The World at One

The world is scarcely ‘at one’ today; we are referring to the BBC Radio 4 programme at 1pm on Monday, 4th July where the lead news item was that Keir Starmer, Labour’s leader, was about to announce that his party will not be working towards rejoining the EU, the Customs Union or the Single market. As usual, this was not a well-balanced presentation by the BBC.

Nominally the item, presented by Sarah Montague, was about Labour’s promise not to undo Brexit. She began by re-broadcasting Sir Kier’s statement’s before the Referendum and now. She continued by asking that since the public is changing its mind on the matter why is Labour changing its mind in the opposite way? Finally, she interviewed Hilary Benn, Labour’s key opponent of leaving the EU, who is now following the party line (we lost, get over it) but still endorsed the economic arguments against Brexit.

Montague opened with this:

Economists are, for the first time, separating the economic damage caused by covid and that by Brexit. They conclude that the damage is real and is not over yet. The Government’s official forecaster, the OBR, predicts that Brexit would ultimately reduce productivity and growth by 4% compared with what would have happened had the UK stayed inside the EU. As yet a little over half of that damage has yet to occur. That damage equates to about a hundred billion pounds every yearand may explain why the UK is now comparing badly with other G7 countries.

There was no opportunity given for a rebuttal of any of these ‘facts’, they were stated as if they were incontrovertible. She went on to say that polling company Ipsos UK has found that the number of British people who think that Brexit has made their daily lives worse has risen from less than a third a year ago to over half. Of course they feel worse off in view of all the chaos they have faced – they’re probably right about Brexit too for the present but their focus is being directed by the kind of information the BBC gives them.

In the Hilary Benn interview he also referenced the OBR’s prediction and added how small business exports were inhibited by red tape – he didn’t mention that it was mainly, onerously, imposed by the EU. He acknowledged that there would need to be another referendum to re-join and that there is no public appetite for that. He rubbished the Government’s efforts to agree work-arounds with the Commission on Northern Ireland and to participate in the Horizon science programme – who ended that? Sarah did put to him the leavers’ case (Andrew Lilico’s tweets) that they had always said there would be a short-term hit on the economy (c. 2%) but the economic benefits would then arise gradually; Benn simply disagreed and that was that.

If the BBC, OBR or other experts want to compare what is likely to happen to the UK in the medium or longer term, having left the EU, with what might have happened had it remained then it should be “a statement of the bleeding obvious” that you cannot base this on the UK situation alone. Any objective observer would know that the EU faces its own unique problems as well as sharing many of them with the UK and other countries. Particularly relevant are the problems of the unbalanced eurozone – how long will it survive without a big fight over debt sharing or a split into two or more monetary unions and what harm would that cause? It would be hugely destabilising and therefore likely to severely damage economic prosperity and prospects across the EU. We have described many of the issues in earlier posts [see TLTRO Rugby for example] but the “Whatever it takes” responses have only postponed their resolution, meanwhile digging even deeper holes like the sovereign debt piles accumulated by the ECB – is Germany expected to soak them up without triggering a popular revolution?

Would the UK as a member still be one of the better- or worse-performing economies in the Union or merely average? Comparing different economies can be difficult, consider inflation for example: The UK’s rate in May was 9.1%, slightly higher than the average for the EU at 8.1% . However, half the remaining member states had greater inflation than the UK, ranging up to 20%. In the other half, Germany’s dependence on Russian fuel could hit the country hard if it follows through (at last) on its noble words in support of Ukraine. Also in the lower half is France which currently generates about 70% of its electricity from nuclear energy but many of its generators are soon to face de-commissioning. These are two big contributors to the average inflation number for the whole Union which could swing it the other way. At the bottom of the list is Malta whose Finance Minister, Clyde Caruana, said: “The load is being felt by all European countries and most of these European governments are offloading the weight of the recession onto the people. It is as though they did not learn from previous recessions.” Malta subsidises fuel, energy and some goods, France also has taken measures to offset inflation. The UK has several measures of inflation (CPI, RPI, etc.), do all countries use comparable methods?

This example merely shows the problem of using raw numbers, they need careful evaluation and cannot simply be plugged into a formula within a forecasting model that cannot foresee the bleeding obvious bumps ahead. As we saw during the covid pandemic, “following the science” (?) is nonsense if the ‘science’ is mostly modelling, which never foretold the actual outcomes and rarely came close. Ah, but what if the resulting advice had not been followed, would the predictions have then been right? We’ll never know but there is some contradictory evidence from other countries where lockdowns were more severe or less so.

Models are useful to scope a problem but cannot be relied upon to predict outcomes in very complex situations. We do not (yet?) have a science of economics.

So, if the BBC is helping to undermine public confidence with its superficial and non-scientific presentations what should be done with it?

The question of bias by our public broadcaster has dragged on and seems not to be getting addressed. The BBC does not want its editorial independence to be interfered with by the Government – any government – and that is right. However, if it is fair to say that there is in practice a left-liberal, metropolitan, middle-class mindset amongst editors and presenters of news and current affairs programmes then there is one very obvious solution. These areas could be separated off and privatised.

Nobody would lose the option to listen or view these programmes, they could choose which news channels to follow. ‘Strictly’, ‘EastEnders’, good drama and the rest could continue either with a proportionately reduced licence fee or on a commercial basis – perhaps there should be a referendum on this. Nobody should be forced to absorb – and pay for – propaganda, however subtle or unintentional, if that’s how it seems to them.


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