Politics Thread!

[pogo]

The problem is there are many factors in petrol prices. The price of oil is one but not the main one. More money goes to the govt. in duty and VAT. The fuel price escalator which affected duty has stopped but VAT has risen since then. The petrol companies will have costs, which only make up a small part of the petrol price, but will go up with inflation.

The other factor, which people should keep in mind whenever it seems petrol prices don't keep up with oil prices, is you would not expect them to follow that closely. For one there's a lag as petrol companies can't and don't vary pump prices to keep up with every market movement. Also the firms won't be using the spot price, but a futures price, i.e. the price of the oil when they will take delivery of it. The exchange rate at that time will make a difference to the price they pay.

These accusations that petrol prices are artificially inflated come up every year, but I've not seen any evidence of it happening. It does seem a very competitive market, with in particular supermarkets treating petrol almost as a loss leader, so selling it at or near cost, to get you shopping with them at the same time as you use petrol. This means there's little scope for other firms to make excess profits at customers' expense, and they'd be very foolish to try.

[pogo]

SNP conference: Nicola Sturgeon says party could hold balance of power

She's right. The SNP look set to be the third biggest party after the next election, with Lib Dem support halving since the last election and UKIP yet to show they can compete in the general election. Current polls suggest Labour and the Lib Dems will be largely wiped out in Scotland, to the benefit of the SNP.

Still unlikely to happen; a few % either way and Labour or the Conservatives have an outright majority. But it would be quite a shake up if they were.

[KlaxonCow]

That'll make for a very interesting dynamic indeed.

Firstly, because the SNP flatly refuse to form a coalition with the Tories.

So, if neither main party win an outright majority - which is looking to be the case, as things appear to be even worse for them than last time - this means either a Tory minority government or the SNP crown Labour the winners (even if Labour end up getting less than the Tories).

Secondly, the obvious SNP request for forming a coalition - an Independence referendum - has already happened.

So what will they ask for, at the UK level? Particularly in light of them, you know, having just had a referendum to not even be in the UK at all. So that's a rather odd position for them to be in.

They can certainly ensure that Scottish "devo max" will definitely happen. But they don't even need to demand that explicitly, because it's already been promised by all the parties anyway. They only have to remind them that they made that promise - and that any broken promises will result in them walking, which instantly collapses any coalition.

It'll be interesting to see if there's any solidarity between the nationalists. When the topic of constitutional reform rears its ugly head, will they insist the Welsh get a better deal, or will they simply not give a shit?

Even more strangely, what can the SNP say when the topic of English devolution - a possible English Parliament or regional Parliaments - appears on the agenda? Do they dare hypocritically tell the English what to do? Do they excuse themselves from the debate completely, as it's a matter for the English to decide themselves? If Gordon Brown's objections to a more federal UK are reflective of the Labour party in general then, if the SNP don't step up, it might simply not happen at all. In which case, the Scottish Nationalists become kind of responsible for the lack of an English Parliament, which continues the very disparity and asymmetry that they've forever argued is the entire problem with the UK.

Oh, the potential political rabbit hole here is exceedingly deep indeed.

(And, in terms of democracy, how bizarre would it be to have a party in coalition power that three out of the four nations - England, Wales and Northern Ireland - can't even vote for, as they field zero candidates outside Scotland?)

What the fuck would it even mean to have the SNP as the "king makers"? It's a very good question indeed, as it's not remotely obvious what that would actually entail or bring about. Because they're nationalists, they concentrate on Scotland - so what the hell is their wider UK agenda even going to be, if they become Westminster's "king makers"?

Quite frankly, I honestly haven't got the slightest fucking clue. We do, indeed, live in interesting times.

[pogo]

I wouldn't be surprised if they asked for a referendum again. They came so close last time they may feel they could win it, and holding the balance of power won't feel obliged to wait. If not that then pretty much anything that favours Scotland. Devo max but without greater powers for England/English MPs at the same time that everyone expects (so no erosion of their influence at Westminster). The preservation of the Barnet formula, or even having it rewritten to benefit Scotland more. Abolish Trident.

The problem for them is if they ask for too much they could set themselves up for a backlash. So far people in England have been very relaxed about letting Scotland have its way, even as they've made off with an overgenerous financial settlement and much stronger autonomy while still maintaining an disproportionate say over English politics. If 2015 – 2020 is dominated by stories of yet more goodies for Scotland, while the rest of the country is still recovering, or endless rows with Scotland which disrupt the normal business of government, then 2020 could see an government elected on a pro-England platform with the express mandate to restore some balance to the arrangement.

And of course the SNP might have less choice over who they go into coalition with than they want. Last time the Lib Dems might have preferred Labour but although the Tories were well short of an overall majority there was no way to make the arithmetic work.

[Dio]

If the Tories win and as a result we exit Europe (which is certain now, given what Cameron has said) hell yes there will be a referendum. It's why I was so surprised that Salmond ejected, since the talk of it being decided for any length of time was obvious nonsense.

[Ratsoap]

Current SNP policy is not to vote on English only matters.

Interestingly Margaret Curran said on the radio yesterday that Labour were prepared to enter coalition with UKIP, but not SNP. Says quite a lot about the current labour lot. They'll let their pathetic 'oppose everything the SNP do and say' approach to government destroy their chances completely.

[merman]

So how does the SNP think it is going to get another referendum? Cameron said that was it for a lifetime.

This one took years to get the legislation through and they got 45% after spending millions on the campaign.

The reality is, even in SNP strongholds the majority voted against independence.

[Dio]

It's fairly obvious that any fundamental consitutional change (e.g. leaving Europe) which affects the core principles undelying a No vote an integral part of the vote would make the existing result invalid.

It's hardly contentious to think that any referendum held in the UK where the result in Scotland is dramatically different to that in England would reopen the question.

[pogo]

A partial solution to the productivity puzzle. That's the curious way we've recovered from the recession. We're certainly recovering – GDP is up, unemployment down, the housing market has recovered. But why haven't wages recovered? Why have they been growing barely enough to keep up with inflation, so not enough to reverse the losses seen at the start of the recession?

Seems wages have been recovering, for those in work:

http://www.bbc.co.uk/news/business-30117284

Those in work for a year or more have seen their pay rise an average of 4.1%, well ahead of inflation and 2.5% in real terms. It's only the newly employed that are driving the average down. There are a few reasons for this. New hires are usually paid less, and there have been a lot of them as employment growth has been especially rapid. Most job growth has been in the service sector which often pays less, at least for entry level jobs.

The upshot is unemployment can't keep falling forever. Once it stabilises, at 5% maybe, and large numbers stop being hired wage growth will be more like 4% for everyone. Or more: once there's not a large pool of unemployed to fill vacancies firms will have to start raising wages to attract and keep staff. Then the economy will have largely recovered, and interest rates will probably be raised to counter any inflationary pressure brought on accelerating wage growth.

As I've written before, get the unemployment rate down first and wages will recover naturally. I just wasn't aware this was happening already, and visible in the statistics, for the longer term employed.

[zip accident]

That's exactly why employers love high unemployment, it keeps wages down. It seems plausible that that was planned on Thatcher's part. It certainly reduced inflation.

[pogo]

Rubbish. No-one likes high unemployment. For firms it means a slow economy, lack of customers, lack of growth. It can mean cutbacks to services, or lack of investment in e.g. new roads and other infrastructure as the govt. focusses on the recovery. A recession can mean a firm has to lay off staff or reduce their hours which can have a depressing effect on morale and productivity; indirectly staff can also feel the effects due to their own experiences of the recession.

So a firm that's expanding and taking on new people because the economy is recovering? They're going to be very happy to do so. They'll be happy to be taking people on, and if they have to pay a few % more than a year ago because the job market's tighter then that's the least of their problems.

There's little chance wages will suddenly take off and generate run-away wages and inflation. For one the BoE has an explicit mandate to stop this happening. They can and will raise interest rates to choke back excessive inflation before too long. For another we have a very open and flexible labour market, open to anyone in the EU to come in and fill vacancies. This flexibility, which we've seen in the immigration and emigration of large numbers from eastern Europe (see e.g. this graph again, where net immigration from the EU more than halved in 2008/9 as the recession took hold and many people returned).

[merman]

So, UKIP has its second ex-Tory MP re-elected in the same constituency.

Mark Reckless got 42% of the vote. In a 50% turnout. Reducing his majority from 11,000 to 2,900.

Hardly a ringing endorsement of anything UKIP actually stand for.

[pogo]

Yes. They should enjoy it while they can as this is probably a highpoint of their electoral achievements. It's possible other Tory MPs will defect but there can't be that many crazy ones left and there's not much time. Come next May I will be surprised if they win any more seats. They may even find it hard to hold on to these two, as the main parties with more times to prepare and with the resources of national campaigns mount much more successful challenges. Winning byelections is very different from winning seats at a general election.

I think their impact could be minimal in terms of affecting the vote too. Although they're politically closest to the Tories they can and do attract votes from all parties. With the collapse of the Lib Dem vote they could win many protest votes and so come third and second in many constituencies, but fail to win any new ones. Or even worse for them the protest vote could be split 2 or 3 ways between UKIP, the Lib Dems, Greens.

[merman]

People are seeing UKIP as anti-establishment when they really are not. The party has been around 20 years and was seen as an embarrassment for so long (remember Robert Kilroy-Silk?)

My constituency is now seen as the most likely for UKIP to win - even though they have picked an inexperienced pipsqueak who only won a council seat two years ago because people knew his daddy.

[zip accident]

Plebgate; he said it:

http://www.bbc.co.uk/news/uk-30235009