Not really. This is Boris showing himself a serious politician, taking necessary but unpopular decisions, plugging the TfL budget black hole bequeathed on London by Kenneth, and it will play perfectly into the “Age of Austerity” narrative that accompanies the incoming Conservative government.

It’s almost as if Boris and Dave are old friends or something.

It’s certainly more likely to ring with voters than the silly “Boris is a racist” campaign last year. Indeed, this may actually result in a sensible debate about policy!

Spot on Sunny.

Spot Off Sunny!

It’s inevitable. Bozza’s three sources of money are council tax precept, congestion charge revenue and fares. He’s promised zero increase in the first, cut back the second, and therefore has to hit the third really hard, given that he is (allegedly) not going to severely cut front line services.

I don’t think anyone’s going to get elected promising to address London’s transport problems and to send the bill to council tax payers, so the logic really points to a much wider roll out of congestion charging. (Not only does it raise money it makes the bus service cheaper to run – it’s dead clever, you know.)

Friendly Kensington resident Clarice is a good example of what logic is up against. Not a car driver, she dislikes traffic congestion and acknowledges that it messes up the bus service she uses, but is so opposed to the perceived inequity of the congestion charge, that her only reaction to being told of the negative effects of scrapping the charge in Kensington is “bring it on!”

(I hadn’t previously thought to argue, so are you saying “bring it on” to 20% fares rises – if you are reading this, Clarice, any view?)

So, my question is, what is the roll out of congestion charging that brings Clarice along?

5

You will never get people to agree with CC where people *actually* live. Look at Edinburgh and Manchester.

If you want wide ranging CC, you will have to impose. If you do, at the next election, there will be a candidate promising to get rid. If the candidate is plausible, they will likely win.

To talk of scrapping the congestion charge extension as “creating a black hole” isn’t really accurate. There wasn’t a K&C-shaped black hole in the finances before the extension was introduced, was there?

And also, it’s a bit rich to criticise him on punishing London’s poorer people vis-a-vis public transport, while simultaneously criticising him for giving relief to poor people and small businesses by scrapping the western extension, which was opposed all along. It would be more consistent to criticise him for both these things on the green agenda.

Actually, this coming year the prices most commuters pay – Travelcard season tickets – are unchanged.

Livingstone hiked season tickets every year (except election year).

I love it how you think of the non-expansion of the CZ as a “spending black hole” when the tax system that hasn’t even been set up yet. Also you get what you pay for, this idea the left have of a free lunch with no cost to the consumer is what got us into the massive public finance mess in the first place

@8 Whoa! Hang on a tick – if LondonStatto is right, we need to be talking about the right number. Statto, the 20% refers to what? And so what is the proposed rise in the average fare, taking into account seasons?

@7 Ah, Clarice you are here. (I feel ike Hannibal Lecter!)

“There wasn’t a K&C-shaped black hole in the finances before the extension was introduced, was there?”

Well there was a big increase in spend on transport which was being paid for by increases in fares, council tax and (to a smaller extent) congestion charge. You may argue that the increase in transport spnd was unnecessary – if you choose to do, I would ask you to carefully substantiate that argument, please.

But what I would really like to ask you is: what would be the policy to reduce traffic congestion that would bring you along in support?

giving relief to poor people and small businesses by scrapping the western extension

Poor people, in general, a) don’t live in K&C b) don’t drive to work. But thanks for playing.

@10, Travelcards, which middle-class commuters use, have been held static; PAYG bus fares, which poor people use, have been raised by 20%. Tories In Class War Shock!

LondonStatto: All the numbers needed to give a fair picture are in both Ken Livingstone’s and George Galloway’s statements as quoted over at http://www.socialistunity.com/

Good to see these two titans of integrity doing the right thing, as ever.
London is well served by the honest, hardworking left opposition these two provide.

@9

“The left” haven’t had a sniff of power in a generation. The increasingly centrist Labour government under Tony Blair made the unfortunate assumption that if they gave the bankers the keys to the economy again, they wouldn’t stuff it up like they did in the ’80s. It was that same centrist Blair government who forced through the PPP over Ken’s (and Bob Kiley’s) objections.

And regardless of whether the system has or had been set up or not, the numbers were plugged into the respective budget – thus removing them would leave a hole.

Honestly, this canard about “the left” existing only to give “hard-working taxpayer”s money away to the undeserving and workshy would be laughable if only it wasn’t so prevalent.

11 – Do any live in Ladbroke Grove? Or Pimlico? I live, annoyingly, a road’s width outside the WEZ, and the idea that the entire area is just greater Knightsbridge is a touch silly.

Martin Coxall @ #1
hilarious mate

I think it exposes as myth this ‘Tories are the party of the poor’ rubbish

@15

The issue is not that only the wealthy of Knightsbridge would have been affected by the WEZ, the issue is that running on scrapping the WEZ was a naked and transparent attempt to get the wealthy of Knightsbridge out to vote for Boris, when in previous years they tended to not be that bothered by who was Mayor.

@17 It was their campaign contributions not their votes he was after.

After admin expenses, the congestion charge generated just £14m of cash in its first five years. The premise that congestion charges has raised significant money is a fallacy. Source.

http://philtaylor.org.uk/?p=726

@18 – I’d say he was probably after both.

@19 – I don’t think that a Tory councillor from Ealing with a clear distaste for Livingstone is going to be an unbiased source of information, do you?

@20 – the information is from the TFL accounts *rolls eyes*.

@21 – And selectively interpreted by an opposition councillor with an axe to grind.

If you want wide ranging CC, you will have to impose. If you do, at the next election, there will be a candidate promising to get rid. If the candidate is plausible, they will likely win.

Not necessarily – people were equally split over the WEZ – so Londoners have come to recognise the CC’s usefulness.

Any candidate saying he’ll get rid of it just won’t be credible enough.

Strategist @10

Why does a big increased spend on transport imply a K&C-shaped black-hole? Since when were we, and our friends and family responsible for picking up the shortfall?

In any case, I still seem to see increases in council tax and public transport fares today, and if the income from the main congestion charge area was so much a lesser amount than the other sources of funding, then the income from the extension must be even smaller. Your argument that the K&C extension is anything more than a drop in the ocean of paying for these increases in spending does not really seem to hold water, so to speak.

What I would be more interested in would be know where the black-hole in transport funding came from in the first place, and where the money that was saved by neglecting transport for all those years actually went.

A fairer system, since you ask, would be to have a congestion charge that is linked to people’s incomes. But I can’t help thinking that something is badly amiss if road tax and income tax and council tax, together with fares, are not generating enough income to do what they need to do.

@19 “The premise that congestion charges has raised significant money is a fallacy.”

That’s not a fallacy I’ve been arguing, although I’d be extremely surprised if your £14m figure was the correct one.

What I’m arguing is that congestion charge is one of only three ways of raising revenue in the Mayor’s armoury, and going for it in a big way (eg by a low charge levied on a much greater percentage of car trips across all London) is a better option than sticking it on the council tax or on fares (*especially* those paid by the poorest).

I’d like to see someone argue against that in principle (not merely by saying the voters won’t have it – I already know that). I’d also like anybody who agrees with it to share any ideas they may have on making it more voter-palatable.

@22 – as any decent accountant knows you can manipulate profit, but you can’t manipulate cashflows. Educated reading of TFL accounts shows that the congestion charge is not a significant fundraiser.

@25 – I’d be extremely surprised if your £14m figure was the correct one.

Why? It’s there in black and white in TFL’s accounts.

@24 Clarice, your comment “since when were we, and our friends and family responsible for picking up the shortfall?” isn’t very justified.

The residents’ discount at 90% was generous and gave residents a pretty good deal (especially if you get cheap parking with a resident’s permit), and if you are talking about friends and family driving in to come & visit you, then they were only charged if they did this 7am-6pm, Monday-Friday. This in area with an exceptional level of public transport coverage.

However, your basic point on the inequity of extending only to K&C is a good one – in my defence I guess I have thought of the K&C extension as a stepping stone, rather than as an end point uniquely picking out K&C. In that, I differ from the policy Ken fought the 2008 election on. One possible point of convergence between our two points of view would be for you to favour the extension of congestion charging to a wider area eg the whole of London. I think we may be getting there – your comment have a congestion charge that is linked to people’s incomes is an interesting one. To me that indicates that you would like the burden to fall on council tax (or better, a fully progressive tax).

On your question “where the black-hole in transport funding came from in the first place, and where the money that was saved by neglecting transport for all those years actually went”. Well that’s a big issue, but its related to the age of the infrastructure, the inherent incompatibility of London’s streets and universal car use, and the failure to levy adequate taxes to keep up with renewing the infrastructure. So where the money went instead is basically that we all pissed it up a wall on private consumption – the rich most of all.

More importantly, the 2010 rises are all on the sources used most by people on lower incomes – pay-as-you-go, buses, even travelcards outside zone 1 – bet the people that voted for Boris all have travelcards and work in zone 1!

@27 Give me a proper reference to the analysis that arrived at that figure and I’ll look at it.

The underpinning rationale for road pricing is to confront each motorist with a charge approximating to the costs of congestion that their road use inflicts on others.

Whether the revenues, net of collection costs, generated by the charge are large or small is an incidental consideration – the main purpose is to promote more efficient use of transportation resources:
http://www2.warwick.ac.uk/fac/soc/economics/staff/faculty/oswald/road.pdf

Opinion polls across the whole of london, finds people split on CC. Yet if you ask people if they want it in their area it’s suddenly different. Livingstone’s public consultaion on the extension found people overwhelmingly against in the affected area.

In addition to the examples of Manchester and Edinburgh, do people remember the petition against road pricing? Over a million signatures.

If the left want road pricing/congestion charging, they will have to impose it.

@33 “Livingstone’s public consultaion on the extension found people overwhelmingly against in the affected area.”

Actually I think the balance in the scientific opinion polling was not overwhelming. The tear-off coupon exercise was the subject of a very well organised campaign by the antis. Nothing wrong with that, but hardly to be taken seriously as a measure of what the population as a whole thinks.

“If the left want road pricing/congestion charging, they will have to impose it.”

So what? There’s not a single comment on here that contradicts that.

My question is, what do you want? Congestion charge, higher council tax, higher fares, or a capital city with non-functioning transport?

johnb @ 11:

poor people don’t live in K&C? yes we do. K&C has some of the poorest areas in Britain, as well as some of the wealthiest.

@ 28 strategist

yes, my comment was perfectly justified. residents can’t choose whether or not to be in the zone, and even with the discount, the extension still means that if we drive anywhere, we are charged every day regardless. this does not happen to people who don’t live in the zone. they can choose to avoid the zone and still drive to the supermarket, or out of london, or to other bits of london. on top of this, as i mentioned, the discount doesn’t apply to our friends and family, who are, effectively, penalised in full for visiting us. not everyone’s friends and family live within a good-public-transport area, and for elderly people or those with young children, or for transporting shopping or larger items, the public transport is not always the preferable option, and very rarely the quickest or most convenient. people who don’t live in the zone aren’t financially penalised for driving per se as we are, and they don’t have their social support limited to outside the zone-hours. you might not appreciate how restrictive or expensive the extension actually is for residents unless you’ve lived here.

I would favour the extension of congestion charging only if it was linked to people’s incomes. The principle of a blanket charge is wrong, because it penalises poorer people disproportionately. On top of which, i do think that a charge-zone in significantly residential areas is also wrong.

Where the money went is a combination of insufficient taxation, and incompetent prioritisation of distribution of tax revenue, in favour of, say, defence spending, to pick one example that springs to mind from the Thatcher government. The lack of investment in the transport infrastructure goes back decades, and if, as you say, the richer benefitted from this the most, then surely the richer should be paying for it the most now? With a blanket charge, it’s the poor who are squeezed.

“The left” haven’t had a sniff of power in a generation.

It was, then, a right-wing government that doubled spending on the NHS.

@36 Thanks Clarice.

This might sound a little harsh, and if you are really genuine, I apologise. But just in case you are not 100% genuine, forgive me if I don’t burst into tears at your sob story.

With the residents’ discount the charge is 80p a day, which compares favourably with a single, never mind a return or all day bus fare (single trip £1, shortly to become £1.20 under Boris).

And in general very few friends & family come to visit by car Monday-Friday 7am-6pm. If they do, £8 is quite hefty, but compares favourably to what they have to pay on a parking meter on in a car park to park. It is certainly no more than the congestion costs they impose on other people by bringing their car in at these busy times.

I may be wrong, but if you are a special case (eg a carer who needs to bring a car in to attend to a dependant) there may have been (or could have been) a scheme you could access to get the residents discount.

“With a blanket charge, it’s the poor who are squeezed.” Actually I think it’s the poor who get squeezed when congestion charging goes off the agenda. Because it all goes on bus fares then, as we are seeing under Boris. And the bus service will become a lot worse, slower and with longer waits. But I’m not completely averse to a case for taxing the rich to avoid a charge which is higher than it needs to be solely to do its job on reducing congestion.

@39 Thanks, strat. Yes, I am genuine. It’s 80p a day, (or about £20 a month) that drivers who aren’t resident in the zone don’t have to pay. For some of us, that’s a lot of money. And it’s about to be £1 a day. Just to go to the supermarket, for eg.

I am not comparing the amount charged to the cost of using public transport, I am comparing it to the amount that people who can choose not to go into the zone are charged for going about their daily business. Going to the supermarket, for eg.

In a way, it’s an incentive to drive more. If you’re going to be stung anyway, you might as well get your money’s worth.

As for when friends and family come to visit, again, I’d say you maybe can’t grasp how restrictive the zone hours are unless you’ve had to live within them. Anyone that stays the night has to be up at least at 6.30 to avoid the full charge on their way home, or else stay for a further eleven hours. And for people who are emotionally or physically vulnerable or isolated, or the elderly, ie those who would rely on visitors or assistance more than people who have a 9-5 lifestyle, then yes, the hours of 7am-6pm are highly relevant.

I don’t know the rules for official carers and special cases, but I do know that most social support is both required and provided outside the remit of the benefit system or other official validation. Politics in general doesn’t seem to recognise this fact, or value it, so I shan’t be surprised if you dismiss this point out of hand.

It’s not a sob-story, just a reality that should be taken into account in weighing up the pros and cons.

If you won’t or can’t grasp the effect that the extension has on non-wealthy residents, whose only crime is to have some rich neighbours, then I can’t counter your argument that the poor will be squeezed more without the zone than we are with. Because I do know the effect, from bitter experience, however, I beg to disagree with your claim. The abolition can’t come soon enough as far as I’m concerned.

Oh, and visiting within the hours doesn’t make you immune from parking costs. The eight pounds is in addition to the parking costs that you say it compares favourably against.

I understand that 40% of bus passengers in London travel for free. This situation is not sustainable.

Well, Clarice, you’ve just about wrung a tear from the eye of this old hearthearted cannibal psychopath.

It’s not really the £20 a month (a monthly bus pass is £55, and a monthly 1&2 Travelcard is £99, I suppose it’s the thought of living on modest means in Ken&Chel with all these rich tosser neighbours. One of the small consolations must be the thought that you can drive around as much as they do, and you have just as much right to clog up the streets as they do.

I’m not buying it’s brutality on the very poorest though, very few of whom can afford to run a car in London, congestion charge or no congestion charge. On a scale of 1-10 for brutality to the very poorest, putting pay as you go Oyster bus fares up 20% ranks as a 10, whilst the congestion charge is maybe a 4.

Now, I’m just off to eat Tim Worstall for breakfast, perhaps with a few fava beans and a glass of chianti.

Boris should be congratulated for having the courage to defend bankers and the city. Hate them or despise them the city is the only thing keeping this country afloat right now. The taxes on city bonuses have been a big part of what has sustained Gordon’s spending binge. God help us now that Boris’s arguments aren’t being listened to and we are driving the bankers away – the French and Germans aren’t silly enough to scare away their own pet industries (aerospace and cars – not quickly moved anyway) but we are p1ssing away our only cash cow…..

http://www.telegraph.co.uk/finance/economics/6339642/Ex-FSA-chief-Sir-Howard-Davies-sees-dramatic-risks-for-Britain.html

@38

No, it was a centrist government, as I said earlier. I’d also love to know where your 40% figure comes from, and how many of that 40% are in fact schoolchildren or people claiming benefits, in which case they’re entitled to discounts at the very least.

Also, I’m usually the first to point out that the plural of anecdote is not data, but having caught the bus to work for 3 years now, I see no people not touching in or paying on double-deckers, and very few failing to touch in on bendies.

@44: “The taxes on city bonuses have been a big part of what has sustained Gordon’s spending binge.”

That is true but this is also true:

“Alistair Darling has already spent almost a fifth of Britain’s GDP on bailing out its shattered banking system – more than any other major economy, according to a grave assessment of the world financial crisis published today by the International Monetary Fund [in March].”
http://www.guardian.co.uk/business/2009/mar/06/imf-uk-bailout-gdp

And so, too, is this:

“One in five hedge fund managers found to be misrepresenting facts . . Using confidential data taken from 444 due diligence reports commissioned by investors between 2003 and 2008, academics at Stern analysed the extent to which hedge fund managers’ representations about their funds differed from reality. . .”
http://www.ft.com/cms/s/0/fc7d2e7e-b859-11de-8ca9-00144feab49a.html?nclick_check=1

Britain cannot afford a replay of the potential systemic collapse of its financial system. Meanwhile, in Brussels:

“Mr Rasmussen says many in the financial sector are working overtime to see the hedge fund proposals watered down, referring to a recent visit by the mayor of London, Boris Johnson.

“‘In that last two weeks, you even saw the mayor of London here in Brussels. We looked into his campaign funding and it looks like more that 60 percent of his campaign costs were covered by hedge funds,’ said the former Danish prime minister.”
http://euobserver.com/9/28814

Oh, and @44

That being the case, maybe it’s time that as a country we started supporting industries that don’t have such an abusive relationship with the majority of the populace.

As it stands, expecting our financial industry to keep the economy strong and not take excessive risks is somewhat akin to asking an alcoholic to supply one with booze.

#35 clarice

some poor people live in k and c yes (at least until the tories put the new gerrymandering proposals hammersmith and fulham are trying to roadtest in action)

But few drive – across the whole of London (rich and poor) 40% of households have no car. This % is higher in inner London, and far higher among the poor. I’d be surprised if more than 10% of k and c council tenants drive.

Therefore the congestion charge is unambiguosly good for them. It keeps fares down, it pays for a more comprehensive and regular bus service, it keeps cars (and accidents and air pollution) from their streets.

The whole argument “congestion charging harms the poor” is completely false in Inner London – the poor don’t drive (though would have some truth for an outer London charge or in other uk cities)

Cheers, strat. Hope you enjoyed your beans.

I never said the charge is *levied against* “the very poorest”. I was simply making the point that the majority of resident drivers in K&C are not the super-rich, but many are people on average or modest incomes. No richer than those in other Boroughs that don’t have the charge. Whether you think the lower middle classes are “tossers” or not does not make it right to tax them disproportionately relative to the super-rich, just because they have some celebrity neighbours.

And amongst the very poorest, most of whom may not be drivers, there is still the friends-family-support-services argument. Non-residents are penalised for visiting them. And that is not fair.

Economically, I am probably in the latter category, and I can tell you, Sevillista, that the extension has been unambiguously bad for us, so please, stop patronising me and telling me what I know to be demonstrably false.

If anyone else out there is under the misapprehension that the western extension has kept cars from my streets, let me tell you: you’ve been misled. If you’ve got 8 pounds, you’re free to visit anytime, and see for yourself. It’s still congested, still polluted, and there are still accidents. Seems like Boris has done a good PR job in convincing people that K&C is now some sort of traffic utopia, but let me assure you, it isn’t.

Oh, and ps @Sevillista – the congestion extension has kept public transport fares down? Sorry, but I’d understood we’d just had a massive increase. For the second year running. Increases that affect the very poorest worst of all. What planet are you on?

@47: “That being the case, maybe it’s time that as a country we started supporting industries that don’t have such an abusive relationship with the majority of the populace.”

In 1997, to get elected, New Labour was going to do something good for manufacturing – like ending boom ‘n’ bust – but nothing much became of that. I suspect (a large?) part of the problem was and is that we lack sufficient shopfloor skills for the high productivity businesses we need to compete with both the higher productivity and the lower wage economies.

It’s hugely significant IMO that the arms producer BAE is now our largest manufacturing company and Dyson no longer manufactures vacuum cleaners in Britain even if the management, development, design and marketing functions are located here.

One big question is how well will BAE continue to fare if HMG manages to reduce the procurement shambles in the MOD.

It will take a long time to fill the legacy gap in shopfloor skills. Meanwhile . . ? We have to rely on growing the Creative Industries, which are mostly services.

Btw I shouldn’t be by now but I’m continually surprised by how quickly Boris and acolytes unravel in open debate.

It never, ever, seems to occur to them that there could be robust analysis and viewpoints which differ from their own. They think that once they have said their bit, that’s it. I’ve a sneaky feeling that has something to do with a classics education at Eton and Oxford.

@50: “the congestion extension has kept public transport fares down? Sorry, but I’d understood we’d just had a massive increase”

Could it be that other factors, besides the Congestion Charge, have impacted on the revenues and costs of London Transport, such as the effect of the recession on travel in London and, therefore, fares revenues? What of the additional costs arising from the failure of Metronet?

As reported, the alternative to a hike in fares was a hike in the rates in London, which would have significant consequences for business costs and jobs.

@50 clarice

And where do these massive holes in Boris’s transport budget come from that have led to the fare rises?

The recession has had an impact – but so has Boris creating black holes in his budget to redistribute money to those who got him elected (a fair choice – he was voted to do this – just need to be transparent about it) through:

* Preference for council tax freezes instead of fare freezes (benefitting people in big houses, costing the poor)

* Preference for freezing outer London commuter fares instead of fare freezes for the poor (the poor are credit constrained and do not have the cashflow to purchase a travelcard so are forced to pay-as-they-go – the same ‘charge the poor more’ policies are followed by privatised utilities)

* Forgoing revenues from the rich and upper middle class (abolish charge on large 4X4s and sports cars, prepare for taking away the Western Extension to the Congestion Charge)

* Paying lots of money because of a groundless obsession with bus shapes amongst those who do not use buses

Sevillista – exactly. You don’t have to tell me any of this. And your point is?

While I’m here, let’s not also forget the years and years of underspending on transport infrastructure under previous governments. It’s not all Boris’s fault.

BobB – my point exactly. Sevillista was trying to argue that the congestion extension has kept fares down, which looks like a bit of a silly argument in the face of the recent increase.

“my point exactly. Sevillista was trying to argue that the congestion extension has kept fares down”

I think it likely that the revenue gap to fill would be even larger but for the Congestion Charge because there would be less reason for some motoring commuters to use public transport.

As a general proposition, I favour road pricing although I regret the loss of privacy that will entail.

45 I’d also love to know where your 40% figure comes from

To quote the man himself:

“Bus subsidy has soared from £24 million in 2000 to more than £600 million today.

With almost 40 per cent of bus passengers allowed to travel for free, I have of course been urged to take those benefits away.”

http://www.thisislondon.co.uk/standard/article-23756829-these-fare-rises-are-hard-but-i-have-no-choice.do

In the same paper:

Baroness Valentine, chief executive of business organisation London First, said: “Almost half of bus passengers and up to a third of Tube passengers pay nothing at all. When we’re searching down the back of the sofa for every last penny, should those in work but over 60 still be travelling in the rush hour for free?”

http://www.thisislondon.co.uk/standard/article-23756905-huge-fare-rises-and-pound-10-c-charge.do

I’d swear I’d seen a third reference, but inevitably, now that I go looking for it, I cannot find it.

@51

“I suspect (a large?) part of the problem was and is that we lack sufficient shopfloor skills for the high productivity businesses we need to compete with both the higher productivity and the lower wage economies.”

I’m not sure that’s the case. I’m certain that the skills exist, it’s just as part of the move to a Friedmanite service industry-oriented economy that’s been going on since 1979, the number of vacancies available to utilise those skills has dropped sharply. This has been aided and abetted by short-termist corporate business practices which favour making a quick buck by shifting manufacturing overseas and collecting the bonuses for cutting costs rather than thinking long-term and keeping high-end medium-scale manufacturing in the country as a bulwark against tougher times when we need to keep exports up.

and @56:

All of your sources are pro-Tory and pro-Boris – I’m talking about *independent* sources, or at least balancing those sources by providing one from an opposing viewpoint.

@57: “I’m certain that the skills exist, it’s just as part of the move to a Friedmanite service industry-oriented economy that’s been going on since 1979, the number of vacancies available to utilise those skills has dropped sharply.”

C’mon.

“Up to 12 million working UK adults have the literacy skills expected of a primary school child, the Public Accounts Committee says. . . The report says there are up 12 million people holding down jobs with literacy skills and up to 16 million with numeracy skills at the level expected of children leaving primary school.”
http://news.bbc.co.uk/1/hi/education/4642396.stm

“A £2bn scheme to improve basic skills among adults has been called a ‘depressing failure’ by education inspectors.”
http://news.bbc.co.uk/1/hi/education/4506410.stm

Britain compares fairly badly relative to other G7 countries in productivity and especially so comparisons with the Netherlands:
http://www.statistics.gov.uk/cci/nugget.asp?id=160

Btw it would be completely inconsistent for Friedman to express a preference for service industries over manufacturing beyond noting that the share of services in national GDP tends to increase, while the share of manufacturing tends to decline, as economies become more affluent.

Rather than dispaging Friedman – and I’m no Friedmanite – it makes better sense to figure out why Germany and Japan have unusually large and successful manufacturing sectors.

@58

I don’t think that lack of academic skills for whatever reason implies lack of shopfloor skills, in fact quite the opposite. I worked with some incredibly skilled and experienced mechanics in my younger years that could barely string a written sentence together, but could take apart and rebuild an engine – and have it running better than before – in a matter of hours. Some people’s brains just work differently, and this is something that the National Curriculum, through both the Tory and New Labour years, painfully failed to take into account.

Not mincing words here, I think Friedman was and remains full of shit. But it was not necessarily his ideas per se, but a misinterpretation of them that was the problem here – Thatcher’s ideology (one that Blair at least partially subscribed to) was that by decimating the manufacturing and industrial sectors, enough service industry vacancies would arrive to take their place – and that was a big fallacy. But as far as the Tory administrations of the 1980s and early 1990s were concerned, that was no problem, because as a rule the people who worked in industry did not vote Tory – and the resultant employment wasteland was their just deserts for not getting with the programme.

And the reason that Germany and Japan retained their manufacturing sectors was because they weren’t stupid and/or vindictive enough to destroy them for political ends in the first place.

@59: “I don’t think that lack of academic skills for whatever reason implies lack of shopfloor skills, in fact quite the opposite.”

Extrapolating from past experience may not be a fruitful guide to the future if the work environment and product technologies change, as they have. Ubiquitous computers and electronics/robotics – which challenge literacy and numeracy skills – have altered the work context.

Car engines are now mostly managed by electronics so mechanical skills aren’t necessarily of much use, especially if mechanics have problems understanding computing and electronic engineering manuals.

Literacy and numeracy skills are hardly “academic” nowadays but I agree that Britain – unlike several other west European countries – has neglected to develop training systems for vocational skills. This neglect is not recent but extends back through the postwar period to the 1944 education act with the failure to create technical colleges alongside grammar and secondary modern schools. The later shift to comprehensive schools didn’t fill the gap. And Gordon Brown’s pre-1997 idea of an Internet-based University for Industry had to be closed down after wasting millions: well-done David Blunkett, the responsible education minister.

“I think Friedman was and remains full of shit.”

I really wonder how much Friedman you have read.

Neither Thatcher nor Blair had any political incentive to “decimate manufacturing”. But you are correct in suggesting they could get comfortably re-elected regardless of what happened to manufacturing.

If you check it out, I think you’ll find that the percentage contribution of manufacturing to Britain’s GDP is about the same as with most other affluent countries, including America and France, but with the notable exceptions of Germany and Japan.

Manufacturing in the German economy has long benefitted from a well-developed system of work-based vocational training. In Japan, for the last 30 or so years, almost all school students stayed on in the education system at least to 18, unlike Britain.

About 20 years ago, the DTI looked into the split in Britain and Japan between arts and science degrees among university graduates. It was found that the percentage of science and engineering degrees was virtually the same in both but in Japan the percentage of graduates with engineering degrees was much larger compared with Britain. To my knowledge and that of colleagues, British universities have for decades had greater difficulty in attracting calibre applications for undergrad engineering degrees than in attracting quality applications for degrees in the science, social science and arts.

If you check it out, I think you’ll find that the percentage contribution of manufacturing to Britain’s GDP is about the same as with most other affluent countries, including America and France, but with the notable exceptions of Germany and Japan.

In that case perhaps it would be wiser to wonder why the size of the service industries in Germany and Japan is so small. It is not as if those countries are any wealthier than the US.

For reference, try this OECD study from 2006 – hence, from before the financial crisis – of Manufacturing in OECD countries:
http://www.oecd.org/dataoecd/44/17/37607831.pdf

Btw I noted with interest this briefing note on Germany for American companies on an official US Department of Commerce website:

“Germany’s regulations and bureaucratic procedures can be a difficult hurdle for companies wishing to enter the market and require close attention by U.S. exporters. Complex safety standards, not normally discriminatory but sometimes zealously applied, complicate access to the market for many U.S. products. U.S. suppliers are well advised to do their homework thoroughly and make sure they know precisely which standards apply to their product and that they obtain timely testing and certification.”
http://www.buyusa.gov/germany/en/trade_regulations.html

@60

You don’t need to read a lot of Friedman to know he was full of self-serving free-marketeer bullshit, you need only look at the company he kept and continues to keep posthumously. Pretty much every wrongheaded conservative and neoliberal policy came form people claiming him for their own.

@63

Do you often stick pins into wax images?

Milton Friedman died three years ago but I’m told that sticking pins into dolls can have definite therapeutic benefits for the seriously afflicted.

Alternatively, I believe an approved course of socially integrated therapy goes something like that demonstrated here
http://www.youtube.com/watch?v=z_C992KPzKs

Otherwise, you could buy a book on economics written by his son, David D Friedman, and burn that:

Hidden Order – the economics of everyday life (Harper Business 1996)
http://www.amazon.co.uk/Hidden-Order-Economics-Everyday-Life/dp/0887307507

@64

The problem is that I’m not attacking the man so much as his ideas, which have objectively failed if their objectives were to provide a better standard of living for most if not all. If however – and this is my personal opinion, so take it as it is – the ideas were to sell a bill of goods to the majority so that they would be unwilling or unable to complain while the wealthy and privileged were able to make a killing far in advance of previous decades and conspiculously fail to spread the largesse, then they have succeeded spectacularly.

I’m a believer in social democracy and regulated markets, as this seems to be the best balance between having the freedom to make money while at the same time keeping a reasonably stable and functioning society in place.

I’m not a slavering follower of Naomi Klein, but “The Shock Doctrine” does make some very salient points. The central fallacy in free-market doctrine, if it’s aims are to be believed, is the posit that the inherent desire to amass wealth will keep everything in check, when the simple fact is that the good of the one will not self-regulate and automatically translate into the good of the many – in fact without strong regulation it comes into direct conflict with it. Put more bluntly, even if a rising tide lifts all boats, if you can’t afford a boat then you’re short on luck. I consider this an unacceptable state of affairs.

Argh – conspicuously* – damn my inability to type this evening!