Inflation Spin Masks Dire Deflation

Government inflation figures are masking the dire state of the economy as ministers have become victims of their own spin. Today's official figures hide what lies beneath, as the country spirals down into dangerous deflation. 

Even the government's own official and well-spun inflation figure has sunk to 3%, craftily hiding the true fall. Things must be really getting bad for the economy.

Inflation dropped to 3% in January, down from 3.1% in December, as measured by the government's consumer price index (CPI), already seized on some with a gleeful "it's not as bad as expected". But that cut no ice with the Times.

The better indicator, the Retail Price Index (RPI), which includes housing, is already falling into dangerous negative territory. It's at a scary 0.1% last month from December's 0.9%. 

And that will send a cold chill down the spine of those whose pay rises, pensions and savings are directly linked to the realistic RPI. 

The fall raises the spectre of deflation which will become negative this year. But the government continues to bury its head in the sand, preferring its own CPI which  kept them in good stead during the boom years. 

Deflation is the killer punch for any economy. Any hope of a boost by increasing consumer spending, is either short-lived or just doesn't happen. People shop around frantically looking for the cheapest deals and put off spending, preferring instead to try to clear a mountain of debt. 

The CPI is a neat little device used to set inflation. It works by carefully selecting what government wants to measure and then a cunning weighting is dropped in to make those final tweaks and adjustments.

Inflation used to be measured by the retail price index (RPI) but New Labour ditched that in 2003.

The CPI is a less effective measure of price falls than the old RPI, but it's much easier to manipulate. But even the spin cannot hide the downwards spiral. 

As the government and Bank of England run out of magic bullets for the economy, the next step has to be to print money, lovingly disguised as 'quantitative easing' and a barrow full of banknotes. 

It's clear the government hasn't a cat in hell's chance of funding its ridiculous borrowing binge but printing money is fraught with long-term dangers.

Brown has steadfastly buried his head in the sand, refusing to shoulder any blame for the current economic disaster. The Orange Party has warned time and again the government is in denial about the dire state of the economy. 

There are realistic ways out of the depression recession, apart from massive government borrowing and reckless spending and printing cash but that would mean the government would have to own up to past mistakes and stop believing in its own spin.

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British Food For British Politicians

Foodies and farmers are having a field day with politicians falling over themselves to get a slice of the bacon and bang the drum for Britain. 

But how much is this a pathetic attempt to jump on the Jamie bandwagon and how much a realistic attempt to finally do something about bad food Britain and the ravaged farming industry?

Not one to miss a trick, environment secretary, Hilary Benn told the National Farmers' Union in Birmingham: "I'm very proud of what British farming does for our country. Farmers do so much for the environment out of love of the land."

What utter patronising nonesense. Farmers are trying to make a living just like everyone else. 

They're bogged down by Brussels red tape, a supermarket stranglehold  on prices, a government which doesn't give a fig about the industry and competition from imported crap food dressed up and processed by slave labour in the food processing camps. Then forced down the nation's throats to make them fat. 

That has been the problem every since Joanna Blythmam first launched her gastronomic polemic and showed how a nation had ruined its appetite in Bad Food Britain. Benn may be trying to hang out his environmental credentials but it is those issues which need to be addressed. 

Latching onto the current craze, whipped up by Jamie Oliver's Buy British and Save our Bacon is an admirable cause and one to be encouraged. But how does that square with a government obsessed by protectionism and the justified fear of a rising spectre of economic nationalism? 

Not questions asked in France, Italy or in any other EU country. Both France and Italy lead the pack, fighting the corner for the consumer and their farming industry, with food an essential part of the terroir. 

But in both those countries the farming industry and the consumer are powerful voices which politicians ignore at their peril, unlike an industry and public here, who have been brow-beaten into submission. 

Words and platitudes are not the answer. To their credit, the Tories have been quick to spot this gap in the market with a spot of realism outflanking a wishy washy government response.

It's a simple mater of labelling. How can you trust something that's got a Union Flag plastered on it when the tiny print tells you it is only produced and packed in Britain, not British born and bred. 

People have a right to know where their food comes from. The Conservatives are promoting a refreshing and what seems to be a totally honest campaign called 'Honest Food'. Whatever your politics, the video released to coincide with the campaign is a little gem.

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How Will Gordon Go?

Beleaguered Brown is hanging on by his fingertips as he battles with botched up banks and bonuses. Now the vultures are circling with politicians and commentators eager to throw in their two penneth on how Gordon will go. 

It's no longer a question of if men in grey suits or white coats will come and take him away but when and how. 

That speculation reached fever pitch today with, among others, Trevor Kavanagh capturing the public mood and thundering in the Sun calling for Brown's head after the mess he's caused. The Guardian's Jackie Ashley speculates on how it may all end for the once Great Gordon. And she knows a thing or two about Brown politics.

Brown's gut reaction is to hang on until the bitter end, despite what strategists and polls tell him. Out of touch with reality, sure, but he has a passionate belief in the Party and that could be the key to his future.

The white coat option - to spend more time with his family - is certainly not Brown's style and for him why should it be? He now stands alone thinking he's the man to save the world but think it he does. There has to be a Plan B. 

What is surprising is that it has taken some commentators so long to wake up to the obvious. Brown and his inner Downing Street circle are biding their time and simply mulling over the best time and place for their supreme leader do honourable thing and go. 

Ashley fuels speculation by suggesting Brown may take a job with the IMF as his escape route. That idea is certainly nothing new and indeed was floated by the Orange Party back in October. Politicshome's panel of insiders reckons he's better off jumping into that lifeboat. 

The key lies in the G20 summit in London on April 2. Downing Street and Brown are obsessed by the whole thing and deals are being struck to try to make sure Obama swings round for the photo-op. IMF or not, Downing Street spinners will want him to go out on what they think will be a high, as the disastrous June elections loom on the horizon. 

But it is the question of who would replace Brown that's starting a leadership bid frenzy. And Ashley drops beaming health secretary Alan Johnson's name into the hat without a by-your-leave. 

Place wake up. Of course it's Johnson. That was hinted here by the Orange Party way back in July. He's a working class lad and one of the few cabinet ministers who didn't read PPE at Oxford, preferring instead to read postcodes. Though he'd have a fight on his hands with Harriet Harman.

The battle has always been between the 'old' or true Labour who hadn't a cat in hell's chance of gaining power in the post Thatcher years and the Blairite gang who hijacked the Party for their own selfish ends. But with Blair leading voters into the false Promised Land, why not go along for the ride? 

That could be played out again but with a true Labour man at the helm and an ermine-clad spinner pulling the strings from behind and flying the flag for New Labour. Much would depend on how much Johnson, now a Blairite New Labour prop,  could and would be willing to be manipulated in return for the top job.  

Brown was never ever one of the original gang - just the guy brought in to cook the books with crafty accounting now exposed as a pack of lies and deceit. 

Brown's Party is still the late leader John Smith's Party. And if his parting shot to New Labour is to sail off into the wild blue yonder with a job with his buddies at the IMF, handing the crown over to election vote-winning Johnson, then that noble move would be good for the Party and the country.

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Chancer Darling Joins Smith's Scam

Chancellor Darling has been exposed as just another chancer using the same second homes expenses fiddle as two homes secretary Smith. If the public thought anyone would lie straight in bed it would be the fastidious chancellor Darling. But second homes expenses scams seem to run in the cabinet family. 

What is it with cabinet ministers and their obsession with second homes? Cabinet ministers have used the allowance to claim more than £2 million over the past six years. The Orange Party has an simple answer- greed. 

Greedy government ministers, with first the home secretary now the chancellor caught shamefully fiddling commons expenses. 

The Mail On Sunday's  second Sunday instalment reports Darling's done a Jacqui over commons expenses after it emerged he lavished £70,000 on his family home in Edinburgh, claiming thousands of pounds in taxpayers' cash by classing the £1.2million townhouse as his ‘second home'.

Before he became chancellor, Darling claimed that a small London flat - worth only around £150-a-week in rent - was his 'main home'.

You can't make it up. And judging by the Mail on Sunday and the Sunday Telegraph reports - they haven't. 

Only last week, home secretary Smith was caught out in the same outrageous expenses scam  after  she'd claimed £116,000 on her family home in Redditch, claiming her West Midlands family home is her second home, while lodging with her sister in London and claiming that is her first home. 

And Smith is not the first cabinet minister to be caught using their MPs' homes expenses in a squalid rip-off at the taxpayers' expense. 

Brown's favourite cabinet couple, Ed Balls and wife Yvette Cooper were let off the hook  after it was claimed they had been able to "maximise" their taxpayer-funded second homes allowances, by claiming their London home was their main home. But not before they faced questions over their decision to flag up their Yorkshire home as their main home, even though their children attend school in London.

Once again we will have to go through all the rigmarole. There is no suggestion that Darling broke any commons rules. It's all perfectly within the law. 

But that's hardly the point when the rest of the country is having to suffer the misery and hardship of a deep and depressing recession. Ministers are on the take in what is nothing short of a common commons scam.

But once again it seems with ministers wrapped up in their own arrogance and self-interest and with the full backing of Brown, any cabinet minister caught fiddling expenses can ride out the storm. 

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Obama's Pork Pie In The Sky Package

Obama's $789 billion pork and pie in the sky dream rushed through Congress is being sold as an 'economic stimulus' when it is a spending bill which will saddle US taxpayers with massive debt for years to come. As Democrats embark on a huge spending spree for their pet projects, the measures have been slammed as a monumental waste of public cash. Now where have we heard that before? 

The package has been wrapped up in pretty pink ribbon and sold to the American people like soap powder, as the new president pushed through the spending spree with evangelical zeal. 

But disturbingly, there's no bi-partisan support, with Republicans and a handful of Democrats voting against it. As usual the devil is in the detail. 

The 1,071 page, 8-inch-thick stimulus/spending Bill has a welcome $281 billion in tax cuts but that's peanuts. More than a half-trillion dollars is earmarked for government spending on infrastructure, health care bureaucracy and state governments. 

At the heart is whether these measures will dig the US out of deep recession, create jobs and expand the economy. Some think it's garbage.

Borrowing from Winston Churchill, one Republican remarked: "Never have so few spent so much so quickly to do so little."

As the package did its rounds, the wording of the spinners on jobs carefully changed. Now it's 3.5 million jobs "that we look forward to saving or creating." 

The entire mess will eventually cost not $789 billion but $3.27 trillion when $744 billion in debt service and $2.5 trillion in spending over the next 10 years is included. And that will cost every US family almost $10,000 in added debt. 

The monster is full of pork-barrel politics.

$2 billion to Obama's favourite "community" group ACORN, that's accused of voter registration fraud, $30 million to Nancy Pelosi's pet project to restore wetlands and save the endangered salt marsh harvest mouse, another $1 billion for a Prevention and Wellness Fund.

Tens of billions will be spent on high-speed rail lines but only in key politically sensitive areas. And vote-catching broadband for everyone in rural areas

Take away the pork and the dollars left over for small-business tax relief amount to only "about one-third of 1% of the total bill," a mere $3 billion out of a $789 billion package. There are no tax cuts to boost investment.

The bulk of the spending comes not right away when the economy needs a boost, but in the dim and distant future. 

Japan, spent $6.3 trillion on infrastructure in the 1990s and racked up the biggest debt in the developed world. Yet all that spending failed to pull Japan out of its slump.

Sure as eggs is eggs, Obama will have to return to the trough, demanding more taxpayer cash. 

But the Obama administration is betting the relative small amount combining tax cuts with spending on unemployment assistance, social security and the Medicaid health program will stop the economy's spiralling decline. Sure that makes people feel better, but it won't boost the economy. 

Schools would receive $70 billion to prevent cutbacks and repair crumbling schools. There's about $50 billion for energy efficiency programs and renewable energy. It's all starting to sound eerily familiar. 

Many have already pointed out a whole raft of of questionable spending, including a massive Federal health care computer system - modelled on our own disastrous £12.7 billion NHS computer shambles - only bigger. 

Speaking for the first time since his presidential defeat, Republican John McCain said: "This measure contains much that is not stimulative and is nothing short—nothing short—of generational theft since it burdens future generations with so much debt."

Why should anyone care about a reckless spending spree across the Pond which will plunge the nation deeper in debt? Because that's exactly what Brown and his hapless chancellor are planning over here, as they face up to disaster in the June elections. 

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A Kosher Reason For Backing Jews

Struggling with the vexed question of why an old liberal Leftie should feel so Jewish all of a sudden, the Orange Party is not alone in trying to unravel the mystery. The answer comes from another liberal Leftie, author Nick Cohen, who's delivered scorching polemics on the mixed-up values of the old Left. Cohen puts his finger on it: "The more the British Left indulges antisemitism, the more kosher I feel."

Cohen's article for the Jewish Chronicle begins in a jocular vein: 

My name is Nick Cohen, and I think I’m turning into a Jew. Despite being called “Cohen”, I’ve never been Jewish before.

But where he's coming from chimes with some on the so-called liberal left: 

My sole interest in Jewish concerns came from being a left-wing opponent of the far Right, and the blood-soaked antisemitic superstitions which turned Europe into a graveyard. When I was young, such attitudes seemed unproblematic. You did not have to be a Jew to oppose fascism; everyone I knew did that regardless of colour or creed.

And that leads into a powerful and forceful argument: 

Today the old certainties have gone because there are two far-right movements: the white neo-Nazi parties that the Left still opposes; and the clerical fascists of radical Islam which, extraordinarily, the modern Left succours and indulges. I am not only talking about Ken Livingstone, George Galloway and their gruesome accomplices in the intelligentsia. Wider liberal society is almost as complicit. It does not applaud the Islamist far Right, but it will not condemn it either. From the broadcasters, through the liberal press, the Civil Service, the Metropolitan Police, the bench of bishops and the judiciary, antisemitism is no longer an unthinkable mental deformation. As long as the conspiracy theories of the counter-enlightenment come from ideologues with dark rather than white skins, nominally liberal men and women will not speak out.

For Cohen, the experiences of left-wing antisemitism and in particular the BBC's Gaza bias has changed the way he thinks and there is no retreat: 

As the struggle between theocracy and liberalism intensifies, I can see some being pushed into taking the same journey I have taken and finding their views towards Judaism and Israel softening as they realise that antisemitism helps drive the fascistic ideologies of the 21st century just as it drove the Nazism of the 20th.

Politicians keen on pseudo-liberal posturing should take note of that breath of fresh air. Give the boy a kosher sandwich.

Nick Cohen is the author of What's Left: How The Left Lost Its Way.

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Join Cuba's Free IT Revolution

Saving cash and breaking Microsoft's stranglehold are not government priorities but it could take a leaf out of Cuba's book, as the country gets to grips with the IT revolution, with plans to run computers on Gates-free, free software. 

In what smacks of a fresh salvo in a new Cold War, the island is following Russia's lead and moving away from Microsoft operating systems with its own take on the free, open source Linux-based system.

Here the government is paying lip-service to open source, vowing to boost its uptake in public services to reduce costs but with little evidence of action. A government 'action plan' is due to be published later this month.

The government's love affair with hugely expensive and utterly useless government IT projects is now beyond a joke, as gullible ministers continue to be taken in by the flannel of slick salesman, who promise the earth and deliver nothing. 

Today the biggest white elephant and biggest IT disaster, the £12.7 billion NHS computer shambles took a further knock, with one hospital trust claiming it's been forced to pump in £10m to prop up the useless system, causing the now all too familiar "heartache and hard work". 

As the NHS's Connecting for Health (CfH) computer system, dogged by problems and more than five years behind schedule, comes crashing down around the government's ears, beavering away in the background is the dominance of Microsoft in government departments and public bodies particularly schools, in return for a whopping licensing fee. 

Microsoft has a clear marketing aim to put its software in every computer in the world and who can blame them? But just because Bill Gates is big buddies with government doesn't mean ministers have to roll over and write a blank cheque with taxpayers cash. 

Computer sales to the public in Cuba only began only last year and the move is all part of a plan for "technological sovereignty".

The country this week launched its own variant of the Linux operating system in the latest fight against what it views as US hegemony.

According to Hector Rodriguez, dean of the School of Free Software at Cuba's University of Information Sciences, about 20 per cent of computers in Cuba, are currently using Linux. 

"I would like to think that in five years our country will have more than 50 per cent migrated to Linux," he said.

In Cuba it makes sense. The long-standing US trade embargo against the communist island makes it difficult for Cubans to get Microsoft software legally, as Castro's kid brother Raul tries to bring the country into the 20th century. 

But the movement towards free, open source operating systems and software has dedicated supporters throughout the world. 

Moving away from Microsoft is not pie in the sky. It's happening already in the new breed of Netbooks now on sale in the High Street. It makes sound economic sense as any issues over compatibility can be easily fixed. 

Rodriguez said free software better suits Cuba's world view: "The free software movement is closer to the ideology of the Cuban people, above all for the independence and sovereignty."

Now that's a tad controversial coming from a left-wing dictatorship but anything that's free and puts the brakes on Microsoft's plans for world domination is worth a serious look. 

Hasta La Victoria Siempre. 

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Stats Office Squares Up To Spinners

While it wasn't only the sea bass being grilled in the commons, served with lashings of Brown sauce, the row brewing at Westminster is how that reckless lot at the ONS had the cheek to publish clear, accurate and relevant jobs and immigrant figures, without letting Downing Street spinners get their grubby little paws on the press release. 

Yesterday's ONS release has left ministers "fizzing with anger" about the publication of numbers showing how many UK jobs go to immigrants.

The figures show the number of foreign workers increased by 175,000 to 2.4 million last year while the number of British workers fell by 234,000 to 27 million. Not good news for ministers still smarting from the BJ4BW protest. 

Such a release would have been unthinkable during the Campbell/Blair years and indeed up until very recently. But that was before home secretary Smith's political advisor was slammed by a commons watchdog after ordering the release of misleading knife crime figures. 

Then ministers and Downing Street spinners were blasted for 'corroding public trust'  using 'selective' figures to claim they are winning the war on the streets as ONS officials tried in vain to stop the government's 'reckless' release. 

The ONS is desperate to prove its independence and restore public confidence but juggling with any figures within a tight and highly skewed criteria set by the government has made a complete mockery of any government statistics, which no-one believes anymore, anyway. But well done guys for trying. 

Playing the numbers game has been a low point of the powerful Downing Street spin machine with obsessive control over what, where and when any information is released. 

Now it seems the spinning top had no idea what is coming out of the Office of National Statistics, as it fearlessly goes its own way. 

As usual, Mike Smithson over at politicalbetting puts his finger on the issue: "Isn’t this also a measure of the decline of Labour’s power? Whitehall has a strong sense that the game is up and bodies like the UK Statistics Authority can launch moves without fear."

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Wilders Ban Reeks Of Double Standards

Government double speak and double standards have been laid bare as the home office caved in to pseudo liberal pressure and banned a Dutch MP who has voiced his opposition to an “Islamic invasion”. His far right views are distasteful to some but the ban reveals a sinister trend to suppress a once cherished freedom of speech.

Geert Wilders, leader of the Dutch right-wing Freedom Party had been invited to show a film called 'Fitna' at the House of Lords. That was until home secretary, Jacqui Smith, stepped in and banned him from entering the country. 

But the film - easily viewed on YouTube - does not incite violence and does not break any laws, nor does the home office suggested that it does.

The Orange Party condemns religious zealots who preach hateful racial bigotry, particularly when they hide behind the mask of religion to ram political ideologies down our throats. Wilders' views are loony right but he should be free to express an opinion. 

As the Times thunders in an eloquent leader today: "There is almost nothing on which Mr Wilders cannot be relied upon to be inflammatory, ill advised and illiberal, and this is precisely why the Home Secretary is wrong to deny him entry. Mr Wilders is an elected politician in a member state of the European Union. Freedom of speech, association and travel is part of the political culture of Europe." 

Wilders opposes what he terms “Islamic invasion” and demands the US and EU “stop appeasing Islam and start fighting together against the rapidly increasing Islamisation of Europe”.

Smith is doing no-one not least decent Muslims any favours. The half-baked decision reeks of double standards, when the UK denies a politician access to the country, just because someone doesn't like what he says. 

Let the man in. It is better to blow apart his arguments rather than just forcing him to shut up.

Holding up to ridicule the vices and virtues of society is essential in a tolerant liberal democracy and that has always included the right to oppose, mock and insult people's beliefs, as long as that doesn't overstep a clearly defined legal and moral mark set by the prevailing cultural mood of the day. 

But it seems the last thing the home office wanted was a confrontation between Wilders and some British Muslims. 

Wilders has never broken the law or threatened anyone with violence, yet the government has stood by while a number of extreme imams have been allowed to preach hatred. 

And it doesn't stop at turning a blind eye to extreme Islamists who openly incite murder and the destruction of Jews. Lesbian and gay people have been targets, as people have been allowed in to say whatever they want. On that criteria alone the decision doesn't make sense. 

All kinds of undesirables seem to be welcome, while this Dutch MP, who does not preach violence, is told that he can’t come here and that reeks of double standards. 

The actions of the home secretary only fuels the belief the government is quite happy to tolerate fanatics but not a misguided Wilders. 

And that decision highlights a fundamental and disturbing trend, when pseudo liberal views are allowed to corrupt a democracy's cherished values. 

UPDATE: Wilders, defied the ban and flew into Heathrow this afternoon where he's been held by home office immigration officials.

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