Posts Tagged ‘Labour’

Labour and Tory MPs in talks over setting up new centrist party

Discussions could lead to new party consisting of six or more Labour MPs plus some Tories

Intense discussions are taking place at Westminster that could lead to the emergence of a new centrist party consisting of six or more disaffected anti-Brexit Labour MPs along with the involvement of some Conservatives and the backing of the Liberal Democrats.

Labour MPs reported that some of those involved had lobbied backbench colleagues they thought were sympathetic as to how they could “make the shift” away from a tribal loyalty to the party.

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Leadsom insists a no-deal Brexit is still on the table – Politics live

Follow all the fallout from the government’s latest Commons defeat on Brexit

Nigel Farage has welcomed Business Minister Richard Harrington’s suggestion that the ERG should join his new Brexit party.

He told PA: “Oh, it seems like a jolly good idea to me, but, I don’t think we have quite reached that point yet.”

Sounds like a good idea. https://t.co/bJagFEnL4p

Labour MP Caroline Flint, a former Europe minister who represents the Leave-backing constituency of Don Valley, said Labour MPs should be given a free vote on Brexit to avoid those backing a second referendum from deserting the party.

But speaking to HuffPost’s Commons People podcast she also conceded that some of her colleague appeared to determined to leave the party. She said: “The truth is, where are they going to stand? Because the likelihood is if they stand against Labour in our areas they will let a Tory in….I think some people are hellbent on going…They won’t win, but they’ll be responsible for ensuring Tory governments.”

Cooper/Letwin proposal is about stopping the chaos & risk of leaving the EU with no deal. It would not lead to an indefinite extension of A50 bcos Govt wouldn’t propose it, MPs wouldn’t vote for it & EU wouldn’t agree to it! #NoToNoDeal https://t.co/14DSkBSIRZ

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Opponents of a WTO Brexit Ignore the Basic Lesson of Economics

Opponents of a WTO Brexit Ignore the Basic Lesson of Economics

The author of this article is Robert Lee.

The article was first published in Briefings for Brexit, and we re-publish with their kind permission

 

We must look at long-term, not only short-term consequences, and at effects for everyone, not only for a few privileged groups.

The whole of economics can be reduced to a single lesson, and that lesson can be reduced to a single sentence:

The art of economics consists in looking not merely at the immediate but at the longer effects of any act or policy; it consists in tracing the consequences of that policy not merely for one group but for all groups

Henry Hazlitt, “Economics in One Lesson”.   

Henry Hazlitt was a philosopher and economist, widely regarded as one of the world’s great writers on economics. He argued that the two central fallacies in economics – responsible for much economic harm – arise from ignoring this lesson. The first fallacy is that of looking only at the immediate consequences of an act or proposal, and the second is that of looking at the consequences only for a particular group to the neglect of other groups. Those who argue against a WTO Brexit on economic grounds commonly commit one or both of these fallacies in spades. Greg Clark, current Business Secretary, is a notable and particularly unfortunate exponent of these fallacies, but the political class as a whole is largely in thrall to them.

Hazlitt would be appalled, but not surprised, by much of the content of Parliamentary debates on Brexit. MP after MP will mention a particular company in his constituency – usually from the motor industry or agriculture – that might lose jobs in a WTO Brexit. That possibility alone is presented as an irrefutable reason for opposing such a Brexit. The MP’s seem not to question the credibility of warnings of a large negative impact on the industry, nor whether the long run impact might be different to the short term, or consider that other groups and sectors might massively benefit from a WTO Brexit.

It is natural for an MP to stand up for his constituency, and nobody wishes people to lose their jobs. However, rational policy cannot be conducted on the basis that no job can ever be lost. In a market economy jobs are lost and created all the time for all kinds of reasons – technological innovation, changes in consumer demand, new regulations, population shifts, and many other factors. The degree of change in the UK labour market is staggering. According to the Office of National Statistics (ONS), in the three months to September 2018, 830 000 people changed jobs! This is evidence of a dynamic and flexible economy highly responsive to change. Job losses in any one sector or company of a  few hundred or even a few thousand – no matter how distressing for the individuals concerned – must be put in this wider perspective.

Following Hazlitt’s lesson, we need to assess not only the immediate consequences of an act but also the longer term consequences. We also need to consider the effect on all sectors of the economy and not just one. Take the motor industry, the sector most often cited by MP’s in their economic arguments against a WTO Brexit. The industry is said to be particularly vulnerable because of a reliance on just in time supply chains from the EU, and because under WTO rules, the EU could impose tariffs of around 10% on UK car exports. However, any new tariffs would only partly offset the boost to UK competitiveness from the 15% post-referendum depreciation of Sterling. Furthermore, the industry may be exaggerating the possible impact on supply chains of leaving the EU. The UK motor industry already receives 21% of its’ bought- in supplies from outside the EU without any problems. Just in time supply chains operate the world over between countries that are not in a customs union. Can the UK motor industry really not adjust its supply arrangements from the EU post-Brexit without incurring unsustainable new costs?

In my experience (I used to assist the Chairman of a large insurance company in his lobbying efforts) politicians and civil servants, in general, are naïve in dealing with big business lobbyists. Are CEOs of big companies likely to use Brexit as a cover for their own poor decisions, or exaggerate likely problems in order to obtain favourable treatment? You bet they will. Will politicians fall for it? Very likely. Will the motor industry adjust rapidly and efficiently to new circumstances and arrangements post-Brexit? Of course, it will.

More importantly, given there will still be some short costs, could a WTO Brexit be beneficial to the motor industry in the long term? There are a number of ways in which it could be. The UK government could reduce or eliminate all tariffs on imported motor components, as a WTO Brexit would allow us to set our own tariff schedule. This would reduce industry costs. In a WTO Brexit we would be able to agree on our own FTA’s (Free Trade Agreements), thus potentially boosting UK car exports to non-EU markets. The UK could use some of the £39bn that would otherwise be paid to the EU under Mrs May’s deal to cut corporation tax or boost consumer spending by cutting personal taxes.

Finally, and most crucially, under a WTO Brexit the UK’s long term economic growth rate should increase as, inter alia, we would be free to:

*Set regulations better suited to our own needs, and eliminate large annual payments to the EU

*Secure our own FTA’s, and reduce or eliminate the nearly 2,000 tariffs that we are obliged to impose by virtue of customs union membership

*Boost the fishing and agricultural industries free of the highly restrictive common Agricultural and Common Fisheries Policies, and introduce Free Ports

*Raise productivity and wages by reducing the flow of cheap immigrant labour, increasing investment and boosting labour force training

A Briefings For Brexit team estimate that on the basis of these and other measures a WTO Brexit could boost UK GDP by up to 4% (see “A WTO Brexit could yield the UK 80 billion pounds per year”).

This brings us to Hazlitt’s second fallacy. Even if the motor industry takes a short term hit – and even if it does not receive a longer-term boost – there are manifestly other sectors that will be boosted by a WTO Brexit outcome. Those fearful of a WTO Brexit focus too much on big companies, which can generally look after themselves and in any case tend no longer to be job creators. They need to think more about existing SME’s, particularly in the growth industries – biotech, fin-tech, aerospace, renewable energy, AI, and others  – in which the UK is already a world leader and from which the large companies of the future will spring. They need to think more about new companies which don’t exist yet, but which could spring up like mushrooms in a more liberated environment.

They need to think more about the benefits of tariff reduction or elimination to consumers, particularly those on lower incomes, and to the many thousands of businesses that don’t benefit from tariff protection. They are after all far more numerous than those in protected industries but are not organised to lobby politicians and civil servants. Hazlitt does not argue, and neither do I, that industries undergoing painful change should not be given relief or time to adjust, but permanent protection should only be considered in exceptional circumstances.

I have concentrated on the economics of a WTO Brexit because this is where its’ opponents concentrate their fire, but profound issues of sovereignty and democracy are also involved. Much will depend on policymakers taking the right decisions with our new-won freedom. But in the words of young Tory MP Julia Lopez, who clearly does understand the basic lesson of economics,

“There is no land of milk and honey awaiting us post-Brexit, only the opportunities we make for ourselves as a people from our own talents, efforts, and energy. Whether we succeed or fail is up to us – and that surely is the point.”

The post Opponents of a WTO Brexit Ignore the Basic Lesson of Economics appeared first on Independence Daily.

‘Labour is red, Tories are blue’: MPs read Brexit poems on Valentine’s Day

MPs mark Valentine's Day by reading poems in parliament about leaving the EU. The leader of the house, Andrea Leadsom, and the SNP's Pete Wishart both elicited groans with their offerings

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Backing a Tory Brexit could wipe out Labour, warns Clive Lewis

Shadow minister says party would never be forgiven as calls for second referendum grow

Labour tensions over Brexit threatened to boil over on Thursday as two shadow ministers broke ranks to call for a second referendum, and others hinted they could quit the party unless Jeremy Corbyn’s position changed over the next fortnight.

Clive Lewis, a shadow Treasury minister, warned Corbyn that Labour might never be forgiven and could disappear from UK politics if MPs voted to facilitate a Conservative Brexit deal.

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Brexit debate: May facing possible defeat on call for no-deal impact report to be published – Politics live

Rolling coverage of the day’s political developments as they happen, including the latest Commons debate and votes on what should happen next with Brexit

Starmer says threatening to leave on 29 March without a deal is not a credible negotiating position.

He says MPs have heard the warnings from Airbus and Nissan about the impact of a no-deal. Yesterday Ford said no deal would be “catastrophic” for the car industry.

Starmer says Labour’s amendment is designed to put a “hard stop” to Brexit. It says either May has to agree a deal by 27 February, or else the Commons will move on to something else.

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Remainers, hold your nerve. May is no nearer to her Brexit deal | Martin Kettle

Although some plans are being talked up and others talked down, Theresa May knows everything is still to play for

Even at the best of times, politics can be a place of deception and a hall of mirrors. High politics and low calculation are inseparable in the way MPs cast their votes. For some of us, that’s part of what makes politics so fascinating. But, over Brexit, the mirrors glint and deceive more than ever.

As the Commons prepares for yet another day’s voting on Brexit today, with more votes to come later this month and in March, this always needs remembering. Today’s votes are skirmishes in a campaign of positioning, not the full battle. Thus far, none of the big Commons votes have meant precisely what they may appear to mean.

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