Tuesday, 18 October 2011

Time for our constitutional

"Watch therefore, for you know neither the day nor the hour."

It's not outwith the bounds of reason to suggest that Alex Salmond might have developed something of a Messiah complex. He has received the glowing adulation of his flock - and the approval of the electorate - and looks out on a sea of expectant faces waiting for deliverance. Those who favour independence for Scotland know that their very best hope is to put their trust in his political judgement, let him call the shots, and cross their fingers that his winning streak holds.

Understandably, Salmond is loathe to call any shots too soon. Hence the "promise" to hold the referendum toward the end of this parliament - a promise which only solidified after the election result. (Despite the many cries of "it was in the manifesto", it wasn't.)

But also understandably, Salmond is keeping a weather-eye on the opinion polls. Like the rest of us, he can see that Scots are keen on more autonomy, especially given the second coming of Thatcherism in Westminster born from the unholy alliance of wet Conservatism and orange Liberals. But he can also see that Scots are not keen to break the ties of this United Kingdom. It remains only a hard core minority who see the battles of hundreds of years ago as recent scars, and talk of freedom as if they understood tyranny.

These hard-liners want the question put to the Scottish people to be yes or no - independence or union. The question that was always assumed to be coming. The question that hard-liners on the opposite side want too. But inexorably, the SNP seems to be heading towards adding a third option to its referendum question, the so-called "devo max" - a maximally devolved Scottish administration still embedded in the union but with some level of fiscal autonomy and some level of greater devolution of the powers currently reserved to Westminster.

It is an idea that could gain significant support outside the SNP - Malcolm Chisholm has recently planted a Labour flag on it, and it suits the Lib Dem federalist wing nicely - and would likely be preferable to the status quo to those Scots who don't want to countenance full separation.

But while the SNP absolutely has an electoral mandate to bring forward a consultative referendum on independence, their mandate does not stretch to deciding the shape of Scotland's future governance within the UK. Both full independence (crown and parliament) and the retention of the status quo, are well-defined concepts on which the electorate can be reasonably asked to judge. But the third option of devo max is not clearly defined at all - just as devolution itself was not.

To define devolution, a constitutional convention was created, comprising all the major parties willing to take part, and representatives of civic society and the major churches. It was the Scottish Constitutional Convention which drew up the blueprints for today's Scottish Parliament and its relationship with Westminster; the Labour party implemented the convention's plans following a referendum in 1997.

If we are to have a 3 question referendum in the second half of this parliament, then it is beyond question that the definition of the middle option is key to its outcome. It would be utterly against our constitutional history - and political decency - for that definition to be drawn up by a single party whose policy is to oppose it. A third option must not be created as political leverage to push the vote in a particular direction. The question people are asked must be honest, and clear.

So I call upon Alex Salmond to come down from on high and declare now the shape of the referendum he proposes. And if it is to offer three options, then he should ask the major parties and civic society to reconvene the Scottish Constitutional Convention now, with a remit to agree the definition of devo max in good time to allow a proper debate to be held before the vote.

If there is to be a third option, then the delay in announcing the timetable and format of the referendum cannot go on. A convention could take two years or more to agree (the last one took nearly ten), and there must be time before the vote for a genuine public debate to be had on the question once it is established.

The SNP - as the sainted Alex himself said - do not have a monopoly on wisdom, and this applies just as much to the constitution as to anything else. It is time for them to stop using greater autonomy as a political football, and to declare their intentions to the Scottish people.

Monday, 3 October 2011

Recent writing

Update: following the sad demise of the Amansaman blog, the articles linked to below can now be found on this blog as well, under their original publication dates.
As I'm now contributing to a couple of other blogs I thought I'd do a quick round-up of things I've written elsewhere recently which you might have missed.

On LabourHame:
On A Man's A Man:

Sunday, 2 October 2011

Robin Hood: a tax to change the world?

Take from the rich,
give to the poor,
shoot the odd arrow.
This article was originally published on Amansaman.

They do say the simpler an idea, the more likely it is to succeed. And the Robin Hood Tax is a pretty simple idea.

In 2001, the charity War on Want published a proposal for a tax on speculative trading on the international currency markets. The effect was to be twofold: to generate global revenues to be applied to fighting poverty across the world; and to reduce the risky trade in world currencies which had contributed to the East Asian financial crisis of the late 90s. A bona fide win-win. Charities and progressive groups applauded. The markets and the governments in their thrall shook their heads and carried on with business as usual.

We all know what happened next, of course. The banking crisis of 2008 which precipitated the global recession exposed our absolute reliance on the financial institutions which engage in speculative trading not just in currencies but in a range of other tradables of varying dubiety. But more significantly the period following the crisis, after banks had been bailed out with government debt to be paid off by taxpayers, showed that banks and traders were utterly unwilling to change their behaviour, and that the bailout had only cemented their attitude to risk. Public disquiet turned into anger.

At the behest of campaigners, political leaders started re-floating the idea of a Robin Hood tax. Gordon Brown proposed it at the G20 in 2009, other European leaders offered varying levels of support, but a common concern was that it needed to be a global system for it be successful. So in early 2010 a coalition of major charities, trades unions, politicians, economists and business leaders launched a concerted campaign for a Robin Hood tax.

The preferred model for this tax is a tiny (around 0.05%) financial transaction tax (FTT) to be applied across key trading areas such as stocks, bonds, foreign currency and derivatives. The group estimates this could raise £250 billion a year globally. Because transaction taxes already exist this approach is well-tested, cheap to implement and hard to avoid.

There are other models, not as effective but potentially more able to garner support from governments still cowed by the markets. A financial activities tax (FAT) – like VAT for bankers’ remuneration and excess profits – has the guarded support of the UK government, which is opposed to FTT. But it would raise less revenue and, crucially, have far less impact in reducing risky speculative behaviour in the financial sector.

So the news this week that the European Commission will press forward with a unilateral FTT from 2014 is very significant, in the week that Bill Gates, one of the world’s wealthiest and most successful businessmen, backed it too. It has pushed the UK government into accepting the concept, though they say they will only implement it if it is global. It has increased pressure on the US government, paralysed by the 2012 presidential election and huge legislative bias against tax. And it has legitimised FTT as a practical, effective way to curtail the damage the markets can do.

With London handling about 80% of Europe’s financial transactions, we’re getting close to crunch time. The UK’s decision on the Robin Hood Tax could help to redefine the relationship between government and the market. It could repair the damage done by the banking crisis while massively reducing the risk of it happening again.

In his speech to the Labour conference this week, Ed Miliband talked about opposing predators in the financial sector, and rewarding socially responsible business. The previous week, Vince Cable told the Lib Dem conference he wanted tough interventions in the banking sector to end profiteering at the expense of economic growth.

On Monday, George Osborne has his moment. Will he back Robin Hood? Will he move from the rhetoric of threat to the threat of action? Not yet, maybe. But the more people who call for it the more likely it is that he’ll have to.

So if you think the Robin Hood Tax is a simple idea whose time has come, you can add your voice to the call to make it happen. I have.