Posted by: davidjmarlow | 22/10/2015

‘Authentic karaoke’ – the best we can hope for from the oxymoronic George Osborne

Another oxymoron as Osborne 'gets one in' before the 'authentic karaoke 'of 'northern powerhouse'

Another oxymoron as Osborne ‘gets one in’ before the ‘authentic karaoke ‘of ‘northern powerhouse’

I recently attended a ‘karaoke competition’. As an occasional vocal exhibitionist, the competition struck me as incongruous – to say the least. Karaoke should never be ‘competitive’ and judgemental. At its essence, karaoke is open to anyone – however good or bad at singing – who wants to have a bit of fun, entertain those in the room, and who doesn’t mind embarrassing themselves in the process.

One ‘contestant’ was a professional in London theatre. She clearly took the whole thing rather seriously – doing a credible (if dull) rendition of Barbara Streisand’s ‘Don’t Rain on my Parade’. Whilst some of my friends admired her talents, I felt rather cheated that a career singer should hijack the event to show off that she is (sort of) OK at her job!

Another contestant had come in a part-cowboy costume to entertain us with a country and western classic. He had little sense of melody and timing, but really got the crowd going with his amateur theatrics, energy and general good nature.

Needless to say, the judges voted to put the professional through to the next round, whilst sending the guy back to the audience with sugary but judgemental words about his (lack of genuine) quality and finesse.

I complained to my friends about the decision. I considered Paul (names changed to protect the innocent) had delivered ‘authentic karaoke’, whilst Barbara was a ‘ringer’.

‘Authentic karaoke’ is surely oxymoronic – describing, as it does, an activity that can only ever be derivative of the ‘real’ piece of music.

Once one begins thinking ‘oxymorons’, it is not long before one is bound to reflect on George Osborne’s narrative for 2015 -20, as he furiously campaigns to move next door – of ‘growth’, the ‘northern powerhouse’, and of Labour as the ‘deficit deniers’ compared to his fiscal prudence.

At an event I attended this week, a Government Minister proudly endorsed this narrative -celebrating UK as ‘fastest growing advanced economy in the world’ whilst ‘paying down the deficit’.

I find the growth narrative uncomfortable – partly because, if true it would appear to go some way to validating Osborne’s strategy; and partly because, it just isn’t true!

For my sins, I am a subscriber to the Economist. This is not for this title’s politics – but I do find it a useful informed weekly summary of world events, with periodic interesting insights into major topics.

Each week the Economist publishes its Economic and Financial Indicators on the back pages. These include metrics such as GDP, industrial production, current account and budget balances etc. And each week, Britain is far from top of the pile.

I don’t know which economies Government consider are ‘advanced’. But, this week the 2015 forecast shows eighteen countries with GDP growth higher than Britain – among them countries like Sweden and Singapore, and even Spain in the Eurozone. On industrial production sixteen countries are exceeding UK performance, including Sweden and Spain again, but also Germany and even Greece in the Eurozone. Our current account balance is worse than ALL of the 42 countries quoted except Turkey and Colombia. And our (negative) budget balance is only exceeded by Venezuela, Egypt, Brazil, Saudi Arabia and Japan. Again, Greece is rather outperforming our fiscal prudence.

As Chancellor from 2010 – 15, George has presided over the largest ever increase in net Government debt. Taking the helm in May 2010, he inherited £977bn of debt, corresponding to 63% of GDP. ONS figures published today (21/10/15) show he is now presiding over £1,524bn of debt amounting to 81% of GDP. According to the Office of Budget Responsibility his policies will take this figure up a further £103bn (to £1,627bn) by 2020, albeit, if his hoped for growth arrives, this will then amount to 71% of GDP. This, though, is still significantly higher than the debt ratio inherited from Labour.

I know debt is not the same as the deficit – but they are relatively closely related. In the last twelve months George has run a current budget deficit of £51.3bn and borrowed £82.7bn. Who is the biggest ‘deficit-denier’ – the Labour Party with their evident discomfort on accusations of fiscal prudence, or their prinicipal accuser currently in #11?

Which brings us back to oxymorons. For growth and prudence, George is like the ‘ringer’ in the competition. He can deliver a convincing political narrative on UKs economic and fiscal success – lapped up by a compliant media. But it’s pretty shallow and mediocre economics.  If we reach the end of the decade at the levels of debt forecast, with a continuing chronic current account balance, low levels of industrial production, and potentially drifting away from Europe and (consequently) Scotland, it will look like pretty poor politics too.

George’s other signature narrative is Northern Powerhouse and devolution. This is quite a  different character of ‘sound-bite’ to the songs he sings on macroeconomic and fiscal policy.

The ‘Northern Powerhouse’ comprises from 10-15million population, depending on definitions; over sixty local authorities; working in five Combined Authorities and eleven Local Enterprise Partnerships (LEPs); whose leadership teams have recently made ten, sometimes competing, ‘devo-deal’ proposals to Government. In ‘powerhouse’ terms, only one LEP area performs above UK averages in GVA per capita (Cheshire & Warrington), whilst ten out of eleven have FALLEN against the UK average since 2010 (with only North East bucking the trend by rising to 74.6% of UK average!).

An immense effort is certainly needed, and the Chancellor has stated, with commendable honesty (and with respect to the ‘Manchester jewel’ of the powerhouse):  “I’m throwing everything I’ve got at it. I’ve brought new science here, promoted the arts here, backed transport links here, brought investment from places like China here. I don’t know if it will work. But I do know that if you don’t even try you’re bound to fail.”

This ‘disruptive’ game changer is accompanied by the ‘devolution revolution’ announcement that, by 2020, local authorities (including the +/- 60 in the north) will be able to retain all business rates revenue collected locally (estimated at £26billion). They will be able to reduce those rates (and collect less). Elected (metro) mayors might be able to raise rates for infrastructure projects with the support of local businesses. There is no idea yet, how this will be put into effect with all parties admitting ‘the devil is (will be) in the detail’. Nor has there been any serious analysis of the negative pressures this could put on the north. For instance, Westminster’s 235,000 population may benefit from collection of £1.8bn business rates p.a. – whilst the five northern core cities local authorities (for 2.6m residents) only currently collect around £1.3bn business rates in total.

This is the ‘authentic karaoke’ side of Mr. O. ‘Northern Powerhouse’ and ‘devolution revolution’ are classic, iconic numbers – but it’s almost totally hit and miss how Mr O will perform them.

I prefer the ‘authentic karaoke’ of rebalancing and devolution to the oxymorons of ‘fastest growing…’ and ‘paying down the deficit’. If performed with the genuine humility of authentic karaoke, embracing and enthusing extensive audience participation, local leadership teams could make a lot out of the powerhouse and devolution sound-bites.

On that basis, Osborne may deserve his position as bookie’s favorite to be the next occupant of #10. It probably won’t determine my vote at the next general election, but his authentic karaoke will make the next few years a much more exciting and productive journey in the interim.

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Responses

  1. […] and Clark attempted the ‘authentic karaoke’ of manipulating data to imply success. But GVA results for the coalition period to 2014 show […]


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