Society

The Keynes vs Hayek debate is at its sharpest on the issue of employment. Can government create jobs (as Balls says)? Or does large public sector employment simply displace economic activity that would happen elsewhere (as Osborne says)? A fascinating study has been released today by the Spatial Economics Research Centre at the LSE showing the damage done by public sector employment to the real economy. Drawing on a huge amount of local-level data over an eight-year period, it’s a serious piece of research that is worth looking into and deserves to impact our economic debate. 1. First, what is seen. In the short term, hiring someone to work for

‘You attack poverty by knowing what you do changes the lives of those people.’ In that phrase on this morning’s Today programme, Iain Duncan Smith summed up the difference between his approach to combating poverty and Gordon Brown’s. As Fraser has put it, Brown saw poverty as ‘a statistical game… his great spreadsheet puzzler’. The aim of the game? To reduce the number of people living in households below the ‘poverty line’ — set at 60 per cent of median income. The easiest way to achieve this is to move people from just below the line to just above it by giving them a bit of extra cash (in the

There’s an inevitability about the Times’s big splash (£) this morning: Gay Marriage Plan Could Divorce Church From State. The Church of England’s historic role as ‘religious registrar’ for the State would have to be severed, we are told, if government plans to legalise gay marriage go ahead. That would not, apparently, mean ‘total dis-establishment … but it would be a significant step in that direction.’ The CofE, for all its liberalism, says it will not support a legal attempt to redefine ‘the objective distinctiveness of men and women.’   So that — if this report is to be believed — is that. Unless the government relents or the Anglican

Earlier today, the government, in the form of Eric Pickles, announced that it was launching new incentives to encourage local councils to improve the lives of 120,000 families, identified as ‘troubled families’ by the Social Exclusion Task Force in 2007. Those incentives are: A). £3,900 for each family whose children attain 85 per cent attendance at school. B). £4,000 for each adult in a troubled family who holds down a job for three months. The measures have been welcomed by the Local Government Association, which does not praise this government all that often. The cynic will say that the LGA is merely welcoming more money for its associates. While that it is

George Osborne writes in the Sunday Telegraph today that the British recovery ‘is being killed off by the crisis on our doorstep.’ This sounds uncannily like Gordon Brown’s ‘it started in America’ excuse, and it’s only mildly more convincing. While Osborne blames Europe, and Balls blames cuts, there is no doubt that the British economy isn’t recovering, which is not good news for a chancellor whose re-election strategy was based on recovery by 2015. But, by attributing blame to Europe Osborne risks blinding himself to a major problem in Britain. The economic headwinds are certainly strengthening. But the euro’s slump doesn’t appear to have halted recovery in countries that have

The expectation in both Brussels and Whitehall is that this weekend will see a bailout for Spain agreed. It appears that a compromise which would not impose harsh external conditions, which is why Madrid has been rejecting offers of help to date, but would satisfy German concerns about bailouts simply encouraging reckless behaviour, is close to being reached.   But this does not mean that the Eurozone governments will be doing anything to get properly ahead of the crisis. Instead, they have decided to wait until after the results of the Greek elections before deciding what to do next.   The increasingly agitated statements coming out of Washington reflect a

I know it’s wrong to take John Prescott seriously, but his attack on the government’s work experience programme epitomises a sneering attitude that is quite widespread. It was most egregiously displayed by the BBC Today Programme in its flagship 8.10am report about those who volunteered to steward the Jubilee celebrations — except the BBC report never once used the word ‘volunteer’. There’s going to be a lot more of these work experience offers, thank God, and we can expect the government’s critics to ask if the labour market is ‘receding into the 19th Century’ with ‘Dickensian’ tactics (to use the BBC’s disgraceful language). Rather, this is a 21st century solution