The government has lost the economic argument around immigration

It now straddles two contradictory claims.

Gus O'Donnell, the former head of the civil service, has written in an article in the Times that the government is "shooting itself in the foot" with its desire to lower immigration.

He writes (£):

A big barrier to growth is an immigration policy that deprives the UK of skilled workers in certain disciplines. Lord Heseltine, while at pains to avoid criticising the Government, clearly sympathises with the difficulties that businesses face in recruiting these workers.

O'Donnell's criticism piles on the pressure the government is facing to justify its immigration policy in economic, as well as just populist, terms. As he mentioned, Heseltine's review, No stone unturned (pdf), also tactfully steers a course rather different to that currently being pursued by the Home Office.

Heseltine writes:

It goes almost without saying that the ideal solution is a well-managed immigration system that is open and welcoming to those who can address our skills gaps and add value to the economy, yet is unattractive to those who do not have and would not get permission to be here. This is easier said than done at a time of tough manpower constraints in the public sector.

While it "almost goes without saying", that is not actually the government's own strategy. The Conservatives are locked into a damaging attempt to bring net migration in under an arbitrary cap; and worse, they have no power to affect the biggest single contributor to that number, which is intra-EU migration.

As a result, the party is forced to attack the small sliver of migration they can have an effect on. But unskilled, non-EU migration had already been extremely constrained by the previous government, so to limit immigration any further, skilled migration came under fire. Even with new strict measures on visas, the government is losing the fight miserably. Its target is net migration of 100,000 people; the latest figures show that number is 216,000.

Politically the government is failing. It has set itself a challenge which it will not – cannot – meet. That alone would be a reason for abandoning the aim now, nobly accepting defeat, even if that figure weren't one which no sane government ought to try to achieve.

Last week's Economist leader laid out the problem the economy faces as a result of this policy in stark terms:

The country has, in effect, installed a “keep out” sign over the white cliffs of Dover. Even as Mr Cameron defends the City of London as a global financial centre, and takes planeloads of business folk on foreign trips, his government ratchets up measures that would turn an entrepôt into a fortress. In the past two years the Tories have made it much harder for students and foreign workers and family members to enter and settle in the country. Britain is not only losing the war for global talent, it is scarcely competing. More people now leave to take up job offers in other countries than come the other way.

In fact, even the nascent pro-immigration voices on the right don't take the argument far enough. While many of them are content to make the argument that immigration represents a favourable trade-off between unemployment and growth, few take the extra step of point out that immigration can help with both employment and growth. This argument involves tackling head-on the pervasive "lump of labour" fallacy – the idea that there are a fixed number of jobs, and if a foreigner gets one, then a Briton can't.

Forbes blogger Adam Ozimek writes about Silicon Valley, where a similar argument is taking place after a technology journalist, Robert X Cringley, has criticised skilled-migration visas:

Imagine the worst case scenario in Cringely’s mind occurs, and a foreign worker takes a job at a 30% discount, and a native worker who could have had the job has to settle for a lower paying job. To understand the impact on U.S. workers you have to look beyond this worker who has had his job “stolen”, and must look at what economists call the general equilibrium effect. Here are other things that happen: the H1-B worker buys or rents a home, and a landlord of home seller benefits, overall, new houses will be built, meaning construction workers benefit. The H1-B worker shops at a grocery store, which employs workers, and sells goods made by farmers who also employ workers. See how this goes?

The economic case for limiting migration is thoroughly lost. At best, the government is now facing the risk that this argument filters into the popular perception; at worst, it is in the position of encouraging a popular attitude which is simply incorrect.

Placards at a protest against the decision to strip London Met university of its ability to sponsor international study. Photograph: Getty Images

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 will Labour handle the Trident vote?

Shadow cabinet ministers have been promised a free vote and dismiss suggestions that the party should abstain. 

At some point this year MPs will vote on whether Trident should be renewed. It is politics, rather than policy, that will likely determine the timing. With Labour more divided on the nuclear question than any other, the Tories aim to inflict maximum damage on the opposition. Some want an early vote in order to wreak havoc ahead of the May elections, while others suggest waiting until autumn in the hope that the unilateralist Jeremy Corbyn may have changed party policy by then.  

Urged at PMQs by Conservative defence select committee chair Julian Lewis to "do the statesmanlike thing" and hold the vote "as soon as possible", Cameron replied: "We should have the vote when we need to have the vote and that is exactly what we will do" - a reply that does little to settle the matter. 

As I've reported before, frontbenchers have been privately assured by Corbyn that they and other Labour MPs will have a free vote on the issue. Just seven of the shadow cabinet's 31 members support unilateral disarmament, with Tom Watson, Andy Burnham, Hilary Benn and Angela Eagle among those committed to Trident renewal. But interviewed on the Today programme yesterday, after her gruelling PLP appearance, Emily Thornberry suggested that Labour may advise MPs to abstain. Noting that there was no legal requirement for the Commons to vote on the decision (and that MPs did so in 2007), she denounced the Tories for "playing games". But the possibility that Labour could ignore the vote was described to me by one shadow cabinet member as "madness". He warned that Labour would appear entirely unfit to govern if it abstained on a matter of national security. 

But with Trident renewal a fait accompli, owing to the Conservatives' majority, the real battle is to determine Labour's stance at the next election. Sources on both sides are doubtful that Corbyn will have the support required to change policy at the party conference, with the trade unions, including the pro-Trident Unite and GMB, holding 50 per cent of the vote. And Trident supporters also speak of their success against the left in constituency delegate elections. One described the Corbyn-aligned Momentum as a "clickocracy" that ultimately failed to turn out when required. 

George Eaton is political editor of the New Statesman.