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The bloke departs the Tory contest

Kenneth Clarke, the former British finance minister of the 1990s and most pro-EU Tory candidate in that party’s race for the leadership, has dropped out of the race. That leaves David Davis marginally ahead of the centrish David Cameron and Liam Fox. My money, for what it is worth, is on Davis to win, but I cannot find much enthusiasm for any of the candidates, to be honest. Tory leadership contests seem to occur with all the frequency of signal failures on the Tube during the rush-hour. There is a sort of wearying regularity about them.

I share the sentiments of this article about the lack of policy content from the candidates thus far. The only positive thing about the Tories, it seems, is their ability to keep the numerous global floods, earthquakes and bird-borne plagues off the front pages of parts of the media. In a way, the feat is quite incredible.

41 comments to The bloke departs the Tory contest

  • Julian Taylor

    I’m shedding a tear as I write. Oh wait … sorry, its a spilled drop of wine from celebrating the news that another tired old specimen has pulled out of the Tory leadership race.

  • Verity

    Jonathan – regarding the content-free campaigns, I think the candidates are rightly leery of saying anything too attractive to the voters because if it’s bright and shiney enough, Blair will grab it and hold it up as his own, with a twerpy air of self-congratulation. He is a dangerous adversary not because he is clever, which he is not, but because he is so utterly devoid of any principles or standards of behaviour.

    This means Conservative candidates can only sketch in programmes without giving too much away – meaning the voters don’t get much, either.

  • Johnathan Pearce

    Verity, you have a point, true. But there has to come a point when we want the principal opposition to communicate some content rather than empty soundbites.

    You have put your finger on a serious difficulty, though.

  • Actually, DD got himself in trouble at Conf. for making a policy-laden speech at his conference as opposed to the rest of them.

  • I think it will be Cameron. Fox will be the next to go, and then Cameron and Davis will be put to the Conserviative party at large. I think Cameron has an edge there.

    I too am very pleased at Clarke’s having been knocked out. I could not in all good conscience have forced myself to vote Tory with such a specimen at the helm.

  • HJHJ

    Well, I think it’s a pity that Ken’s out, despite the fact that I disagree with him on several matters. He at least made two things clear: That he would attack the economic incompetence of Gordon Brown (as opposed to the rest of the Tory party, who seem scared of criticising him because of his self-created and deceitful image othat he has somehow made our economy the envy of the world) and he expicitly said that he would reduce the proportion of GDP taken by the state below 40% (not nearly enough, but at least he put a figure on it). As for the age argument – bullshit. If someone is good enough, they’re young enough.

    I am disturbed by the support for Cameron. What does he stand for other than looking and sounding nice and ‘modern’? Where are his new ideas? The other day I heard him banging on about introducing ‘synthetic phonics’ in state schools. NO NO NO – I don’t want any politician implementing his ideas on schools – we’ve had enough of New Labour trying to run the school system by central dictat. I want politicans to say that they don’t know anything about running schools, so will free the system from central control of any type. And I fear that if he became prime minister, his total inexperience of life in general and outside politics in particular would cost us all dear in the way that it has with Blair, with his naivety and failure to reform because he doesn’t realise the limits of what can be achieved by government.

    Liam Fox I find creepy – he also has little experience of the private sector as he was an NHS GP (a grossly overpaid closed shop). I also find his views too socially conservative (frankly, I’m pretty socially conservative, but my libertarian instincts curb me from wanting to impose my view on others – I just want the government to stop subsidising economically unstable lifestyles with taxpayers money).

    So David Davis it is for me. Ecomomically he is sound and he’s a libertarian. It’s a pity that he doesn’t speak so well – it seems that this one factor may cause him to lose.

  • Euan Gray

    I think Clarke is one of the great underrated Tories. His grasp of economics is very strong and it is largely his policy when Chancellor that has enabled the economy to (so far) resist Brown’s assaults. I agree that age is not a real problem, and it certainly did hold Churchill back. However, this is a period fixated with style over substance.

    Because of that, I think Cameron has it. I suspect Davis’ libertarian tendencies are going to prove a bit weird for most people. I suspect the vote for the party at large will be a choice of Fox or Cameron. I’d prefer Fox, but don’t think he’ll make it because he’s less aesthetically appealing than Cameron and, of course, he’s Scottish.

    EG

  • Verity

    HJHJ – You are right to point out that the only one with the cojones to attack Brown would have been Clarke – although why this is, is a mystery. Brown’s an easy target. Deceitful and incomptent – or driven by an ideology that impels him to wreck an entire successful economy without the guts to do it upfront – but hide behind empty arrogance (as in wearing a business suit to a black tie City event – oh, pulleeeze, Mr Chippie!).

    But the problem is more than Brown. It’s the whole structure of the Za-NuLab/Gramscian project, and that’s what has to be blown away. Like you, I don’t think David Cameron has anything like the weight. Ken Clarke could move to better effect by agreeing to work with Davis.

  • Della

    Verity wrote:

    (About Blair) not because he is clever, which he is not

    I only wish this were true. Whilst I can’t stand the guy he is a genius and a master manipulator. He has made a number of mistakes I didn’t think he could recover from, but he did and in ways that were brilliant in their own way. I don’t like him, I don’t repect him, but I know what he’s capable of.

  • It is tragic Clarke is gone that he was by far the best chance we had of seeing the Tory party implode completely and very quickly.

  • Verity

    Della – no, Blair isn’t clever – except as a performer. He’s neither a genius nor a master manipulator – in fact, there’s a lot of Noddy about him – although the people behind him most assuredly are.

    Perry … always erring on the side of compassion… What a softie!

  • GCooper

    None of this matters. Too few UK laws are determined at home to make very much difference, whichever of these clowns gets the job.

    That notwithstanding, I suppose either Fox or Davis would be better than Lord Snooty of Coke, the apparent BBC/Guardian/Indy candidate.

    But until somone is prepared to get up on his or her hind legs and wrest back control of our destiny from our masters across the water, I can hardly see what the fuss is all about.

  • Verity

    G Cooper is correct. To use a phrase which is not just trite, but overly trite, yet seldom bettered – choosing among leaders for the Conservative party really is rearranging the deckchairs on HMS ….

  • mbe

    Just a minor correction, Ken Clarke did not ‘pull out’ of the leadership race- he was voted out by the Tory MP’s because of any of the above reasons (i.e. too old, too europhile etc)
    My reckoning is that Cameron will beat Fox in the national vote as Davis has lost too much momentum and his MP support is fading.
    Either way Ken Clarke, the self styled ‘big beast’ of the Conservatives, should properly serve his country and offer his services as Shadow Chancellor.
    There are certain people who will never vote Tory for ideological reasons but the Party has a duty to form the best, strongest and most effective oppostion possible and hold this despiscable Government to account.

  • HJHJ

    Perry: I know that you’d rather see the Tory party go and be replaced by a more radical right wing party. The point is that such a party will never win an election What you’re saying, in effect, is that you find a purist right wing party in opposition, with government left to New Labour, preferable to a flawed Tory party in government.

    Let’s be clear here about how parties position themselves. It’s like ice cream vendors on a beach. When one vendor sets up in the middle of the beach (as New Labour continues to do in the public perception) the best that the next vendor can do is to set up right beside the first vendor to attract customers from one half of the beach. The further the second vendor moves to the right, the smaller the customer base it has within its range compared to the first vendor. This smaller customer base is better served (because it’s closer to its customers, on average), but it doesn’t change the fact that it then has a smaller customer base.

    This is a sad, but true, fact of political life, I’m afraid. Parties have to win power and then try to move the centre demographic centre of the beach.

  • HJHJ

    mbe: It’s very unlikely that, should Cameron win, he will appoint Clarke shadow chancellor. This portfolio is currently held by his number one supporter, George Osborne.

  • Euan Gray

    What you’re saying, in effect, is that you find a purist right wing party in opposition, with government left to New Labour, preferable to a flawed Tory party in government

    This is also the UKIP mentality, which sees the destruction of the Tory party because it won’t adopt the policies they want as far more important than defeating a Labour government. Talk about cutting of your nose to spite your face…

    EG

  • Euan has it right, Purist Perry would rather cut off his nose than vote Tory…

  • pommygranate

    I agree with Perry.
    A victory for Cameron will mean the Conservatives limp on for a further ten years possibly leading to a hung Parliament in 2014.

    The Tories only real hope lies with homeowners in Florida and LA. The great US credit bubble has finally peaked. Its unwind will have profound effects in the UK.

  • mbe

    HJHJ, I not saying that Cameron would appoint Clarke but he should. Perhaps more importantly Clarke should offer to serve, instead of sulking for another decade, like he has just done.
    Osborne was Howard’s appointment and I think a tactical one, to blood the more youthful MP’s during a quiet summer, in the midst of a power vacuum.
    If the Tory party ever want to get back in power they do need to attract a much wider range of voter. From all the polling I’ve seen Clarke could woo a good proportion of the centre-ground semi-Blairite voters back to the Tories.
    Historically the Conservative party has always beena broad church but the internal fighting has, certainly over the last 15 years, severly damaged the party’s reputation. Whoever wins shold demonstrate the breadth of opinion within the party and be a bit savvier with their cabinet appointments.
    This, in turn , is why we have an adminisitration that is increasingly power-crazed and ignorant of democracry because the opposition isn’t credible or reflective of national opinion.

  • HJHJ

    mbe: I agree with you. Ideally Osborne would be a minister under Clarke looking at longer term tax reform – but this won’t happen as Cameron wouldn’t demote his friend. But if Davis wins, perhaps…

  • Clarke: Nice bloke…sound on nothing at all. The only thing that makes him Conservative is the C by his name at election time. His politics are anything but.

  • Perry: I know that you’d rather see the Tory party go and be replaced by a more radical right wing party. The point is that such a party will never win an election

    Maybe, maybe not, but I would rather a Labour-Lite Tory party lose the next election and have another ten years of real Labour Party if that is what it takes to lay the ground work for a real opposition party.

    Just getting the Tories into power is meaningless if there is no real difference to what is there now.

    Maybe DD will surprise me and he certainly talks the talk (at least in front of the right private audiance, but then he IS a politician so that is hardly surprising)… but I am not holding my breath.

  • Euan Gray

    I would rather a Labour-Lite Tory party lose the next election and have another ten years of real Labour Party if that is what it takes to lay the ground work for a real opposition party

    But this “real” opposition will never win elections, because there is approximately zero popular demand for a libertarian or quasi-libertarian party in the UK. Doing what you want simply means an endless succession of Labour governments. Fair enough, but it might be sensible to stop moaning about how bloody awful Labour is if the only reason they are in office is the selfish demands of a tiny and unrepresentative group of people who wilfully wreck any attempt at coherent opposition.

    One might also ask why, since you refuse to vote, it makes any difference to you anyway.

    EG

  • HJHJ

    Perry: I can’t agree that 10 more years of New Labour ruining the economy and destroying our civil liberties is a worthwhile price to pay just on the chance that a more effective alternative opposition party will emerge.

    The Tory party, for all its faults, is the most enduring political party in the world, bar none. I think you’re being naive.

  • GCooper

    It’s always entertaining to note the Great Thinkers who have swallowed the latest media myth, hook, line and sinker.

    The Conservative Party under Michael Howard (far from a Clarkeite) actually won a majority of votes in England at the last election.

    While it remains true that in an ideal world, the glowering, resentful masses on the Celtic fringes would need winning over, that seems unlikely ever to be accomplished by anyone wearing a blue rosette.

    What must, therefore, be achieved is a greater majority in England. Can that only be done by occupying this ‘centre ground’ that BBC pundits and their fellow travellers bang on about?

    The question to ask is, has the English public really undergone some sort of profound cultural or psychological change which makes it fundamentally different from that which elected and then re-elected Margaret Thatcher? This seems unlikely in less than 30 years, though it is clearly something that a Blairite might wish to be the case and which it is worth their while repeating so that the gullible swallow it with their cornflakes.

    In reality, what has happened has been that the UK economy has been floating on a sea of cheap, Chinese imports and a credit bubble for the past decade. Thus, Labour has presided over a period of relative financial comfort. Now that the birds are flapping home to roost (‘flu ridden, or not) the economy is starting to suffer and people will soon be in pain. Disenchantment with Bliar and Brown will follow, as sure as day follows night.

    At which point a Tory can – and probably will – win the election and we can forget all this Notting Hill babble about self-abasement and a ‘need to change’ (in other words, become Labour-Lite).

  • Euan Gray

    Can that only be done by occupying this ‘centre ground’ that BBC pundits and their fellow travellers bang on about?

    Can it be done at all by swinging to the more libertarian right?

    has the English public really undergone some sort of profound cultural or psychological change which makes it fundamentally different from that which elected and then re-elected Margaret Thatcher?

    Part of the reason why Thatcher was re-elected twice was that the opposition was unelectable. This just about applied in 1992, as well. It is not reasonable to conclude that Thatcherite policy was the deciding factor, just as it is not reasonable to conclude that the people re-elect Blair because they like him. Splits within the Tories and the divisive effect of UKIP have simply rendered the opposition too fragmented and fractious to be elected. Policy has remarkably little to do with it, I suspect.

    EG

  • GCooper

    Euan Gray writes:

    “Policy has remarkably little to do with it, I suspect.”

    Precisely my point. Which is why all this ‘occupying the centre ground’ is so much airy waffle.

    When the economy tanks, as it will, unless the Conservatives elect a complete imbecile as their leader, they will win.

  • sesquipedalian

    The tories need to be liked before they detail policies. No matter how
    brilliant a policy is
    it will be generally binned as soon as the Tory brand is attached (if not adopted in part by Blair).
    If the tories had the right image then they’d even
    get away with a (George Osborne) flat tax policy.

  • GCooper

    sesquipedalian writes:


    The tories need to be liked before they detail policies”

    Margaret Thatcher was not liked. Indeed, she was widely disliked.

    What matters is that a party is trusted when, as the axiom reminds us, the opposition does not win an election, the government loses it.

  • HJHJ

    GCooper is incorrect.

    The Tories did not win a majority of the votes in England at the last general election. They won (by a small margin) more votes than Labour, but far from a majority. Both major parties won pretty small proportions of the vote by historical standards. The problem is that many formerly Labour votes defected not to the Tories but to other parties.

    In any case, it’s a UK election (where unfortunately Labour won more votes than the Tories) and the electoral system/constituency boundaries require the Tories to win many more votes than Labour in order to win even the same number of seats. It would be interesting to see what happens at the next election if the Tories win more votes in the UK overall than Labour, but Labour still gets an overall majority of seats. How could they then claim a mandate to govern?

    I do concur with GCooper about Labour’s ‘economic miracle’ – mirage, more like. The problem is that in a low worldwide inflation environment, you can afford to prop it up with borrowing for much longer than you could get away with in the past. The long term damage, of course, is correspondingly greater, but most people don’t realise this.

  • GCooper

    HJHJ writes:

    “The Tories did not win a majority of the votes in England at the last general election. They won (by a small margin) more votes than Labour, but far from a majority”

    This is true and I should have phrased what I wrote with greater care.

    However, the fact remains that, in England, more people voted for Michael Howard’s Tories than for Tony Bliar’s New Labour.

    People vote not with their feet but with their pockets. All the Conservatives need to do is present a trustworthy face when the hard times come.

    It won’t be sufficient to persuade me to vote for them, nor, by all accounts, Perry de Havilland, but it will do for most.

  • Julian Taylor

    I don’t know if anyone commenting had the opportunity to watch the Frank Luntz focus group on potential Tory Party keaders, shown on Newsnight during the Conservative Party Conference. One aspect that intrigued me was that when Mr Lutz mentioned that David Cameron was ‘of the ruling class’ a small number of marginal supporters immediately transferred their support to Liam Fox, almost as a kneejerk reaction, and I wondered if maybe a similar number of Tory fencesitters feel the same way. If so, I should think that rather than lament the passing of Ken Clarke as a way of forcing an implosion of the Tory Party then Liam Fox is just the man to achieve that, given that he would seem to have more skeletons in his cupboard than Harold Shipman did, and don’t we all just know just how competent the Tories are at hiding secrets from the Millbank Mafioso?

  • Paul Marks

    Mr Clarke was the one candidate who we know from experience of high office.

    And how do we know him. More government spending, vastly increasing the national debt (with help from the First Lord of the Treasuary John Major of course – and with the help of the now Lord N. L. who goes about saying he opposed everything the Major government did – something he kept rather quiet at the time).

    Also the burden of regualtion greatly increased – although that was mostly an E.U. thing.

    Mr Lawson (now Lord Lawson) did not understand monetary policy (the most difficult branch of economics) and (back in the late 1980’s) created a credit bubble due to his policy of “cheap money” (i.e. he played about with interest rates as part of his effort to influence the exchange rate with the D.Mark).

    But Mr Clarke did not understand any branch of economics – he fully supported Mr Lawson’s increase of the money supply. And, later, he supported the E.R.M. exchange rate rigging.

    At least Mr Lawson understood fiscal policy – he tried to both cut and simplfy taxes and to balance the budget. Burke, Peel and Gladstone would have approved – but they would not have approved of his monetary policy (the odd thing is that the young Mr Lawson understood that you should not issue money to try and influence an exchange rate – he wrote that you should not when he was editor of the Spectator).

    On the E.U. Mr Clarke’s views are longstanding (they go back to his time at Cambridge, when he invited Sir Oswald Moseley to speak – not out of any sympathy for his opinions on race, as a smear campaign has made out, but because of their shared passion for what is known as a “United Europe”).

    For those loyal to Britian Mr Clarke is clearly unacceptable, but he has never pretended that his loyalty is to any other country than “Europe” so the word “traitor” (which has often been tossed at him) is misplaced.

    One can not be a “traitor” to a nation that one has never believed could stay independent and indeed when has always openly supported this nation becomming part of a (supposedly) greater nation.

    As Mr Clarke’s ally Lord Heseltine [spelling] is fond of saying “just as the eight kingdoms of Anglo Saxon England came together to form one nation, so the nations of Europe will come together…….”

    Mr Clarke proudly helped Mr Howe (now Lord Howe) to take the European Communities Act throught the House of Commons. And has always honestly made clear that he would support any Act increasing the E.U.s powers – boasting (of course) that he did not even need to read such Acts (which, I must admit, is perfectly logical – the illogical one was Mr Major).

    On economic policy it is quite true that Mr Clarke has attacked Mr Brown for increasing govenrment spending and taxes in recent years. However, there is no evidence (that I know of) that Mr Clarke would not have done the same thing.

    There is only one clear area of difference (and this is to Mr Clarke’s credit).

    He opposed the absurd “independence of the Bank of England”.

    If one is going to have fiat money it should be under the control of the democratically elected government of the day – the idea that a government entity like the Bank of England should be “independent” makes no sense. Abolish it certainly, but whilst it exists this government entity should be under the control of the government.

    Nor (of course) is there any evidence that the Bank of England is any good at controlling its fiat money – the money supply has been going through the roof for years (hence the asset price inflation we have seen – the idea seems to be “if it is not in the R.P.I. it does not exist”).

    If Mr Brown really thinks he has “abolished boom and bust” he has got a shock comming.

    Mr Clarke was quite correct to oppose the silly gimmick of “independence for the Bank of England”.

    I used to think that the one good thing about European (really E.U.) Monetary Union is that the central bank people in the various nations would lose their jobs. Then I found out (for example) that the five thousand people who work for the Bank of France are still sitting there (with full pay and pensions) even though the Franc has been abolished.

    Perhaps if Mr Clark had been Prime Minister he would have sen the bulldozers in on the Bank of England. I normally defend old buildings and despise those “conservatives” (such as “Super Mac” and Heath) who like to get rid of them – but the Bank of England just might be an exception to the rule (and the present one replaced a much nicer building anyway).

    Still we could save the building and still sack the staff – that would be the one gain of new country callled “Europe”.

    The other three candidates?

    Does anyone really know for sure where they stand on the great questions?

    At least one (Mr D.C.) seems to be basing his (rather successful) campaign on the fact that he does not stand for anything.

    This is better than standing for bad things I suppose.

    I will vote for Mr Davis or Dr Fox (whichever one gets through with D.C.), but this is more out of tribal loyality to people who are called the “free market” or “Euro Sceptic” candidates, rather than out of any real faith that they would stand up to the vast political and commercial powers (the alliance of the “opinion formers” in the media and academia with the corporate interests) that seek to dertermine policy.

    One would have to be a hero to stand up to the powers that be – and heros are in rather short supply.

  • Paul Marks

    An extra “r” seems to have appeared in determine. Oh well I must have put it there – doubtless I have done a lot of other odd things to.

  • HJHJ

    It is hard to take Paul Marks seriously. For all his faults, Ken Clarke did a better job controlling the growth of public spending than any chancellor of the last 20 years. You have to remember that any action the chancellor takes to do this is subject to a time lag and Britain was in recession when he took over.

    As for the Bank of England – it is under democratic control. The chancellor sets its targets – its job is just a technical one to meet those targets. The government can change the targets or, indeed take back control of interest rates as it pleases. The point is that monetary credibility is enhanced by the fact that the BoE has a purely techncal remit and that under the current arrangements, any political intervention is completely visible for what it is. The question of whether, in the long term, concentration on controlling one measure – CPI inflation – is wise, is another matter.

  • HJHJ

    I should also point out to Paul marks that the remit of the BoE monetary committee is to achieve a CPI inflation target within a certain margin of error – nothing to do with money supply.

    The chancellor is perfectly free to tell it to target a different inflation measure, a particular measure of money supply or whatever.

  • Midwesterner

    The reason the Federal Reserve Bank (of the United States) is made as independent as possible is to avoid market manipulation for political ends. The assumption is that the party in power could arrange to have a strong market in the run up to an election.

    Would politicians really do that? Ya think?

  • Julian Taylor

    Interesting. In the UK convicts lose the right to vote during their incarceration, one of the prime reasons having always been stated that these people would be vulnerable to a corrupt Home Secretary (is there any other type?) making promises to them that he has no intention of seeing through and could not be held liable for either. Now it would appear that NuLab have decided to re-enfranchise prisoners with their right to vote, so now only members of the House of Lords and people declared unfit under the Mental Health Act are exempt.

  • Paul Marks

    HJHJ says that he finds it hard to take me seriously – well everything that I wrote was correct, so if he finds it hard to take the truth seriously that is his problem not mine.

    Of course I missed many things out. One of them being that Mr Clarke is not the only Conservative to attack Mr Brown for spending too much money, many Conservatives have attacked Mr Brown for this (and some of them, unlike Mr Clarke, may have actually meant it).

    The difference is that Mr Clarke’s attacks were reported by such organizations as the B.B.C. – because some people in such organizations are friendly towards Mr Clarke. Anyone who is on the free market side of politics should ask themselves what sort of person is likely to have influential friends in such organizations as the B.B.C.

    We might then turn to Mr Clarke’s connection to the “Independent” newspaper and to other matters.

    HJHJ may choose to hide his own name, but if he comes on to a libertarian website (rather than, say, one for “pragmatic” Conservative party members) he should not expect to see Mr Clarke praised.

    Actually I was careful to be as polite as it was reasonable to be.

    On the Bank of England – the increase in the money supply (whichever “M” one chooses to look at, the increase is a matter of record). If HJHJ says that the Bank of England should not be judged on this – well then he is indeed hard to take seriously.

    Of course, I am not defending Central Banks (or fiat money), but whilst such things exist they can be judged – they are not all as bad as each other.

    To concentrate on an “inflation target” is to ignore the fact that real inflation is an increase in the money supply, not an increase in the “price level” (whether measured by the R.P.I. or by some other method).

    “Stable prices” went along with the vast American credit money expansion of the late 1920’s (a boom that led, of course, to a bust), and “low inflation” went along with the early part of the Lawson credit money boom.

    Just because one has fiat money and a central bank does not mean that one has to have credit money expansion on this scale.

    “Do not blame us for what we do, we are just looking at the price level as ordered to by Mr Brown” is absurd.

    If the order is to “increase the money supply as long as the price level does not rise too quickly” the only logical course is to resign.

    Let Mr Brown take the responsibilty for the increase in the money supply.

    And whilst we are talking of the money supply. If it is good idea to increase it (as long as the “price level” remains stable), who not do so directly – i.e. through a government printing press.

    Why go through the complex credit exapansion rituals of the financial institutions?

    Why not rib off the veil of decency and just print the money and spend it (harmful though this would be)?

    I suspect that the very financial industry people who support credit expansion (as long as the “price level” does not rise too fast) would attack direct print-and-spend as terrible.

    And they would be correct to attack it is a terrible – but the effect of their own credit money expansion is much the same.

    The only difference is that the various financial institutions would not benefit from direct print-and-spend in the way that they benefit from indirect credit money expansion.

    The cleverness of J.M. Keynes did not lie in suggesting an increase in the amount of money (such an increase in “demand” had been suggested by various “monetary cranks” for many years), his cleverness lay in suggesting that the procedure be undertaken through the banking system – which got a lot of people on his side (people who could see how they would benefit from such a credit-money expansion).

    As F. A. Hayek was fond of pointing out (see his essay in “New Studies” 1978 and many other sources), a real monetary expansion is not like the increase in the money supply one finds (for example) presented by the monetarists – it is not a matter of everyone getting X per cent more money (as if it had teleported to them).

    Money (in a credit money expansion) is more like “treacle”, its flow piles up in mounds in certain places, and it seems to stick to the fingers of some people.

    Asking people in certain business enterprises if there needs to be a credit-money expansion, is like asking a barber whether one needs a haircut.

    To be fair some people in these industries (whether the financial services industries, involved in the game directly, or other business enterprises looking for “more demand” or just “lower interest rates” for their debts) may sometimes say a credit expansion has gone too far.

    But cut off the drip feed of funny money totally? Oh dear me no.

    That politicians, administrators, media folk and academics do not tend to be in favour of a free market is something that every libertarian learns very quickly – that few people involved in business are in favour of a free market is a bitter fact that we learn more slowly.

    Most business people (at least connected ones), want to “play the game” or “make a deal”. This is only natural, men of business tend to adapt to the situation they find themselves in (otherwise they do not tend to prosper). And the modern situation is a vile one.

    Or to put it in nice “value free” language – “the capital structure and, therefore, the structure of production is distorted by malinvestments influenced by the credit-money expansion over time”.

    Not the words that I tend to think in, but then one should not use such “Anglo Saxon” words in public.

  • Paul Marks

    Nothing I have written above should be interpreted to suggest that HJHJ has less knowledge of political economy than most people (I am sure that he knows far more than 99% of the population).

    Nor should it be interpreted as a claim of moral superiority on my part. My behaviour over the years has been disgusting, I would guess that HJHJ has acted far better than I have done (this would not be difficult).

    I also should correct an implied claim that Mr Clarke does not really mean his attacks on Mr Brown’s spending – I am not a mind reader and, therefore, can not know what is going on inside Mr Clarke’s mind.