Archive for August, 2015

Political battle resumes in Wales

"hypocrite' says Davies

“hypocrite’ says Davies

Opening shots in Assembly election campaign

The Assembly election is not until next May yet the political parties are behaving as if it was imminent.

Yesterday it was the Welsh Conservative leader Andrew RT Davies challenging Plaid Cymru to work with the Welsh Conservatives to unseat Labour from government in Wales.

Following the poor general election results for Labour, the Conservative’s feel that Labour will not succeed in getting a majority of seats in the Assembly come next May.

Unless the Opposition parties get their act together, the political landscape of Wales will remain the same with Labour still running the country, all be it with an even smaller minority government.

In the robust language that is associated with the leader of the Opposition, Davies accuses Leanne Wood of “hypocrisy.”

Why “hypocrisy?” Well, according to the Tories, Leanne Wood claims she wants to kick out Labour but has ruled out working with them to achieve that very aim.

In response Plaid’s Steffan Lewis said no party wished to work with Conservatives, as they want to “run down” the NHS and cut services.

Labour worries

So there you have it, very little chance of a rainbow coalition and Carwyn Jones not likely to lose his job in the near future.

But there are concerns in Welsh Labour ranks on how a Corbyn victory might impact on the Assembly election results.

Chris Evans the Islwyn MP who is backing Kendall is worried that a Corbyn victory might make it more difficult to hold on to the marginal seats of Cardiff North and Gower.

David Rees the Aberavon Assembly Member has a different concern. He worries less with Mr Corbyn’s policies but more with perceived splits in the party. He sees Corbyn’s views not being to distant from the socialist tradition in Wales, but warned: “If people start fighting as a consequence that will harm our chances.”

But Carwyn Jones has made it clear that he will be leading the campaign in Wales on a Welsh Labour manifesto and not whoever leads the Labour party in London.

Corbyn and Welsh Labour

Should Corbyn win the Labour leadership, and it looks increasingly likely that he will, it may have interesting implications for Welsh politics.

Welsh Labour is likely to press for a Federal structure for the Labour party.

Carwyn Jones has been eager for such a structure sometime but has been held back by the more unionist wing in the Welsh party. A Corbyn victory will likely strengthen Jones’s hand.

Many of the most trenchant Unionists amongst Welsh MPs are impeccably opposed to a Corbyn led Labour Party and might throw their hand in with Jones’s ambition for the Welsh party to distance themselves from Corbyn in Westminster.

Where does Plaid go?

But it’s not only Labour that would have to reflect on a Corbyn victory but Plaid Cymru. As a party they’ve always positioned themselves as left of Labour. They could hardly push themselves to the left of a Corbyn Labour party.

So how will they respond? Will they try to re-position the party in the centre ground of Welsh politics with a move to the right? It’s unlikely that this will happen whilst Leanne Wood is leader but certainly the pressure will be on for such a move.

Certainly politics in Wales looks like getting interesting in the near future, all thanks to Mr Corbyn.

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China today, Wales tomorrow

Chinese stock exchange show big falls

Chinese stock exchange show big falls

Fall in shares could affect  economy

It used to be said that when America sneezes the rest of the world catches pneumonia. Well, the same can be said for China.

With shares in China in free fall the world should worry. The US and China together generate as much output as the rest of the world put together.

If the market fall signposts, as it does, a slowdown in the Chinese economy it will affect the Wales as it will the rest of the worl

Wales has seen on average two trade missions to China an year – sometimes lead by Ministers.  A measure of how important China is to Wales.

Another economic downturn?

Just as when the whole world had bought into the US sub-prime boom when the bubble bust it eventually contributed to the 2008 global financial crisis, the current turbulence in China could have an equally devastating effect on all our lives.

Indeed after the 2008 crisis China notably emerged as one of the twin engines of world growth. Despite the US being the world’s biggest economy China has contributed as much to world GDP growth as the US in the past 15 years and even more than the US since the 2008 financial crisis.

China accounted for a mere 2% of world GDP in 1995 to around 15% now. So if China slows down the world economy will slow with it.

Indeed, the European Union is China’s largest trading partner, and China is the second-largest trading partner of the EU. So, a slowdown in China will certainly affect Europe.

 Osbourne sanguine

Although Chancellor George Osborne believes China’s stock market woes will not have much impact on European economies.

It is difficult to understand how he can be so sanguine when you couple the slowdown there with the continuous problems

In the euro zone, signs of weaker global growth and vast sums flowing out of fragile emerging markets such as Brazil.

The signs are not good. Indeed it would be a foolhardy person that would bet that the Chancellor’s budget predictions would now be met.

To paraphrase the song, time is undoubtedly going to get harder.

 

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A wild man of the left?

Corbyn leads the pack

Corbyn leads the pack

There was a rally in Sophia Gardens, Cardiff in 1981 to support Tony Benn’s campaign to become Deputy Leader of the Labour party.

As history will show, despite the enthusiasm of the rally, Benn narrowly lost to Dennis Healey when the votes were counted. That was the peak of the left’s influence in the Labour party for many a year.

Foot was replaced by Kinnock to be replaced in turn by John Smith and then the parliamentary Labour party shifted to the right under Blair and Brown.

Mrs Thatcher when asked of her greatest achievement replied “Tony Blair.” She rightly pointed out that Labour had moved away from being a party of the left to one that embraced capitalism.

Labour’s Clause four was ditched.  Now the market would provide all the answers.

Things have remained more or less the same until the current leadership contest and the Corbyn phenomena.

Whether Corbyn wins as is widely predicted, or is narrowly defeated, his intervention will have changed fundamentally the party. The Blairite project will be over. The centre of gravity of the party will have moved to the left.

Whatever your views about Corbyn, his campaign has created an exciting leadership contest. He has made many reflect on “what is Labour for?”

Corbynomics

He’s made a debate of the direction Labour should be taking. Take the very concept of “Corbynomics.”  Interestingly, no one is talking about Cooperomics, Burnamomics of Kendallomics. They barely make it on to the political radar.

No it’s Corbynomics. It is he that the debate’s about.

Out, the stale politics of austerity and in, a new anti-austerity agenda. He’s offering a hope and in that has caught the imagination of the young.

Reform rather than revolution

But in reality what Corbyn is proposing can hardly in an historic sense be regarded as revolutionary.

That his very modest ambitions can cause such panic simply shows how far to the right the country has moved. And how unadventurous the other leadership candidates are.

His approach is to reduce the budget deficit through economic growth rather than austerity. An approach favoured by the International Monetary Fund, an organization hardly known for being leftwing and radical.

Plans for selective nationalization in the transport and energy sectors seem to have particularly got the wrath of the right.  It’s almost as if he was Stalin reincarnated.

But selective state intervention is hardly socialism red in tooth and claw.  After all public ownership of the railways, electricity, gas and water remain the norm in Angele Merkel’s Germany and Francois Hollande’s France and in many other advanced capitalist economies.

A vote loser? Not if the opinion polls are to be believed. They constantly show  the British people supporting such a move.

A People’s QE

There is one area above all others that Corbyn’s plans have been most heavily criticized, his plans for a form of “quantitative easing” for the people.

Under such a scheme, the Bank of England would create money to buy bonds issued by a National Investment Bank to fund specific projects. Can’t be done says his critics it will fuel inflation.

These very same critics conveniently forget the £375bn handed to banks, insurance companies and pension funds to redeem mostly state-issue bonds. That money was supposedly to be used to stimulate economic demand, investment and the housing market.

What it did produce was fatter corporate bank balances and created the property price bubble that has made it virtually impossible for young people to access the housing market.

At least Corbyn’s plans for QE will actually benefit the real economy.

What Corbyn has done more than any of the other candidates in this contest is challenge the principles of deregulated finance, free-wheeling market capitalism, privatisation of public services and the shrinking back of the state.

His belief in social justice, egalitarianism, and the ethos of public service and full democratic accountability simply reflects what many an ordinary party member expects the Labour party to stand for. And is perhaps what makes him the favourite to win the contest.

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