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Douglas Carswell's Blog

02 DEC 2016

Ending free movement is non-negotiable

Immigration from the EU hit record levels this year, according to the latest figures. The majority of the British people made clear in the referendum they want immigration brought under control. Ministers and MPs now need to make that happen.

In June, we voted to take back control. That entails an end to the free movement of people. From now on, our parliament and our government must control our borders. We should be able to decide how many enter and on what grounds – and to modify criteria as circumstances change. Anything else would be a surrender of sovereignty.

Most voters want immigration reduced. David Cameron was elected on the promise to cut it to the tens of thousands. Brexit will allow the government to fulfil that manifesto pledge on EU immigration – though it must also do likewise for non-EU immigration, which it already has the power to control.

But controlled immigration doesn't mean zero immigration. We should attract talented people who add significant value to our economy.

That's not the system we have at the moment. Unskilled immigrants from the EU get priority over skilled immigrants from non-EU countries. People are judged based on nationality, not merit. That's not just bad for Britain. It's patently unfair.

The latest immigration figures should be a wake-up call to the Remain rearguard in Parliament. The issues that motivated people to vote Leave won't just go away. If control over our laws and our borders is not restored, the majority of voters – Lib Dem by-election success notwithstanding – will react accordingly. Remember, seven out of ten Labour constituencies voted Leave.

There is an alternative to obstructionism. Brexit enables us to rethink whole swathes of policy areas – from immigration, to fishing, to energy. We have the opportunity to build a broad, new post-Brexit consensus.

Those Remainers who accept the people's mandate will play a constructive role in shaping Britain's post-Brexit future. Those who reject it will ultimately be ousted by the electorate. Choose wisely.


01 DEC 2016

How to fix Britain's broken banks

Three of Britain's biggest banks failed the Bank of England's latest stress tests. Despite billions in bailouts, interest rate cuts, and new regulations, our banks still aren't any more secure. Doesn't that suggest governments got their response to the financial crisis wrong?

This year's stress test was meant to mimic the economic conditions of the financial crisis. So it's ominous that RBS, Barclays, and Standard Chartered all failed. None would have sufficient capital to withstand another shock.

That's an indictment of the response to the financial crisis.

We were assured that there was no alternative to bailing out the banks, because they were too big to fail – notwithstanding the cost to taxpayers, who still own a majority stake in RBS.

We were told ultra-low interest rates and quantitative easing was essential to keep banks liquid – in spite of the dire consequences for savers.

But we were promised that new regulations would make sure that banks were much better capitalised, so they wouldn't have to be bailed out at our expense again.

In reality, though, all governments, central banks, and regulators did was to reward banks for failure – and repeat the same mistakes that caused the crisis.

They allowed banks to privatise profits, while socialising losses. They made credit too cheap, incentivising banks to issue too many high-risk loans all over again. They never significantly raised capital requirements.

The precarious state of Britain's banks today comes as no surprise to UKIP in parliament. Last year, we published a paper warning that banks' capital ratios were far too low, while the Bank of England's stress tests were far too weak. In fact, the only surprise is that the test seems to have been toughened up.

Our paper recommended that banks need much higher leverage ratios: not 3%, as mandated by Basel III, but 15%. Interest rates also gradually need to rise.

But to make the financial sector secure in the long-term, we have to go further still.

The only way to stop bank failures is to rein in the excesses of fractional reserve banking. To do that, we need a legal separation between deposit accounts and loan accounts – as I wrote in my pamphlet After Osbrown. Banks should no longer be able to lend on deposits multiple times over as a matter of course.

The banking crisis wasn't a failure of capitalism. It was a failure of government. Around the world, governments incentivised banks to take reckless risks by protecting them from the consequences of their own decisions. To fix the financial system, that's what needs to change.


30 NOV 2016

Defence procurement needs competition - not industrial strategy

The Royal Navy today has only 19 frigates and destroyers. That's too few for comfort. Sir John Parker's report on shipbuilding critiques some of what's gone wrong with defence procurement. But it doesn't go far enough.

Too much taxpayers' money is consumed in wasteful defence procurement. Major projects routinely arrive years late and billions over budget – if they arrive at all.

The comparison to private-sector procurement is staggering. Parker notes that the Type 23 Frigate took 17 years to deliver, whereas 'mega-cruise' ships, which are 9 times the size, are delivered in 5.

The delay makes a huge difference. There's not much point in a ground-breaking, complex system if it is obsolete by the time it is delivered.

Our warships need to be built more quickly. So why aren't they?

Partly because government is often held to ransom by a monopoly contractor. Parker points out that BAE Systems' shipyards are "the only UK shipyards currently used to design build and commission a sophisticated naval warship" – thanks to "an exclusive position held under the Terms of Business Agreement between BAES and MOD."

In this context, Parker's recommendation that the construction of the Type 31 Frigate be opened up to a wider range of companies and shipyards in the UK is welcome. As is his plan for the Type 31 to be simpler, so that it can enter service urgently.

I'm less convinced by his belief that an industrial strategy which gives British shipyards a monopoly over warship construction can make them more, rather than less, competitive.

It's important to sustain British shipbuilding. But the way to achieve that is to free our shipyards to compete internationally – not to give them preferential treatment.

The reason BAE's shipyards in Scotland are less efficient than commercial shipyards elsewhere in the UK is because the government gives them guaranteed custom, whether or not they meet deadlines and costs.

By contrast, Britain's commercial shipyards – Parker acknowledges – display "no single customer dependency culture" because they are "sustained by multiple income streams".

What makes manufacturers competitive is open competition. If we want efficient procurement, shouldn't that be the model to follow?

The primary purpose of defence procurement is to keep this country safe. At the moment, it's failing. The corporate contractor cartel needs to be broken. Read our paper – Rethinking Defence Procurement – to find out how.


29 NOV 2016

UKIP's future is bright

Congratulations to Paul Nuttall! UKIP is beginning a new era – and we have every reason to be optimistic about the future. Our greatest victories are yet to come.

In his inaugural speech as leader yesterday, Paul set out his vision for UKIP to replace Labour as the party of the working-classes. It's ambitious – but it's also genuinely achievable.

Over the last year, pundits have pored over the splits in the Parliamentary Labour party between pro-Brussels Blairites and pro-Castro Corbynistas: in other words, between South Islington and North Islington.

But that's an irrelevant sideshow. Labour's real fracture is between Labour elites and traditional Labour voters. Post-Brexit, that electoral coalition could be broken beyond repair.

Seven in ten Labour constituencies voted to Leave. Yet all but ten Labour MPs declared for Remain. Indeed, many still seem to be campaigning for it.

Nor is it just on the EU that Labour MPs are out of touch. From defence, to justice, to foreign policy, to education, the position of Labour MPs is diametrically opposed to that of many traditional Labour voters.

But there's more to it than that. The truth is top-down, centrally planned government doesn't sell anymore.

In the digitised world, people are citizen-consumers. The Internet gives us more choice than ever before.

Yet, when it comes to government, Labour still expects people to take what they're given by Whitehall mandarins. They think the bureaucracy knows best. Voters know otherwise.

To beat Labour, UKIP needs to offer Labour voters choice and control. Autonomy over healthcare – so funding follows patients, not the other way round. Autonomy over education – ending the constraints of catchment areas, so kids' prospects are no longer determined by the price of their parents' house.

The lesson of the referendum is that taking back control is a winning proposition. If we offer control on the domestic front too, we can break the political cartel. Our future is brighter than ever. As Paul Nuttall put it, "there's no need for pessimism in UKIP".


28 NOV 2016

Castro symbolises socialism's moral bankruptcy

Fidel Castro systematically tyrannised and impoverished the people of Cuba for fifty years. Jeremy Corbyn has eulogised him as a "champion of social justice". Welcome to the moral bankruptcy of the left.

Castro wasn't just any autocrat. He was one of the nastiest exponents of Communist despotism.

He executed political opponents by the thousands. He sent men to forced labour camps to "correct" homosexuality or "effeminate mannerisms". He maintained power through military oppression, mob violence, and a network of neighbourhood informants.

His economic planning – which, at one point, involved co-opting people from every walk of life to work the sugar fields – reduced the people to penury. Some three million Cuban citizens fled the country for the chance of a better life elsewhere.

Both politically and financially, Castro turned Cuba into a Soviet dependency. He was instrumental in the Cuban missile crisis, which brought the world to the brink of nuclear war.

But Western left-wingers – and not just longstanding Communist apologists like Corbyn – have turned a blind eye to these inconvenient facts.

Canada's Prime Minister, Justin Trudeau, praised a "legendary revolutionary". France's President, Francois Hollande, paid homage to a man who represented "the pride of rejecting external domination". President Obama – the leader of the free world – tritely hailed "the enormous impact of this singular figure".

Their selective recall has been topped only by their media echo chambers: the New York Times, the Guardian and the BBC.

The left's indifference to the reality of Castro's Communism is reprehensible in itself. But what makes it outrageous is the fact that these people have appointed themselves the guardians of human decency and the rights of the vulnerable.

The reason the left won't condemn Castro is because they agree with him. Like him, they propagate the lie that the world's evils can be blamed on capitalism, and the solution is socialism.

The truth is the precise opposite. No system of government has ever lifted so many people out of poverty so quickly as free-market capitalism. And none has subjected so many to poverty as socialism. The socialist lie has cost the lives of millions of people.

Leading leftists have used a veil of faux compassion to perpetuate mass suffering for the last century. They're still doing it today. It's high time to expose them for the frauds they are.


25 NOV 2016

Blairism is bust - and even Blair can't save it

Nicolas Sarkozy has abandoned his hopes of a comeback, and given up on politics for good. So, it seems, has Hillary Clinton. Shame Tony Blair didn't get the memo.

By no popular acclaim, Tony Blair has decided to return to British politics, aiming to overturn the result of the referendum. It's a sign of how detached from reality he has become that he seriously believes he could succeed.

In the first general election I fought as a candidate, back in 2001, I stood against Tony Blair in Sedgefield. There's no doubt that he was an impressive campaigner. I saw that first-hand.

But times have changed. Just as his landslide victory in 1997 marked a popular rejection of almost twenty years of Tory government, so Brexit is a public revolt against two decades of Blairism.

Tony Blair and Gordon Brown were blasé about European integration. With the Lisbon Treaty, Brown railroaded through the EU Constitution Blair had signed – the constitution which had been expressly rejected in referenda in Holland and France – without ever asking for the people's consent.

Blair didn't just ignore public concerns about immigration. He made immigration a taboo subject for debate. Perhaps he genuinely thought there was a consensus behind multiculturalism. But all he actually achieved was to stoke public resentment.

He might have left Number 10 in 2007, but Tony Blair effectively defined government for the next nine years. David Cameron proudly called himself the heir to Blair – and so he proved to be. On European integration, as on so much else, he delivered continuity.

But now the British people have rejected that elite consensus. Blairism is over. Thankfully, not even the return of the man himself can take us back to 1997.

It is revealing, though, that he thinks he can.

Though some ex-holders of the office seem to forget it, prime ministers aren't monarchs. They don't have a God-given right to rule forever. The people are their boss, not the other way round.

When I lost to Tony Blair in 2001, I accepted the result. Not because I thought his agenda was better than mine. But because I recognised it was for the electorate to choose.

Now the voters have chosen again. Brexit is going to happen, whether establishment grandees like it or not. They might as well get used to it.


24 NOV 2016

The political establishment can't dodge the blame for debt

Successive pro-EU Chancellors have more than trebled the national debt in ten years. Yet yesterday the pro-EU Westminster bubble tried to blame rising debt on Brexit. This is why people don't trust politicians or pundits.

As the graph illustrates, our national debt has risen from under £500 billion in 2005 to over £1.6 trillion today. That's even without including nationalised banks, or unfunded pension liabilities.

Labour, the Conservatives, and the Liberal Democrats have all been in government over the last ten years. They have all had ministers at the Treasury. They are all directly accountable for the mess our public finances are in.

But instead of accepting responsibility, they prefer to blame the British people. What's pushing up debt is Brexit, they tell us. We're supposed to believe that a problem that has been growing since 2005 is somehow the fault of the way the majority voted in 2016.

Worse still, this pathetic excuse for an argument is trotted out uncritically by equally pro-EU pundits. These are the people who are supposed to scrutinise our politics. Yet all they provide is an echo chamber for the political establishment.

What's truly bizarre is that politicians and pundits actually expect people to be credulous enough to buy this rubbish. No wonder Donald Trump won.

Debt isn't increasing because of Brexit. It's increasing because government spends too much money. Because successive Chancellors haven't kept their promises, or even followed their own fiscal rules.

If we don't want to impoverish the next generation, government needs to shrink. No amount of hypocritical whining from shameless Remainers can change that.


23 NOV 2016

Osborne - not Brexit - is to blame for borrowing

I'm interested to hear Philip Hammond's first Autumn Statement today. Hopefully, unlike his predecessor, he'll spare us political gimmicks and giveaways. But I'm curious to see if he will turn out to be any more fiscally responsible.

Even though the economic news since the referendum has defied Project Fear, pundits tell us that the Chancellor is set to warn of higher gilt yields, lower growth, and even more borrowing – and that Brexit is to blame.

Plus ça change.

Given how often Treasury and OBR forecasts have proved wildly inaccurate, you'd have to be pretty foolhardy to put much faith in them.

But if the public finances are in a perilous state, that didn't suddenly happen this year. It's down to the decisions made by the last Chancellor.

Prior to the 2010 election, George Osborne promised to eliminate the budget deficit by 2015. It didn't happen. Instead, during his tenure, he doubled the national debt. He transpired to be no different from Gordon Brown.

If Britain is unprepared for rising gilt yields, it's because we're still borrowing when we're meant to be running a surplus.

Relying on borrowing at record low rates forever was always a high risk strategy. Government bonds worldwide are a bubble - and all bubbles eventually burst.

This one needs to burst, too. Record-low bond yields – the result of record-low interest rates – have created a huge black hole in pension funds. It's a crisis, which can't be solved unless rates rise.

But, from the perspective of the public finances, we may once again be about to discover the costs of what George Osborne would call failing to fix the roof while the sun is shining.


22 NOV 2016

Why the left is finished

I was quite struck by Will Hutton's review of all the Brexit books in the Guardian. Not because of what it says about the inside story of the referendum campaign – I got to see most of that first hand. But because of what it reveals about the sorry state of the left.

Ex-Observer editor Hutton has been an influential figure in the Labour party for decades. He was chief executive of the Work Foundation – whose mission is to "transform people's experience of work".

So it's striking just how much contempt his review displays for the millions of working-class Brits who voted to Leave.

At every point in the review, Hutton seeks to diminish and belittle those he disagrees with.

The Leave coalition, he writes, is "a malign alliance of obsessed constitutional nationalists and far right-wing populists."

Remain's failure to make its case for the EU was, he modestly claims, "what happens to countries in irreversible decline".

Brexit, he mourns, is "going to transform the country into an unpleasant, illiberal and inward-looking island."

Hutton sees the whole campaign through the prism of people with ulterior motives putting party before country. Nowhere does he acknowledge that there were people – on both sides of the debate – who passionately believed in what they campaigning for.

This is the reason the British left is in existential decline. Its leaders are so convinced of their own moral superiority, they have no sense of self-awareness.

The majority of the electorate voted Leave. Labour's base is abandoning the party. But its representatives never seem to ask why. Every loss for the left is seen as a dastardly manipulation of people who can't be trusted to know their own best interests.

It never seems to occur to these savants that maybe voters can think for themselves. Or that, just perhaps, they're fed up with sneering condescension from those who claim to represent them.

"The liberal centre, derided as the establishment, could not muster the matching energy, conviction, unity and passion to fight back", Hutton concludes. "Nor, as matters stand, is there any sign it has learned its lesson."

Well, quite.


21 NOV 2016

All MPs should back Steve Baker's Brexit letter

Along with around 60 other MPs, I'm backing Steve Baker MP's letter to the PM to ensure Britain leaves the European single market and the customs union. We're standing up for what the majority voted for. Any MP who respects the referendum result should follow suit.

Brexit entails being outside the single market and the customs union. Every Leave campaigner made that clear during the campaign. It's the only way to take back control over our laws, our trade policy, and our borders.

So the claim that voters didn't know that's what Brexit looks like is demonstrably false. Those MPs and peers still trying to block Brexit on that pretext do so in the full knowledge that they are putting their personal wishes ahead of those of the majority of the electorate.

Equally false is the idea that leaving the single market and the customs union means losing trade with the EU. Britain doesn't need to be a member of the single market to have access to the single market. Countries around the world have bespoke, bilateral trade deals with the EU. We will too.

Leaving the customs union frees us to make trade deals with other countries. Many foreign leaders are queueing up to make those agreements – not least, reportedly, the new, pro-Brexit President-elect of the United States.

The important question now is what kind of trade deals we will make. Will they be overregulating, single-market-style agreements that set uniform standards in the interests of Big Business? Or will they be genuine free-trade deals, based on mutual standards recognition?

The reactionary obstructionism of Remainers fighting a rearguard action is a pointless distraction from what we should be discussing. All MPs now have the chance to shape the UK's future as a sovereign, independent country.

Let's implement what the people voted for, and get on with something constructive.


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The End of Politics and the Birth of iDemocracy

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