Tuesday, 23 November 2010

Does Clegg's philosophical pitch stack up?

Nick Clegg follows in the footsteps of David Cameron last year by giving this year's Guardian Hugo Young lecture on Tuesday night.

He will be seeking to establish a profile as a politician of ideas. And I am all in favour of politicians setting out their vision of what the good society is, so I am looking forward to going and hearing what he has to say about the philosophy which he brings to government.

Since Tuesday's Guardian has treated us to a commentary preview, also reported on the front-page it is already possible to offer some advance challenges about whether the treatise is going to stack up on the night.

Here are three problems with the speech's argument, on the basis of the Guardian preview.

1. A stale caricature of what "old progressives" want

This seems to be Clegg's big (if rather artificial) "dividing line":

For old progressives, reducing snapshot income inequality is the ultimate goal. For new progressives, reducing the barriers to mobility is.

Was it? Challenge one to Nick Clegg and his team: please name any three British left-of-centre political philosophers or major Labour politicians of the last century who advocated literal equality of incomes and outcomes.

The truth is: nobody did. (The late Bernard Crick wrote that he could identify only two socialist thinkers to have done so. The French revolutionary Gracchus Babeuf, and George Bernard Shaw, sometimes and not others, and perhaps partly in jest. But perhaps Clegg has better information than Crick about this).

What "old progressives" have wanted was perhaps best encapsulated by RH Tawney:

"While natural endowments differ profoundly, it is the mark of a civilised society to aim at eliminating such inequalities as have their source, not in individual differences, but in its own organisation. Indeed, individual differences are more likely to ripen and find expression if social inequalities are diminished."

It is good news that Nick Clegg argues the case for more equal life chances, the core ambition of much Fabian advocacy. (David Miliband set out very well why income matters, and why income is not enough in launching the Fabian Life Chances Commission report in 2006). But he can't claim to have invented it.

2. Seeming to claim that redistribution is irrelevant to mobility - despite the evidence that it is not

Clegg may not have read much Tawney, since he thinks "old progressives" were simply hell-bent on increasing the state.

Old progressives are straightforwardly in favour of more state spending and activity. On this analysis a state spending 50% of GDP is more progressive than one spending 40% – while a government spending 60% would be more progressive still. This is clearly nonsense. The question is not how much money the state is spending, it is how it spends it. The real progressive test for any state intervention is whether it liberates and empowers people.

Well, I can concur at least with "this is clearly nonsense". Again, Clegg is obviously just attacking a straw man. Literally nobody in democratic politics thinks the 99% state is better than 90% is better than 80% and so on. Can Clegg sincerely think otherwise? (Some do take the opposite view - that less government is always more freedom, but that is a highly anaemic view of liberalism).

Clearly, Clegg wants an increase in mobility, rather than a reduction in income inequality or a larger state. He believes "new progressives" will see that as the key choice in politics. But old progressives have pretty much always wanted equal opportunities too. What they have not believed is that overall levels of inequality have no impact on this goal of fairer and more equal opportunities across generations. If the rungs of the ladder become exceptionally wide, and the starting points on it so far apart, the call for equal opportunities and more mobility is a chimera. Calls for mobility and even meritocracy are, taken seriously as a call to break cycles of disadvantage potentially more radical than many of their advocates recognise.

So Clegg's argument should lead him to be somewhat agnostic about whether the state is large or small, as long as it does what is best for life chances and mobility. Yet, tonally, he gives every impression of being strongly anti-state and anti-redistribution, before he has worked out what the drivers of mobility are. That is why he appears quite perfectly sanguine in opposing "those who see the crisis in public finances as a catastrophe for progressive politics, who believe that cutting the deficit means cutting progressive aspirations". In fact, it is an "opportunity for renewal".

Here, Clegg seems to follow David Cameron, who believes that the "big state" causes poverty, and so creates a mobility trap.

This is usually made as an evidence-free argument. The Fabian Society wrote to ask Cameron whether he could explain why the countries with high levels of social mobility - Sweden, Finland, Denmark, Canada - consistently have both less inequality and larger states than those with high levels of poverty and low levels of social mobility - the United States of America and, to a less severe extent, the UK. Cameron's polite response left this mystery unsolved.

So let's put challenge two to Nick Clegg: If levels of inequality and income distribution by the state have little or nothing to do with social mobility, please name three "high inequality" or "small state" countries with comparatively high social mobility? Could he please explain what he thinks the drivers of high mobility are in Sweden and other societies which rank highest in the OECD?

David Cameron, famously, favours "conservative means to progressive ends": shrinking the state in order to reduce inequality and increase mobility. I would recommend that Nick Clegg reads a particularly good critique - A big unequal society of the approach set out in Cameron's own Hugo Young lecture. The LibDem leader could pick up a copy of this interesting article in his own office, as it was co-authored by Nick Clegg's own special adviser Richard Reeves (while in his last job, running Demos), writing in a joint Prospect article with Phil Collins, the former Blair speechwriter who works for The Times. Neither Reeves nor Collins are easily characterised as old school statists, but they did offer a very clear case about why state redistribution matters to reducing inequality.

[Cameron] is signing himself up to Labour-style poverty and inequality measures, even as he rejects Labour-style redistribution. In other words, he is setting his own big trap, and trotting gamely towards it ... it makes literally no sense to argue that inequality needs to be reduced and then to call for a reduction in state benefits. The issue is not ideology; its not politics; its just arithmetic ... Labour's record shows that cash transfers can work to reduce basic income inequality. It also shows that even a broadly centre-left government did not feel able to transfer money on the scale needed truly to make society more equal. So inequality has been checked, not reversed.

Reeves, with Collins argued Cameron's that Hugo Young lecture, which set out to "chart the course of 20th-century British history but miss out the Thatcher years was dishonest". Cameron could not articulate any reasons to explain the largest increase in inequality, and related collapse in social mobility. There is surely nothing to stop Nick Clegg doing much better on that. Richard Reeves is very well placed to help to draft a more honest analysis of British inequality and the collapse in mobility than the evasive speech he criticised so strongly last year.

So I shall listen out for this passage in the Clegg speech with interest.

3. Mischaracterising the government's spending review, still claiming it was "progressive"

Clegg claims that:

The highest profile studies of the impact of the spending review have used just one measure – income – at just one point in time. As such they provide valuable information. But they take no account of the value of public services.

Here, Clegg means the IFS. But we can help Nick Clegg out on exactly this point. Because the Fabian Society and Landman Economics in research for the TUC - "Where the money goes: how we benefit from public services" - have done exactly what he asks here, modelling not just one cherry-picked policy, but the entire distributional impact of public spending, both before and after the spending review.

This creates just one problem for his argument: the changes in public spending are much more regressive than the changes to taxation.

Though not according to Nick Clegg, who writes this in The Guardian.

That is why the government's own analysis, which did include services, showed a different picture, one which showed the richest fifth losing the most from the spending review and the poorest fifth losing less.

Up to a point, Lord Copper. Here Clegg is depending entirely on an most bizarre claim.

He is referring to government figures showing that those with an average income of £48,750 [top quintile household] will lose £10 a week worth of services from the CSR and that a much less affluent household with an average income of £19,100 [second decile] will also lose £10 a week worth of services on average.

When both lose the value of £10 a week worth of services, Nick thinks we should all believe that the richer household on £50k is being hit twice as hard as the poorer household on £19k.

This topsy-turvy claim really is all that remains of attempts to rescue the CSR for progressivesness against all of the evidence. The claim depends on ignoring entirely any relation to household income, which is surely what matters in terms of ability and resources to compensate for lost services, by showing instead only the proportion of services lost. The Treasury tables Clegg is depending on are reproduced here at Left Foot Forward, alongside a rather more commonsensical graph, showing the regressive impact of lost services as a proportion of household income (using the very same Treasury tables).

However, the Treasury CSR annexe only modelled the impact of half of public spending, citing methodological issues for its limited selection. (The IFS suggested the inconsistency in what the Treasury chooses to include and omit was rather selective - noting that the IFS' own helpful modelling of the benefits cuts was ignored, but the more difficult to model pupil premium was not; whatever the motive, this did have the impact of reducing the regressive impact). The Landman Economics/Fabian model covers all spending. It showed the poorest 10% hit fifteen times harder than the richest by the spending cuts.


But let's see what else the deputy Prime Minister has to say. I am sure there should be some things to agree with in the lecture too.

Nick Clegg's challenge to create a more pluralistic Labour party is one that should be accepted, for example.

One good starting point might be to try to establish that it is possible to disagree about political values, ideas and policies without challenging the good faith of political opponents. Yet it is surely also the case that a battle of ideas in politics will be much more illuminating if those with ambitions to conduct it do not only stick in the comfort zone of articulating only their own caricatures of other political positions, but rather engage seriously so that they challenge political opponents based on the ideas and views that they actually hold, in the terms that they themselves express them. Let's see if Nick Clegg's speech might meet that test better than the op-ed extracted from it.

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