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10
The Mancunion / 7th February 2011
www.mancunion.com
Interview
“Both of the other
parties wanted higher
tuition fees”
The Mancunion reporter Neil Ashton interviews former Chief
Secretary to the Treasury, and the shortest serving cabinet
minister for 200 years, David Laws.
Neil Ashton
David Laws MP was a key
member of the Liberal Democrats
negotiating team during the five
days in May 2010 that ultimately
shaped the current coalition
government.
He was appointed as the Chief
Secretary to the Treasury, the first
Liberal Democrat to take this post
since 1931. He was central to the
£6 billion of cuts that the coalition
announced within a week of
coming into power and was a
driving force in the progressive
reforms that the Liberal
Democrats set out to achieve in
Government.
He was also the shortest serving
Cabinet minister in 200 years
years
after
a
Telegraph
investigation
exposing
his
sexuality and parliamentary
expenses resulted in his
resignation on the 28th of May
2011. He now serves as a
backbench
MP
for
the
constituency of Yeovil.
I asked him about how well the
coalition had performed in the
past six months and if they were
on course to implement the
changes he had negotiated for.
David Laws: I think it’s done
surprisingly well, in the sense
that it works much better as a
Coalition than most people
would have expected. People
would always assume that
Coalitions would be difficult to
make work and there would be
disagreements
and
rows.
Actually the striking thing is how
well the leaders of the Coalition
have got on, how few rows there
appear to be between the
Coalition partners, and how if
anything the disagreements
appear to be not between the
different Coalition partners but
between the parts of the
coalition parties and the
coalition leadership. So the
Conservative right might be a bit
unhappy that the policies aren’t
more euro-skeptic, and obviously
there are some people in our
party who are upset about things
like the tuition fees change. But
the Coalition itself as a collection
of ministers and leaders of the
two parties has worked
remarkably well.
I think it would be easy to
underestimate the achievement
of calming the financial markets
about the state of the economy,
after all we’ve got the biggest
deficit as a share of the economy
of almost any advanced country.
So we could have been subjected
“
I think it can
be a problem
when people
taken
entrenched
positions
partly
because of the
politics of the
situations
rather than
what they
think is right.
to lot of speculation against our
bond market and our currency
that we’ve seen in Ireland, Spain,
Greece and Portugal. But we
haven’t, because people are
confident
the
necessary
medicine has been taken.
Now we’re going to have to make
sure it works effectively over the
next few years.
Neil Ashton: You say in your
book, 22 days in May , “For some
people
avoiding
the
unpopularity that can come with
responsibility seems more
important than making a
difference” Do you feel that
you’ve made enough of a
difference
to
make
the
unpopularity and drop in the
polls worth it?
DL: Yes, I don’t think we had any
choice in May about what to do, if
we hadn’t gone into a coalition or
some similar arrangement there
would have been a second
election. In which I suspect
people would have punished us
for not taking a share in power
and reasonability by giving an
overall majority to another party
– the economy would have been
in a complete mess and panic as
people would be worried about
what would happen to our
deficit. We would also have been
seen for the first time where
we’ve ever had the chance to
exercise any influence for 70-80
years to abduct it, in which case
people would simply assume we
were a nice party for throwing
stones from the sidelines but
were never interested in any
power. The test for us wasn’t
should be do this but will people
think over five years that we’ve
influenced the government in
the right way, and we’ve done
something constructive to make
the government better.
NA: Do you think in politics,
there is problem with people not
willing to change their stance on
issues, because of the media and
their stubbornness?
DL: I think it can be a problem
when people taken entrenched
positions partly because of the
politics of the situations rather
than what they think is right.
There is always, particularly
when you’re in opposition, and
the media are expecting simple
dividing lines, a pressure to stick
with more extreme or sharply
painted policies and not change
your mind on them. So I think
that can be a difficulty and Ed
Balls [Shadow Chancellor] is
clearly going to take an
entrenched
position,
and
presumably since the Coalition
has done virtually nothing that
would so far have impacted on
growth, if the economy has
slowed down, because of
anything the government has
done, then its actually more
likely to be the VAT increase that
Labour
implemented
themselves, because of the
delayed impact. Its very unlikely
to have been the cuts we made in
public spending in June 2010,
because those have not all bitten
yet, and they were very small in
the context of the overall
economy. Though there has been
a lot of talk about fiscal
tightening, that’s all yet to come,
most of it won’t come until
beyond April 2011.
NA: Do you therefore think there
is a risk that while the economy
is still weak and growth is slow,
then once the tightening of fiscal
policy and increases in tax kick
in, the economy could suffer in
2011?
DL: There is a risk, but that’s why
the tightening of fiscal policy and
spending, and the tax cuts have
to be offset by some other
positives to give the economy a
boost. These have to be: keeping
interest rates down at absurdly
simulative levels, way lower than
inflation, so you have negative
real interest rates. Massive
disincentives for people to save.
You ‘ve got mortgage rates at
record lows, you’ve got a
competitive pound, which is
good for exporters – there should
be a whole series of positive
things for the economy that
more than offset the tightening
of fiscal policy, and obviously it’s
a difficult calculation to know the
timing of each of them, and how
they’re going to perform. If you
get it wrong you could end up
with too much stimulus and you
“
I think it
would be
easy to
underestimate
the
achievement
of calming the
financial
markets about
the state of the
economy
get inflation, but if you end up
with too many spending cuts and
too much in tax increases, you
overdo the effects on growth.
Most people think though that
the most likely outcome is that
the fiscal stimulus will be greater
than the tightening of fiscal
policy and hopefully therefore
what we’ll see is growth
gradually
strengthening
throughout 2011.
NA: Do you think the issue of
student fees is something that
will come back to be a problem
for the Lib-Dems at the next
election?
DL:I think there are bound to be
some people who voted for us for
our stance on tuition fees who
will feel disappointed or let
down because we didn’t abolish
tuition fees and actually signed
up for an increase in them.
However, I think that there are a
number of things that will
moderate that from our
perspective. One is that in spite
of all the noise Labour created, I
think that most students are wise
enough to understand that
actually both of the other parties
(who were the ones that
established the brown report in
the first place) wanted to see
higher tuition fees themselves.
So we had precious little chance
of getting our policies accepted
by the other two parties in a
coalition. If Labour had got back
in, they would have introduced
an increase in tuition fees just the
same, who knows whether it
would have been the same
package precisely, but I suspect it
would have been pretty similar.
The other thing is that we have
tried to reshape the tuition fees
package to ensure that anyone
who has got good qualifications
can still go onto university,
because we’ve come up with a
better deal for part-time
students,
we’re
ensuring
students don’t pay until they
graduated and because we’re
increasing the starting point for
re-paying
the
graduate
contributions, every person who
graduates is actually going to be
paying less in any one year than
they would have done under the
old system.
I also think that when the public
finances improve it may be
possible to reduce the tax
burden on students and others
who have got very high housing
cots, tuition cots, national
insurance or income tax. In five
years there may be things we can
do to cut the burden on students
so that as they start emerging
from university with these
higher total debts, the tax burden
can come down, so that we’re not
taking an unreasonable amount
of tax from people.
NA: Do you still feel some
frustration that you are not
involved in the Government
especially as you were so
fundamental in the forming of
the Coalition?
DL:Yes it is frustrating in a sense,
although the Government is
doing a lot of the things I agree
with, so its not like its doing
things I disagree with. I think
Nick Clegg [The Deputy Prime
Minister], Danny Alexander
[Chief Secretary to the Treasury]
and the Lib-Dem’s who are in
Government are doing a very
good job so for the time-being
I’m happy to be supporting the
government from the backbenches, I can still see Nick
occasionally and talk to him, and
if I’ve got ideas and suggestions I
can bring these up with him.