand on individual businesses will vary according to how they are run and the wishes of their owners; seemingly identical businesses in Brighton and Birmingham might take completely different approaches. There is nothing government can do about that. And then there is the question of how people react now to the stark fact that taxes are likely to have to rise substantially in the next year or two (and thereafter). Some will ignore it and hope it goes away, others will cut spending now and save to prepare themselves for the onslaught. These personal decisions will have a dramatic effect on how quickly recession ends yet no amount of speechifying and theorising by politicians or anyone else will change them. The real economy, comprising those millions of individual decisions, will find its own response to the current situation. The little people are the real economists in all this.

The best thing poor Gordon can do is sit on his hands and hope the damage he did to the economy in his decade as Chancellor is not as bad as it is.

A fine day Part 2 - the democratic deficit

A few days ago I waffled on about how Gordon Brown's authority comes primarily from his party rather than from the last general election and that his position is necessarily weakened by fractures appearing in the party itself. Friday's forced "re-shuffle" was a direct consequence of that weakness, not least because it was not expected to happen until Monday and had to be brought forward to try to stop the snowball effect of ministerial resignations and divert attention away from criticisms of the Prime Minister.

It is important to put current events in context. Criticisms of the Prime Minister and the government are only part of the picture, there is also a massive constitutional issue about the way parliament has been sidelined by an over-powerful executive which whips its backbenchers into voting for all but the very most absurd policy initiatives. The last thing a beleaguered leader should do in the face of such a serious issue is make things worse. Oh dear, step up poor Gordon.

The cabinet traditionally contains one member of the House of Lords, the leader of the government party in that House, and in days of yore it contained a second in the Lord Chancellor. Neither of these had conventional departmental responsibilities and were not front-line policy spokesmen. When Tony Blair decided to abolish the established role of Lord Chancellor he used the incumbent (his old flatmate from student days, Lord Falconer) as a spokesman on any number of issues and received criticism for undermining the elected House by doing so. For a year we have had a member of the House of Lords running the Department for Business, the first time a major spending department was headed by an unelected politician since the mid 1980s.

Friday saw the breathtaking constitutional change of Lord Mandelson being promoted so that he now holds the second most powerful position in government and another Lord is now in charge of transport. But that wasn't the end of it. In addition to the cabinet itself there are now five other ministers who attend cabinet meetings and two of them are unelected, Lord Malloch-Brown and Lord Drayson and the Attorney General, Lady Scotland, attends when the agenda includes matters within her departmental responsibilities. Out of twenty-three cabinet ministers three are unelected and out of the twenty-eight ministers who attend all cabinet meetings five are unelected, that will soon be six when the new Minister for Europe, Mrs Kinnock, takes her seat in the House of Lords. So Gordon's answer to the gap between government and the little people is for almost a quarter of his top table being appointed rather than elected.

And it doesn't stop there. Are ministers going to be responsible for forming policy? One might think that is the way to ensure democratic validity, but no. Gordon announced three new policy quangoes to guide the way forward.

Things have quietened down a little over the weekend. It might be that all those who were inclined to resign have done so. Gordon is enjoying a couple of days of breathing space while everyone reflects on what to make of last week's turmoil. What I see is a widening of the democratic deficit. Not only does Gordon have his own democratic deficit by being a party appointee without endorsement through a general election, but his deficit has widened through his party being fractured. More than that, the gap between the top of government and the House of Commons has widened and the gap between policy formation and our elected representatives has also widened.

Gordon is bleating more and more about constitutional change, his anti-democratic moves last Friday will come back to bite him. If, indeed, he lasts long enough to be able to put forward whatever half-baked plans he has.

A fine day Part 1 - neither MacMillan nor Forsyth

When I went to bed on Thursday night the cabinet was one member light of its compliment at the start of the day because James Purnell resigned in the old-fashioned way - by saying "I resign" and leaving office on the spot. It also contained two ministers who had announced they would stand down when the Prime Minister decided to change his cabinet. So they were still in office and garnering a few hours or days of ministerial pay, they knew not which, despite being the lamest of ducks. Their announcements came before Mr Purnell's which gave rise to the delicious possibility of Gordon Brown not changing the cabinet and leaving them in place. He might as well have done for all the responsibilities they had for the formation or implementation of policy.

By bedtime on Friday the upper ranks of our government had been decimated. Four cabinet members exited in addition to those who announced their departure on Thursday, and two non-cabinet members who have been louder spokesmen for the government than many of their more senior colleagues had also resigned.

Those of us of a certain age talk about "the night of the long knives" when Harold MacMillan dismissed seven members of his cabinet in 1962. None of them showed any sign of wanting to leave government to spend more time with their second homes or of being overtly dismissive of the ability of Mr MacMillan to carry out his responsibilities. He sacked them because he needed to present a new face of government under his leadership. He also needed to assert his authority because whispered questions had been asked about his ability to steer the ship. A radical step was taken to say "I'm in charge". Those of us of a certain age also know that "I'm in charge" was a catch phrase used by Bruce Forsyth when the game-show part of a live television programme he presented needed to be pulled back from mayhem to meet time constraints.

Poor Gordon is no Harold MacMillan, nor is he a Bruce Forsyth. His replacement of seven cabinet ministers was forced on him rather than him forcing it. The clearest evidence of this is that he was forced to promote the multiply corrupt Lord Mandelson who is now the holder of the title "First Secretary of State". One can only speculate about what Lord Mandelson had to do behind the scenes to prevent even more cabinet resignations but he must have done something in order to have been able to persuade the Prime Minister to give him an additional half a department and a title that makes him the government's undoubted number two (such a worthy title for the man).

On Friday afternoon, at around four o'clock, a press conference was held at 10 Downing Street with the apparent intention of allowing poor Gordon to explain how his new appointments were part of a master plan of refreshment and renewal and would strengthen the government as it ploughs towards glorious victory at the next general election. Instead we saw a broken man being berated by mocking journalists.

The normal protocol of Prime Ministerial press conferences is based on common courtesy. Whatever the journalists might think about the Prime Minister, he is still the head of government and will be treated with courtesy and reserve. Not on Friday afternoon he wasn't. I was struck by the similarity with the final showdown that caused the Speaker to resign less than three weeks before. Speaker Martin tried to placate critics with a statement only to find that the inadequacy of his words and delivery added fuel to the fire and open rebellion followed on the floor of the House of Commons. The same pattern of behaviour was witnessed on Friday. Normally poor Gordon fails to answer questions or answers them with assertions that are demonstrably false. The journalists know that they have to put up with the answer they are given and will not normally contradict that answer to the Prime Minister's face (although they will do so in their newspaper columns). On Friday they answered back, heckled and openly challenged the truth of answers they were given. It was unprecedented in modern times, just like the overt challenges to Speaker Martin's authority on the 18th of May.

It had been such a fun day that a meal at the splendid local Thai restaurant was warranted. On taking my seat the waiter said hello and asked "has Gordon Brown gone yet?" He is an MBA student who works in the restaurant six evenings a week to pay his way, he hadn't been able to follow events during the day but read the Evening Standard on his journey from college to work and knew the writing was very much on Gordon's wall.

Harold MacMillan's night of the long knives succeeded in giving his government new vigour because he was able to promote people of quality whose own strengths caused the whole government to be strengthened. As a result MacMillan's authority was itself strengthened. The new entrants to Gordon Brown's cabinet are mere makeweights. Peter Hain, forced out of office less than eighteen months ago by exposure of corruption, has returned. Tessa Jowell was demoted twice by Tony Blair and is married to a convicted fraudster, so she is perfect material to be brought back to high office. A junior minister of no great distinction, Bob Ainsworth, has been catapulted into the important position of Secretary of State for Defence despite showing no sign in his seventeen years in the House of Commons of having the gravitas required for a cabinet position. Two party yes-men, Ben Bradshaw and Lord Adonis complete the new entrants to the cabinet. Bradshaw is a former journalist who rose through the ranks by knowing how to evade questions with the slimy charm of Tony Blair, but has never said a single thing of substance on any contentious issue of policy. Adonis is an academic who twice chickened-out of standing for election (once for the Liberal Democrats and once for Labour). He's a clever chap, one of the few in the cabinet, but apparently spineless.

There is no sign of new strength in the new cabinet. Everything points towards poor Gordon simply filling places for the sake of filling places. In one way it makes no difference to him because he dictates policy in every field. All he needs is someone prepared to sign on the dotted line. This "re-shuffle" does not set the scene for the death of the current government, the press conference does.

It's only a matter of time and I am going to enjoy every minute.

Why poor Gordon's authority is shot

As I start writing this piece today is set to be one of the most memorable politically. An incompetent and dishonest cabinet minister announced her resignation this morning, the day before local elections. She is the cabinet minister responsible for policy on local government which makes the timing particularly embarrassing for the Prime Minister. Like so many of the present cabinet she has never actually achieved anything in government and is merely a dedicated party functionary employed at vast public expense to further the interests of the Labour Party. As such her departure, and that of the equally useless Home Secretary yesterday, has special significance to the authority of Gordon Brown as Prime Minister.

We all know the conventional theory. The leader of the largest party in the House of Commons is invited to form a government and a change in the balance of seats in the House or in the identity of the majority party leader does not require a general election for the new Prime Minister to be validly appointed. When Brown took over from Blair the same constitutional process occurred as when Eden took over from Churchill, MacMillan from Eden, Douglas-Home from MacMillan, Callaghan from Wilson and Major from Thatcher. There was, however, something different about the practical effect of the change.

Callaghan was the first of those I have named who was elected leader of his party, the others assumed leadership at the invitation of party grandees following meetings in smoke-filled rooms, ordinary party members and even backbench MPs had no real stake in the appointments. Callaghan's election made him beholden to the party machine far more than any of his predecessors because the "grass roots" could say "we put him there so he must do as we wish or we will remove him". In fact this was not much of an influence because he did not command a majority in the Commons and needed to tailor his policies to what he felt he could push through with the help of the Liberal Party. When John Major was elected leader of the Conservatives in 1990 he was under pressure to keep the party happy although the issue of Europe and the growing EUSSR project meant he could only ever seek to satisfy one wing of the party. For Mr Major things changed in 1992 when he led the party into a general election and received his own mandate as Prime Minister. No longer could it be said he was beholden solely to the party for his position.

Although a general election does not involve a direct vote for Prime Minister it does involve candidates standing on a platform that implicitly includes "my party's policies are as set out in our published manifesto and the Prime Minister will be Mr X if we win a majority." A Prime Minister who led his or her party through a successful general election has a personal democratic legitimacy as well as a pure constitutional legitimacy. In answer to his party saying "we put you there" he can answer: "no, the result of the general election put me here". Without that personal democratic legitimacy he will be beholden to his party for his role and will not be able to point to any other factor as the substantive basis for his position. We are now seeing how that affects the practical authority of a Prime Minister who commands a working majority in the House of Commons. He has no ammunition with which to fight discontent in his party because he owes his status to the party and to no other entity.

Those who can exploit this situation best are loud-mouthed party functionaries like Jacqui Smith and Hazel Blears. If the cabinet included any people of real substance things might be different because they would be governing for the country rather than for the party. The current shower don't know the meaning of the concept. It was noticeable that on news breaking of Blears's resignation this morning the radio phone-in I listened to featured a number of callers extolling her work for the Labour Party and no one with a single word to say about what she had actually done as a minister. Indeed, her letter of resignation emphasised the party above all else.

When you owe your very existence in office to your party machine, any attack from prominent members of that machine challenges your authority to the core. That is why I believe Hazel Blears' decision to stomp off in a hissy fit is particularly significant and far more significant than that of Jacqui Smith who only ever does what she is told and has neither the personal courage nor the intellectual ability to take the initiative on anything. Hazel Blears is an absurd figure of no substance, a laughing stock of a minister who would be out of her depth in a soup spoon, but she has a loud mouth and the sort of blind, stupid loyalty to a corrupt party that gives her special authority within just such a party. Poor Gordon's authority is so dependent on people like her that we might now be entering the final few weeks of his disastrous tenure as Prime Minister.

Perhaps Hazel Blears has actually done something useful for the first and last time in her self-serving and non-achieving ministerial career.

Proportional misrepresentation

We have today been treated to the most blatant challenge yet to Gordon Brown's leadership of the Labour Party. One of the few members of his Cabinet capable of stringing together a sentence without using jargon has called for a referendum on our voting system. Writing in The Times, Alan Johnson called today for the next general election to be accompanied by a referendum in which we would be given the choice of retaining the present first-past-the-post system and something called "alternative vote plus". In doing so he knows there is virtually no chance of it happening, but that is not what troubles me.

A referendum is a serious thing. In my lifetime there has only been one for voters in England and the same one is the only one in history for voters throughout the whole United Kingdom. It was held in June 1975 and concerned our membership of the European Economic Community. The referendum was held as a direct result of a general election manifesto commitment by Harold Wilson's Labour Party to hold a referendum on continued UK membership of the EEC once his best efforts to re-negotiate the terms of our membership of the EEC were known. The general election was held in February 1974 and the re-negotiation took almost a year (another general election occurred in this time, in October 1974). By mid March 1975 a new deal had been reached and the following month Parliament voted for a referendum.

Membership of the EEC was a very hot topic at the time. It split both main parties then as membership of the EU (an entity those arguing for continued membership of the EEC in 1975 said was never a prospect) does now. Politicians of both parties expressed their views freely and it was one of the most widespread topics of debate. The referendum was held not just because of the February 1974 manifesto promise but also because the issue was a festering sore, a big red boil that needed lancing. One way or another an answer had to be provided so that the country could move on from an argument that threatened to engulf every aspect of political debate.

Today, completely out of the blue, we find a cabinet member arguing for a referendum on something that was nothing more than an aspiration in general election manifestos. The Labour Manifesto of 1997 included these two sentences tucked in the middle "We are committed to a referendum on the voting system for the House of Commons. An independent commission on voting systems will be appointed early to recommend a proportional alternative to the first-past-the-post system."

The "independent commission" was headed by former Labour Home Secretary and Chancellor of the Exchequer, Roy Jenkins. Labour's Manifesto for the 2001 election watered down the position put forward in 1997. After mentioning that the new devolved authorities for Scotland and Wales, the London Assembly and European Parliament elections had different electoral systems they said: "We will review the experience of the new systems and the Jenkins Report to assess whether changes might be made to the electoral system for the House of Commons. A referendum remains the right way to agree any change for Westminster."

Showing no evidence that they had undertaken the promised review, their Manifesto for 2005 abandoned any proposal for altering the voting system to the House of Commons saying: "Labour remains committed to reviewing the experience of the new electoral systems - introduced for the devolved administrations, the European Parliament and the London Assembly. A referendum remains the right way to agree any change for Westminster."

This is hardly the necessary background for holding only the second national referendum in history. The issue wasn't on the national radar in 1997 when it was a firm manifesto commitment, since then it has even been dropped in importance by the Liberal Democrats who have argued for proportional representation for decades. So, why is it now important? The simple answer is that it is just as important or unimportant as it ever was. What it is not, however, is something to be sprung on us with no more than a year to the next election. The Jenkins report might have recommended "alternative vote plus" and I might have heard or read about it at the time, but it rings no bells in my drink-sodden mind.

I am no fan of proportional representation systems because I believe it is healthier for one party to be able to do its worst and be shot down than to have a series of compromise solutions that satisfy no one. That, however, is not my objection to Mr Johnson's proposal. Mr objection is that the issue is far more complex than choosing between the current system and a proposal Mr Johnson's government has abandoned. If the current voting system is to be challenged through a referendum it should only be after full debate about all the options. I find it fundamentally objectionable that an idea should be brought out of mothballs and presented as not only the solution to current ills but the only possible solution. And why is it said to be the solution? Because of a plea to authority. An "independent commission" considered the matter and we should bow down and accept their wisdom. A wisdom which, as far as I am aware, has not been adopted in any other country. No, it doesn't work like that.

The issue needs mature consideration, not a knee-jerk reaction.

The irrelevance of MPs' additional income

The latest government initiative is to try to deflect attention from the dishonest profiteering of Labour members through the generous MPs' expenses rules. Gordon Brown wants MPs with paid employment outside the House of Commons to declare how much they earn because he believes, probably correctly, that more Conservatives than Labour members have such jobs. As I understand the current rules they have to declare sources of additional income but not the amount received. On tonight's Question Time we had the usual "balanced" panel of two Labour Party supporters, one hard-left Welsh Nationalist, one Lib Dem and one Conservative. On this topic being reared we heard exactly the type of confused, ignorant and envious arguments Gordon sought to elicit.

Those arguments were three: (i) MPs should work only as MPs otherwise they can't do the job properly, (ii) they get paid enough so taking other work is just greedy and (iii) they shouldn't do other work because being an MP is a career in itself.

The first of these points is quite stunningly absurd, yet it was pressed to the hilt by the Labour MP on the panel, Hilary Benn, a cabinet minister. Perhaps the heat of the studio lights caused him to forget his own position. He has two jobs. He is an MP and he is a government minister. I have never heard anyone suggest he is unable to represent his constituents adequately because of the time taken to do his other work. I have to be fair and acknowledge that ministers receive additional secretarial assistance to help them deal with constituency correspondence. No doubt some routine enquiries from constituents which would otherwise be dealt with by the MP himself are instead delegated to assistants, but that does not mean that the heavy burden of cabinet office leaves the minister's constituents unrepresented.

In any event, whether a particular MP represents his constituents adequately cannot be judged by whether he has other interests (be they paid work, needlepoint or watching large ladies wrestling in mud), it can be judged only by how he does his job as an MP and his constituents are the sole judges of that. Some MPs don't do a good job as constituency MPs even though they devote all their time to it, others have the ability to do all sorts of additional things without ever providing a less than first class service to those they represent. I would rather have as my MP someone who is able to do a lot of things well than someone who is either frustrated by being limited to only one role or struggles even to do that. We have all met people with extraordinary amounts of energy and who operate at a level of efficiency we could not dream of meeting. You see it in every walk of life and no one would think of saying that those who are capable to doing more should be prevented from doing so (although the EU does its best through the working time directive).

On the second point a lady in tonight's audience bristled at the thought of the Conservative MP on the panel earning £24,000 from a non-executive company directorship in addition to his MP's salary. She observed that many can only dream of earning £24,000 for their only job at which they work long hours. No doubt that is true, but it is neither here nor there. After all, those people would not be filling the vacancy if the MP were forced to resign that directorship. I wasn't sure whether her point went any further than just expressing envy at the MP's fortunate position. I suppose it is possible that she was arguing for an absolute income cap at the rate of pay received by MPs (£64,700, I believe), no, that can't be possible, it's just too absurd for words. It seems to be part of the character of many Brits these days to act with spiteful envy towards those with more money than them. Perhaps this is not surprising given the levelling-down culture that permeates state education and much of the output of television, it will take a long time to turn it round if ever the will exists to do so. In the meantime all that can be done is to argue against it point-by-point. In the case of the MP earning an additional £24,000, there is no benefit in depriving him of that income (and the Exchequer of the top-rate income tax paid on it).

In relation to this second point a further and very important issue arises. Learning how much MPs earn from consultancies or directorships tells us the cube root of nothing about anything relevant to how they do their work as MPs. As I mentioned above, some have the ability to undertake all sorts of additional work while representing their constituents very well, others do not. Take two MPs of identical ability who each can take on one consultancy or directorship requiring twenty days' work a year and still be good MPs. Twenty one days and their constituents suffer, nineteen days and they have a wasted day on their hands. One takes a consultancy for twenty eight days and received £10,000, the other takes an identical job for twenty days and receives £25,000. The amount paid to them tells us nothing, indeed it is entirely misleading because the one earning less is compromising his role as an MP whereas the other is not. The figures of how much they earn are meaningless except in stoking envy among Labour's core voters and, presumably, increasing their chance of voting Labour at the next election.

The third point is, perhaps, the most worrying of all. For a good twenty years we have seen a steady fall in the calibre of MPs and ministers as more and more "career politicians" have filled the House of Commons. Only one member of the current cabinet had anything even vaguely approximating to a successful career before entering politics. Some of them practised law at a junior level for a few years, at least one was a teacher for a decade or so, the rest (apart from Alan Johnson) have been full-time career politicians since university. Mr Johnson was a postman and rose through the ranks of a Trade Union to a senior position. Only he had a career first and then entered politics, all the rest have so little experience of the outside world that it is hardly surprising the current government is a complete shambles with no grasp of the real consequences of their policies.

I am sure poor Gordon will shore-up a tiny part of his party's core support among the bitter and envious by this measure, but it is yet another piece of shallow and meaningless political gesturing from a man who is proving every day how he has nothing else to him.

Another day, another slap in the face for Gordon

There was always something slightly surreal about Gordon Brown's intervention last week into the debate on MPs' expenses. With the Committee on Standards in Public Life only part-way through its research and deliberations he tried to short circuit the whole process with a clumsy announcement projected through YouTube and the proud assertion that the House of Commons would be voting on his big idea on Thursday of this week.

Today his plan has been abandoned, so certain is he that putting the matter to the vote will result in yet further humiliation for this most incompetent of Prime Ministers. It is not the substance of his argument that I want to address today but the way he chose to put it forward. If there is one thing that runs through the blood of people who have had to argue points for a living it is the knowledge that there is no such thing as a guaranteed winner. So often we think of a proposition and cannot see how it can fail to be accepted, only to find that our opponent in the debate or the arbiter of the proceedings throws out a question or counter-argument that cuts the ground from under our feet. It's not that we have been careless or sloppy in our preparation or presentation, it is just that no one can think of everything from every angle. That is one reason we choose to decide legal proceedings and settle laws through a process of debate in which propositions are put forward and examined. All sorts of good ideas turn to dust when their practical implications are exposed or the theory underlying them is seen to contain a previously undetected flaw.

And you know what? It takes guts and skill to stand up and argue a point. You have to be able to respond substantively (if you can) to all sorts of assaults on the proposition you are putting forward. It is not an exercise for the faint hearted or for those lacking mental and linguistic dexterity. The reason we use that system is that no better way has yet been devised. An essential aspect of it is that someone has to lose. It can be disappointing to lose a debate, it can even be embarrassing if your argument is shown to be wholly without merit, but that soon passes, you have to be able to cope with it or you shouldn't be playing the game in the first place.

Poor Gordon's attempt to by-pass debate by announcing his ill-thought out plan and demanding that the House vote on it a week later is troubling in several respects. First, the issue is not for government but for Parliament so it was not for him to seek to preempt the process. Secondly, the sensible way to deal with it was to make his idea known and allow it to be considered along with all others rather than to force it through. Thirdly, trying to use this issue for party political advantage through YouTube was absurdly clumsy. When full details of MPs' expenses claims are published in the summer his party will be hammered left right and centre, trying to appear virtuous on the subject now could only make the fall even steeper. Fourthly, and most importantly, arguing his case on YouTube is a cowardly way to avoid challenge.

It is quite obvious what he was seeking to achieve, he wished to show himself as a decisive and incisive leader on an issue that has caused public uproar. If you are going to follow that path you have to do so bravely and with a well formulated solution to an urgent problem. Yet even then, sneaking your idea through the back door rather than having the courage to state it to the House of Commons and have it debated means that you prevent the very acclaim you seek.

On a wider point, it is also troubling to find two important announcements being made by senior ministers through YouTube in one week. Mr Darling spoke about the economy and now poor Gordon has spoken about MPs' expenses. No doubt some bright spark in the government spin machine thought it would be a good idea to connect with the little people directly through a popular medium and without the restrictions applicable to party political broadcasts on television and radio. If so they must disabuse themselves of the idea forthwith. No doubt it is very convenient to have a free platform to say what they want without questioning or contradiction, it certainly works to the advantage of the leaders of North Korea. But at a time when politicians are held in probably as low public esteem as ever in modern history the very last thing they should be doing is avoiding open debate.

No stimulation please, we're broke

Cast your mind back a few weeks. Gordon Brown was touring the world (at our expense) in advance of the G20 meeting in London, trying to drum-up support for his plan to "stimulate" economic activity by even more government spending than had already been announced. He had a partial ally in President Obama who believed in the same barmy idea and is now facing difficulties getting his proposal through a Congress dominated by his own party. No one else seemed terribly interested. The French and Germans said they had already spent enough and weren't prepared to throw more in any more until they saw how their first efforts had fared. Still poor Gordon toured on plugging the same message, hectoring anyone who was forced to listen that massive further "stimulation" was needed. Then he got to Chile, whose diminutive but feisty President echoed the sentiments of the Czech leaders that spending money you don't have causes problems for the future and that providing a cushion against the effects of recession could only sensibly be done if you had saved during the good times.

When the G20 summit ended there wasn't a single new penny of international money to throw into the furnace of recession, each country decided it would do what was best for its own economy. Those who could afford to do so would spend more as and where they thought it might help and those who could not afford to do so would ride out the storm as best they could. The single brilliant scheme by which Gordon was to save the world was lying in tatters around his ankles, other world leaders saying, in effect, that he could throw good money after bad if he wanted to but he shouldn't expect them to commit economic suicide with him.

While he was on the road his Chancellor, Mr Darling, grew a spine almost as sturdy as his eyebrows and made clear there simply wasn't any more money. Since then he has been printing a some more but not with a view to using it for a so-called "stimulus", it is being created to inflate-away a bit of debt and provide cash he needs for current spending plans.

Mr Darling will make his fifth Budget speech later today. There used to be one a year in the Spring, now we have a second in the Autumn but last year was exceptional and there was an extra one squeezed in between the two scheduled events to try to sort out the mess caused by eliminating the lowest tax band and thus doubling income tax rates for the lowest paid. So after less than two years in office he will have delivered an average of one Budget every eighteen weeks.

It used to be rather good fun looking forward to the Budget. Strict secrecy would surround the Chancellor's plans to prevent people seeking to gain an advantage by arranging their affairs in a way that would be most beneficial to them and most detrimental to the Treasury's coffers. The weekend before the Budget would see the newspapers and television news programmes featuring pictures of the Chancellor relaxing in his constituency before his annual big day. For some reason they always wore very bad trousers. Not now. The trousers are still bad but secrecy has gone. Now it is all leaked in advance to get a view of how proposals will go down with the media and to allow last minute tweaking to counter any criticisms made. No longer is the primary focus of the government on making the right decisions for the country, today it is on making the right decisions for their position in the opinion polls.

There is often one measure hidden in advance, something the government thinks will be a guaranteed vote winner. In the Spring 2007 Budget it was poor Gordon's cretinous decision to abolish the 10% starting tax rate with effect from 2008. We know what a brilliant move that was from the need to cobble together a set of remedial measures in an emergency Budget when the full damage it would do the most vulnerable was exposed. Mr Darling might have a surprise for us, but the majority of his major measures are already in the public domain. Indeed, they feature on the lead article on the BBC web site.

It is noteworthy that poor Gordon's brilliant plan for a further "stimulus" is not included. I wonder why it is no longer needed when just a month ago he told us it was the necessary central plank of anti-recessionary policy worldwide. The answer, of course, is that everyone else was right and Gordon was wrong as usual. If you seek to boost an economy by increased government spending you cannot do so with borrowed money otherwise you are applying a brake to future economic growth in return for the hope that current spending will cause economic growth in the short-term. For reasons I have given before I don't believe government spending can make anything other than a minor difference to the rate of recession and to seek to do that by incurring debt that must be repaid later is dangerous, not least because repayment might have to start before there is any actual growth.

I believe that what we are seeing in this country is the little people doing what must be done to extract fictitious wealth from the economy and thereby place it on a firmer footing. New debt is being avoided where possible and existing debt is being repaid where possible. Those who were living beyond their means are adjusting their spending. This was always going to happen because Mr and Mrs Ordinary are far more worried about their own financial position than about the government talking in numbers too large to be understood. The result, unfortunately, is that many have lost their jobs and many more will follow suit; this is simply unavoidable because jobs that depended on people spending beyond their means will be exposed. And as people cut back on "normal" spending in order to repay debt yet further jobs will go. Once the credit bubble has deflated and the millions of Mr and Mrs Ordinarys establish the new level of "normal" spending many jobs will return.

It takes time for people to repay debt but they will do it whether the government likes it or not. Mr Darling seems to realise this, hence both his rejection of poor Gordon's plan while the latter was glad-handing globally and his continued refusal to incorporate it into his Budget plans. Stimulation is off the agenda, and about time too.

A sign of the times

The British domestic political story I commented on on Saturday gives rise to an interesting question, that question is contained in the title to this little piece.

The superannuated thug Damian McBride is not a Member of Parliament. He was not elected to anything, he had no ministerial duties and no government department to manage. No chain of responsibility made him answerable to the public for what he did nor was he required to answer to MPs in the House of Commons. Yet his downfall has been reported in a manner not seen when cabinet ministers have been forced out of office through incompetence or corruption. Such ministers have been replaced by promoting an equally incompetent government party lackey from the lower ranks of the ministerial pyramid and there has been no mention of their departure striking at the heart of the government machine. The Sunday newspapers were clear and consistent in their description of Mr McBride's as a seriously big fish. Jane Merrick of The Independent described him as "a proper scalp, one of the most prized in Westminster". The Sunday Times talked of him as "one of the prime minister's most senior lieutenants". In The Observer he was described as being part of "Brown's inner circle" and in the Mail on Sunday as an occupant of "Mr Brown's No 10 War Room".

It's a rather strange state of affairs that an unelected, unaccountable toady can be considered by the main commentariat as more significant to government than a cabinet minister. I suppose there might be an element of journalistic narcissism involved in that his job was to manipulate the information leaked to the press and the select band of recipients are bound to consider that a particularly important job. But there seems to be far more to it than that. Controlling the news and steering the message received by those who report the news are now major parts of the government machine, particularly in relation to the Prime Minister himself. I find this very disturbing.

One would have to be absurdly naive not to recognise that incumbent politicians want to stay in office and will always seek to put the best possible gloss on what they do. To that end they will need assistance and that assistance will cost money. The job of such assistants is, however, a party political job it is not a government job. They are employed to further the interests of the government as against the opposition parties. And by far their most important function will be to limit the damage done by the incumbent governing politicians' own mistakes. To have a unit in the Prime Minister's office, paid for by taxpayers, whose purpose is to further the interests of the governing party is a gross abuse of power; it exemplifies government for the government not government for the people.

And, of course, there is no easy way to stop it. If, as seems likely, the Conservatives defeat Labour at the next general election is there any realistic prospect of them not putting in place a similar unit filled with their own bullying, mendacious sycophants? The only way to prevent it is to enforce the supposed rule against civil servants engaging in party political activities. Ah, there's a big of a snag with that. Who can enforce it and how? It cannot be left to the Minister for the Civil Service because that is the Prime Minister. It could be done by the grand fromage of the civil service if only he were given the power, but that could draw him too closely into party politics because his decisions would be questions and his own impartiality brought into question by those on the wrong end of his verdicts. It could be done by a Parliamentary Select Committee, but they have a numerical balance in favour of the incumbent party.

I know not what the right solution is but one must be found because the more tightly the power over the dissemination of information is concentrated in 10 Downing Street the more isolated the Prime Minister (of whichever party) will be from both substantive criticism and the need to justify his policy positions. The more narrowly power is concentrated, the fewer the people who take decisions and the less scrutiny those decisions receive. Only one thing can result, bad government of ever-increasing badness as the Prime Minister withdraws further and further into his bunker to limit examination of, and debate about, his decisions and their effect.

McBride, McBrown, McUnfitforoffice

It doesn't seem so long ago that governments sought to persuade the electorate that they should be returned to office because they were more competent in present circumstances than the opposition parties. Anyone reading this from outside the UK will probably not know why I raise this topic, so let me give a little background.

Upper echelons of the UK government employ (at taxpayers' expense) a number of people whose role is to promote the government as a political entity rather than to promote its policies. Nominally they are not employed to do this because it would be a misuse of public funds, but it has been the reality since Tony Blair came into office in 1997 and is even more prevalent today. They are employed as civil servants but given a wholly party political role and no one seems to have the power to challenge it. Recently news was broken that one of these supposed public servants was planning a party-political campaign involving no policy debate at all. His plan was to launch smear attacks against opposition politicians suggesting, regardless of the truth and regardless of having supporting evidence, that they have misbehaved in the past and/or that relatives of theirs have flaws. His plan was disseminated to a select few by email and certain of those emails, or certain details from them, came to the attention of a blogger known as Guido Fawkes who timed his blowing of the whistle to perfection. Today the man who planned the exercise was forced out of his job. His name is Damian McBride, he was, and no doubt will remain, Gordon Brown's closest advisor.

To some, dirty tricks might seem a new phenomenon to UK national politics but the seeds were sown in the 1990s when the press happily latched on to stories of government ministers unable to keep their lusts within the marital bedroom. Previously no opposition party would seek party political advantage of such matters because they knew they had members (no pun intended, although it is a good one) who were just as guilty. But the tide was against the incumbent government, they had been in power for a long time and were showing signs of staleness. The Labour Party had few substantive policies on anything, most of it was just waffle, but they wanted power so they made the most of the moral turpitude of a few Conservative ministers. They found there were votes in it so they dressed it up further, the message was "you can't trust them, they are seedy philanderers". It was a pretty pointless exercise. No doubt it won a few votes but it could never win enough to make a difference, it was a tactic guaranteed to backfire in the long run.

Not long after they were elected in 1997 stories emerged of senior figures in the Labour government being as free and easy with their intimate juices as Conservative ministers had been. At that time it didn't matter, the tide had turned and they had been elected, the British people would give them a chance to prove themselves. Even the most vociferous critic of Conservative ministerial pork-swordsmanship, the ludicrous John Prescott, was eventually exposed for an affair with his diary secretary while his fearsome wife was busy enjoying the largesse of a minister's expense account to keep her bouffant suitably puffed. He called the previous government unfit to rule because they couldn't keep their trousers on, yet steadfastly refused to resign when found to be guilty of exactly the same thing. One might think the current government would shy away from personal attacks in light of their hypocrisy on the issue, but that would be to ignore the pitiful mental state of Gordon Brown, the man who thinks he saved the world.

Poor Gordon has shown no sign at all in his political career of being able to acknowledge that someone else might have a point. He seems to work in the very starkest black and white terms. He is also a lifelong adherent to the view that only the Labour Party should be in government. No matter what it takes, opposition parties should, in his feeble mind, be destroyed. It is, of course, the mindset of a dictator not of a democratic politician, yet it runs through his very marrow.

A smear campaign designed to denigrate opposition is very much poor Gordon's cup of tea. Nothing could please him more because he really believes that anyone who disagrees with him is unworthy. If you have any doubt about this, all you have to do is see how he answers questions. There are far too few opportunities to ask the Prime Minister questions and no opportunities to require him to answer them substantively. There is a half-hour session in the House of Commons every Wednesday, when I say every Wednesday I mean every Wednesday the House is sitting (which is disgracefully few). During that time the Leader of the Opposition, the leader of a minor party and a few backbench MPs ask questions, but they are never answered unless they ask the Prime Minister to heap praise upon himself. He is often asked perfectly sensible and calm questions by those who have doubts about his chosen path of action on one subject or another. His reaction every time is to attack. There is no debate, no explanation and no response of a type appropriate from a democratic politician.

Against that background we find that his closest advisor, a man he took with him as the lynchpin of his backroom staff when he usurped the office of Prime Minister, decided to launch a campaign of personal (not policy) attacks on political opponents of Gordon's clique. I ask myself what poor Gordon's reaction was when he heard that such attacks were planned. I ask myself whether he said "No, stop, that is not the way we do business" or "what a great idea, these evil deniers of my brilliance must be perverts and defectives, they must be exposed". Is there a middle ground? Frankly, I can't see that there is. This manoeuvre follows exactly the way our so-called Prime Minister thinks and acts.

He will try to distance himself from it, of course, because the press is on the story. We might never know whether poor Gordon had advance knowledge of the plan, but it can be said with absolute certainty that he approves of it. It fits his thinking exactly. No matter that members of his party are guilty of exactly the things opposition politicians would be accused of doing, to someone like Gordon there is a difference. His side of the political fence is right, so personal failings are neither here nor there. The opposite side of the political fence is wrong, so personal failings must be exposed because they prove the errors and flawed judgment of his opponents.

It's pathetically shallow. It's Gordon to a tee.

Poor Gordon's millinery conundrum

The excitement is mounting in anticipation of the G20 meeting in east London in a couple of days. I'm sure I read somewhere that it is expected to cost the UK taxpayer around £50million. There's not a lot we can do about that, these self-indulgent beanos are going to take place whether we like it or not and whether or not they have any chance of achieving anything, every so often it has to be our turn to pay for the tea and biscuits.

Although I am always delighted to witness poor Gordon being humiliated, it is quite a relief that President Obama decided to attend after early doubts; the fall of my country down the pecking order caused by a Presidential snub would have been painful.

What intrigues me today is which hat Gordon will be wearing. In his brief time as the worst Prime Minister in history he has plonked a wide variety of headgear atop his overheated brain. No doubt one consequence of being out of his depth is that he cannot maintain a consistent position. Not only is he constantly buffered by events, a risk for any political leader in current circumstances, but he has actively volunteered inconsistency in some of his most important and widely publicised speeches.

Right at the start of his time as Prime Minister he made his first leader's speech to the 2007 Labour Party Conference. When addressing the issue of the EU he said "At all times we will stand up for the British national interest. And I accept my responsibility to write in detail into the amended European Treaty the red lines we have negotiated for Britain." Fair enough, that's nice and clear, he recognised that the interests of the UK are different from the interests of other European countries. No one will dispute that, all the other European countries feel the same about their own national interests.

So how does this play when he is talking to Europe? Last week he made an excruciating speech to the European Parliament in which there wasn't, of course, any mention of differences of opinion but praise for the EU working together and forging an alliance with the USA to lead the world to a promised land of ... well, it's not clear what exactly, but it's going to happen because The EU is a single entity with a united position on everything. "I passionately want Europe to be leading on the world stage", "I propose that we as Europe take a central role", "I propose that Europe takes the lead". All good stuff but hardly consistent with putting Britain first.

And how does that compare to his speech to Congress a couple of weeks ago. Oh dear. On that occasion it was Britain and the US marching together and leading the world to fresh green pastures. A footnote, long after the glorious unity of the UK and US had been flogged to death, contained mention of Europe. But there was no "Europe is leading and you are coming with us", it was "America and Britain will lead and succeed".

So which hat will he be wearing this week? British, European, UK-US or EU-US? Perhaps he has been busy designing a new bonnet, just in time for Easter.

Underwear - the key to economic recovery

One of the most interesting things about current economic strife is that no one knows what to do about it. "What nonsense!" you cry, but it's true. There is not a single person on the planet who knows what to do. All that any of us can say is that we believe one course of action or another is likely to be beneficial, and even then others will disagree that the outcome we predict for our preferred option is desirable in any event. Even if we all agreed on the perfect result, we can only ever believe that certain actions will get us there; we cannot know they will because the problems being encountered at present are unprecedented and take place in a world that is very different from the 1930s when the nearest comparison occurred.

The effects (good or bad) of moves made so far by national governments to kick-start their dormant economies cannot be predicted as a matter of knowledge nor with any degree of certainty. And, perhaps most importantly, existing measures will play-out differently in different countries such that one might benefit from leaving things as they are and another might benefit from a further initiative. I believe it is a combination of lack of superhuman foresight and the need to do what is right for their own country that causes some leaders of Western countries to resist poor Gordon's calls for concerted action.

So far the only country following anything like the path he advocates is the USA, although it would take an excruciating degree of naivety for anyone to believe they are following that path because poor Gordon argues for it. The US government, more than any other in the Northern Hemisphere, acts purely out of what it considers the best interests of the country for which it has responsibility. What it proposes might be right or it might be wrong, that debate is being held in its legislature and through its news networks. You won't hear many high-falutin' calls for America to sacrifice its own interests in support of the so-called world economy. What you will hear, and what has been heard already, is debate about the effect President Obama's plans are likely to have on the financial well-being of the American people. Possible effects on international trade come into the equation but from a purely US perspective. Once they have finished the debate and voted for a particular package of measures the matter will not be over, because then they will have to see how those measures work in practice. The most experienced, highly qualified and ostensibly sensible economists will disagree amongst themselves both about the suitability of the final package and about the effect it will have. I find that rather refreshing because it reminds us that we are dealing with a process of educated guesswork rather than science.

Against that background I am left, yet again, perplexed by poor Gordon. Germany and France say "hold on, oh one-eyed Scottish idiot of the Manse, we need to see whether the vast sum we have already forked-out has had any effect before we throw more good money after bad." Gordon says "No no no, continental brothers and sisters, I am right, you must stimulate further and you must do so in the manner I have devised." Two questions come to mind.

First, how can it be wrong to sit back and observe the effects of current policies before changing them? After all it is not a zero-sum game. Further so-called stimulation comes at a price and over-stimulation is risky (as any fat middle-aged man with a weak heart can tell you, especially when Joanna Lumley is involved). It always used to be said that changes in central bank interest rates take a year or so to work their way through the system. Although part of their effect could often be judged after a month or two, they had a widespread influence on highly sophisticated economies and it was hardly surprising that the full consequences could not be judged quickly. When a strategic policy is initiated at enormous cost in unprecedented circumstances it becomes particularly important to allow it to have its influence (if any) and decide what to do next only when the effect of the first move can be evaluated.

Secondly, who is poor Gordon to tell them what to do? I don't just mean that his disastrous stewardship of the UK economy is hardly evidence of good judgment on his part, but it's just not his call. Indeed, it's not his call in two respects. Not only is management of the economy of a particular country the exclusive responsibility of its own government, but the very concept that the same pattern of governmental action will suit everyone is patently absurd.

Of course his current pointless globetrotting at the expense of the UK taxpayer is more about trying to bolster his image before the next round of excoriating opinion polls appear than it is about saving the world. At least, that is the reality. It is not necessarily how poor Gordon sees it. Everywhere he goes he is being told "thank you, but we'll do it our way". Sometimes, as in the European Parliament yesterday, he is told something rather more forthright. His reaction is, as always, not to listen and consider what others have to say, but to descend into a froth of self-indulgent fury that anyone should question his uniquely brilliant analysis. That is about to cause a bit of a problem.

This time next week London will be awash with the bigwigs of the twenty most rapidly shrinking economies in the world. It is Gordon's big moment, or so he thinks. He should have the courage and integrity to say "frankly chaps, we're all guessing here and this is my best guess ...". It might allow him to win influence and befriend people. Instead he will continue to claim that everyone agrees with him. He won't shift an inch because he doesn't have the moral or intellectual strength to do so. A summit which could have been used to consider a range of strategic policies is likely, instead, to be dedicated to finding a form of words to spare his blushes.

This week we have seen both his glove-puppet Chancellor of the Exchequer and his placeman Governor of the Bank of England so frustrated with his intransigence that they have taken the unprecedented step of refuting his approach in public while he is out of the country. They assert that the UK cannot afford further government borrowing in an attempt to re-kick-start the economy. They might be right, they might be wrong. Over the pond President Obama might find support for his case that the US can afford to follow such a path. He might be right, he might be wrong. Germany isn't prepared to follow suit because it's economy was not burdened with excessive debt and it feels no need to adopt that burden in order to show unity with anyone. Frau Merkel might be right, she might be wrong. The inescapable fact is it is all a matter of opinion and judgment and those with direct responsibility to the citizens of any country must be allowed to follow the course they think right.

I rail from time to time against the very concept of one-size-fits-all, whether it be in economic management, in the internal laws of different countries, in voting systems or in pretty much anything. It seems to me to be an especially inapt concept for national economies. Not only do they all operate differently, with differing balances of manufacturing and service industries, they also operate against different cultural backgrounds. Countries such as France and Sweden are wedded to massive welfare states and until their populations vote for something different they will continue to be so. That's their choice. Some think them barking mad, some think they don't go far enough. But it's their choice. Other countries look on and decide whether they like what they see. We adopt some of the things they do because we think they will be beneficial here, other of their choices are considered inappropriate to the way we like to live in the UK. It's not a matter of us being right and them being wrong, or vice versa, it is a matter of the government of each country doing what it thinks is right for that country and taking its chances at the next general election. When it comes to macro-economic policy exactly the same applies.

No one knows what will best, and fastest, lift the countries of the developed world out of recession. Of all the heads of government of the G20 nations, poor Gordon is the only one who claims there is a single answer and that it must be set in stone for everyone. There is no more chance of it fitting each national economy than there is of a single size of underwear being appropriate for all.

A little clear blue water

Today saw a potentially important step towards the next general election, which must be held within the next fifteen months. It seems quite a long time when you put it in months, but it will soon pass. What was witnessed today was a purely strategic move by David Cameron, the leader of the Conservatives, to put a clear dividing line between him as potential Prime Minister and poor Gordon. He made a speech acknowledging that his party did not say enough about the likely problems from excessive credit building up in the economy. As reported, it does not appear that Mr Cameron apologised for anything although the BBC was, as always, keen to dress it up in both the heading and the first paragraph as an acceptance of partial responsibility for the mess and an apology for that error. After casting aside the BBC's pro-government slant, I asked myself what Mr Cameron was playing at.

The current government has a majority over all other parties in the House of Commons of, I believe, sixty seats. This is a sufficient majority to ensure passage of all but the most controversial measures it puts forward. Their majorities following the general elections of 1997 and 2002 exceeded one hundred seats. There has never been the slightest sniff of poor Gordon's economic conjuring tricks being voted down over the last twelve years no matter how strongly the Conservatives argued for a different strategy. Not just that, but the current government does not share the content of detailed civil service briefings with the opposition, so Mr Cameron's party has not had anything like as much inside information as poor Gordon and his merry men. The consequence of this is that there was absolutely nothing Mr Cameron's party could have done to prevent or limit poor Gordon's boom of doom.

So why has he expressed regret about not opposing the government more vociferously? And why has he done so now? I cannot speak for him, but from the comfort of FatBigot Towers it seems to me that his speech is all about showing himself to be humble and subject to human fallibility so as to show up poor Gordon's utter lack of these qualities. It's actually a nice little two-pronged attack. First, we see a sensible man leading the opposition compared to the dysfunctional Prime Minister. The second prong is a little more subtle. Mr Cameron is saying, in substance, "if only we'd told him, it might have helped" followed by a deep sigh of remorse. That raises the question whether it would have helped. When we ask that question the only possible answer is that it would not have changed the disastrous course the government was following. Poor Gordon is shown up yet again, he cannot turn round and say "you should have told me and then I would have changed course" because we know it would have made no difference. So, rather than Mr Cameron saying his party is partly to blame we find that it is not to blame at all because there was nothing that could be done to infiltrate the Brownian thick skull.

And why now? To have done so immediately after poor Gordon's rant to journalists about being entirely free of blame for the recession would have sounded opportunist. Let the story circulate, let the message sink in that poor Gordon has completely lost grasp of reality and once that is the current mind-set of the sturdy Brits, hammer the contrast home and widen the gap between how the incumbent is perceived and how the only potential alternative Prime Minister is perceived. It's rather a neat move.

There are still those who seek to dismiss the Conservatives as a credible alternative government by arguing that they do not have a comprehensive policy platform. In fact the only area in which their likely policies at the general election have not been spelled out in detail is the economy. No doubt they could have shouted about their other prospective policies rather more than they have, but it would have been pretty pointless over the last year or so when everything has been so dominated by the threat of recession and now the threat of depression. In this respect things are rather different from the final year of John Major's administration. At that time the economy was genuinely strong and stable, perhaps more so than at any time since the War. His government was being questioned not about the state of the economy but about other matters including the perceived under-funding of health and education. A smell of overall staleness and a sense that they'd had their time were pervasive messages, pressed home by a Labour opposition with new, alternative policies. Those policies were, in many respects, less worked-through than the initiatives the Conservatives have published in recent months, yet they were in the public eye and they caught that eye by seeming to be different.

Much can change in the next year, just as it has in the last. The formulation of a credible economic policy simply cannot happen today because it could be blown apart tomorrow, as the government is seeing with its own panicky efforts to sort out the mess. One pattern that is already set is that the government has chosen the route of bigger and bigger national (and international) government as the answer to all woes. Those of us who believe it a sure-fire failure have little to achieve by putting forward a structurally different proposal to deal with things as at Friday the thirteenth of March 2009. If our opinion of the government's preferred option is correct, by the middle of summer our own preferred structure will need substantial amendment. Mr Cameron and his team know this. Their best tactic is to sit back, watch initiatives and interventions fall flat and present their own fully-formed alternative only when it is too late for poor Gordon to steal it, implement it, watch it fail and blame the Conservatives.

Mr Cameron would do well to continue highlighting not just the government's failures but also the difference between his calmness and openness and poor Gordon's secretive panic. Today was a good start, let's see if he can keep it up.

An idea from Bexhill-on-Sea

An interesting contribution in the Letters columns of The Times today came from someone in Bexhill-on-Sea. She suggested that, instead of the government pouring money into banks, it should pay-off personal indebtedness so that the economy could be revived by the little people spending again. She wrote: "This would make it possible for people to spend money again on large items, such as cars and furniture; it would kickstart the housing market ..." At this point I felt an icy shiver down the spine, but there was worse to come. "Rather than heap blame on those in debt, let us instead remember that if it were not for people's willingness to go into debt we would never have had a boom in the first place." Her proposal is to wipe-off all personal debt (although not made clear in the letter, it seems home-purchase loans would not be included).

There is a certain illusory logic to her argument because a lot more jobs are directly dependent on the continuing flow of little individual transactions through the tills of small businesses than on the result of individual corporate mega-deals or huge lumps of inter-bank lending. Eradicating current personal indebtedness would give people more spending power, but not, I think, in the way she suggested.

You see, there are two very different aspects to the effect of credit on consumer spending and they work against each other. On the one hand, expanding credit gives people more money to spend today. On the other hand, once they have taken out credit they have less money to spend tomorrow. The reason they have less money to spend tomorrow is because tomorrow they have to pay interest on the money they spent today and they have to repay the capital debt. If you wipe-off a debt of £5,000 today the only additional money made available for the happy beneficiary to spend tomorrow is the money they would otherwise use servicing that debt.

A quick bit of research suggests to me that average credit card interest rates are currently somewhere north of 20%pa. Call it 24% and, to keep it all nice and simple, let's call that 2% a month. If you owe £5,000 and have to pay 2% a month, you are forking out £100 each month. No doubt additional spending power of £100 a month for all those currently owing £5,000 or more on credit cards could make a significant difference to the small shopkeepers of the country. Ah, but maybe not as much as we might hope. Those who actually owe £10,000 and have seen their monthly repayments rise from £75 to £200 might think better of spending their additional £100 a month booty, and use it instead to make additional repayments against the other £5,000 they owe, after all they have to pay very hefty interest on it. Nonetheless, wiping-off a certain level of consumer indebtedness would free-up some extra spending money and this could save jobs.

The other way businesses could be saved is by those who have had a certain amount of debt paid for them borrowing the same amount again. In the example I have given, you find the government paying-off £5,000 so you rack-up another £5,000 on your piece of plastic by feeding your addiction to unnecessary fripperies. That throws money into the tills of the shops selling fridges with two doors, suitcases with wheels and little wooden racks full of decorative thimbles. But once it's spent, it's spent. Then you are in the position you were before the government gave you another £5,000, namely you are stuck with a £10,000 debt.

Credit does not provide limitless opportunities for ever-expanding consumer spending because the day must always come when the cost of repaying what you have already borrowed becomes so high that you cannot afford to borrow any more. In other words, the limit to consumer credit lies not in the amount of credit offered but in the amount of money available to repay the borrowing.

For months I have been bleating like a deranged goat about the problem of unsustainable credit. That is not to say that all credit is unsustainable. Credit is a facility to allow us to pay over time for something we wish to possess today. Large purchases, such as houses and cars, are not readily affordable for most people without credit. Every prospective purchaser has to balance how much he can afford to repay out of his monthly income against the desirability of having the thing now rather than saving up and having it later. Some conclude that they cannot afford a car at all, others buy one for £3,000 over five years, others buy one for £40,000 over three years; what can be afforded is a matter for individual budgets. The one inescapable fact is that you can only repay what you can afford to repay. When it comes to smaller things costing just a few hundred pounds - beds, televisions, chairs, dishwashers and the like - credit allows people to buy them a little bit earlier than if they had saved but overall it just makes them much more expensive than they would otherwise be.

The essential difference between sustainable and unsustainable credit is that sustainable credit is based on fact and unsustainable credit is based on unrealistic hope. Sustainable credit is paid for now from money you have and in the future from money you reasonably expect to have. Unsustainable credit is paid for now from money you either have or borrow, and in the future from money you can only hope to receive.

The correspondent's proposal is for all personal debt (excluding home-purchase loans) to be wiped-off, not just part. It seems to carry with it the necessity not to allow such indebtedness to arise again. I will leave to one side the obvious moral argument that it is obscene to allow the spendthrift to wallow in thousands of pounds worth of fancy home cinema arrangements and other electronic wizardry they acquired on the never-never while the prudent make do with a small fat telly, a single-doored fridge and the abject poverty of no bidet. I will also leave aside the obvious fact that everyone will have to pay the cost of the write-off because it won't just happen by magic. How, as she suggests, will the big purchases be made? Cars will be just as unaffordable without credit as they have been for years. Her other example was furniture, much of that could be saved for over a relatively short period without undue difficulty, but while it is being saved for other purchases will be forgone. And how will it kick-start the housing market? (Not that I am suggesting for one second that the housing market should do anything other than fall by another 20% or so to reach a genuinely affordable level.)

The answer, of course, is that the big purchases will still need credit and restricting credit for small purchases cannot affect the housing market directly. The only likely consequence of wiping-off existing credit card and personal loan debt is that cash spending in shops will increase. I certainly don't have a problem with the concept that that would save many small businesses, both shops and those who supply them. It will transfer some spending from finance companies to florists and from banks to bakeries. But it won't do anything for big purchases.

Therein lies both the strength and the weakness of her suggestion. Insofar as she wants to eradicate some of the means by which people have borrowed beyond their capacity to repay, I am with her all the way. I would happily see credit cards abolished tomorrow without shedding even one thousandth of a tear. They cause far more trouble than they are worth. Yet the fact remains that many businesses became dependent on the short-term additional sales they made to people using expensive forms of personal credit. Those businesses are first in the firing line if consumer credit is restricted heavily. The reason they are in jeopardy is that they were built on a foundation of pretend money. Remove the pretend money and you have a necessarily more stable economy, albeit one with a smaller overall turnover than before.

That is what poor Gordon's boom of doom was based on - an awful lot of people borrowing more than they could afford to repay. The correspondent from Bexhill wrote "... if it were not for people's willingness to go into debt we would never have had a boom in the first place", as though the boom were a good thing and something we should seek to replicate and continue to the end of time. The boom was never anything more than a bust waiting to happen because the time had to come when the unaffordability of a massive chunk of consumer credit could no longer be hidden inside yet further personal borrowing. Payback day had to arrive.

The problems arising when payback day arrives depend on many factors. As things have turned out its arrival coincided with, and perhaps was brought forward by, the pickle banks got themselves into. Yet even without current banking problems there was a structural difficulty caused by overspending. As people spend more over a lengthy period businesses react to increased receipts by expanding to meet perceived future demand. Shops hire more staff because they are busier, they open more branches because they expect to be busier still; their new staff earn money which they spend in other shops who also expand, and so the whole merry-go-round turns.

It all seems so wonderful until you realise that a proportion of the money being spent must dry up when the credit card is full. It would be a different day for different people, but eventually it would have to happen to so many people that overall spending on the optional extras of life would slow down. And where does that leave the shops? There's less in the till yet fixed costs remain the same, and there's the new branch they have just opened and which isn't yet covering the rent. Something has to give. What gives first is the most flexible of all costs, wages, and that means jobs. And lost jobs means lost income for the unlucky few. And lost income for them means less spending by them. And less spending by them means more lost jobs elsewhere. Of course it's not just shops but they are a good illustration of the problem.

We can "boom" our way out of recession, as called for by the letter I am discussing, but we can only do so for a short time. The same structural problem of unsustainable credit that we are now witnessing will happen again and again because there really is no such thing as a free lunch. Make Mr Visa pay for lunch today and it might seem free, but you will have to pay the price eventually and you'll pay him 2% a month in the meantime. No one should look on poor Gordon's boom of doom as anything but a disaster. It might have seemed great for those who found jobs and enjoyed a decent income for a few years, but too many of them are now in more pain than if they had never had the job in the first place. And, sadly, there are many more who will find themselves in that position in the months ahead.

Lost, one plot, if found return to 10 Downing Street

A feature of someone having a job beyond their capabilities is that from time to time they will expose their true limitations. We see it in every walk of life. So many couples have bought pubs with a view to a blissful life of serving pints and ploughman's lunches, only to find they cannot manage staff or cope with the paperwork. As barman and cook they might be stars, as proprietors they go bankrupt. The jobbing builder who has earned a decent living for years by replacing roofs, laying patios, fitting doors and painting houses can find himself a fish out of water when he takes on his first house conversion. And in my own field of work, many a barrister is outstanding at one or two days trials in which the issues are limited but simply cannot maintain the high level of concentration required to present a month-long case to a good standard. It's all a matter of horses for courses. Each of these people, having failed in the bigger tasks, can still perform an excellent service and earn a good living by reverting to the individual jobs they do well. There is no shame in trying something, finding you can't do it and reverting to what you can do.

What is very rare is to find someone who held a substantial position for a long period of time and appeared to know what he was doing, only for it to become apparent later that he really didn't have a clue all along. It happens with fraudsters, but they deliberately set out to deceive and laugh all the way to the bank while their victims pay them. They know they will be exposed some day and just hope the victims will be so embarrassed by their own gullibility that they won't involve the police and will just put it down to experience. It happens also when very skillful managers are given executive responsibilities they cannot cope with themselves, they delegate and take advice and ride through on the seat of their pants. One day they get put on the spot and have to think for themselves, then they are exposed. It has never happened in senior government circles in my lifetime until now. Yes, there were people I didn't rate who held senior ministerial appointments, but that's different, that's just my opinion. Now we are seeing clear objective proof that the man who was Chancellor of the Exchequer for ten years and is now Prime Minister really didn't have the foggiest idea all along.

There have been hints since the beginning. His famous pensions grab, stripping pension funds of their long-standing exemption from tax on the income from dividends on shares, was criticised as something that would lead to shortfalls in funds. Yet there were arguments in favour of what he did - he removed an anomaly, over time the funds would be able to recover, it was necessary to pump money into the NHS and schools so it was a price worth paying. It was possible to excuse it as a political decision regardless of the effect it had on pensions. Nonetheless the criticism remained. Even in 1997 insufficient provision was made for pensions, to take a big chunk out of the pensions pot each year seemed likely to add to that problem. It raised a question about his ability to see the bigger picture.

Money was pumped into the Department of Health and the Department for Education. Eye-watering amounts of money. He called it "investment" and boasted of it as a great thing for the country. The improvements in service for the little people were small in the NHS and almost non-existent in schools. So much was pumped in at the top and so little reached the bottom that questions were asked about the efficiency of the system. Still he boasted that it was all "investment" for the future and (too) many believed him, thinking that "investment" must produce a long-term benefit even if we can't see it yet. He was "investing" so he received the benefit of the doubt. Now it is clear beyond argument that the vast majority of this additional "investment" was wasted on form-filling bureaucracy and pointless, expensive gimmicks. It was not spent on health and education but on exercises designed to make the government look good. And it worked, they won elections, so they carried on with more of the same.

The whole structure of banking and financial services was changed. The single most significant consequence was "light touch regulation" which left the banks and finance companies at liberty to undertake high-risk transactions with no questions asked. They did undertake such transactions and, for a while, appeared to be making a lot of money. That resulted in them, and their employees, paying lots of tax. A double-whammy. Under poor Gordon's stewardship of the economy the financial sector was hugely profitable and he had ever expanding receipts to spend on yet more of his "investments".

Once it all started to unravel we learned a lot about the brilliant man with his hands on the steering wheel. There was something he said late last year which troubled me enormously, although I only touched on it in passing at the time. The decision was taken to ban short selling of shares in financial companies. Short selling is the practice of agreeing to buy shares on a date in the future at a price lower than their current market price. It is done when the market price is expected to fall but it can also cause the price to fall because people infer that those who have made those deals know something is wrong and that the price will fall, so they offload their holdings and supply exceeds demand causing the price to fall. The ban was put in place for fear that an artificial fall in the market price of shares in financial institutions would be manufactured by speculators. Fair enough. Poor Gordon clearly did not know what short selling was because he referred to it as "short term selling". Although I can't remember when I wrote about this, I recall saying that no one who knew anything about the financial world would refer to "short term selling". He could only have said that because he did not have the faintest idea what he was talking about.

And now I finally arrive at the point of this missive. News has broken that poor Gordon had one of his hissy fits on the way to America to be given the type of reception by President Obama that would be given to the Prime Minister of a bankrupt African dictatorship. It is reported that poor Gordon got wind of the intention of the press to suggest he should apologise for getting the country into recession and decided to challenge the reporters who were travelling on the plane with him. He is reported to have put forward three arguments to defend himself: (i) it all started in America, (ii) every previous British recession was created by high interest rates and high inflation whereas the UK had low interest rates and low inflation during his time as Chancellor and (iii) house prices were high because of lack of supply.

When people get angry they say what they really think. It is reported that poor Gordon was angry when he assailed the press contingent. There is every reason to think he believed what he said. Let's see what it shows about him.

His first point is fair. It did all start in America. If truth be told it started in the late 1970s when they were nutty enough to require banks to lend to the indigent, but we can concentrate on more recent times. It started in America because thirty years of bad lending built up a huge portfolio of losses which had never surfaced. They were bound to surface one day and when that day came it would affect the economies of all developed countries. No matter how well or badly each country had been run it would be affected somehow. That goes without saying, but that does not mean that every country would be affected in the same way. The mere fact that it started in America is neither here nor there. No one is blaming poor Gordon for that. He seemed to put forward "it started in America" as meaning he cannot be subject to legitimate criticism for the way our economy has been able to deal with the problem. That is patently absurd. True though his first proposition is, it is nothing by a red herring. He should be able to understand that.

His second point is just breathtakingly stupid. Recession is a continued fall in Gross Domestic Product (GDP), usually defined as a fall in GDP for two consecutive quarters but there is nothing magical in that formulation. GDP can fall one month and pick up the next, generally that isn't a problem. There is only a problem when there is a sustained fall in GDP, yet the problem is not the fall in GDP itself, after all that is just a measure of current economic activity, the problem is that a sustained fall in economic activity bites into wealth. I really don't think poor Gordon understands wealth.

Wealth is stuff that makes life comfortable. We are wealthy in the UK because we have houses to live in, electricity and/or gas to provide light, heat and cooking facilities, we have enough food and clothing to sustain us, we have motor vehicles and trains to allow us to travel, we have facilities in our homes and our towns to provide entertainment and information and we have lots more other stuff besides. Somewhere like Zambia is not wealthy because it does not have these things on anything like the scale we have them. Our lives are comparatively more comfortable, therefore we are wealthier. Wealth is stuff.

In order to maintain our level of stuff we have to maintain GDP because an awful lot of stuff gets used up every day. Tomorrow we need more food, more gas, more electricity, more petrol, more paper, and more of all the things that we consume. A fall in GDP means we can't maintain our level of stuff and, therefore, can't maintain our level of comfort. Over a short period this is just part of the normal swings and roundabouts of life, but over a sustained period it leads to significant problems which affect the living standards of millions because it means a lot of people cannot afford the amount of stuff they previously enjoyed.

So, now we know recession is all about a reduction in the amount of stuff we can afford. What have interest rates and inflation got to do with it and how can they be the only causes of previous recession? I say "the only causes" because that is the substance of what poor Gordon said. His defence is that previous recessions were caused by high interest rates and high inflation and because we did not have high interest rates and high inflation he cannot be blamed for the current recession. That necessarily involves three propositions: (i) it was high interest rates and high inflation that caused previous recessions, (ii) because high interest rates and high inflation caused previous recessions it was not possible to predict any other cause of future recessions and (iii) no matter what changes happened to the economy the first two propositions would remain true.

The first proposition is utterly unsustainable. Interest rates and inflation can contribute to the pressures that cause a sustained fall in GDP but they cannot cause it all by themselves. If his proposition were correct all that would be needed is for the government to direct a cut in bank base rate and recession could be avoided. That is absurd. A highly developed modern economy is a complex web of corporate and individual transactions. Those transactions are decided on by people, real people with all the good and bad qualities people have.

The recessions in the 1970s, 1980s and 1990s were not caused by interest rates and inflation, interest rates and inflation merely reflected underlying problems in the economy. The major cause in the early 1970s was a sustained rise in oil prices which increased the costs of business and caused widespread cut-backs. There were other causes too. The early 1980s saw another sustained rise in oil prices combined with massive stagnation in nationalised industries. There were other causes too. In the early 1990s the recession was almost entirely a result of a false boom creating a credit bubble that popped rather sooner than anyone expected. It popped because other factors caused interest rates to rise, but interest rates did not cause the recession they merely brought out into the open the fact that apparent increases in wealth financed by credit were unaffordabe.

Because the first proposition is unsustainable the second necessarily falls. Yet the second also falls independently of the first. Even if the first proposition is correct, the second does not follow. Even if high interest rates and high inflation caused earlier recessions, it does not follow that other factors could not cause a future recession. Once we recognise that a recession is a sustained reduction in the amount of stuff we can afford, it is obvious that all sorts of factors can cause a recession.

And that leads to the third proposition inherent in the second part of poor Gordon's panicked outburst. Acts of government that change the structure of the economy have the capacity to do more harm than good. They also have the capacity to do more good than harm. What they will actually do depends on factors wholly outside political control. Those external factors are infinitely variable and that fact, of itself, gives the lie to his third proposition.

The final part of his outburst was that house prices rose purely because of lack of supply. At this point it is simply impossible to take him seriously. That argument would not have gained a pass in A-Level economics in the 1970s (yes, it would get a starred A grade today, but that is a different matter). Let's look at the most basic analysis. Price is a product of supply and demand. If supply exceeds demand the buyer is in the driving seat and price falls. If demand exceeds supply the seller is in the driving seat and price rises. OK, fair enough, that's readily understandable. Now let's look at what drives demand. What drives demand is the amount of money buyers have at their disposal. The more they can borrow, the more they can pay. If it is right that supply exceeds demand the seller is in the driving seat but the price he can achieve is limited by the amount potential buyers can pay. Lend them three times their gross salary and they can pay less than if you lend them five times their gross salary. It's not a difficult concept. You would think someone who was Chancellor of the Exchequer for a decade would be able to understand it.

And so we can now see the twilight zone that is poor Gordon's understanding of real everyday economics. Recessions can be imported and destroy our wholly sound economy. Only interest rates and rates of inflation can cause recessions. The only factor affecting house prices is the volume of supply. Does he really believe this nonsense? If he does we are in an even deeper hole than we thought. If he doesn't we now have the final proof that he is so deeply dishonest and mendacious that he is unfit for any governmental position.

But we needn't worry. He'll say something even more stupid in the next week or two.