18/10/2016 Newsnight


With Evan Davis. Central bankers, child abuse inquiry, homelessness in the 21st century, and Charlie Brooker on Black Mirror.

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This graph shows us interest rates, starting all the way back in 1694.


They never ran lower than 2% - not until the 2008 crash.


Then they hit the floor and stayed there.


Some think this tells us Mark Carney doesn't know what he's doing.


The era of easy money, low rates and heavy borrowing has


not been great for savers - and the central bank chief


The power that is concentrated in his hands, the hands


of committees that he sits on, is huge by the standards of any


previous predecessor of his, or anyone else in


Is that too much for an institution that's not democratically elected,


We'll try to work out if central banking has gone wrong,


and whether it's time to put less faith in the people in charge.


Also tonight, it is fifty years since Cathy Come Home opened


the country's eyes to the plight of the homeless.


I'm told you lost your place on the list long ago,


But we was meant to be one of those families!


It was grim then, and for some it is grim now.


We'll look at how housing has changed and should change.


And If you hate the way technology runs our lives,


It's back for a third series, and we've booked Charlie Brooker,


As I came in to work today, I did a double take on spotting


the headline on the London Evening Standard.


It's true inflation did soar, but that was only to an annual


But that soaraway 1% makes the point that we are in exceptional times.


Independent central banks have pursued the easiest


of money, but have struggled to get inflation up.


Central bankers have kept interest rates on the floor,


and have sometimes burrowed through the lino to get them even


lower - with negative rates in some countries.


But they are increasingly getting criticised for not


helping the economy, while hurting savers.


Theresa May joined the chorus in her conference speech


and today the former Foreign Secretary William Hague


wrote a Telegraph article which claimed that "central Bankers


So, is the era of the all-powerful central bank at an end?


Before we discuss that, here's Adam Parsons.


Back from the past and emerging from the gloom.


A spectre you may just have forgotten.


This is inflation, hitting the Bank of England


and the rest of the country and grabbing our attention.


The secret of a good horror movie is to throw in some surprises. But


useful the twist this morning coming, inflation up to 1%, a


two-year high but way below the government target of 2%. The


projections suggest inflation might be hitting 3% or even more in the


year. Typically you would expect the Bank of England to be thinking now


about backing up interest rates to control the economy. But a majority


of economists actually think the next move will be a cut in interest


rates and city traders are pricing in no movement at all. Almost as if


no one is quite sure what is going on in this post Brexit referendum


economy. If anyone knows it is probably him, the Bank of England


Governor Mark Carney has a clear remit from government to keep the


economy stable and target inflation of 2%. The bank has been plenty of


new fibre nodes but also spent hundreds of billions on a bond


buying spree, known as quantitative easing. It has either boosted the


economy or promoted inequality almost most likely done both. They


have been the only adult in the room, the economy had this Brexit


shock and members of the MPC and Mark Carney did all they needed to


do. The cut rates, did quantitative easing, said they would do


everything necessary and have been extremely impressive, fighting


against comments by the Theresa May government and senior Tories trying


to do them down. Central bankers do


form an elite group. The Bank of England,


the Bank of Japan, the American Federal Reserve


and European Central Bank. Their low interest rates


have shaped the world In 1997 Gordon Brown gave the bank


the task of setting interest rates and targeting inflation, jobs that


it still retains. But that independence has come under attack.


William Hague today wrote that central banks had lost the plot. By


allowing very low interest rates to go on for so long, hurting savers,


rising house prices, damaging productivity. While in her


conference speech the Prime Minister's attack on the QT


programme looks like a rather hostile warning shot. While monetary


policy with superlow interest rates and quantitative easing


provided the necessary emergency medicine after the financial crash,


we have to acknowledge there have been some bad side-effects. People


with assets have got richer, people without them have suffered. People


with mortgages have found their debts cheaper, people with savings


have found themselves poorer. A change has got to come. We are going


to deliver it. Ignorance teaches us you want a central bank that is


independent and do not want things like the column written by William


Hague in the Telegraph saying, keep your independence, it is in peril,


the point is to prevent people saying ridiculous things like that


and Theresa May said the same kind of thing, threatening the


independence of the Bank of England which had an impact on cost of


borrowing for the UK. Those within the Bank of England


highlight the comparison between what they can do and what is open to


government. The bank just has one Giant lever, monetary policy based


around the interest rate. On the other hand they said the government


can change policy around the economy or housing benefits or investment in


infrastructure. And that has a much bigger potential to change the


nation. But there are those who think the banker -- the bank has


long been susceptible to government influence especially when it comes


to that bond buying programme. It was instructed by government to


undertake asset boosts using printed money to put it crudely. What assets


is its purchasing, government bonds. How many, more or less the same


amount as the government has borrowed from the market over that


period. Government borrowed eczema, the Bank of England printed the same


amount and used it to buy government bonds. The bank is not independent


while that is going on. That is the case in the UK, the US and Europe.


The world central banks have been delivering their brand of emergency


treatment for eight years now, putting the frighteners on some


comment making others very rich and we're still not sure if the medicine


is working. This may be a scary movie, but not when knows how it


ends. -- nobody knows how it ends. Well, we did ask the Bank of England


to address these issues but they were not able


to offer anyone. But I'm joined now


by Baroness Altmann, the former Pensions Minister,


and in Washington by Adam Posen, who was a member of the Bank of


England's Monetary Policy Committee and is now President


of the Peterson institute You're not a central banker, not a


technocrat, but you feel annoyed with everything that has been going


on in monetary policy? I do feel that this policy of continually


pushing interest rates down, printing new money to buy government


bonds, has ignored very damaging side-effects that that policy itself


has. It is one thing to introduce an emergency experiment when we were


facing some kind of depression, as we possibly seem to be around 2008.


But this policy is still going on now when we have record employment,


record jobs, we do have growth. And therefore you have to ask is this


really the right way to be running policy especially when much of what


the impact is now facing significant groups in the economy. You mean


elderly people who may rely on savings. And also pension funds,


anyone who has been buying an annuity, who will be poorer for the


rest of their life as a result of this exceptional level of low


interest rates. It is not the fault of central bank that the economy is


flat on its back and there is a glut of savings in the world. And they


somehow have got to keep the economy going against that backdrop. It is


not clear that pushing down interest rates from already exceptionally low


levels is actually keeping the economy going while boosting the


economy. In fact low rates have deflationary impact. The expectation


in theory that continually push rates down are bound to be


expansionary. In some ways they are offset in the real world by the


practical realities of pushing rates down. Because for example, one of


the intentions of QT is to push up asset prices including housing. But


housing wealth is unevenly distributed and so young people


cannot get on the housing ladder, if you do not own a home it costs more


to rent. I want to put all this to add. This stuff that you are from


people who now knock Central bankers quite a bit. This argument that


you're making the rich richer and the poor poorer. Is there credence


to that. No, it has nothing to do with whether or not it is the


central bank or some other technocrats. The fact is it is not a


choice between the Bank of England pushing down interest rates and


therefore rewarding speculators and punishing small savers. It is a


choice, given the fact as you indicated, that the performance of


all the rich countries in terms of productivity and risk-taking, has


been lousy for almost ten years. The UK has been the worst on


productivity. No one is going to get any returns on their investments and


no corporation is going to want to invest in that kind of environment.


So the Bank of England has, facing a world of slow growth and low


opportunities, and if they put up interest rates in that kind of


world, what happens is young people become unemployed, small businesses


get cut off from credit, the pound goes up instead of down at a time


when that will hurt exports. All kinds of knots are good things


happen and talking about practicality in the real world, if


you look at data instead of just reading the whingeing letters of


certain constituents, that is the real world. We saw that in Europe


because when the ECB fail to cut rates for the first couple of years


of the crisis while the Bank of England and Federal Reserve did, we


saw unemployment go up in Spain and Greece. It is not a crisis. You put


the point very strongly and physically. Do you concede that the


drugs do not seem to be working as well as they used to, you do not


have to be William Hague or a politician to say hang on, we have


now gone down to negative interest rates, something is wrong. Maybe we


need to step back and think about how monetary policy works and maybe


have other alternatives. That argument has some credence I think.


I think the observation that central banks and monetary policy is less


effective now than in the midst of the crisis has credence. Central


bankers themselves say that and that is very practical. As I said to the


Treasury subcommittee five years ago. In the midst of a crisis of


course liquidity policy has more of an effect in stopping a panic. Not


in the midst of a crisis, the effect is diminished. I would like to take


William Hague's largely ridiculous essay and turned the title on its


head. It is not that central banks have lost the plot, but we have


moved from Henry IV to Henry V. There is supposed to be a new


leading character with central banks now in a supporting role, that is


fiscal policy. As Mark Carney said, all the different things the


government could do instead of blaming central bank. Putting aside


the technical arguments, there is some measure of agreement between


you, is it healthy when politicians criticised central bank. It does not


end well? I do not know, the point is this is a massive monetary


experiment and no one knows what the outcome is. The transmission


mechanism is indirect. Just trying to rely on people borrowing more to


stimulate the economy when in fact in many ways this supposedly


expansionary monetary policy is acting rather like a tightening of


fiscal policy. If the government itself was trying to change tax


policies to give more money to rich people, there would be outrage. In


fact that is what the Bank of England policies have effectively


been doing in the hope of stabilising the economy.


How we given a central bankers too much deference? It started with Alan


Greenspan. Mark Carney was walking on water. I have spent time with all


of them. They definitely are just human. I agree. That is a place


where we went wrong. We had the ridiculous state of affairs in the


late 90s when we had a senators talking about weekend at Bernie 's.


If someone died, you would prop the mob just to make sure there was no


panic in the market. The inflationary targeting regime the


Bank of England has now is to constrain the discretion of central


bankers, be they Governor Cani, Chairman Greenspan or whoever, and


make them accountable to the government. The cultural of


deference to central banks is excessive. Nobody should fear, not


even the governor of the Bank of England, should fear saying that.


They can say what they want. The central bank should listen and think


about it. There is no need for a deference. But there is a need for


independence. If the government wants the bank to do something else,


let them pass legislation or redefine the target. Do not let them


back-seat drive. Thank you. You were Pensions Minister. The government


made an important announcement today. You will not be able to cash


in your annuity. Good thing, bad thing, sensible, stupid? It is


understandable that if we do not have the consumer protection in


place, we will now not be able to go ahead. It will be very disappointing


to tens of thousands of people who have bought an annuity that they


didn't want, didn't need, because they were forced to. Thought they


would be able to get some money back for themselves. That opportunity


seems to be gone. The Daily Mail leading on that story. The


government thought they were going to be ripped off again, according to


the paper. More information has come out today


about the troubled inquiry We had the chair of the inquiry,


some of her colleagues on the inquiry and the permanent


secretary of the Home Office giving If you were with us last night,


you'll remember the story so far, that the Home Office is accused


of trying to bury news - the news that there had been doubts


over the former chair of the inquiry Lowell Goddard before


she stepped aside. Our policy editor


Chris Cook is with me. Just bring us up-to-date on the


story. What do we know until today? The most recent chapter of the story


starts in August, when Lowell Goddard, the New Zealand judge,


appointed by Theresa May, the third chair of the enquiry, resigned. In


September, Amber Rudd was called to the Home Affairs Select Committee to


discuss this. She said the reason she thought Justice Goddard had


resigned was the reason she alluded to in a letter, that she was lonely,


that she was homesick, she wanted to go back. MPs pushed her on this


fact. Amber Rudd said she knew nothing more. Well, we now know,


thanks to the Times reporting, that there were concerns about Lowell


Goddard's capacity to run this big enquiry under English law, raised


with the Home Office and the Prime Minister prior to her resignation.


It is quite sticky for the Home Secretary. What did we learn today?


The permanent Secretary of the Home Office was there. He was asked about


why it was that the Home Secretary had volunteered this information.


You can have a look at the answer. All I'm saying to you is that the


Home Secretary answered the questions put to her accurately.


That is our obligation. She said, I only have the information that you


have. That is not accurate, is it? That went quite badly. He was not


able to defend the Home Secretary. Lowell Goddard was given ?80,000


severance when she left, even though she was apparently resigning because


she was homesick. There are some issues around that. Where does that


leave the enquiry? There was a little incident today. The leader of


one of the core participants in the enquiry, he was basically thrown out


of the hearing because he got basically annoyed with the town,


with what he felt were the -- was the glibness with which things were


discussed. It is critical for the public confidence in the enquiry,


and for the evidence, that the big victim groups still support the


enquiry. His concern, his anger, and he is someone who has been quite


supportive of this enquiry at times, is quite a visceral reminder that


that cannot be taken for granted. Thank you.


Next month will mark 50 years since the BBC aired a television


play that probably had more impact than any other programme in the


You've got a place in a month's time?


I'm told you lost your place on the list long ago,


But we was meant to be one of those families!


Haven't you got a room in one of your houses?!


Haven't you got flats that are empty half the night?


It was famously described as "an ice-pick in the brain


Well, to mark 50 years, BBC Two is tomorrow airing a programme


about homelessness in the 21st century, another one to make


the comfortable classes sit uncomfortably as they watch.


It goes behind the scenes at the housing department of Barking


We see the staff barely cope with desperate people who have been


evicted from their home, or can't afford their rent,


and the team have to make tragic choices as to which people get


emergency shelter and long term housing, and which don't.


Have a look at this and you can see what part of the problem is.


The amount of social housing built in the UK peaked at 207,000 in 1954.


The year that Cathy Come Home was released, numbers


By 1967, a year later, when the homeless charity


Crisis was founded - numbers increased a little.


Now, 50 years on, you can see the number of social houses built


Today, social housing is a last resort, rather than an expectation


In this clip, we see one man told he has to leave his mother's council


And they're going to serve me notice.


I'm not being horrible, this is where I end up thinking


I'm 40 next week, and I've got no future at all.


There is nothing that says he must have this house,


You know, we have to be very, very careful and satisfied


that we are making the right decision when we give


We cannot be sentimental about it at all.


That is just a taste of the programme.


We are joined now by the writer and activist Poppy Noor,


Conservative MP and chair of the All-Party Parliamentary Group


for Housing and Planning, James Cartlidge and Jon Sparkes -


the Chief Executive of the Homeless charity, Crisis.


Poppy, you have some familiarity with these difficult decisions being


made in housing offices. Tell us about the kind of thing you have


seen? I went through the system myself when I was 16 years old, when


there was more provision in terms of benefits that people were afforded


and in terms of the rhetoric as well around homelessness. And then it was


incredibly difficult, even back then. The first council I went to, I


was sent away for not looking harmless enough. You watch that


scene and it's incredibly sad. But ultimately what it is getting at is


the fact we no longer see housing as a basic human rights. Is that


acceptable in one of the richest economies in the world? Were they


judging you, where they judging what your need was? Or were they thinking


about how much they thought you were responsible for your plight? The


thing is, these things do not happen in a vacuum, right? Local councils


have cuts to their budget. Automatically, when you walk into a


council, they are thinking, especially if there isn't enough


housing, how can they get you out of here as quickly as possible? This


comes across in the programme. It is incredibly easy to do that when you


have got a rhetoric that says people who own houses own houses because


they have worked really hard, and people who are homeless haven't


worked hard enough. James, what you are seeing in the programme is


people, who live there in the housing market sector, RTD not going


to get a home. They will not be able to afford one. I just wonder whether


the most basically obvious fact, and whether it is an accepted now, is


whether we do not have enough of the social homes, where they are


allocated by other factors than how much money you can afford to pay?


Sure. There is a lack of housing of all kinds of options. If I was to


summarise the housing crisis, the challenge faces -- the challenges we


face today, a huge number of people have no palatable option on housing.


The only long-term answer to that is greater supply. That is a huge


challenge. We are doing what we can. Greater supply at existing prices is


not going to help the small numbers of millions of people who cannot


afford the current prices. Housing benefit will help a lot of those


people. I just wonder again whether you think we went too far in getting


rid of the houses that we can allocate because this person needs a


place to live, and we have got one to give them? We have built 300,000


affordable homes since 2010. Before I was an MP, I ran a business in


shared Ownership. I was a volunteer for a London homeless charity. We


used to sit with homeless clients trying to get them to get on their


feet. We award of them grants. The thing that always struck me in those


cases, the most severe cases, is how complex and different each case was.


I don't think you can talk structurally about each and every


case affected. Have we got enough housing that we can allocate to


people who do not have enough money to buy them? We clearly haven't.


This is the very sharp end of the housing crisis. Homelessness is on


the rise in England. Whatever measure you put on it. 73,000


households in temporary accommodation tonight. 3500 people


sleeping on the streets on average night. We clearly haven't got it


right in terms of affordable housing. There are two ways to house


people on low incomes. One is investing in social housing, another


is providing Social Security to bridge the gap between what people


can afford and social housing. Both of those things are under pressure.


Contrast that with Poppy's experience and the experience of the


programme with hard-working housing officers with a system which drives


them to the crisis point, rather than a system that deals with


prevention. They have to sometimes say to people, we have nowhere for


you, you have to sleep on the street. They operate within the


legal system which says some people are priority need, some people are


not. You always have to love and allocation system of some kind. It


is a difficult job. Under any government in any circumstance, you


have to make rational decisions and prioritise. Poppy, even in the


1960s, that is the point of Cathy Come Home, we were building Council


houses and still finding that you had to make difficult choices. Cathy


was the subject of that. Yeah, I suppose my issue with it is that it


is completely reasonable to suggest that we should have readily


available social housing for people in one of the richest countries in


the world. This discussion about... OK, if I can put the question back


to the Tory minister. Is housing a basic human rights? I am not a


minister. I'm chairman of an all-party group. Sorry. Every


family, every person out there as an aspiration to live in a home they


can afford, whether owning our renting. One thing I would say is


there is more than an acknowledgement that we have done


important things in terms of encouraging homeownership, but we


have two have a housing policy that everybody, including those who rent,


in other words, those who will probably not be able to afford to


buy. Would it be reasonable to say to


people, we can get you a home but it will not be in Barking and Dagenham,


we will put you somewhere else and if you do not have a job or are not


a student here, you could live somewhere else. Someone who is


vulnerable, who is homeless, the very best solution for them is to be


in their community with positive support systems. With the people


they know, schools where their kids can go to school, not someplace, not


be shunted somewhere else in the country. That says, if you look at


the housing market in London, you can see why there is a tendency to


do that. The other thing is that although a huge part of this is


about housing and provision of housing, it does not have to be the


way that is described in terms of allocations. The system at the


moment drives the housing officer to only deal with the person in crisis,


it does not put a duty on them to try to prevent homelessness in the


first place. Recent legislation in Wales has shown you can reduce the


number of people owed a housing duty by getting prevention activity


right. And the private members Bill is exactly about that. One other


thing that comes out of the documentary, there was not enough


emergency shelter, there are people sleeping on the streets because we


cannot find a mattress and a whole. Within a year surely we could have


also mattresses, better than the church hall you seen the film, and a


decent bed for people who are literally on the street.


Homelessness has been around for a long time, no one has ever come up


with a magic solution. Government is providing support as far as


possible, ?40 million this week and of course working with the


charitable sector, with voluntary groups and the local authorities


judge, with innovative ways to deal with that. There is no magic answer


but do not forget a lot of those individual cases come from complex


circumstances. No easy general answer to this.


If you like dystopian visions of the future,


showing how technology will come to manipulate us, you probably


There have been two series on Channel 4 and, later this week,


it is coming back for a third, but this time on Netflix.


It's been compared to the Twilight Zone -


each episode is a self-contained story with its own characters


and plot twist, but they all share a mix of satire


Here is a clip of the first episode - in a world rather like ours,


where everybody is always rating each other and keen


If we drill down into the numbers, you have got a solid


Let's just look at the last 24 hours.


You see, even, what's that, 8:40am, you're working hard on your socials.


Let's check on your sphere of influence.


Healthy inner circle, that's good.


Well, the series was created by Charlie Brooker who is with me.


Good evening. Do you worry about technology, smartphones and all that


kind of stuff. I worry about everything! I am a 360 degrees


worrier. Technology is one thing I worry about. Not technology per se


so much as our inability to control these new superpowers that it is


granting us. But the Black Mirror of the title is the Black front of a


mobile phone. Pretty much any screen that is off and just reflects you.


We have always tended to worry too much about things, Griggs said the


books would be the death of us. I was not around, I dare say they did!


People worried about the printing press. The computer in 2001. I am


quite a geek, I love technology, I am an early adopter of lots of it. I


suppose I tend to worry out loud about the potential worst-case


scenario. It is people you worry about rather than the device. Not


the computer coming to take us over so much as is not understanding how


to use this thing. Yes and certainly in that particular story, it is kind


of about the inauthentic nature of our online selves. Which makes it


sound like a barrel of laughs! It is better than you make it sound! Good!


Personally, if you dropped out of social media, if you drop out of


readers comments on your articles... I did not do that. I got fed up with


writing columns generally, just because I started feeling like there


is so much extraneous communication in the world. I did not want to keep


on adding to it. There is a cacophony, technology going back to


the printed press has made that possible, basically. It is too easy


to say stuff. That is not a negative, though. Just a lot of


people shouting and how many columnists are there. Too many, does


not like there's a shortage of columnists. So you withdrew a bit. I


did a bit because I felt... Is not a good mindset for a columnist to be


in, what is the point of saying, of me saying anything, I have said


enough. It is great to hear you say that! You were fed up with me


talking! No, no. You're also a satirist. I hate that word. Everyday


I have people saying satire is dead, at what Donald Trump is said or


something like that. Is politics now so ridiculous that you cannot be


funny any more? It is difficult to get a foothold on, I think, it is so


slippery and ridiculous, you would never create a character like Donald


Trump because no one would find it plausible. So it is difficult but I


do not know, I do not think of myself as a satirist. It is the word


I'm slightly allergic to. You write about politics, you are a funny guy.


I do not write about politics so much as, the shows I do, in my head


I am reviewing the news as though it is just another entertainment show


and I am being appalled by this grotesque soap opera I'm watching. I


wonder, I love satire and I am in favour of it, have we if you liked


being debasing our political culture by mocking these people who have to


make difficult decisions that we cannot talk about honours programme.


We make it difficult for them, that is our job, you make it difficult


for them. Other programmes make us laugh at them and we come to think


of them as being nincompoops. I'm trying to feel some pity! I wondered


then if you end up with politicians who claim the fact that... We did an


episode of Black Mirror about the comedian who controls a cartoon Bear


that runs for office after becoming an anti-politics celebrity. That was


loosely based on Boris Johnson and away because he became a sort of


figure through appearing on TV should comedy shows, appearing like


a kind of buffoon. So it is kind of like inoculating yourself to


Mochrie, to become beyond mockery by openly sort of behaving like an oaf.


I do not think that is necessarily the fault of comedians. Not the


fault of comedy. Do we take offense to easily, people do take offense


quite a lot. They take offense quite a lot or they profess to. I do not


know how much about this genuine. I think a lot of it is performance.


But generally speaking I am in favour of bearing people


sensitivities in mind to a degree. It was on Channel 4 and now it's on


Netflix, what happened? They said to us go out and get some co-funding


because we cannot afford to go on making the show. Then they could not


agree, there was a creative disagreement over how we were going


about making it. And they needed the money for a tent! Instant Karma!


They were saving for that big empty tent with gales of despair blowing


through it! You have no beef with Channel 4? No, I'm not furiously


angry with them. Thank you very much.


We end with news that following the success of Oldstock


at the weekend, Chuck Berry, who's alive and well at 90,


is upping the ante and releasing his first album in four decades.


In case you've forgotten what he looks like,


here he is performing in some remarkably fresh looking footage


filmed at the Newport Jazz Festival, a mere 58 years ago.


And if you look closely in the audience you can just make


Good evening. Clear and cool might for many, some showers around


coastal districts


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