May 7th, 2015 – a poor (s)election

Date: 25 Apr 2015 Comments: 0

Things can change, but the likely result is 1/3 each of voters choosing the two main parties and the further 1/3 selecting one of the rest. So, not a ringing endorsement of anyone, even if everyone was voting. When you take into account 40% of the electorate will not vote, it suggests we will have a Prime Minister chosen by just 20% of the total.

There appears to be only one winner, namely Nicola Sturgeon who may attract up to 50% of the Scottish vote. While it will worry many in England and Wales, it cannot be disputed that she has earned a right to be taken very seriously. But what does this mean as to the options for Westminster, let alone how long will it be before she looks for another independence referendum?

The current logic is only an alliance between Labour, SNP and possibly PC or the LibDems, can have a working majority, given the deep mutual dislike between SNP and the Tories. The problem is multiplied if, as is supposed on today’s opinion polls, the Tories get first pick on forming a government, by being slightly the largest party in Westminster.

How long Cameron delays allowing Miliband a chance to form a government is one issue; a second is whether the arrangement with SNP needs to be a formal alliance in order to gain the Royal Assent, rather than an agreement to vote together on all matters of settled policy.

There is one other potential answer, namely a giant coalition between Labour, Tories and possibly the SNP and the LibDems. The argument for this would be to lock in a five year plan (albeit understanding the SNP Westminster party could be instructed to withdraw if Holyrood opts for another Independence vote). There is a danger of a joint government by the top two, to the exclusion of SNP, that this would encourage an independence move, sooner rather than later.

The problem, of course, is who would lead such a government? On any one-to-one comparison, even Labour supporters would recognize that Cameron and Osborne outshine Miliband and Balls, but why would Labour accept this, particularly if the question of a referendum on the EU was part of the ‘deal’.

On 24th April two events occurred which may have a significant impact the outcome. The threat by HSBC to move its headquarters out of the UK (at the risk of what percentage of its 50,000 UK employees and large tax base?) is one of them, given the basis of this being the risk of a Brexit from the EU. This matter may become the significant extra factor over the last two weeks, as business leaders swing across to Labour as the ‘safe pair of hands’ on this issue, no matter what would have been the preference on general tax and budgetary matters without the referendum threat.

The second event was Cameron’s encouragement of a Little Englander position, to protect English voters from being dominated and/ or under-represented by the SNP. It would seem this is a desperate last move, but one which has enormous consequences for the UK overall. It would encourage Scottish independence (if it succeeded) and would also appear to similarly encourage a Welsh separation, if the aim is to ensure a Tory majority in Westminster.

This decision may be part of the playbook designed by Lynton Crosby, but if it is, I would be amazed. The only question is “if this is not part of the playbook, what is?” For an election strategist of such renown, the Tories have been remarkably low key in their usage of their assets to date. Is there some tactic to delay any action until the final week? That seems very risky, particularly with the high number of postal votes that will already have been cast.

The only person gaining in the Tory camp would seem to be Boris; the awkward hand painting outing with Cameron could only have hurt the PM and acted as a reminder of a challenger in waiting. But it does presuppose two matters; firstly the Tories have to lose the election (which they could have won) and secondly Boris has to dump his City of London supporters if he is to lead the anti-EU rump of the Tory party.

The polls remain sufficiently balanced to mean that a Labour/ SNP/ PC alliance is the only likely majority available. Miliband has done better than virtually anyone expected, apart from in Scotland where Sturgeon is dominant. If Labour can keep a low key stance (particularly for Balls) up until Election Day, it seems as though they can win under this basis. The question of an EU referendum is the one which could change matters, but is there more to be lost for the Tories in that position than gained?

Many questions are still to be raised, but I think we have reached a stage where Miliband has shown sufficient capability that many floating voters would now prefer to put aside the EU argument, aiming to have the UK’s position within the community enhanced by collaborative membership, not under constant threats of withdrawal.

Sturgeon has done well enough in the Leader debates as to prove her potential value in an alliance with Labour. Of course there is the potential threat of another independence vote, but it would not seem impossible to get a commitment for five years before that. In the meantime, much of what she wants could be achieved in a planned reorganization of the overall UK into more regional responsibilities for most activities, while keeping a single role for external action. In a sense, the US role of State versus Federal management can indicate how this may satisfy everyone.

 

The question of the Greek debt level is just part of the overall issue of the value of the Euro – and the machinations which are continuing to take place to keep this flawed structure in place. There is a fundamental flaw in saddling the weaker economies within the Eurozone with a currency that is overvalued, based on the converse undervaluation versus those of the primary exporting nations within it.

However, the likelihood of this changing is somewhat remote, given the stranglehold of the larger countries – and of the banks which have been responsible for the austerity suffering of the poorer nations.

There is a partial answer; we need to look at instigating a tax collection structure which can limit the gains of the rich in favor of the poor, as well as provide a financing format which may be used to recover much of the  lost ground.  You can see part of this at  [the-euro-remedies-or-replacement] – not a complete solution, but a step in the right direction, if we can get implementation.

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