Friday, 19 April 2002


Paul Anderson, Tribune column, 19 April 2002

LAST week’s launch of Labour Against the Euro caused barely a ripple on the political pond, and it’s not hard to see why: the usual Labour Eurosceptic suspects say the same old thing yet again. Hardly the thing to drive the Queen Mother’s funeral or Israel’s assault on the Palestine from the front page.

But the new campaign deserves more than what Ernie Bevin once described as “a complete ignoral”. In the current political climate there is a real danger that its fatuous, head-in-the-sand message will be taken up widely in the Labour Party — for no better reason than that it is opposed to the party leadership’s line.

The Labour sceptics rest their case on two main arguments: first, that there
are good economic reasons for Britain not to join the euro; and second, that joining the euro would be a “diversion” from the task of improving Britain’s
public services.

Their economic case against the euro in the short term boils down to the assertion that UK interest rates need to be higher than those in the euro-zone in order to keep a lid on inflation — one result of which is to make sterling’s exchange rate against the euro too high for British euro entry.

But what are we really talking about here? It’s not as if UK interest rates are 5 percentage points above the euro-zone’s, or that the UK is fighting off double-digit inflation, or that sterling is 25 per cent overvalued against the euro. The interest-rate difference between Britain and the euro-zone is less than a single percentage point, UK inflation has been hovering for years between 2 and 2.5 per cent, and the sterling devaluation required, according to just about every credible economist, is in the region of 5-10 per cent. Reducing UK interest rates to those of the euro-zone carries few inflationary risks and would go a long way to encouraging the small devaluation most economists think we need to enter the euro. With the economic cycles of the UK and the euro-zone are more in step now than at any time in the past 20 years, the truth is that we can join the euro pretty much when we want.

Aha, say the LATEites, but what about the “one-size-fits-all” interest rate policy if we join the euro-zone? And what about the European Central Bank’s limits on public spending, which would rule out Labour’s spending plans? Well, you get a single interest rate with any currency, and you cope with any regional imbalances with taxation and spending. It’s true that the Europe-wide mechanisms for this are inadequate at present — but, as every social democratic party inside the euro-zone argues, there is nothing to stop them being improved. As for the claim that the European Central Bank would outlaw Labour’s spending plans, sorry, it’s just complete cobblers.

The part of the LATE case that really annoys me, however, is the argument that joining the euro is somehow a “diversion” from Labour’s primary task of improving public services. It’s true that some members of this government are uncannily reminiscent of US President Gerald Ford, who was said to find simultaneously walking and chewing gum too much of an intellectual challenge. But the idea that it is beyond the government to organise a referendum campaign on the euro at the same time as spending more money on the National Health Service is ludicrous.

The fact is that the euro is utterly unavoidable and urgent. The government has no option but to make a decision inside the next two years, for the simple reason that it cannot assume that it will be in power for more than three terms (and even that assumption could turn out to be optimistic).

Of course, it might decide to stay out, but I doubt it. Even if it is not swayed by the best reasons for joining — that the euro is a massive step on the road to a democratic federal Europe characterised by a much more social model of capitalism than that of the US — it almost certainly will be by the experience of being increasingly excluded from influence in the European Union the longer it delays opting in.

Precisely when the government should declare for the euro and hold the referendum is of course a matter for dispute. It would be madness to hold a referendum if there were a serious chance of losing. But the opinion polls increasingly suggest that a referendum could be won this side of the next general election. Whether the government has the guts to risk it is another question, but the rewards of winning would be massive. A decisive yes vote would consign both the Tories and the Europhobe left to the proverbial dustbin of history — a mouth-watering prospect if ever there was one.

Friday, 5 April 2002


Paul Anderson, Tribune column, 5 April 2002

The farrago that now appears likely to end in the complete collapse of ITV Digital puts the government in a very difficult position.

It would be an exaggeration to say that the government had invested all its hopes for the roll-out of digital TV on the channel. There are still the BBC’s digital efforts, after all — although I’ve yet to meet anyone who has seen the much-hyped BBC Four, not least because no one I know has found a shop selling the promised £99 set-top boxes that would allow those of us who don’t want pay-TV to receive the BBC digital channels.

But ITV Digital was key to preventing Rupert Murdoch having a monopoly on commercial digital TV in Britain — and in the short run a near-monopoly of the platform for all digital TV in Britain. If it goes under, the Government will have the stark choice of either accepting Murdoch’s monopoly or legislating to remove his control of what TV is broadcast digitally. The first option would outrage everyone who cares about diversity of media ownership, including most Labour MPs; the second would outrage Murdoch, whose support has been so assiduously courted over the years by Tony Blair.

That’s not all, though. The final straw for ITV Digital was its stupid decision to pay over the odds — a whopping £315 million — for television rights to Nationwide League football. It went into administration after failing to persuade the football clubs to accept a much-reduced sum for the remaining years of its contract. And the upshot is that, because so many clubs have come to rely on TV money, ITV Digital’s demise will almost certainly result in several of them going under.

This is a problem for the government because so many of the 30 or so clubs that are in danger are in towns that have marginal Labour seats. Just a little Tory opportunism (“We won’t let English football go under”) would have the Government squirming — and quite right too, because the failure of ITV Digital
is at least in part a failure of Government policy.

For these reasons, last week’s confident assertion by Tessa Jowell, the Culture Secretary, that there will be no Government bail-outs for either ITV Digital or the football clubs deserves to be taken with a very large pinch of salt. So too does her claim that the timetable remains the same for the switch-off of the analogue signal and the sale of its waveband to the highest bidder.

She is, of course, right, to argue that football needs have its house put in order before anything else happens. But the way to do that is to legislate to end the “winner takes everything” economics of the Premiership, whereby Manchester United, Arsenal, Liverpool, Chelsea and a couple of other clubs get ever-richer and everyone else — particularly in the Nationwide but also the smaller Premiership clubs — is forced to pick up the scraps. And that is the last thing that this supposedly football-friendly Government would ever consider.


Given how bad it could have been, the national outpouring of bullshit following the death of the Queen Mother last Saturday has so far been remarkably restrained. By comparison with the hoo-hah that came after the death of Diana in 1997, it has been entirely avoidable if you don’t bother to read the papers or watch the TV — no one but no one is talking about it outside media land. And there have even been some critical pieces on the “matriarch of the nation” in the Guardian and elsewhere, which have pointed to the reasons the Queen Mother does not deserve to be lauded despite her morale-boosting role during the blitz: her (and her husband’s) shabby pro-appeasement stance in the late 1930s, her opposition to decolonisation in the 1950s and 1960s, her generally reactionary views on just about everything, her snobbery.

What no one has brought up, however, at least as far as I’m aware, is the question of how much it cost us, the British taxpayer, to keep her in the opulent style to which she became accustomed after marrying the future George VI in 1923.

Unless I’ve got something horribly wrong about the way we paid for the monarchy in those far-off days, she lived the best part of 80 years at least partly at the taxpayers’ expense (admittedly with more than a little help from the House of Windsor’s extraordinary, nominally private, wealth).

We helped her buy and keep up several country homes, employ hundreds of servants and maintain a serious gambling habit. Of course, you could argue that it was all worth it – but, now we’ve enjoyed the meal, it would be good to know the bill.