Friday, March 27, 2009

Caroline Lucas on Question Time

Caroline Lucas, leader of the Green Party, was given a tough time on Question Time last night, and did us proud. She was up against five phat male speakers: David Dimbleby, Charles Clarke, Eric Pickles, Michael Winner and a LibDem man.

Michael Winner was a complete waste of TV licence payers' money. He is enormously pleased with himself, and takes a nihilistic view on everything, a position that has no place on a TV programme that is supposed to be a serious political discussion, since politics is about trying to make the world a better place, and Winner had absolutely nothing to offer here. Apparently he is some kind of London celebrity.

Eric Pickles, a Tory MP with an eating disorder, came pleasingly unstuck when he admitted that he was claiming expenses on a house to save himself a 36 mile commute. It was interesting to see his 100% self confident stance progressively come unbuttoned, under attack from everyone else in the assembled company. In the end he held up his hands and admitted that he "had not made a good case" - the nearest to an apology that the world can expect from a pachydermatitic politician. The full truth is that he did not have a good case at all. There is an evolutionary drive for politicians to develop thick skins, and to disregard and deny all criticism, right up to the very last moment. More self critical people, like Estelle Morris, tend to drop out of power, although their judgments may be as good as if not better than the pachyderms. This is not a good way for things to be run.

When the economic question came up (on the current rift between Lord King of Ovis Mortua Secundum and the Lord Gord, Supreme Leader in Word Not Deed) Dimbleby interrupted Caroline as she began her answer (inadvertently, we can be sure), then interrupted again (justifiably) when she said that new money should go into the real economy rather than be used to "keep the banks solvent".
DD: "So the Green Party would let the banks go hang then?"
Caroline: "No, we would nationalise them". This got a spontaneous round of applause, and Caroline went on to set out the Green New Deal. DD tolerated this uninterrupted, to his credit, but moved swiftly on as soon as she finished.

This was a good recovery by Caroline, and shows the sound political qualities of our spokeswoman, but it also shows a weakness in our economic policy. Nationalisation of the foolish, debt laden mega-banks, (but not the wise virgins like Triodos and the Co-op, who should be rewarded for their wisdom in resisting the call of the casino) is a sensible step that will surely happen as the economic tragi-comedy unfolds, but the banks need to be purged of toxns first. It is no good taking possession of banks whose account books contain unknown debts of astronomical dimensions. Financial policy needs first to ring-fence the real part of the banks (ordinary deposits and loans), to protect the real world from the psychotic excesses of the casino economy, the mega-debts, the toxic assets lurking in the shadows.

The financial policy we passed at Conference criticizes "Complex and opaque financial instruments, which managers of financial institutions and regulators themselves do not understand"; but it does not go into how their malign influence can be kept from infecting the bloodstream of the real economy.

These are the steps that can be taken:

1. Pass a law to require all derivatives holdings to be registered at a central agency.
2. Examine all holdings for signs of fraud (using the characteristics of the Madoff and Stanford frauds as indicators)
3. Examine all holdings for signs of Ponzi schemes that only work if the market is expanding. Invalidate all Ponzi debts
4. Find how much of the Toxics can legally be ascribed to negligent decisions of the chief executives of companies. Make said CEOs responsible for their mistakes, by bringing the debts back to the executives who decided to buy them. Said executives go bankrupt, and the toxic assets are neutralised by their bankruptcy.

If any readers do not like this plan, (and remember, in a room containing two economists, there will be at least three opinions as to what should be done) then please come up with a better way of neutralising the Toxic Assets, bearing in mind that their "value" is about 10 times greater than the global GDP of the whole planet.

The problem for the Green Party is that it would take at least 6 months, and possibly as long as two years, for us to make this official Green Party policy. Clearly we need a more realistic way of helping Caroline to have robust, logically coherent and up-to-date policy advice. We have a Policy Committee, and also a shadowy Political Committee responsible to the Party Executive, so by setting up a decision pathway, and ensuring that the committees' decisions are transparent and accountable to Conference, we could get give Caroline the support she deserves.