French president Nicolas Sarkozy delivers a speech in front of the Eiffel Tower in Paris, May 1

Facing an uphill battle to win Sunday’s presidential election, France’s Nicolas Sarkozy is trying desperately to cast his left wing opponent as an old school socialist who will try to tax and spend his way out of the nation’s budget woes.

During an almost three hour televised debate on Wednesday night, the incumbent attacked his Socialist Party challenger François Hollande at length on economic policy, characterizing his plan as one of “crazy overspending.” He specifically cited Hollande’s pledge to hire sixty thousand additional civil servants which Sarkozy lamented would only exacerbate France’s fiscal shortfall.

Hollande has said that he will not endeavor to reduce the deficit to under 3 percent of gross domestic product as is demanded by eurozone budget rules unless December’s fiscal compact is revised to put more emphasis on growth.

In a speech to supporters in front of the Eiffel Tower in Paris earlier this week, Sarkozy insisted that only spending restraint will save France from the fate that Greece and Spain, heavily indebted eurozone states, have suffered. Both have had to implement deep budget cuts to avert a sovereign default.

The president added, “We don’t want jealousy. We don’t want egalitarianism. We don’t want bitterness. We don’t want hatred. We don’t want class war. We don’t want socialism.”

Hollande defended his push for a more expansionary fiscal policy on Wednesday night by arguing that “Europe is today facing a possible resurgence of the crisis with generalized austerity. That’s what I don’t want.”

The conservative newspaper Le Figaro reiterated the president’s criticism of Hollande, describing him as an “old timer” in its editorial on Thursday while championing Sarkozy as a “modernist.”

The left leaning Libération, by contrast, predictably reported that Hollande had wiped the floor, headlining, “Hollande presides the debate.”

The socialist kept bringing the incumbent president back to his record, then developed his proposals, which conferred an authority that often irritated his adversary.

Hollande pledged to be “the president of unity” and appeared calm and confident whereas Sarkozy is seen as the “hyper president” who acts erratically and lashes out at opponents. He seemed reluctant to debate his stewardship of the French economy and for good reason. Despite his ominous warnings of what negative effects Hollande’s leftist policies will have on growth, Sarkozy himself has championed protectionist policies on the campaign trail and achieved markedly little reforms in his five years as president, despite promises to enact liberalizations.

The French economy contracted by 2.7 percent in 2009 and has since struggled to recover. The government had a €96 billion shortfall in 2011 which was equivalent to 7.1 percent of GDP. The deficit is expected to come out at 6 percent for the fiscal year 2012. In January, the country lost its top credit rating from the Standard & Poor’s agency.

The conservative government of Sarkozy’s party has tried to mend the deficit largely by raising taxes on consumption. That hasn’t stopped the president from claiming that an income tax hike, as favored by Hollande, would “discourage work” and “isolate France from the rest of the world.”

If Hollande wins the second round of the president election this weekend, which opinion polls suggest is likely, his Socialist Party will also probably secure a majority in parliament in June’s legislative elections. The right wing vote could be split if the nationalist Front nationale claims as big as a share of the vote as its standard bearer Marine Le Pen did in the first round of the presidential poll last month, foreboding major losses for Sarkozy’s conservatives.

President Barack Obama during a briefing in the Situation Room of the White House, March 23

The presidents of Argentina and the United States both announced measures to penalize the oil industry this week.

Argentina’s Cristina Fernández de Kirchner’s method is the most blatantly protectionist. She relieved Spain’s Repsol of its majority share in Yacimientos Petrolíferos Fiscales, Argentina’s largest oil company. From a president who has implemented dozens of policies that inhibit foreign trade and investment, the effective nationalization of the concern was almost to the expected.

“Companies that operate in Argentina, even when their shareholders are foreign, are Argentine companies. Don’t anyone forget that,” Kirchner said Monday. She felt it necessary to add, “I’m the head of state, not a thug,” even if her seizure of YPF suggests otherwise.

Kirchner’s Argentina ranks among the least economically free nations in Latin America. Regulations for businesses are burdensome and nontransparent. Tariffs, import and export controls, licensing provisions, restrictions on ports of entry and subsidies hugely distort commerce. Domestic preference in government procurement predated Kirchner’s administration but has not been repealed.

YPF stakes owned by Argentina’s Petersen Group will notably escape the expropriation.

Her American counterpart’s response to rising fuel prices has been timid in comparison to Kirchner’s brazen appropriation of a privately owned company and it is still a proposal, one that is unlikely to get support from a divided Congress.

President Barack Obama urged lawmakers on Tuesday to raise penalties on individuals and businesses that are involved in manipulative practices.

“We can’t afford a situation where speculators artificially manipulate markets by buying up oil, creating the perception of a shortage, and driving prices higher, only to flip the oil for a quick profit,” he said.

Opposition Republicans, who control the lower chamber of Congress, have dismissed the call as a political gimmick and blame Obama’s tendency to vilify domestic oil and gas production while subsidizing green energy alternatives for the mounting costs of fuel.

Gasoline prices in the United States have surged nearly 50 cents since late January, as tensions in the Middle East and supply disruptions bolstered oil costs. Prices are up nearly 70 percent compared to when Obama took office.

Blaming “speculation” has been a common refrain with Democrats in America and leftists around the developed world. It refers to oil futures markets which can affect prices at the pump if investors anticipate higher prices in the future and temporarily keep oil off the market. The amount of oil that can be stored off market is limited however and storage is costly.

As the libertarian Cato Institute’s Jerry Taylor and Peter Van Doren explain in Forbes this month, “If this is going on, we would expect to see some sort of inventory buildup.” This is not the case. “Hence, there’s no evidence that speculators are reducing the supply of crude or gasoline through increased storage.”

Who needs proof that a policy is appropriate or effective when it is popular though? Kirchner’s popularity may have dropped in recent months but that has more to do with the economy slowing down than Argentinian voters recognizing that their president’s policies are responsible for it.

80 percent of Americans believe that speculation is at least partly responsible for driving up fuel prices. Rather than admitting that “going green” will inevitably drive up costs at the pump—as he did quite plainly in 2008 when then senator Obama predicted that electricity rates would “necessarily skyrocket” as a result of his energy plan—the president is putting the blame on private enterprise. As is sadly true for President Kirchner as well, that is hardly news anymore.

Tiananmen Square in Beijing, China, February 15, 2005 (Peter Morgan)

The ambitions of a rising China on its way to global dominance could look very different in the year 2030. If the country fails to diversify its economy and the ruling Communist Party remains reluctant to challenge vested interests, it not only loses legitimacy but could be seen as an obstacle to further economic development.

This prospect of a Chinese Communist Party on its last legs is offered by E. Andrew Eccleston, a contributing analyst for the geostrategic consultancy firm Wikistrat. It ran a “China hits the Great Wall” simulation through March in which researchers from all over the world explored the potential and likely ramifications of a slowdown in Chinese growth.

Eccleston recognizes that China’s ruling party derives much of its legitimacy from high economic growth rates. He writes, “The social contract that the CCP had offered its citizens was economic freedom and rapid economic growth in exchange for the CCP’s unquestioned political monopoly.”

That contract is now under pressure as China’s burgeoning middle class begins to assert itself politically. It will be all the more so if the economy slows down while hundreds of millions of Chinese remain in poverty.

The catalyst could be a “rebalancing” of the world economy which forces China to decrease its dependence on exports to the West and enables foreign companies to boost their sales in China.

The United States are particularly adamant that such a rebalancing should occur. They complain that China’s currency is undervalued which poses an unfair advantage to Chinese exporters over their American competitors.

“The concept of rebalancing,” projects Eccleston, “was based on the idea that China could simultaneously withstand an increase in the value of its currency while climbing the production ladder of the global supply chain. This thinking,” he adds, “greatly overestimated the strength of China’s economy and institutions.”

The transition from an economy based on cheap exports to an economy based on services and higher end manufacturing was too big a change for the CCP to manage.

China’s response would likely have come in the form of increased protectionism—which exacerbated corruption in state owned enterprises and reversed the trend toward privatizations—possibly backed by military threats against low wage competitors in East Asia. Forced by greater powers to retreat from such showdowns, the Communist Party could have only lost face.

Rather than embracing reform and extending party membership to businessmen and other bourgeois interests, Beijing’s mandarins “chose to circle the wagons and protect the interests of the existing leadership.”

Local party chiefs and mayors of China’s sprawling coastal cities could pose another challenge to the system as they win popular support by “running” against Beijing. Crackdowns from the central government would only enhance their popularity so the party grants them autonomy and privileges instead.

“This trend toward localized rule swept through the country, further reducing the CCP’s ability to govern nationally. Local politics,” Eccleston predicts, “soon became the most dynamic parts of Chinese society.”

This development caused the CCP to become even more insular as it experienced brain drain to the more dynamic polities of the coast and local government.

As a result, when confronted with popular protests against corruption, pollution or failed economic and infrastructure policies—”there are Tiananmens everywhere”—the party fails to respond to them positively and sends in the troops instead. “This is the final delegitmizing factor for the party and rather than scare the people into submission, protests explode everywhere.”

This time, “there is no figure equivalent in stature to Deng Xiaoping to plot a course of action and reconcile feuding elements within government and disagreements over how to respond to the protests.”

Or is there? In another scenario, Wikistrat senior analyst Robert Jordan Prescott suggests that “Nixon opens China, again.” Only a shrewd leader who is respected by both the party establishment and ideological purists, he believes, can proceeding with selective liberalization and safeguard China’s economic future.

“When China hits the great wall,” writes Prescott, this Nixonesque figure “is the one who saves the party and country from complete stasis.”

If China’s future hinges on the emergency of a single, powerful leader, that is only testament though to the institutional weaknesses which Eccleston exposed.

One man may be able to bring together warring factions within the party and bridge the diverging interests between party and business and cities and hinterland but for such an accomplishment to last, the party itself must open up and channel the aspirations of the whole of China. Else, it could be on its last legs in less than two decades from now.

The Supreme Court of the United States in Washington DC, March 16, 2009 (Stephen Masker)

The Supreme Court of the United States later this week will hear the first arguments in the case against President Barack Obama’s signature health care reform law. The individual mandate, which compels citizens buy insurance at the risk of a financial penalty, is at the core of the constitutional argument against “ObamaCare,” as the law has been dubbed by opponents. But there are more, practical problems as well that will not be solved with repeal of the mandate alone.

Because government is inherently incapable of effectively regulating, let alone controlling, any sector of the economy, it should come as no surprise that in many instances, the health care law only made a bad situation worse by trying to solve problems that were created by government intervention with more government intervention.

Health care comprises nearly a fifth of the American economy. The notion that central planners in Washington can somehow better manage it than the millions of health care consumers and providers who constitute the market every day is so delusion that the collapse of the Soviet Union should have put it to rest entirely.

Yet America attempted programs premised on the same notion if executed on a smaller scale before. Medicaid, Medicare and an array of smaller health care entitlements combined accounted for half of all medical spending in the United States before the Democrats enacted their reform measure which will all but destroy the limited free market that still existed in health care and insurance.

That is not to say that American health care was fine before March 2010 but many of the problems associated with it were the government’s own doing.

After creating two health care entitlements, one for seniors and one for the poor, in the mid 1960s, public health care spending soared to such an extent that Congresses repeatedly intervened with price controls and regulations to try to control costs. Meanwhile, the more fundamental impediments to competition and efficiency were ignored.

Americans can buy health insurance policies only from companies that are licensed by the states in which they live. There is no nationwide insurance market, let alone foreign competition.

State governments, moreover, mandate that insurers cover all sorts of treatments that the consumer may not require nor wish to buy, including prenatal and psychiatric care. In most states, it was impossible for a people to insure themselves again medical catastrophe alone.

With ObamaCare, it will be impossible across the country because it, too, forces insurers to offer a basic plan that covers ambulatory services, hospitalization, maternity and mental health care as well as rehabilitative services.

Health insurance costs can only rise as a consequence. The administration and others proponents of the health reform measure have pointed out that millions of Americans were uninsured and people with preexisting conditions denied coverage before the law came into effect.

As recent as 2001, just 1 percent of Americans reported to have ever been denied health insurance. If they had preexisting conditions, they were probably charged higher premiums but this isn’t unfair. Premiums that are based on risk incentivize people to buy insurance while they are healthy and encourage insurance companies to develop innovative products that protect against the risk of rising premiums. The real problem, again, was created by government when it tried to provide people insurance through their employer. This denied consumers choice and further undermined competition.

It’s not just the health insurance market that’s limited by mandates and perverse tax incentives. Providers of health care, too, can only operate with a state license and states typically require a licensed physician to carry out procedures that an experienced nurse can otherwise perform without supervision. Because a doctor is more expensive than a nurse, the costs of treatment are far higher than they would be if care were unregulated.

In both health care and health insurance, the laws of supply and demand do not apply because government rations the supply on many levels. With ObamaCare, it will even ration specific procedures if they are deemed too costly. At the same time, demand is rising. No wonder costs skyrocket!

Democrats insisted that ObamaCare would somehow reduce the federal deficit by $1 trillion but it bankrupts the states.

Half of all the net gain in insurance coverage will be due to higher enrollment in Medicaid, including its Children’s Health Insurance Program. Medicaid is administered by the states but federally funded. ObamaCare forces the states to cover all persons with incomes up to 138 percent of the poverty level and prohibits them from setting their own eligibility criteria at the risk of losing their entire Medicaid funding.

The Federal Government will pay the increased costs until 2016 after which date the burden is gradually put on the states. Already, Medicaid costs, which are rising at more than 7 percent per year, are crowding out state investment in education and infrastructure. The additional costs will devastate state budgets unless they raise taxes substantially or chose to leave their poor without care entirely.

There is no way of salvaging whatever “good parts” may be in the reform bill while repealing the rest. The law should be overturned in its entirely once the Supreme Court rules the individual mandate unconstitutional. That should only be the start of a comprehensive deregulation of American health care and health insurance. Doing away with ObamaCare will only bring back a system that was in need of repair. What’s needed is not more entitlements and “rights” but fair and free competition.

The former committee secretary of the Communist Party of China in Chongqing, Bo Xilai

Steady as she goes. That’s the mantra of China’s ruling party. Premier Wen Jiabao knows that his country has to change its leftist ways if it is to enter the brave new world of global preeminence but old school socialists are pulling him back in, refusing to admit that China is prospering in spite rather than because of its hybrid system of central planning and free enterprise.

The natural outcome is an endless quest for compromise and consensus which especially defines the Communist Party leadership at the top.

China’s leaders must be bland and cautious lest they upset vested interests—including highly influential real estate developers, provincial barons and the captains of China’s state owned industries—or ideological zealots, many of whom barely, if at all, remember the atrocities of Mao’s “reforms” and revolutions.

One such an ideologue is Bo Xilai, the Communist Party chief in Chongqing who was sidelined this week as a result of his revivalist tendencies.

Bo was popular because he worked to curb corruption in his province but China is not a democracy in the traditional sense. The masses do not have a vote in the leadership transition that is happening this year and next. Bo did not fit the bill of colorless technocrat that is expected of one who aspires to a position in the Politburo.

His resignation appears to be part of a political crackdown. Maoist websites have been shut down. A left wing television host was fired. A public park in Chongqing, where people used to gather to sing patriotic anthems and wave red flags (Bo encouraged them to) was closed.

The measures follow Premier Wen’s warning last week that without political change, China could revisit the cruelties of the Cultural Revolution, Mao’s 1966-1976 purge of intellectuals.

Bizarrely, Newsweek columnist Niall Ferguson explains Bo’s ouster as a revival of the Cultural Revolution for the single reason that a dissident was “purged.”

Ideologically, his removal from power signifies the very opposite. There is no appetite for a return to Maoism in today’s China, at least not among the country’s elite. If there is a nostalgia for Mao’s times, however benign and superficial it may be, Beijing may not tolerate it anymore. The next generation of leadership will be as bureaucratic as the present. China soldiers on.

European Central Bank president Mario Draghi when he was governor of the Bank of Italy, February 28, 2011

Europe’s social model is obsolete and fading according to central bank president Mario Draghi. “You know there was a time when [economist] Rudi Dornbusch used to say that the Europeans are so rich they can afford to pay everybody for not working. That’s gone,” he said.

In an interview with The Wall Street Journal, the Italian head of the European Central Bank suggested that austerity is the new normal on the old continent. The social democratic welfare model of lifelong employment and generous safety nets is “already gone,” he said, citing high youth unemployment figures in the eurozone’s periphery.

In Greece and Spain, half of workers under the age of twenty-five is unemployed. The jobless rate in Italy and Portugal hovers around 30 percent.

Labor market reforms are essential if the highly indebted economies in the south of Europe are to recover. In Britain, Germany and other “core” countries, it is often easier for employers to dismiss and hire workers. In Germany and the Netherlands, trade unions have also been willing to freeze wages and accept temporary job contracts to weather the worst of the recession. Such flexibility is supposed to be extended throughout the single currency area as the euro nations have enacted a pact to boost their competitiveness.

Despite the recent emphasis on enhancing economic growth, Draghi said Europe must remain committed to short term fiscal consolidation. “Backtracking on fiscal targets would elicit an immediate reaction by the market,” he predicted, and make it more expensive for countries as Italy and Spain to borrow.

Draghi acknowledged that public spending cuts can hurt the economy in the short term but argued that the negative effects are offset by structural reforms.

Traffic in New Delhi, India, February 13, 2010 (Kalpana Chatterjee)

India’s central bank last week cut its growth forecasts for 2012 and moved to increase liquidity in an effort to contain a nearly 7.5 percent inflation rate. It specifically cited the government’s “policy and administrative uncertainty” as one of the reasons for India’s weakened economy.

The bank lamented “the absence of credible fiscal consolidation” and urged efforts to “induce investment that will help alleviate supply constraints in food and infrastructure.”

India has made it easier for foreigners to invest directly in domestic firms but structural industrial and labor market reforms, which are critical if the country of 1.2 billion is to live up to its economic potential, are unlikely to be enacted in the short term by the center left administration in New Delhi.

Neither of India’s two major political parties has so far been willing to risk losing votes from people who dependent on government for their livelihoods by reining in a pervasive bureaucracy that is rife with corruption. Ridden by scandals, Prime Minister Manmohan Singh’s government lacks the credibility to push ahead with reforms which the former finance minister himself pioneered in the 1990s.

Starting a business in India takes up to two hundreds days if one is to complete the excessive licensing requirements and can cost more than sixteen times the average annual income. That is, unless an entrepreneur has the financial resources to bribe officials and streamline the process.

Corruption is a major impediment to growth in itself. Property rights are not effectively protected nor enforced. Judicial procedures tend to be protracted and can be subject to political pressure.

The economic liberalization of India has lifted hundreds of millions out of poverty and allowed the country to attract international business and investment. The process has stalled at a time when China, India’s largest competitor for access to food, hydrocarbon, mineral and water resources abroad, is expanding its reach across the Indian Ocean.

Even as it enjoys an informed workforce that speaks English, laborers in China are better educated on average than their Indian counterparts. They are also more productive. China enjoys an almost complete industrial supremacy over its competitor. It produces nearly half of the world’s steel, ten times India’s output, while Chinese infrastructure receives three times the investment that India’s does.

There is mounting apprehension in India about the other Asian giant’s rise but also a huge disparity between the upper middle class’ recognition of what needs to be done to boost India’s competitiveness on the one hand and the everyday struggles of the nation’s poor on the other. The World Bank last year estimated that 32 percent of India’s population lives in poverty. Two-thirds of its people depend on rural employment for a living.

The agricultural economy nevertheless faces considerable challenges which the government has largely failed to address. There aren’t good roads to allow farmers to take their products to market but there is ample regulation of foodstuffs to discourage expansion.

Irrigation systems are poorly maintained when fossil aquifers are rapidly depleting. India’s food production is stagnating yet the country is projected to add almost half a billion people before 2050. Climate change further raises the specter of diminished river flows if Himalayan glaciers melt.

There is no question that India cannot afford a “Hindu rate of growth” anymore. If it is to meet the challenges of the twenty-first century, it must work to stamp out corruption, lift the regulatory burden that stifles innovation and growth and invest in its road and water infrastructure instead, else it may not be able to feed its people in the long term.

Prime Minister David Cameron speaks at a Conservative Party conference in Cardiff, March 6, 2011

British prime minister David Cameron set out a vision of a “socially responsible and genuinely popular capitalism” on Thursday. In a London speech, he argued that Britain wouldn’t build a better economy by turning its back on the free market. “We’ll do it by making sure that the market is fair as well as free,” he said.

Cameron’s address came mere days after opposition leader Ed Miliband advocated more aggressive consumer protection in an interview with The Daily Telegraph. He said, “People’s living standards are squeezed as never before” as a result of the government’s austerity policies.

Miliband’s Labour Party has somewhat distanced itself from the Third Way centrism of former prime minister Tony Blair but argues that it still champions the interests of the middle class.

In a policy speech last year, Miliband lambasted “predatory” business practices and “wealth strippers” which he claimed were ripping ordinary people off. They were “squeezed by runaway rewards at the top,” he lamented, while British society was “too often rewarding not the right people with the right values but the wrong people with the wrong values.”

The statements were generally interpreted as a return to past Labour strategy when it was in opposition to the “nasty” Tory party of Margaret Thatcher and her adherents who believed in smaller government and free enterprise.

Cameron on Thursday argued that the government was implementing “less but better regulation” and said “of course there is a role for government, for regulation and intervention” but “the real solution” to Britain’s economic woes “is more enterprise, competition and innovation.”

We are the party that understands how to make capitalism work; the party that has constantly defended our open economy against the economics of socialism.

David Cameron’s case for capitalism is less convincing than Thatcher’s and is informed more by pragmatism than ideology. He argues that the government has to cut because it faces a debt crisis. Labour points out that the spending policies haven’t contributed to higher growth.

Indeed they haven’t. The British chancellor announced last November that growth in 2012 will be weaker than the government previously anticipated. Whereas 2.5 percent expansion was projected in March 2011, the figure will probably come in under 1 percent this year.

Borrowing, therefore, will be higher—more than £120 billion this fiscal year and next which is nearly 5 percent of gross domestic product. Public spending, despite the “heartless” cuts Labour so condemns, has only increased under the coalition government.

Britain’s debt is roughly 62 percent of GDP or nearly £1 trillion but that doesn’t include the state’s huge pension liabilities. When factored in, according to the Treasury, the actual debt equals 173 percent of GDP

Last year, accountants at PricewaterhouseCoopers estimated that “Britain would have to make across the board budget cuts of 5 percent a year to come close to cutting the deficit in half by 2014.” They even assumed a slight economic upturn that’s unlikely to materialize due to Britain’s high energy costs and the spiraling debt crisis in Europe.

Cameron, for all his praise of the free market, isn’t making tremendous progressing in getting the government out of the way of job creators. The state still consumes more than half of economic output in Britain while the “cuts” (which aren’t real cuts but decreases in spending projections) barely meet the requirements set by private sector accountants to achieve a balanced budget.

British Labour Party leader Ed Miliband (Reuters)

Britain’s Labour Party leader Ed Miliband is struggling to connect with voters. His performances as opposition leader in parliament have been disappointing and despite mounting unease with the ruling coalition’s austerity agenda, his socialists are barely more popular today than they were during last year’s election.

Even if almost 70 percent of Britons believes that slowing budget cuts would boost growth according to a recent poll, less than 30 percent thinks Labour would do a better job than the government. The reason is simple—74 percent of respondents in another poll last week said that there should be no increase in borrowing to reduce the deficit. That included a majority of Labour voters.

It’s not just that British voters mistrust Labour on the economy. It’s that they don’t trust Labour’s leader. If ever they were willing to give “Red Ed” a chance to prove that he was more than a puppet for party activist and union leaders, he wasted it with his “predators and producers” speech at October’s party conference. There, he attempted to draw a line between honest “wealth producers” on the one hand and “asset strippers” on the other who were “squeezing” people at the bottom, indeed, ripping them off.

This sort of pre-Thatcherite rhetoric doesn’t tend to go well with a nation that’s instinctively laissez-faire. Yet the Labour Party loves it. When Miliband announced, “I’m not Tony Blair,” it was met with thunderous applause from party faithful before he could utter than he wasn’t Gordon Brown, his immediate predecessor as leader, either.

While David Cameron’s conservatives have moved to the center, the socialists have taken a hard turn leftward and many of them hardly recognize it. Coupled with Miliband’s feeble leadership style, it makes for dismal polling numbers. Just 3 percent of voters agree that he is a “natural leader,” half believe that he has no positive qualities whatsoever.

However, “there is something more profoundly wrong with Labour’s present condition than the personalities at the top of the party,” writes The Telegraph‘s Janet Daley, “although,” she believes, “the fact that they are at the top is not unconnected to this malaise.”

The party once again belongs to its hard core adherents. It has apparently given up on—or lost any understanding of—the wider electorate that once gave it a succession of general election victories.

As with committed political activist in any party, Labour’s are convinced that the other side isn’t just wrong but evil. That puts centrists off but Daley points out another predicament the opposition faces in appealing to its core constituency—working class voters.

The two legs of Labour’s activist base, militant unionism and salon leftism, “may be incompatible on many fronts,” she writes, “but what they have in common is an inexhaustible contempt for the opinions of ordinary people, or more specifically, that cohort of people which determines the outcome of elections.”

The disdain of Labour’s leadership was particularly visible during August’s mob violence in London and other English cities. While conservatives chastised the contemptible behavior of the rioters, Miliband urged Britons to try to understand these poor, desolate youth who, supposedly, were only protesting their deplorable situation, entirely brought on by the coalition’s reckless spending cuts.

This blatant disconnect between Labour and voters has forced the party back into ideological gridlock. As Daley puts it, the socialist mindset seems to be, “if people do not agree with us, we must try harder to make them see the light.” This belief that the British public can be bullied into accepting that its own moral instincts are unsound is foremost what’s keeping Labour from rising in the polls.