12/09/2013 Newsnight


12/09/2013

In-depth investigation and analysis of the stories behind the day's headlines with Kirsty Wark.


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is the makings of a deal to get Syria to relinquish its chemical

:00:12.:00:16.

weapons, weapons its finally acknowledged it has. While

:00:16.:00:20.

President Assad negotiates on Russian TV. Tonight we meet some of

:00:20.:00:24.

the millions of refugees sheltering in Lebanon. Too much too soon? The

:00:24.:00:30.

education ministers doesn't admit that starting school at the age of

:00:30.:00:32.

education ministers doesn't admit seven is much better for children.

:00:32.:00:33.

She will tell us why. seven is much better for children.

:00:33.:00:39.

# Bicycle # Bicycle

:00:39.:00:42.

Stkpwhrk is the economy picking up speed?

:00:42.:00:45.

We ride around the personal indicators.

:00:45.:00:48.

The economics of confidence are like riding a bike, one minute it

:00:48.:00:52.

is all wobbly, worrying about doom, the next minute you are sailing

:00:52.:00:56.

along and on the upside. It is all about momentum.

:00:57.:01:01.

I will be checking the confidence levels with my guests.

:01:01.:01:10.

The Chinese puzzlele, too many men and not enough women. Marriage in

:01:10.:01:17.

China seems like a distant fairytale, we hang out with the

:01:17.:01:21.

love hunters. TRANSLATION: There is a lot of competition, the girls are

:01:21.:01:32.

demanding a prefer tall guys. Good evening, in the last few

:01:32.:01:35.

minutes we have learned that Twitter will sell shares to the

:01:35.:01:39.

public. The company made an announcement in a tweet, and the

:01:39.:01:47.

on-line world is abuzz tonight. In a minute we will hear from the

:01:47.:01:51.

Lebanese border. First there is no doubt that the momentum of Syria is

:01:51.:01:56.

with President Putin now, indeed the Republican leadership have

:01:56.:02:00.

wasted no time in sticking the boot in into President Obama, claiming

:02:00.:02:04.

he used Syria as a distraction from domestic bugetry business. The

:02:05.:02:07.

caravan has moved to Geneva, where the US secretary and his Russian

:02:07.:02:11.

counterpart have been joshing over who is calling the shots. After

:02:12.:02:18.

Assad's star appearence on Russian TV, the UN said it had a request to

:02:18.:02:29.

join the chemical weapons ban. How significance is that? Signing

:02:29.:02:32.

join the chemical weapons ban. up to the chemical weapons

:02:32.:02:36.

convention is important. A week or two ago Syria was barely

:02:36.:02:38.

acknowledging those weapons. That is a key thing. Yet we still hear

:02:38.:02:44.

this rhetorical diplomacy from President Assad this morning saying

:02:44.:02:47.

they won't do this unless the threat of American force is lifted

:02:47.:02:51.

and they stop supplying arms to the rebels. Today, bizarrely enough the

:02:51.:02:55.

Washington Post leaked the story that arms have started arriving

:02:55.:02:59.

from the Americans through the CIA with the rebels this very day. So

:02:59.:03:03.

you would think how can they reconcile these particular

:03:03.:03:05.

you would think how can they positions these political stands.

:03:05.:03:07.

you would think how can they We got more of that from John Kerry

:03:08.:03:18.

soon after he arrived in Geneva. Only the credible threat of force

:03:18.:03:21.

and the intervention of President Putin and Russia based on that has

:03:21.:03:26.

brought the Assad regime to acknowledge, for the first time

:03:26.:03:31.

that it even has chemical weapons, and an arsenal and it is now

:03:31.:03:35.

prepared to relinguish it. President Obama has made clear that

:03:35.:03:42.

should diplomacy fail, force might be necessary to deter and degrade

:03:42.:03:45.

should diplomacy fail, force might Assad's capacity to deliver these

:03:45.:03:51.

weapons. So is it actually going nowhere? No, it is going somewhere,

:03:51.:03:55.

that is the fascinating thing. Despite the rhetoric we heard from

:03:55.:03:59.

John Kerry, we know working groups are sitting in Geneva with Russian

:03:59.:04:04.

chemical warfare experts and American ones deciding practically

:04:04.:04:06.

chemical warfare experts and how would you do that, if we can

:04:06.:04:09.

agree it in the Security Council. John Kerry has an inside into the

:04:09.:04:13.

American thought process. He thought about firstly

:04:13.:04:16.

internationally safeguarding the stocks, then removing them from

:04:16.:04:19.

Syria for destruction elsewhere. We stocks, then removing them from

:04:19.:04:22.

are getting insights into the process they have in mind. What is

:04:22.:04:25.

the Russian game here, is it keeping America away? Well, there

:04:25.:04:31.

is a view that this process, even if we accept it is being sincerely

:04:31.:04:36.

entered in to. Of course the state department and others would not

:04:36.:04:39.

accept that of President Assad, they are still casting doubtds

:04:39.:04:43.

about his motives, if it was completely sincere and the process

:04:43.:04:46.

went ahead, under the conditions of civil war, it could easily take a

:04:46.:04:50.

year or more to carry it out. During which time we know that

:04:50.:04:52.

year or more to carry it out. President Assad and Russia are

:04:52.:04:56.

insistent on the point there can be no American strikes while this

:04:56.:05:02.

process is going ahead. The dilemma is that price worth aPremier League

:05:02.:05:05.

for President Obama. Effectively it then -- it allows President Assad a

:05:05.:05:16.

free hand in a war that has already claimed 117,000 lives. Is there any

:05:16.:05:21.

way that President Obama can wrest any glory from this? If this is

:05:21.:05:26.

what it seems to be, which is an increasingly viable and practical

:05:26.:05:29.

diplomatic discussion about how this can be done, yes, if it comes

:05:29.:05:34.

through. Because securing those chemical weapons is a vital

:05:34.:05:37.

national interest to the United States. If that process goes ahead

:05:37.:05:40.

he can say to the American people we have done this. The question,

:05:40.:05:44.

what will he have had to give up in order to do that, and will he be

:05:44.:05:49.

seen as selling out the suffering people, those in the refugee camps

:05:49.:05:54.

in Syria, who have been pleading to American help in order to get that

:05:54.:05:57.

over the past few years. Let's hear more about that, a deal on chemical

:05:57.:06:02.

weapons might be on the table. There is no sign the conflict

:06:02.:06:07.

itself and the dreadful damage inflicted on Syrians by

:06:07.:06:08.

itself and the dreadful damage conventional weaponry will let up.

:06:08.:06:11.

Thousands are still fleeing out of the country, more than two million

:06:11.:06:15.

people. Many escaping to Lebanon. Jeremy has been to a refugee camp.

:06:15.:06:26.

The bishop has more on his mind than usual. His diocese straddles

:06:26.:06:34.

the Bekar Valley, the route by which refugees flee Syria, across

:06:34.:06:38.

the border and into Lebanon. They say the fields and orchards of the

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Bekar Valley fed the Roman empire. Just over the hills in the distance

:06:44.:06:48.

is the frontier with the Assad dynasty. Since Islamist rebels fell

:06:48.:06:57.

like a wolf on the Christian fold of Maaloula, such as can throw

:06:57.:07:02.

themselves on the bishop's mercy. This refugee needs help to pay the

:07:02.:07:06.

rent, the bishop promises that if she gives her name, she will go on

:07:06.:07:11.

to a list and when aid arrives they will be in touch. Those who make it

:07:11.:07:16.

here are offered a place to weather the storm. They start to stay with

:07:16.:07:22.

the people, and we tried to find them somewhere to live. We tried to

:07:22.:07:27.

find jobs for them. We try our best really. I'm afraid if there is an

:07:27.:07:34.

attack in Syria, we will have more ref refugees in will he be I don't

:07:34.:07:39.

know. That is why I called the international community to stop

:07:39.:07:44.

sending arms to Syria. To work together with the Syrian people for

:07:44.:07:47.

sending arms to Syria. To work the peace. Otherwise we don't know

:07:47.:07:53.

what will happen. Not only in Syria, in Lebanon, in Turkey, and all the

:07:53.:08:00.

Middle East. Fear knows no creed and Christians are a minority among

:08:00.:08:04.

the refugees. Most of those fleeing the fighting are Muslims. Three-

:08:04.:08:10.

quarters of a million refugees have reached Lebanon, and the promise of

:08:10.:08:12.

sanctuary. The lucky ones shelter in small

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sanctuary. camps, this one is home, if that's

:08:15.:08:20.

the word, to 80 families who live in rented tents in an orchard. No-

:08:20.:08:25.

one wants to stay here, but the tents are beginning to look

:08:25.:08:41.

depressingly permanent. 1-2-3-4-5- 6-7-8-9-10. Some of the children

:08:41.:08:44.

have seen things no-one should ever have had to see. All have read the

:08:44.:08:49.

fear and desperation in the eyes of their parents. In the impromptu

:08:49.:08:52.

school, students have volunteered as their teachers. They must have

:08:52.:08:59.

seen some terrible things? Yes, of course, but they are children. You

:08:59.:09:06.

know and we cannot stop their imagination of the children. Things

:09:06.:09:12.

that happened and in themselves and their growing is peace, they want

:09:12.:09:18.

peace, they don't want war and terror. Most of these people seem

:09:18.:09:26.

to blame Assad. But whatever their feelings life has to go on. This

:09:26.:09:32.

couple, who sold sweets for a living in Syria had a baby in the

:09:32.:09:40.

camp. They called him Jihad. I would like to ask you what it was

:09:40.:09:46.

like having a baby in the camp here? TRANSLATION: Very hard, it

:09:46.:09:50.

was freezing. There was a lot of snow, so it was really hard. When

:09:50.:09:53.

was freezing. There was a lot of do you think your son will go back

:09:53.:09:59.

to Syria? TRANSLATION: Of course, God willing, he will return, even

:09:59.:10:03.

if we his parents don't ever, his generation will go back. Even if

:10:03.:10:05.

if we his parents don't ever, his there is only rubble left, he will

:10:05.:10:10.

go back. Even if it is just to plant one rose. Le

:10:10.:10:20.

What is a -- what is a home, they have light, water and half-a-dozen

:10:20.:10:24.

or so lavatories between 400 of them. Parents and children do what

:10:24.:10:28.

they can, but a home is surely somewhere you feel you belong, and

:10:28.:10:35.

no-one belongs here. Yet this morning in Beirut there

:10:35.:10:38.

no-one belongs here. were hundreds and hundreds more

:10:38.:10:44.

learning the patience every refugee needs before officialdom can

:10:44.:10:47.

acknowledge your existence. Over half those fleeing are children.

:10:48.:10:54.

Lebanon's schools health and housing services are already

:10:54.:10:57.

stretched to near breaking point. There is now a real risk of Syria's

:10:57.:11:03.

war setting off instability across the region. When these people made

:11:03.:11:09.

the decision to lead everything behind them, a missile strike and

:11:09.:11:14.

who knows what else seemed terrifyingly imminent. It didn't

:11:14.:11:18.

happen or it hasn't happened yet, at least, but neither has the war

:11:18.:11:23.

ended. When you have nothing but the clothes you stand up in,

:11:23.:11:29.

diplomatic games seem very remote indeed.

:11:29.:11:34.

Still they come, the old, the young, the millions in whom hope has been

:11:34.:11:39.

driven out by fear. The makeshift shelters give way to the concrete

:11:40.:11:44.

floor and the shortened horizons of lives lived from day-to-day. So

:11:44.:11:55.

very many small tragedies. Now we know that Newsnight viewers are

:11:55.:11:59.

pretty smart. But you might want to put a pen and paper together for

:11:59.:12:02.

the end of the programme. Right now though try to work out what age you

:12:02.:12:06.

were when you first went to school, are you four? Five? Six? The law

:12:06.:12:10.

now says that children must be in school by the age of five. But

:12:10.:12:14.

according to an influential group of educationalists writing in the

:12:15.:12:19.

Telegraph today, that is just too early for formal learning, never

:12:19.:12:23.

mind testing. Tomorrow they jaunch a Too Much Too Soon campaign, and

:12:23.:12:27.

point to the Scandinavian education system that starts at six or seven,

:12:27.:12:31.

and where children consistently achieve better education results,

:12:31.:12:33.

and where children consistently they say, as well as higher levels

:12:33.:12:37.

of well being. At the moment I will be asking the education minister if

:12:37.:12:40.

we have the whole thing wrong. First we have this.

:12:40.:12:45.

If you are six in Finland you can play all day. This morning these

:12:45.:12:48.

children were in kindergarten, now play all day. This morning these

:12:48.:12:52.

they are at their club. They won't start school until their seven.

:12:52.:12:55.

There are so many things you have to be able to do in school, sit

:12:55.:13:03.

still, receive orders and to fulfil them. To understand abstract

:13:03.:13:11.

concepts and most of those you have to do at the same time. So at the

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age of five they are still kids. Last year Finland's education

:13:16.:13:20.

system was ranked the best in the world. Based on how the students

:13:20.:13:24.

did in tests and how many went to university. Not surprising, then,

:13:24.:13:29.

that many in Britain are keen to copy them. When it comes to

:13:29.:13:34.

education questions this is a hardy perennial, do we start our children

:13:34.:13:40.

too early in formal education? And could this help explain the serious

:13:40.:13:44.

problems we have like poor literacy amongst boys or the achievement gap

:13:44.:13:49.

between rich and poor children. The head of this nursery thinks it can.

:13:49.:13:54.

Along with over 100 leading figures in education, she signed an open

:13:54.:14:00.

letter today saying our approach could cause profound damage to

:14:00.:14:03.

children's self-image and attitude to learning. The letter argues

:14:03.:14:08.

children should spend more time in high-quality nursery schools,

:14:08.:14:10.

learning informally, getting involved in active, outdoor,

:14:10.:14:16.

creative play. You don't need a structured environment, you needed

:14:16.:14:20.

a dults who are understanding how that child -- adults who are

:14:20.:14:24.

understanding how that child is learning, and using the early years

:14:24.:14:27.

understanding how that child is foundation stage. If a child is

:14:27.:14:30.

able to read at three then the adult supports that, if the child

:14:30.:14:35.

wants to do anything that they are interested in, calculus at four!

:14:35.:14:40.

That's fine. These parents agreed. Even in schools they don't play,

:14:40.:14:42.

they don't play enough. More play is always better, it gets them

:14:42.:14:48.

thinking, using their brains and different areas. That is what I

:14:48.:14:52.

feel. In eight European countries, including Finland, children have to

:14:52.:14:56.

be in school at seven. In 23 countries they have to be in school

:14:56.:15:00.

when they are six, in most of Britain and Cyprus it is five. In

:15:00.:15:05.

Northern Ireland school starts at four.

:15:05.:15:09.

Not everyone in education agrees with the letter writers, here, a

:15:10.:15:13.

cop of miles from the nursery, another -- a couple of miles from

:15:13.:15:19.

the nursery, another disadvantaged area of London, an educational

:15:19.:15:22.

charity believes the best way for children to learn is putting them

:15:22.:15:25.

in a structured environment as early as possible. Jacob's only six

:15:25.:15:30.

but he has been becoming to the Learning Store for two years, he's

:15:30.:15:35.

out tisic, he spends part of every estimate -- out tisic, he spends

:15:35.:15:40.

half of Saturday in the Blur fly Class, improving his reading. I

:15:40.:15:49.

don't want him to fall behind that is why I put him in the class. So

:15:49.:15:59.

he gets the extra help. Katie has run the classes for 14 years,

:15:59.:16:03.

mostly for children failed by their schools. They are saying that if

:16:03.:16:07.

you start teaching them in any formal way before age seven it is

:16:07.:16:10.

too much too soon. I would say that what we are doing at the present

:16:10.:16:14.

still isn't good enough, it is too little too late. Children has a

:16:14.:16:18.

very young age are very ready to learn in a formal manner. Yes they

:16:18.:16:22.

like to play, but they love to learn, they like to be taken

:16:22.:16:25.

seriously. They are extremely intelligent and I think we

:16:25.:16:28.

seriously. They are extremely underestimate them. There is

:16:28.:16:30.

another lesson from Finland. Teaching is highly competitive, and

:16:30.:16:35.

a masters degree is required even for primary school. Many would

:16:35.:16:40.

argue it is the quality of teaching across the system which make the

:16:40.:16:42.

difference, not the age children start formal school. We're going to

:16:42.:16:51.

talk to the Education Minister Liz Truss in a moment. First let as

:16:51.:16:55.

talk to Dr Mary Bousted, the General Secretary of the teachers

:16:55.:16:59.

union, the ATL, who backs this move. Isn't the issue that children at

:16:59.:17:02.

the age of five are sponges, they want to learn, they seek to learn,

:17:03.:17:06.

and that is what the system provides them with, a chance to

:17:06.:17:12.

learn? Well, they are sponges, but they need to have a strong grasp of

:17:12.:17:16.

key concepts before they can actually go on to formal learning.

:17:16.:17:18.

key concepts before they can For example let me just take the

:17:18.:17:22.

example of maths. Before you understand the importance of number,

:17:22.:17:24.

you have to know what number is. You have to understand the concept

:17:24.:17:28.

of more or less. And the way to understand that is through playing

:17:28.:17:33.

and through real live expeerence of what that means. Can you --Real

:17:33.:17:40.

live expeerence of what that means. Can you get that in school? We are

:17:40.:17:46.

in a period of where children are taught and tested. If there is a

:17:46.:17:51.

test for five-year-olds, how will that work? The Government will have

:17:51.:17:54.

to explain what is proposed as a baseline test at five to understand

:17:54.:17:56.

where they are and a more baseline test at five to understand

:17:56.:18:00.

formallised curriculum that will be further tested through a phonics

:18:00.:18:03.

test at six. If the Government has its way through every child in the

:18:03.:18:08.

country being ranked in percentages of where they are in respect of the

:18:08.:18:12.

national population at 11. We are entering a more testing period.

:18:12.:18:16.

national population at 11. We are Isn't it up to primary school

:18:16.:18:19.

teachers to cope with this and interpret it in the way they think

:18:19.:18:23.

best for the chin in their class? It is, but when you are under a

:18:23.:18:27.

strong accountability regime and having to meet particular standards,

:18:27.:18:30.

it can be very difficult to teach in way that does develop the

:18:31.:18:35.

ability of children to learn properly. The accountability regime

:18:35.:18:40.

imposes certain formallised approaches to teaching. Many

:18:40.:18:43.

schools are really under that regime at the moment. Won't your

:18:43.:18:47.

ideas, your plans hit less privileged children? No they won't.

:18:47.:18:52.

The evidence shows that countries which adopt a less formal approach

:18:52.:18:56.

to early years education, where children get a better grasp of

:18:56.:19:00.

concepts and they then approach the more formal concepts more ready to

:19:00.:19:04.

understand them. There is less of a gap between disadvantage and the

:19:04.:19:08.

advantaged children. How are those comparable, these two aren't

:19:08.:19:12.

comparable? The international system and this system? You can

:19:12.:19:16.

only compare systems by looking at another system, if they achieve

:19:16.:19:20.

better results, saying how is it and what are they doing. Most

:19:20.:19:23.

countries in western Europe start school later than us, and those

:19:23.:19:27.

that do very well have a less formal curriculum when children are

:19:28.:19:31.

very young. Thank you very much indeed. Well Liz Truss, the

:19:31.:19:38.

Education Minister is here. Too much too young, the idea is you are

:19:38.:19:42.

force-feeding formal education, no matter the level the child is at.

:19:42.:19:46.

Every child is at a different level? That is absolutely true, we

:19:46.:19:50.

have given teacher more flexibility in the new national curriculum to

:19:50.:19:53.

find the right level for the child and teach in the right way. If you

:19:53.:19:58.

go into a reception class you will find that children are playing,

:19:58.:20:01.

they are learning how to play together, they are learning how to

:20:01.:20:04.

take turns. What I think the issue is that too many children are

:20:04.:20:08.

arriving at school, not with those skills that Mary talked about, not

:20:08.:20:13.

ready to learn, so what we need to do is improve early years education

:20:13.:20:14.

to make sure that rather than the do is improve early years education

:20:14.:20:19.

33% of children who arrive at school without communication skills

:20:19.:20:23.

make sure they have them. So you believe the state should,

:20:23.:20:31.

essentially be in loco parentis? We are recruiting early years teachers

:20:31.:20:36.

for our nurseries. 96% of children take up early age education at

:20:36.:20:40.

three and four. Let's make sure it is high quality so children have

:20:40.:20:44.

the skills and vocabulary and learn how to take turns, and they start

:20:44.:20:48.

school ready to learn. We shouldn't delay the start because we haven't

:20:48.:20:51.

done the preparation beforehand. This Government and other

:20:51.:20:55.

Governments have always praised the Scandinavian system of education

:20:55.:20:58.

because of what comes out the other end. So therefore if you embrace

:20:58.:21:02.

some aspects of it, why can't you embrace the idea that the best way

:21:02.:21:06.

to start a child is to start a child informal low and then

:21:06.:21:08.

to start a child is to start a actually move to formal education

:21:08.:21:13.

at seven. It seems to work for Scandinavia and other countries in

:21:13.:21:19.

Europe. It is a complete misrepresentation of Scandinavia,

:21:19.:21:23.

they have formal settings in countries like Sweden with highly-

:21:23.:21:28.

trained teachers, an early years teachers are paid the same as a

:21:28.:21:32.

primary school teachers. Here we have them paid less. You think

:21:32.:21:35.

early years teachers should be better paid, a I hooer salary I

:21:35.:21:40.

would like to see them better respecteded and better paid it is

:21:40.:21:43.

really important. We are setting higher -- respected, and better

:21:43.:21:48.

paid, it is really important. We are setting higher standards to

:21:48.:21:54.

close the gap. If we can come back to the whole idea of the child,

:21:54.:21:57.

what Mary Bousted is saying, I in terms of concepts and socialisation

:21:57.:22:04.

and more and less, it means much more play, much less focused

:22:04.:22:07.

learning, and yet you have started putting kids into test situations

:22:07.:22:11.

at the age of five. Essentially you are putting them in pigeonhole,

:22:11.:22:15.

even before the age of six? We're absolutely not doing that. There is

:22:16.:22:19.

already an early years profile done at age four or five to see where a

:22:19.:22:23.

child is. We do that through the current system. What we are doing

:22:23.:22:27.

is we are saying schools can have a choice between using that and using

:22:27.:22:29.

is we are saying schools can have a alternative methods to see where a

:22:29.:22:33.

child is. But good teaching is all about finding what a child knows

:22:33.:22:36.

already, how they are learning, how they are developing and building on

:22:36.:22:41.

that. We're giving power to professionals to say this is the

:22:41.:22:46.

way we want to approach it, and this is the way we want to help

:22:46.:22:50.

children get on in their school career. Can I make the point about

:22:50.:22:54.

play. We are not about play, we absolutely think about children

:22:54.:22:58.

learning through play, the issue is whether it should be entirely

:22:58.:23:04.

child-initiated or teacher-led. And parents supporting? When you had on

:23:04.:23:07.

the film we will teach the child to read if they want to. I think that

:23:07.:23:09.

the film we will teach the child to is the wrong approach. What you

:23:09.:23:11.

will get is middle-class children with book on the balls, they will

:23:11.:23:15.

be the ones learning to read, the children who may not have an

:23:15.:23:19.

experience of reading will be the ones that are left behind. Are you

:23:19.:23:23.

saying that poor people and working-class people aren't capable

:23:23.:23:26.

of introducing their children to books? I'm saying that children on

:23:26.:23:33.

free school meals do much worse at GCSE than children without. There

:23:33.:23:37.

is a long tale of underperformance. Low income children arrive at

:23:37.:23:39.

school less well prepared. We have evidence to show that. What you are

:23:39.:23:44.

essentially saying is this policy is simple low because you believe

:23:44.:23:48.

that poorer children -- simply because you believe that poorer

:23:48.:23:53.

children need the Government to step? I'm saying we need to make

:23:53.:23:59.

sure that every child succeeds. Basically part of the problem with

:23:59.:24:03.

it is you need women to come into the work force, you just do, and

:24:03.:24:10.

therefore what you are offering is three and four-year-olds, places in

:24:10.:24:15.

nursery and form yamalised because that suits the economy, rather than

:24:15.:24:18.

child-centered which the UN believes the rights of the child

:24:18.:24:22.

won. We know 66% of mums go out to work, that is a fact of life. We

:24:22.:24:27.

know early education benefits all children. There is a study showing

:24:27.:24:29.

that early education has benefits far into a child's life, right

:24:29.:24:34.

through to 18. But it has to be high-quality early education, that

:24:34.:24:37.

is why we are raising the standard for early years teachers, we are

:24:37.:24:41.

giving professional autonomy. We are not saying how we want teachers

:24:41.:24:44.

to teach, what we are saying is we are going to allow you to get the

:24:44.:24:48.

best outcomes for children, to see where a child is, to offer much

:24:48.:24:52.

more flexibility. Let me give you an example. I can't have an example,

:24:52.:24:57.

we have run right out of time I'm sorry. All manner of indicators

:24:57.:25:00.

would suggest there is a new optimisim in the country, those

:25:00.:25:04.

popular folk, estate agents, are being recruited by the budgetload.

:25:04.:25:09.

The monthly consumer confidence bore barometer is at its highest in

:25:09.:25:16.

four years, and GDP is up to since the first quarter. How does it feel

:25:16.:25:21.

to you? Given the UK real wages have fallen by 5.5% since 2010, is

:25:21.:25:26.

confidence measured in hard data or is something else in the air. Be it

:25:26.:25:31.

the Olympics, a football match, an autumn day, or the joy the economic

:25:31.:25:37.

editor gets from riding a bike? The job market is moving, growth is

:25:37.:25:42.

accelerating and house prices are rising. But these are just the

:25:42.:25:45.

tangible side of the recovery, what we are waiting for is the return of

:25:45.:25:49.

something called "confidence", to invest, to spend, to take risk. But

:25:49.:25:54.

that is hard to quantify. The economics of confidence are a bit

:25:54.:25:58.

like riding a bike, one minute it is all wobbly, you are worried

:25:58.:26:02.

about doom, the next minute you are sailing along and everything is

:26:02.:26:05.

amplified on the upside. It is all about momentum. I have been

:26:05.:26:14.

amplified on the upside. It is all covering the economic crisis since

:26:14.:26:17.

it started. Here is what I think about when I think about confidence.

:26:17.:26:25.

Number one, pubs. Five years ago when Lehman Brothers went bust my

:26:25.:26:29.

local pub emptied, there was a dramatic loss of confidencek even

:26:29.:26:32.

though I don't think anybody there actually worked for Lehmans. Now,

:26:32.:26:36.

the economy is clearly coming back, but I still think a lot of pubs are

:26:36.:26:40.

struggling. If you look at the statistics on people's spending

:26:40.:26:44.

power there is a reason why. So what we found out over the last

:26:44.:26:48.

five years the average household has been squeezed by a prolonged

:26:48.:26:54.

period of inflation with essential items running ahead of regular pay.

:26:54.:26:59.

Pay growth all the way back since January 2010 has been running

:27:00.:27:03.

behind inflation, that has seen spending power squeezed

:27:03.:27:07.

considerably in the last three years. Number two is estate agents,

:27:07.:27:11.

house prices are rising, but the ones in the window are always a

:27:11.:27:15.

little bit optimistic. It is once estate agents start recruiting that

:27:15.:27:22.

you know the market is recovery. -- recovering. This week's job figures

:27:22.:27:26.

showed 380,000 private sector jobs have been created in that year.

:27:26.:27:32.

Staggeringly 77,000 of those were estate agents.

:27:32.:27:38.

And that, to me, is confidence. Number three might seem a bit close

:27:38.:27:43.

to home, but it is job adverts for journalists. I have come to

:27:43.:27:47.

London's Silicon Roundabout, home of the tip and techno-savvy to meet

:27:47.:27:51.

a man who can tell me what's happening in the recruitment market.

:27:51.:27:54.

We have seen some big investment plays by big players in the market.

:27:54.:27:58.

We have the Mail on-line, the website for the Daily Mail is out

:27:58.:28:02.

there recruiting 100 journalists for a big expansion. A lot of it on

:28:02.:28:10.

the back of the US. We have got the Evening Standard launching a TV

:28:10.:28:13.

station there, a good amount of journalism jobs there, and the Sun

:28:13.:28:16.

on-line coming to the market as well. Is journalism the canary in

:28:16.:28:22.

the coal mine when looking at an advertising upturn? They have to be

:28:22.:28:26.

confident about revenues coming through, on-line revenues are very

:28:26.:28:30.

much advertising that. Number four is a graph, the consumer confidence

:28:30.:28:34.

index, it is always a negative number, what now? This graph shows

:28:34.:28:39.

the last five years, it is recovering fast, that is because

:28:39.:28:42.

there is more credit in the economy. Of course, on my bike, I'm not

:28:42.:28:46.

really seeing outside London. The recovery beyond the M25 is patchy.

:28:46.:28:51.

That means a lot of people are not really confident there is a

:28:51.:28:55.

recovery at all. My final barometer of confidence is Twitter. Because

:28:55.:28:58.

every time a report like this goes out saying the statistics show

:28:58.:29:02.

signs of recovery, a lot of people tweet me saying basically I'm a

:29:02.:29:13.

Cameronite, Osbourneist full of propaganda. When that stops I will

:29:13.:29:17.

say confidence has returned. There is momentum and a bit of movement,

:29:17.:29:23.

but the magic ingredient of total confidence is till missing. Paul

:29:23.:29:29.

will be back with us soon when we explore that Twitter sale story.

:29:29.:29:36.

Are there reasons to be cheerful? Here is the assistant editor of the

:29:36.:29:39.

Financial Times and in New York we have the economist and director of

:29:39.:29:45.

the Earth Institute. You both look happy. Welcome to the studio. First

:29:45.:29:51.

of all, Gillian, is Paul right? Is there a feel-good factor, what is

:29:51.:29:55.

your equation for confidence? Paul is definitely right in the sense

:29:55.:29:58.

your equation for confidence? Paul that optimisim is rising. We have

:29:58.:30:01.

just seen the highest optimisim level for the last four years and

:30:01.:30:07.

the most significant increase, the fastest-pace of increase in decades

:30:07.:30:10.

that is striking. The level of optimisim is always relative, we

:30:10.:30:14.

have just been through a very bad recession. Frankly it is not

:30:14.:30:17.

surprising that people are feeling more confident. To me the big

:30:17.:30:20.

question is, who is feeling confident. Is it just the people

:30:20.:30:23.

who have assets that are being buoyed by qoosing. Or is it young

:30:23.:30:27.

people -- quantative easing, or is it young people as well, we don't

:30:28.:30:33.

have that breakdown. Where you sit in America, is confidence a self-

:30:33.:30:37.

fulfiling prophesy? It is a little bit more than that. I think there

:30:37.:30:43.

really is a recovery under way after the hard knocks of 2008/2009.

:30:43.:30:53.

The UK, and the eurozone that suffered badly, Japan and the

:30:53.:30:56.

United States are healing. There are still lots of wounds and

:30:56.:31:02.

structural imbalances like high inequality of income and lack of

:31:02.:31:08.

opportunities forepeople with lower skills or educational training. --

:31:08.:31:12.

for people with lower skills or educational training. There is a

:31:12.:31:17.

real recovery under way, and the real pessimists yelling at the

:31:17.:31:20.

Chancellor until recently, saying you are wrecking everything and

:31:20.:31:23.

driving the economy over the cliff have been proved wrong. Does it

:31:23.:31:28.

look different sitting in tech areas like San Francisco and New

:31:28.:31:32.

York and sitting in Nebraska or outside Detroit? Of course, so we

:31:32.:31:41.

are suffering from very, very, deep divides and widening inequality

:31:41.:31:44.

that has been widening for divides and widening inequality

:31:44.:31:48.

than two decades, even more than that. Our politicalcy thems have

:31:48.:31:52.

not wanted to look very deeply at. This is a real underlying -- it has

:31:52.:32:05.

left people without jobs on low incomes, it is not fair and right,

:32:05.:32:10.

the rich have just prospered incredibly and we need more balance,

:32:10.:32:17.

that is not yet soft. Is it true the people in Idaho and Nebraska

:32:17.:32:19.

that is not yet soft. Is it true don't matter as much. The boom and

:32:19.:32:22.

that is not yet soft. Is it true recovery here might look better in

:32:22.:32:26.

London than in North Shields? The answer is of course they matter. It

:32:26.:32:30.

is disgraceful to imagine we can have a society where the rich get

:32:30.:32:36.

richer. If you are living in London it is easy to feel confident, house

:32:36.:32:41.

prices are rise, partly due to foreign money coming in. The gap

:32:41.:32:45.

between the old and the young is perhaps the most important issues

:32:45.:32:49.

right now. If you are old and have assets, you are benefiting. If you

:32:49.:32:57.

have savings that earn very little interest. But if your house price

:32:57.:33:01.

is going up it offsets it. A fascinating study from the Bank of

:33:01.:33:02.

England last year, suggesting that fascinating study from the Bank of

:33:03.:33:05.

40% of the gains from quantative fascinating study from the Bank of

:33:05.:33:09.

easing have gone to the wealthiest 5%, they own stocks and houses. In

:33:09.:33:16.

the US in particular when stock markets go up confidence goes up

:33:16.:33:19.

too, particularly amongst people who are wealthier. Stock markets go

:33:20.:33:25.

up and people take huge risks we have problems then and it happens

:33:25.:33:29.

all over again? Absolutely, I don't think we are in bubble territory

:33:29.:33:33.

right now. Let's come back for housing, Jeffrey housing is up 12%

:33:34.:33:38.

in America as well. Part low because of the help to buy. And now

:33:38.:33:43.

we have Vince Cable so you better watch because of a housing bubble?

:33:44.:33:49.

That is a bit of an exaggeration. Take it from an American

:33:49.:33:51.

That is a bit of an exaggeration. perspective, house prices going up

:33:51.:33:54.

12% but still much, much lower than they were in 208. Yes we had a

:33:54.:34:04.

megabubble and collapse. And now we have some recovery because it has

:34:04.:34:08.

been a number of years of not building houses and finally people

:34:08.:34:12.

are earning some more income and coming back into the market. I do

:34:12.:34:16.

think the point is those who were panicking that we are going over

:34:16.:34:22.

the cliff, that's not the case. We see moderate growth in many, many

:34:22.:34:25.

important economies around the world, but I don't think we should

:34:25.:34:31.

therefore be complacent regarding these deeper problems of high

:34:31.:34:34.

unemployment among young people, very low wages if they have a job.

:34:34.:34:41.

People with the lower skills, we have to work on making our

:34:41.:34:44.

societies more fair. We also have to start looking at the long-term.

:34:44.:34:48.

Because in the meantime we are also still wrecking the environment and

:34:48.:34:51.

many other things, we haven't attended to any of those longer

:34:51.:34:58.

term issues. Always driven to the very short-term. Now that we have

:34:58.:35:01.

both feet on the ground, there is a bit of a recovery, let's think

:35:01.:35:06.

about the quality of the growth. Would you learn from history? I

:35:06.:35:10.

think certainly there have been a number of lessons learned. Let's

:35:10.:35:13.

not lose sight of the fact that it is good news that people are

:35:13.:35:19.

feeling more cheerful. Whether it was the summer, or Andy Murray

:35:19.:35:26.

winning Wimbledon, or a new baby in the palace. Danny Finkelstein said

:35:26.:35:29.

last night, he was talking about the Government last night and the

:35:29.:35:33.

recovery, he was saying it was very, very important for George Osborne

:35:33.:35:37.

and David Cameron not to talk up the recovery too much because that

:35:37.:35:39.

is what they have going for them, the continued idea of a recovery.

:35:39.:35:42.

You don't want to talk too soon? Maybe, but the enof the day, the

:35:42.:35:47.

thing that matters now is not so much our British consumers rushing

:35:47.:35:50.

thing that matters now is not so out and buying new sofas, it is are

:35:50.:35:55.

companies feeling confident enough to hire, invest in new plant and

:35:55.:35:59.

equipment and get the real economy growing as again. That is a key

:35:59.:36:02.

equipment and get the real economy question, we need to watch that

:36:02.:36:04.

closely and say house prices. We question, we need to watch that

:36:04.:36:12.

have an incredible short memory, over the last four years we have

:36:12.:36:17.

learned a lesson, or have we? No more Masters of the Universe?

:36:17.:36:23.

Tragedy is that quantative easing, pumping money into the economy and

:36:23.:36:29.

the rich have got richer, that is one of the ironies, dealing with

:36:29.:36:31.

the rich have got richer, that is that will be a challenge for

:36:31.:36:34.

politicians for years to come. Thank you very much for joining us.

:36:34.:36:42.

The news that Twitter is to share sell shares to the public has

:36:42.:36:46.

happened. Paul is here. What is the story did we expect it to happen so

:36:46.:36:50.

quickly? It has been rumoured for the last few days. Let me explain

:36:50.:36:55.

what is going on. An initial public offering is where you sell shares

:36:55.:36:59.

in a company to anyone who wants to buy them. What you are expecting is

:36:59.:37:04.

to make eight, ten fold back, invested by the original people who

:37:04.:37:11.

set the company up. Those moments are big signal moments, with

:37:11.:37:17.

capitalism, 1 up had had hundredors ago Goldman Sachs brought

:37:17.:37:21.

Woolworths, it dominated the 20d century. What we are looking at --

:37:21.:37:27.

20 years ago, a company in San Francisco was open opened up, has

:37:27.:37:32.

filed documents under a confidentiality clause which is is

:37:32.:37:34.

only available for companies that take less than a billion dollars a

:37:34.:37:39.

year. This is a country with 200 million user. It has been valued at

:37:39.:37:47.

8-10 billion. That is a ten fold increase put into it by the private

:37:47.:37:52.

investors. Look this company is, via these things, the new service

:37:52.:37:57.

of the world. There is two views of it, either it is a low-ref few tech

:37:57.:38:02.

company that nobody knows how it will make money. This is the radio

:38:02.:38:07.

of the 21st century. Who decides who will make money? It will be a

:38:07.:38:11.

big challenge to the company. Interesting fact, since Twitter was

:38:11.:38:17.

formed there have been 430 billion tweets dispatched across the world.

:38:17.:38:25.

£4 30 billion. It is an extraordinary triumph of technology

:38:25.:38:31.

and entrepenural driving the economy forward. The big question

:38:31.:38:37.

is for Twitter how to make money on The Tweets. Facebook have had the

:38:37.:38:41.

challenge, they managed to get our tentacles in our every day lives,

:38:41.:38:43.

we reply on them and use them but tentacles in our every day lives,

:38:43.:38:48.

don't want advertising on it. How do you monetise that? I think the

:38:48.:38:50.

don't want advertising on it. How answer to that has become clear in

:38:50.:38:56.

the past few days, Twitter acquired a company called Mo Pub, reported

:38:56.:39:01.

low the market leader in mobile advertising. Advertising on devices

:39:01.:39:16.

is so technological choices, if will be used to outFacebook

:39:16.:39:20.

Facebook. A lot of people who use Twitter doesn't want to be

:39:20.:39:24.

interrupted or bothered. Two ways to do it, put adverts on to the

:39:24.:39:31.

tweets, the creepier way is to actually start sorting people into

:39:31.:39:36.

groups and use algorithms to look at their behaviour and sell things

:39:36.:39:41.

more subtley. What is fascinating now is seeing the same geeks doing

:39:41.:39:46.

finance a decade ago and getting involved in using their mats to

:39:46.:39:50.

read how markets are going, they are trying to lead us to do the

:39:50.:40:02.

same. Twitter needs to hosepipe the data to sort us all out. There will

:40:02.:40:09.

be a real jarb lash about that? This company don't tell us what the

:40:09.:40:19.

user base is. 200 million is the starter figure. The point thing is

:40:19.:40:26.

they posted a live BOt may not be making much money yet, it is all

:40:26.:40:30.

about the belief of making money in the future. Essentially they can

:40:30.:40:34.

read our new addiction and find ways to profit from that. The

:40:34.:40:39.

addiction to Twitter is different to Facebook, and they were using

:40:39.:40:43.

one more than the other? This is the crack of on-line addiction,

:40:43.:40:54.

Twitter is it. For a lot of people like me. When the last bank was

:40:54.:40:58.

floated and then it was sickness and gone down. Not just for all the

:40:58.:41:02.

addictions but the stock market more broadly, that will have a big

:41:02.:41:05.

impact. Interesting we have just been talking about confidence,

:41:05.:41:10.

something like Twitter floating a new contract, seven years old, this

:41:10.:41:14.

will lead to business confidence. If you want to basically see 21st

:41:14.:41:19.

century innovation and growth and business building in action. Things

:41:19.:41:26.

like Twitter are encouraging. Twitter won't be like that with Pin

:41:26.:41:33.

to Rest and all these other things. The signal moment it represents,

:41:33.:41:37.

not just because it is a big tech, it is the tech ifpt PO we have been

:41:37.:41:42.

waiting for. We are talking about the Royal Mail floating, it makes

:41:42.:41:48.

£200 million a year. This company makes reportedly £330 million. It

:41:48.:41:53.

is about the same as the Royal Mail in business terms. If 25 years

:41:53.:41:58.

hence we are still twittering you will guarantee that the scale of

:41:58.:42:01.

the revenue will be fast. What is the scale of growth? It is doubling

:42:01.:42:07.

its user base and tweets every year to eight months in the seven years.

:42:07.:42:13.

The critical question is those 450 billion tweets that they have

:42:13.:42:17.

already sent sitting in databases, who will use them, how will they

:42:17.:42:20.

already sent sitting in databases, use the information and can it

:42:20.:42:28.

Monetorise. That is to do with vive -- monitorise, that is to do with

:42:28.:42:41.

advertising. That is what we make a deal with every operating system we

:42:41.:42:50.

use. So the cards are packed? We are analysing our data and we don't

:42:50.:42:55.

mind making that because we get a lot from it. You might want to have

:42:55.:43:00.

your pen and paper handy for the end of the programme. First the

:43:00.:43:01.

papers: That is all tonight. Tonight's

:43:01.:44:33.

Twitter news meant we were unable to show our film from China.

:44:33.:44:38.

Apologies for that. Before we go the Government's communications

:44:38.:44:44.

centre, GCHQ, has issued a cryptic code and invited potential recruits

:44:44.:44:48.

to break it. We asked our crack team to set a challenge of our own.

:44:48.:44:52.

There is a coded message hidden in our closing credits and tomorrow

:44:52.:44:57.

night we will name the first person to tweet it with the hashtag

:44:57.:45:00.

Newsnight.

:45:00.:45:01.

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