A year ago, just before the Bank fired up its £200bn printing press, they expected inflation to fall into the range 0-1% pa, with a significant risk of outright deflation (charts relate to Consumer Price Index - CPI).
Today, they have revised up their figures to reflect the fact that inflation is currently running at just under 3% pa, and far from falling, is heading higher. It seems that inflation has refused to die despite the demise of our dear old friend GDP growth.
Undaunted, the Bank reckons inflation will soon fall back again, with apparently still something like a 20% chance of outright deflation.
Yet we know that sterling commodity prices are up 19% year-on-year, and we know that producer output price inflation has already accelerated to 4%.
"In the big lie there is always a certain force of credibility; because the broad masses of a nation are always more easily corrupted in the deeper strata of their emotional nature than consciously or voluntarily; and thus in the primitive simplicity of their minds they more readily fall victims to the big lie than the small lie, since they themselves... would be ashamed to resort to large-scale falsehoods. It would never come into their heads to fabricate colossal untruths, and they would not believe that others could have the impudence to distort the truth so infamously.
Even though the facts which prove this to be so may be brought clearly to their minds, they will still doubt and waver and will continue to think that there may be some other explanation. For the grossly impudent lie always leaves traces behind it, even after it has been nailed down, a fact which is known to all expert liars in this world and to all who conspire together in the art of lying."
So said one of the foremost experts on lying*. For real impact and lasting effect, you have to lie big.
And boy, has Labour lied BIG.
This morning brings the latest revelations concerning their Big Migration Lie. For years Labour told us that we needed mass immigration in order to make us richer. There was never any serious evidence to support the argument, but ministers routinely spouted it. It now seems that the economic case was always just a Big Lie, and their real reason for encouraging the influx was to irreversibly transform British culture and society.
We've blogged this before (eg see here), but this morning MigrationWatch have released a smoking gun in the shape of previously unpublished sections from a government report in 2000. MigrationWatch's Sir Andrew Green says:
"...In the executive summary, six of eight references to ‘social’ objectives were cut from the version later published...
...It seems there was a project led by Downing Street political advisers to introduce a secret policy of mass immigration. Their economic arguments surfaced in an obscure research document but the social objective of greatly increased diversity was entirely suppressed for fear of public reaction – especially from the white working class.
... One point to consider is the impact on the electorate. It is not generally realised that Commonwealth citizens legally in Britain acquire the right to vote in general elections as soon as they put their names on the electoral register. In Labour years we have now seen an additional 300,000 from the Old Commonwealth and about one million from the New Commonwealth.
They may well have been conscious that they have much stronger support among the ethnic communities than their Conservative rivals. Given that mass immigration is heavily in Labour’s electoral interest, they may have thought that they could get away with it."
It's so outrageous, you just know it's true. An almost exact replay of the old economic snow job that took us into the EU: we were sold the EU on the basis that membership would make us richer, whereas in truth, the ruling elite wanted us in so they could be part of the new Superstate, continuing to enjoy a seat at that all-important top table.
And then there's the Great Global Warming Lie. As we've blogged many times, nobody seriously doubts the climate is changing - it changes all the time - but by promoting the unproven assertion that it's man/capitalism that's responsible for frying the planet, Labour has sought to validate its entire agenda of state control and high taxation. This is socialism disguised as saving the planet.
Worse, even though much of this lie is now unravelling in the face of climategate and the dodgy IPCC reports, ministers and their supporters at the state broadcaster are still spouting the same old stuff as if nothing had happened. Just like good old Doc Goebbels advised, they're trying to spin the issue into one of dark forces seeking to extinguish the sacred torch of truth.
Of course, the Global Warming Lie pales into insignificance beside the damnable lies concocted to justify the Iraq War. In another performance straight out of the Doc's playbook, they justified an illegal war on the basis of the dodgiest of dodgy dossiers presented to us as being "beyond doubt".
But the important things about the Iraq lies is that they have come back to bite the perpetrators. The Major was immensely encouraged to see the odious spinmeister Campbell breaking down on the Andy Marr show. Confronted with the facts, Campbell slumped into embittered victimhood, losing any final shred of authority and credibility in the process. Or as the Major put it "they can dish it out, but they sure can't take it".
Which is why we need to see much more of this. We need to see the Big Liars confronted and humiliated. We need our politicos to understand that Big Lies have big downsides. We simply can't afford another government like this one.
It wasn't you who ran up all those debts. It wasn't you who employed legions of civil servants and then paid them so extravagantly. It wasn't you who let the public finances kereer out of control, failed to take any remedial measures, and then cooked the books so nobody would know. It wasn't even you who elected the clothead government that did this. So WTF should you pay?
WTF indeed.
It would be like, say, some bunch of clowns who you didn't vote for coming to power in this country. And then they splurge shedloads of money they don't have on a wild expansion of the public sector, and let the public finances kereer out of control. And then they cook the books to hide the damage. And then, when the damage can't be hidden any more, they come to you and say you've got to pay off the humongous pile of debts they've accumulated.
Thank God that couldn't happen here.
*****
And thank God we're not in the Euro. As we've blogged before, the only thing Gordo has ever done that's been any use was to stop Imperator Bliar taking us in.
Because if we were in the Euro, we'd now be on the spit alongside the Greeks and the other PIGS. Sure we'd be forced to make the spending cuts pdq - which would be A Good Thing - but we'd have no opportunity to earn ourselves out of penury via a currency depreciation. We'd be looking into a long dark tunnel of jobless joyless despair, with no glimmer of light much before 2030.
Not that being outside the Euro means we're out of jail free. Yes, independent free floating sterling gives us the chance to earn our way back to health - a chance denied to the Greeks - but we still face a huge risk that weaker sterling will spill over into higher domestic inflation. And although the Bank of England has finally stopped printing all that surplus money (aka Quantitative Easing), we remain wholly unconvinced they have a grip on the inflation risk.
So should you switch your savings into Euros? The traditional pre-Euro investment rule for continental currencies was "buy on a strike: sell on a riot", and I fancy I hear the sirens of the sell signal coming from Athens right now.
No, for security of capital, your best savings bet is anything that looks like this:
It's been perhaps a year since mobile phone company Orange allocated animal names to their various contract options. While some people were critical, others heralded their avoidance of standard descriptor language as a great piece of imaginative differentiation.
At a superficial level, for sure, Orange are in some sense "different" from the other phone companies. They have a different tone about them. But that isn't always a good thing - especially because they cannot control the dissemination and, more importantly, the context of that information.
Yesterday, that was brought into clear focus in a third-party phone store where details of the various tariffs available from different service providers were listed next to each phone.
These comparisons are never easy to dissect, but with Orange it was impossible. Viewed in black and white, Monkey, Dolphin and Canary are meaningless monikers that repel potential customers and simply emphasise how thin is the line between differentiation and alienation.
Ever since Tyler can remember, Britain's old industrial heartlands have been a disaster area. Once they'd lost their traditional industries like steel and shipbuilding, something very bad happened to them - they seemed to lose the will to live.
And as we've blogged many times (eg here), despite decades of political promises and billions of tax-funded support, they have never managed to leave the high dependency unit. For example, when last sighted - in 2007-08 at the height of the biggest economic boom the world has ever seen - around 55% of the North East's GDP comprised government spending. It will be even higher post-Crash (see chart above).
Now George has joined the long succession of politicos who want to do something. Among other things he wants to connect up our failing cities to a high speed rail network and superfast broadband.
Sounds kind of sensible - if effin' expensive - but given the record, why should we believe that will be any more succesful than the motorways (and that famous White Elephant across the Humber) were back in the 60s and 70s?
No, after more than half a century of failure, it's time we started thinking much more radically.
One possiblity would be to close the North. This was pretty well what think-tank Policy Exchange suggested back in 2008 (see this blog). They advised we recognise reality, pull down the shutters on basket cases like Liverpool, Hull, and Tyneside, and ship their populations down to the prosperous (pre-Crash) South. Needless to say, they were immediately condemned for urbanocide by all and sundry, including Mr Cam. The Major wasn't too pleased either on account of needing to build 30,000 workers flats at the bottom of his garden outside Guildford.
Fortunately there is another more attractive option - one whose time has surely come.
"Paul spoke about his pioneering idea that city-sized areas can be created in developing countries so that their citizens can experiment with better rules. An example would be the experience of Hong King in China. He stated that by setting examples in these areas, better rules and new ideas can spread more quickly. Paul argued that large-scale migration is no longer possible. Hundreds of millions of people cannot move to places with better rules and laws. Instead they can move to Charter Cities."
Romer's proposal focuses on helping the populations of developing countries through the establishment of brand new self-governing mega-cities located on the coast for easy access to the outside world and a ready supply of water. Like old-time Hong Kong and Singapore, these Charter Cities would be dedicated to hard work and enterprise; tax and economic regulation would be minimal, with for example, no minimum wage and no social benefits. But crucially, the rule of law - both criminal and civil - would be paramount, and guaranteed by some strong third party from the developed world outside (and if you're thinking that sounds awfully like the British Empire, so were we).
In truth, most of the audience seemed sceptical that this proposal could ever fly (like, what's in it for the guarantors?). But what if instead of establishing new Charter Cities on the coasts of developing countries, we simply reconstituted some of our own dying coastal cities? Liverpool, Hull, and Tyneside would be good places to start.
Take Hull. Given its prime location facing Europe, we've long believed it has huge potential, and yet it has failed dismally to exploit it. Suppose it became our own version of a Charter City - minimum wage and working hours regulations abolished, social benefits for working age citizens abolished (maybe a 5 year phased withdrawal), central government economic and planning and regulations abolished, no more central government development assistance but a 10% flat rate income tax, 10% Corporation Tax rate, and no capital gains tax.
Public spending as a percentage of GDP would obviously fall sharply, and those that depend on public spending would certainly feel the squeeze (although social welfare recipients could be given the option of staying on benefit if they relocated outside the City). But against that, Hull would attract entrepreneurs and private investment on an unprecedented scale - and with its easy European access, much of the inflow would come from overseas. There would soon be jobs for all.
Yes, yes, of course. We can't do it because of the 53rd EU Directive on not doing stuff. And there's also the question of human rights. And anyway, we might end up with all kinds of Coketown beastliness, and children being sent down the mines. And... well... anything might happen... it's impossible to predict.
Yes, yes, we know all that.
But have you ever been to Hull?
Do you honestly think faster trains and better broadband are the answer?
PS If you want to know more about Romer's proposals, here's a vid he made earlier:
Booker (along with Richard North) has made another valiant attempt to unravel just how much of our tax money is being flushed down the bog of the global warming industry. It's not easy, as regular BOM readers will recall from our own attempts. Indeed, there is every indication that government departments deliberately mislead us.
For example, Booker describes how Defra paid £1,436,000 to fund the international working group that produced the last IPCC report - the one that included such lies as the melting Himalayas. Yet they later claimed in a report to Parliament that the cost was only £543,816 - only around one-third of the true cost.
Indeed, as Booker points out, when it comes to tax funding for the increasingly discredited global warming industry, official behaviour bears all the classic hallmarks of money laundering:
"Her Majesty's Revenue & Customs... lists 26 "suspicious indications" which should attract attention to the possibility that a financial transaction might need investigating. These range from "checking identity is proving difficult" or "reluctance to provide information requested" to "unnecessary routing of funds through third parties" and "transactions having no purpose" or "which seem to involve unnecessary complexity".
It's clearly outrageous, and not at all what any of us want. But as Mr Nicholls' comment highlights, we don't seem to have much choice. All three of the mainstream Westminster parties are committed warmists, pledged to go on with Operation Barbarossa however bonkers it may be, and whatever the catastophic impact on our prosperity.
Which brings us to the conversation Tyler is having with increasing frequency round the leafy glades of Surrey. It goes like this:
The Major (or Mr Scott, or Mrs Fitzgerald):"But why should I vote Tory when they're going to be just the same as Labour? Why shouldn't I stay at home to show what I think of them all?"
Tyler: "Well, because if you do that, the LibDems will get in all round here, and we'll either end up with Brown scraping back or a hung parliament. And if that happens, the markets will tank within weeks, there'll be the emergency budget to end all emergency budgets, taxes will go through the roof, and you'll end up in an even worse situation than now. Is that what you want?"
The Major (or Mr Scott, or Mrs Fitzgerald):"No of course not, but it may be we just have to go through it. I mean we never got Maggie until Heath had gone down and the country had experienced some serious pain. Right now we seem to be wandering around in a daze... nobody seems to understand what a grave situation we face, and Cameron isn't prepared to stick his head above the parapet to tell us. And even if he gets in, do you seriously imagine he'll get a grip? He'll be just like Heath... drifting along until we hit the rocks."
Tyler: "Hmm... well... Cam and Osborne are bright boys. They must know what happened back in the 70s, and they won't want to preside over a replay. Once they're in - assuming they can get a majority, that is - they'll have 5 years to sort things out. And whatever they say or don't say ahead of the election, they know they'll have to get a grip right away in order to give the economy the best possible chance of returning to growth by 2015. They're not dumb."
The Major (or Mr Scott, or Mrs Fitzgerald):"You think so, huh? And do you believe in fairies as well? Frankly, it isn't just the economy that worries us about Cameron, it's the whole deal - from hugging hoodies right through to this global warming nonsense. I mean, whatever happened to the traditional Tory party? Whatever happened to Tory values?"
Mr Farage (rudely butting in): "They all went off and joined UKIP."
*****
It's very difficult all this, isn't it. The horrible fact is, there isn't actually anyone we can vote for who will stop this happening. Sure, there are people we can vote for who will promise to stop it, but that's a different thing - under our grotesquely unfair first-past-the-post Westminster system of government, such people will never get the chance to actually implement their promises. Tyler's constitutional reform package includes separation of the powers and a directly elected President, but absent that, our real world choices are indeed very limited.
Which is why we will be out campaigning for the Tories again this time. They sure ain't perfect, and we share many of the Major's concerns, but in terms of forming a government to replace Brown's disaster, they're all we've got.
And what we can say is that from Tyler's personal knowledge, a good number of the new Tory candidates who will hopefully become MPs in May do share our belief in small government. Yes, they are all susceptible to the murky compromises that condemned souls make for power, but they are at least starting out on our side.
What we must do - all we can do - is to carry on campaigning outside of Westminster for the things we believe in. Believing that one day, when the tide of public opinion has turned far enough, our once and future king/queen will again step forward to wrench that sword from the stone.
It may not be much, but right now my friends, I'm very much afraid it's all we've got.
All over the place: reporting methods have changed twice since 1997
As you will know, shadow Home Secretary Chris Grayling has been rapped over the knuckles for misusing official statistics by the head of the UK Statistics Authority, Sir Michael Scholar.
Sir Michael wrote to Grayling:
"I must take issue with what you said yesterday about violent crime statistics, which seems to me likely to damage public trust in official statistics."
Grayling's offence was to claim that official stats show violent crime has been increasing under Labour. In reality they don't show that - or indeed anything - because of changes in recording methodology since Labour came to power.
Now, as we've blogged before, we have the greatest respect for Sir Michael. He's one of our few remaining mandarins of the old school: those Oxbridge men of myth and legend who believe duty to country always trumps duty to some here-today-gone-tomorrow politico. So if he raps someone, we must accept it's a fair cop.
"The humiliating slapdown adds to doubts about how credible the Conservatives are as a potential government, when they appear to be only three months away from taking office."
Strange we can't recall them making any comparable point when Sir Michael read the riot act over Jacqui's shocking abuse of knife crime stats (see this blog).
But whatever the Prog Con says, the Big Truth here is that for judging long-term crime trends the UK's crime stats are next to useless. We've blogged this many times, but the key points are:
Recorded crime statistics - supposedly the hard measure of crime that is serious enough to report to the police - have been through two changes of counting/recording methodology since 1997; Labour's criminal record is therefore conveniently masked (the latest Home Office report is here).
Recorded crime stats come from the police who are heavily conflicted. Under Labour's tractor production regime, police performance is judged against targets based on these very stats, so naturally they are heavily gamed and distorted (eg see this blog, including Inspector Gadget's account of how "threatening behaviour" - a recorded crime of violence - gets downgraded to "drunk and disorderly" which does not show up in government stats; and see this blog for Her Majesty’s Chief Inspector of Constabulary confirming that a third of violent crimes don't get recorded, probably in order to meet government targets).
The government's own preferred measure of crime - the British Crime Survey - is no more than an opinion poll on people's perceptions and experience of crime (how you feeling now love?). It is entirely voluntary, and it suffers from all the usual flakiness of such polls. When we looked at it, we found it claiming to have a 75% overall response rate, but much lower in high crime urban areas (62% claimed). It reckons to have a +/-3.5% statistical confidence interval around its estimate of total crime (an uncertainty margin that rarely gets mentioned by ministers). But that is not the sum total of the uncertainty, because we have no idea whether people with high experience of crime are more or less likely to respond. In Tyler's humble opinion, as a measure of actual crime it ain't worth the paper it's expensively printed on.
None of these stats are produced by the independent Office for National Statistics, but outrageously are still under the control of the Home Office - ie the very people who are most interested in persuading us that crime is falling. Sure, they now say they adhere to the National Statistics Code of Practice, but come on.
The fact is that the official crime statistics do not need Chris Grayling to damage public trust in them - they are doing a great job all by themselves.
All of which leaves us with a problem. Because if the official measures of crime are useless, how do we tell if Labour's record is good or bad?
Yup, we have to conduct our own crime counts. And here's Tyler's.
Since Labour came to power, Tyler Towers has suffered two assaults from burglars - including this one - against none previously. The houses on both sides have suffered as well. In the next road there has been an apparent contract killing. Prior to 1997 there were no such events.
One of Tyler's sons has been decked by a thuggish Balkanese (?) minicab driver, against no such deckings pre-1997.
Tyler's brother and his family have been subjected to an armed robbery in their own home, against no such robberies pre-1997.
From where we sit, the record looks all too clear.
