The Bad Wine Guide

Brace, brace – we’re in the crash landing phase of this election campaign. I’m afraid to say none of us are likely to emerge unscathed.

Jeremy Corbyn’s spending his time being mauled by Andrew Neil, while Boris Johnson’s gone into hiding. My admiration knows no bounds, and that’s before we get to the competition for who’s got the most racist candidates. In other “make you proud of Britain” news, we’ve spent the morning rowing about an ice sculpture melting, which I can’t help thinking ranks slightly below the whole ice caps melting thing priority wise. But what do I know.

If we can’t save the planet or get some answers from politicians, we can at least focus on the massive choice facing the country. We’ve done our bit, pulling the levers, crunching the numbers and drawing the charts to interrogate the parties’ plans. From deep dives into the shape of the state, to manifesto analyses and focuses’ on fiscal rules, minimum wages and housing, it’s all there. Hope it’s of some use to you ahead of democratic D-Day on 12^th December.

Have a good weekend,

Torsten
Chief Executive
Resolution Foundation

Economics for (public) good. I really enjoyed yesterday’s speech by Benoît Cœuré (who sits on the European Central Bank’s version of our own MPC) to the students at the Paris School of Economics. Mixing careers advice with reflections on the state of economics, he makes the case for economists committing themselves to the public sector. I couldn’t agree more with his argument that working in finance ministries, central banks or the IMF is “as close as it gets to applied economics” – models, maths and economic theories are interesting, but the using of them and other inputs (hello politics) to make public policy is what it’s all about. He also offers a strong defence of the macroeconomic profession from attacks that it failed to spot the financial crisis coming, arguing that economists, like doctors, aren’t about predicting recessions/illnesses but curing them. But as Claudia Sahm points out, doctors (and hopefully economists) are definitely about prevention not just cure…

Vine economics. The wine economics literature (I kid you not – this is actually a thing) suggests that the price of wine is determined more by the label than the wine itself. Some Tuscany-focused research (full version) proves the point. The relationship between the quality of the booze and its cost is weaker within a given denomination or appellation (ie the shared label for wines from a particular place with particular rules). So basically we’re all mugs paying for the average quality of that place-based brand (ie Sancerre), rather than what specifically we’re about to pour down our throats.

Welsh work. We’ve previously praised the innovation happening in New Zealand on sectoral agreements between workers and firms, so it’s only fair to highlight action here at home too. The Welsh government’s Fair Work Commission published their 150-page final report in May this year, and the government has accepted “in principle” its 48 recommendations. The most interesting one is the establishment of ‘Fair Work Wales Forums’, with the first to be created in social care. These Forums would bring together employers/unions/government/experts to develop sector-specific ‘Fair Work Wales standards’, and to generally push for improved quality of work at a sector-wide level. We’ll keep an eye out to see if these end up being talking shops, or the start of more substantial change.

Waspi women. Labour’s £58bn compensation plan for women born in the 1950s has attracted more interest over the past week than the policies that were actually in its manifesto. This House of Commons Library note has the background. It’s crucial to separate out the coalition government’s rather short-notice speeding up of increases in pension age in 2011, which meant those born in the mid-1950s had up to 18 months more to work than previously expected, with the much longer-term raising of the female pension age to match that of men. The latter policy was announced in 1993, legislated for in 1995, and only began to affect people retiring a full 15 years later. While rhetoric focuses on the first of these changes, it’s the bizarre promise to compensate people for the second change (which equality legislation requires) that drives the huge majority of the £58bn price tag. The result: Labour ends up planning to spend twice as much in the next parliament on this than the extra it proposes for the NHS. Nuts.

Chart of the Week

It’s a common trope that party manifestos don’t swing elections (though many Conservative candidates traumatised by the dementia tax in 2017 will tell you otherwise) and that no-one reads them anyway. But they’re still important guides to a party’s plan for government, and the language of manifestos gives us a surprisingly clear insight into parties’ priorities, as this week’s Chart shows.

The new buzzword for the next parliament is going to be ‘invest’, whoever wins. But in this brave new world of big spending, it’s clear that Whitehall will hold the purse strings – devolution has fallen off the political agenda. The Conservatives really want to talk about getting Brexit done, and not much else given their plans would leave lots of austerity baked in for the coming years. Labour are a bit less keen to talk about the B word, but also try to steer clear of the T word. That’s understandable politics if you’ve got £83bn of tax rises planned. The environment has also shot up the agenda as the politics of climate change have been transformed in recent years. Words as much as policies can tell you a lot about the state of 21^st Century politics.