New Broadcasting House. The BBC is a fine institution, but needs to get its house in order. Photo: Oli Scarff/Getty Images
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Leader: Blind faith in the BBC

The BBC is the best broadcaster in the world - but it needs to get its house in order.

The former Conservative chancellor Nigel Lawson once said that the National Health Service was the nearest thing the English people had to a national religion, but surely the BBC must come close behind. Our state broadcaster is frequently mentioned as a source of Britain’s international “soft power”, with Top Gear alone sold to more than 200 countries around the world.

The comparison between the NHS and the BBC is apposite, because these institutions suffer from several of the same malaises: overmanaged while their front lines are under-resourced, a few individuals at the top enjoying bloated salaries while low-paid workers with insecure contracts pick up the slack from redundancies and cutbacks at the bottom.

It also must be said that both organisations are too often blindly defended by the left. That is understandable. If neither existed, our country would be much the poorer for it. Yet affection for the history of these great institutions should not lead us to treat questions over their efficiency and purpose as an assault on our values. During the last election, Ed Miliband spoke of “weaponising” the health service; in the end this amounted to a handful of small-scale proposals, such as one-week tests for cancer, and a panoply of misty-eyed “I heart the NHS” badges and Twitter ribbons. Labour’s health policy was never bold or innovative: the service was supposed to function merely as an applause line, its very existence an implicit rebuke to the supposedly uncaring Tories.

It is tempting for progressives to pursue a similar strategy towards the BBC, particularly because it now seems to be coming under sustained assault from a Tory party that has always chafed at the licence fee funding a supposedly “left-wing” broadcaster. (This suggestion of left-wing bias is laughable; the BBC’s bias is merely towards the establishment.) John Whittingdale, who has long been hostile to the licence fee, is now Culture Secretary; and on 5 July the Chancellor, George Osborne, told Andrew Marr that he would curb the BBC’s “imperial” ambitions by reducing its budget. Mr Osborne added that the lifestyle features and the recipes on the BBC’s website were practically turning it into “the ­national newspaper as well as the national broadcaster”.

Tempting as it is to dismiss this analysis as one merely intended to help the (mostly right-wing) newspaper industry, it is fundamentally correct. For example, the BBC website publishes articles that recap trending topics on Twitter – traffic-chasing content that is in plentiful supply elsewhere. The reality shows on the youth-focused BBC3, such as Snog Marry Avoid and Don’t Tell the Bride, are hardly in the Reithian tradition. At the same time, the corporation’s coverage of news and politics has fallen far behind that of Channel 4 and Sky News in terms of the diversity of voices it represents (it is still, in Greg Dyke’s phrase, “hideously white”, but we could add to that: southern, male and middle-class). And as Jason Cowley notes in this week's issue, there are too many long-time senior executives collecting huge salaries with far too little to show for it.

The BBC is eminently defensible. It is the best broadcaster in the world. Thanks to the licence fee, it produces content of a quality and breadth that the commercial sector could never hope to match. And it is clear that it will need to be defended as the Conservatives enjoy the newfound power their overall majority in the Commons gives them. But the BBC must overhaul its practices and get its house in order.

Budget blues

The perversity of the British tax system is that it falls most heavily on earned income. Successful entrepreneurs pay more tax on their earnings and business than their children do on inheriting the fruits of that labour, while the very rich are adept at avoiding taxation altogether. A homeowner whose house triples in value pays no tax on the asset other than council tax – based on property valuations fixed in 1991. Land ownership, an increasingly valuable commodity, is subject to almost no taxation at all.

This requires a fundamental change in our attitude. We need a new business model in Britain, one that shifts the burden of taxation from earned to unearned income; from taxes on income and consumption to those on static assets – property, inheritance and land. As Vince Cable has written, we should shift taxation away from “profitable, productive investment” and towards “unproductive asset accumulation”.

For his next Budget, instead of tweaking inheritance tax to benefit the already property-rich, Mr Osborne should think again: levy more tax on assets, and less on income.

This article first appeared in the 09 July 2015 issue of the New Statesman, The austerity war

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Leader: The unresolved Eurozone crisis

The continent that once aspired to be a rival superpower to the US is now a byword for decline, and ethnic nationalism and right-wing populism are thriving.

The eurozone crisis was never resolved. It was merely conveniently forgotten. The vote for Brexit, the terrible war in Syria and Donald Trump’s election as US president all distracted from the single currency’s woes. Yet its contradictions endure, a permanent threat to continental European stability and the future cohesion of the European Union.

The resignation of the Italian prime minister Matteo Renzi, following defeat in a constitutional referendum on 4 December, was the moment at which some believed that Europe would be overwhelmed. Among the champions of the No campaign were the anti-euro Five Star Movement (which has led in some recent opinion polls) and the separatist Lega Nord. Opponents of the EU, such as Nigel Farage, hailed the result as a rejection of the single currency.

An Italian exit, if not unthinkable, is far from inevitable, however. The No campaign comprised not only Eurosceptics but pro-Europeans such as the former prime minister Mario Monti and members of Mr Renzi’s liberal-centrist Democratic Party. Few voters treated the referendum as a judgement on the monetary union.

To achieve withdrawal from the euro, the populist Five Star Movement would need first to form a government (no easy task under Italy’s complex multiparty system), then amend the constitution to allow a public vote on Italy’s membership of the currency. Opinion polls continue to show a majority opposed to the return of the lira.

But Europe faces far more immediate dangers. Italy’s fragile banking system has been imperilled by the referendum result and the accompanying fall in investor confidence. In the absence of state aid, the Banca Monte dei Paschi di Siena, the world’s oldest bank, could soon face ruin. Italy’s national debt stands at 132 per cent of GDP, severely limiting its firepower, and its financial sector has amassed $360bn of bad loans. The risk is of a new financial crisis that spreads across the eurozone.

EU leaders’ record to date does not encourage optimism. Seven years after the Greek crisis began, the German government is continuing to advocate the failed path of austerity. On 4 December, Germany’s finance minister, Wolfgang Schäuble, declared that Greece must choose between unpopular “structural reforms” (a euphemism for austerity) or withdrawal from the euro. He insisted that debt relief “would not help” the immiserated country.

Yet the argument that austerity is unsustainable is now heard far beyond the Syriza government. The International Monetary Fund is among those that have demanded “unconditional” debt relief. Under the current bailout terms, Greece’s interest payments on its debt (roughly €330bn) will continually rise, consuming 60 per cent of its budget by 2060. The IMF has rightly proposed an extended repayment period and a fixed interest rate of 1.5 per cent. Faced with German intransigence, it is refusing to provide further funding.

Ever since the European Central Bank president, Mario Draghi, declared in 2012 that he was prepared to do “whatever it takes” to preserve the single currency, EU member states have relied on monetary policy to contain the crisis. This complacent approach could unravel. From the euro’s inception, economists have warned of the dangers of a monetary union that is unmatched by fiscal and political union. The UK, partly for these reasons, wisely rejected membership, but other states have been condemned to stagnation. As Felix Martin writes on page 15, “Italy today is worse off than it was not just in 2007, but in 1997. National output per head has stagnated for 20 years – an astonishing . . . statistic.”

Germany’s refusal to support demand (having benefited from a fixed exchange rate) undermined the principles of European solidarity and shared prosperity. German unemployment has fallen to 4.1 per cent, the lowest level since 1981, but joblessness is at 23.4 per cent in Greece, 19 per cent in Spain and 11.6 per cent in Italy. The youngest have suffered most. Youth unemployment is 46.5 per cent in Greece, 42.6 per cent in Spain and 36.4 per cent in Italy. No social model should tolerate such waste.

“If the euro fails, then Europe fails,” the German chancellor, Angela Merkel, has often asserted. Yet it does not follow that Europe will succeed if the euro survives. The continent that once aspired to be a rival superpower to the US is now a byword for decline, and ethnic nationalism and right-wing populism are thriving. In these circumstances, the surprise has been not voters’ intemperance, but their patience.

This article first appeared in the 08 December 2016 issue of the New Statesman, Brexit to Trump