Reinventing the State Chapter 15: The Case for Localism - the Liberal Narrative

The problem with reviewing Chris Huhne's second chapter, making the case for localism in public service provision, is that it is by now an argument we are very familiar with. And one which I entirely support.

Peter Welch takes a thorough look at this issue in the context of the leadership election here. To paraphrase (or perhaps invent) Peter's question to Chris, it is this: Is localism the end of the story?

And would we rule out localities being permitted to introduce insurance or vouchers? Chris doesn't say, but if so the power of his own argument defeats him. And if not, it was strange of him to make such a fuss about ruling them out during the leadership election.

And finally, although I agree localism is the right policy, I am not entirely satisfied with having to say 'localism is the answer' on the doorstep. Why? For two reasons. Firstly, because there is no more confidence in the ability of local government than there is of any other level, there is a vicious cycle of insignificance and second-rateness about local politics, and rarely (at least round here) much local press scrutiny of local issues. Perversely it may seem easier to hold national politicians to account because at least they appear on Newsnight or the Today programme.

The second reason is that we are local politicians too. A policy worthy of the name must say what we would actually do locally, once localism was in place. Headlining the localism can sound evasive.

But these are questions about the completeness and presentation of the policy, not objections to it. Anyway I will pick up on a couple of points in Chris's text...

I have considerable doubts about whether there is really such a close parallel
between markets in the private and public sphere: if you buy more or fewer
oranges you are unlikely to affect in any material way anyone else's options.
But if you take your child away from a failing school, you may worsen the
outlook for the children left behind. One person's exercise of choice may limit
anothers.

I have great difficulty with even a slight suggestion that a parent shouldn't take their child away from a failing school. Actually Chris's school example does seem to have a private sphere market analogue: that of positional goods. If you buy Van Gogh's sunflowers, nobody else can. Positional goods have some (intrinsic?) limit on their supply, and a good question might be why do schools appear to be like this. I suggest that the extent to which they are like this is due to the influence of the peer group. There are so many talented and hard working children and so many difficult ones, and we all want our children educated with the former.

Quality peers are a positional good, and this explains much of the heat over private schools, admissions policies, selection, etc. Policies which address funding and governance may be good but largely ignore this issue.


The other aspect of Chris's argument I find unconvincing is the section explaining why more localism would not increase inequality. Now I agree with the conclusion, but I think the argument is cod statistics. Chris shows a graph plotting inequality (the Gini index) against the proportion of taxes raised locally. This shows little or no correlation. Meh.

It is, for example, entirely possible that more equal countries are willing to tolerate greater decentralisation, but that they become less equal as a result. It is possible that there is a correlation here, positive or negative, but hidden by some other variable that is also correlated. It is certain that we are comparing numbers that are not strictly comparable. No, it is nice to have the odd graph, but it is bad statistics to base firm conclusions on it.

But I am nitpicking. Chris has an easy win with the case for localism. He brutally mocks the rewards for failure that went to Margaret Beckett and David Milliband.

It is as if we were implicitly admitting that the system is so big and so
complex that it would be unfair to hold anyone to account for its
failures.

Amen.