Opinionomics | 28 March 2012

Must-read comment and analysis. Featuring Robert Peston taking on the Bank of England.

1. Did the Bank of England cause the boom and bust? (BBC News)

How much were central banks to blame for the financial boom and bust, asks Robert Peston.

2. Heathrow's third runway is not happening – move on (Guardian)

John Stewart writes that the aviation industry's tired third runway campaign ignores the facts of the future of air travel, and a total lack of political will.

3. Focus: The middle-income trap (Economist | Graphic Detail)

The Economist examines economic growth relative to the United States, and finds remarkable – depressing – stability.

4. BUNDESBANK COMES OUT AGAINST WOMEN, WAR ON ALL GOOD THINGS CONTINUES. PUPPIES AND ICE CREAM TARGETED NEXT (FT alphaville)

Lisa Pollack looks in depth at the "women bankers riskier" story from yesterday.

5. Ireland Deserves Breathing Room on Debt to Revive Economy (Bloomberg View)

Bloomberg calls for Ireland to be given time off repaying its debts to the ECB.

A counterfeit €100 note is presented to the Bundesbank. Credit: Getty

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

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How Theresa May laid a trap for herself on the immigration target

When Home Secretary, she insisted on keeping foreign students in the figures – causing a headache for herself today.

When Home Secretary, Theresa May insisted that foreign students should continue to be counted in the overall immigration figures. Some cabinet colleagues, including then Business Secretary Vince Cable and Chancellor George Osborne wanted to reverse this. It was economically illiterate. Current ministers, like the Foreign Secretary Boris Johnson, Chancellor Philip Hammond and Home Secretary Amber Rudd, also want foreign students exempted from the total.

David Cameron’s government aimed to cut immigration figures – including overseas students in that aim meant trying to limit one of the UK’s crucial financial resources. They are worth £25bn to the UK economy, and their fees make up 14 per cent of total university income. And the impact is not just financial – welcoming foreign students is diplomatically and culturally key to Britain’s reputation and its relationship with the rest of the world too. Even more important now Brexit is on its way.

But they stayed in the figures – a situation that, along with counterproductive visa restrictions also introduced by May’s old department, put a lot of foreign students off studying here. For example, there has been a 44 per cent decrease in the number of Indian students coming to Britain to study in the last five years.

Now May’s stubbornness on the migration figures appears to have caught up with her. The Times has revealed that the Prime Minister is ready to “soften her longstanding opposition to taking foreign students out of immigration totals”. It reports that she will offer to change the way the numbers are calculated.

Why the u-turn? No 10 says the concession is to ensure the Higher and Research Bill, key university legislation, can pass due to a Lords amendment urging the government not to count students as “long-term migrants” for “public policy purposes”.

But it will also be a factor in May’s manifesto pledge (and continuation of Cameron’s promise) to cut immigration to the “tens of thousands”. Until today, ministers had been unclear about whether this would be in the manifesto.

Now her u-turn on student figures is being seized upon by opposition parties as “massaging” the migration figures to meet her target. An accusation for which May only has herself, and her steadfast politicising of immigration, to blame.

Anoosh Chakelian is senior writer at the New Statesman.

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