Category Archives: Economy
In spite of Labour’s General Election surge and its continued polling strength – not to mention more than thirty u-turns Labour under Corbyn had already forced from the Conservatives before the election – the line persists in some quarters that Labour is not an effective opposition.
That line tends to be spouted either by those who think defeating Brexit is the only important task for the opposition – or by those who talk like it for factional purposes – ignoring the fact that Corbyn’s handling of the issue has been intelligent, nuanced and politically skilful.
So, as it’s the time of year for round-ups, here is a non-exhaustive list of sixteen u-turns that the Conservatives have been forced to make because there is an opposition party willing and able to stand for something different.
And for those who think Brexit is the only vital issue, the first three are Brexit-related:
- Brexit deal vote u-turn
- Brexit impact assessment u-turn
- European Court of Human Rights u-turn
- Dementia Tax u-turn (unprecedentedly dropped from the manifesto before the GE)
- Pensions triple lock u-turn
- Housing benefit cap for supported housing u-turn
- Self-employed National Insurance increase u-turn
- School meals cost u-turn
- NHS Professionals sell-off u-turn
- Police funding u-turn
- Fire safety in schools u-turn
- Grammar schools u-turn
- Abortion for Northern Irish women u-turn
- Winter fuel payments u-turn
- Universal Credit 7-day waiting period u-turn
- Universal Credit freephone u-turn
- Fox-hunting u-turn
- Diesel tax u-turn
- Manchester terror attack costs u-turn
- Prisoner vote u-turn
The government has been weakened by Corbyn’s Labour taking a clear, firm stand – and the Labour surge resulting from the party presenting a genuine alternative.
2017 has been a historic year for Labour and much of that can be attributed to Corbyn’s vision, leadership and his strength in standing firm against an unprecedented media onslaught – and it’s been a better year for millions of UK people as a result of Labour’s effective opposition.
The FT reports that senior executives at several of the largest US banks have privately told the Trump administration they feared the prospect of a Labour victory if Britain were forced into new elections.
It then referred to a report by analysts at Morgan Stanley arguing that a Corbyn government would mark the “most significant political shift in the UK” since Margaret Thatcher’s election and may represent a “bigger risk than Brexit” to the British economy. It predicted snap elections next year, arguing that the prospect of a return to the polls “is much more scary from an equity perspective than Brexit”.
Jeremy Corbyn gave ‘a clear response’ to Morgan Stanley in a video (left) published on social media reflecting anti-Wall Street rhetoric from some mainstream politicians in the US and Europe, saying: “These are the same speculators and gamblers who crashed our economy in 2008 . . . could anyone refute the headline claim that bankers are indeed glorified gamblers playing with the fate of our nation?”
He warned global banks that operate out of the City of London that he would indeed be a “threat” to their business if he became prime minister.
He singled out Morgan Stanley, the US investment bank, for particular criticism, arguing that James Gorman, its chief executive, was paying himself a salary of millions of pounds as ordinary British workers are “finding it harder to get by”.
Corbyn blamed the “greed” of the big banks and said the financial crisis they caused had led to a “crisis” in the public services: “because the Tories used the aftermath of the financial crisis to push through unnecessary and deeply damaging austerity”.
The FT points out that donors linked to Morgan Stanley had given £350,000 to the Tory party since 2006 and Philip Hammond, the chancellor, had met the bank four times, most recently in April 2017. The bank also had strong ties to New Labour: “Alistair Darling, a Labour chancellor until 2010, has served on the bank’s board since 2015. Jeremy Heywood, head of Britain’s civil service, was a managing director at Morgan Stanley, including as co-head of UK investment banking, before returning to public service in 2007”.
A step forward?
In a December article the FT pointed out that the UK lacks the kind of community banks or Sparkassen that are the bedrock of small business lending in many other countries adding: “When Labour’s John McDonnell, the shadow chancellor, calls for a network of regional banks, he is calling attention to a real issue”. And an FT reader commented, “The single most important ethos change required is this: publish everyone’s tax returns”:
- In Norway, you can walk into your local library or central council office and see how much tax your boss paid, how much tax your councillor paid, how much tax your politician paid.
- This means major tax avoidance, complex schemes, major offshoring, etc, is almost impossible, because it combines morality and social morals with ethics and taxation.
- We need to minimise this offshoring and tax avoidance; but the people in control of the information media flow, plus the politicians, rely on exactly these methods to increase their cash reserves.
But first give hope to many by electing a truly social democratic party.
Is the rainbow suggesting a new party logo?
Earlier this month, the FT noted that – as the latest national opinion polls show Labour eight points ahead of the Conservatives (though Yougov shows a far closer score) – some investors and business leaders are increasingly worried about the prospect of a leftwing UK government overturning decades of economic orthodoxy.
One of these, Ajit Nedungadi, a managing partner at TA Associates, a Massachusetts-based private equity group said. “Corbyn will be bad news for the industry. It’s black and white. There is no question. How can it be good news?”
Not everyone in the financial community views a Corbyn government in such grave terms.
Dean Turner, an economist in the UK investment office at UBS Wealth Management, believes investors have exaggerated the threat posed by Mr Corbyn, saying a government led by the Labour leader would not turn Britain into “Venezuela overnight”.
“Taxation as a share of gross domestic product would be at 1985 levels, and spending as a share of GDP at 1984 levels,”
After agreeing that it would be a “dramatic shift from where we have been for the last 30 years”, Mr Turner pointed out that many of Mr Corbyn’s policy proposals, such as renationalisation of the railways, would be seen as mainstream in other EU countries.
He also said that Mr Corbyn’s pledge to reverse cuts in corporation tax — raising the headline corporation tax rate from 19 to 26 per cent — was also relatively conventional.
Even under Mr Corbyn’s plan, for example, the UK would still have the lowest corporate tax rate in the G7.
Mr Turner also dismissed speculation about a run on the pound and the imposition of capital controls, even after Mr McDonnell said that Labour would have to prepare for both possibilities. “If we do see a weaker pound, the change would be gradual,” Mr Turner said.
“I doubt we would see the kind of falls we saw post-Brexit vote.”
A growing number are urging Government to move support from the Trident project and arms export industry to other sectors that meet real needs and use highly skilled workers for constructive purposes, designing emission-free rail, road and waterway vehicles, advancing renewable energy, particularly wave and tidal energy, engineering low emission new-build housing and retrofitting much of the housing stock.
- On the Lucas Plan website, following its 40th anniversary, we read that one of Labour Leader Jeremy Corbyn’s excellent reports, released during his 2015 election campaign, has put arms conversion firmly back on the political agenda.
- Following this, Steve Schofield, who is arguably the country’s leading authority on arms conversion, wrote “Defence Diversification or Arms Conversion? Why Labour needs a programme for nuclear and conventional disarmament“.
- The Campaign Against Arms Trade’s 2015 case study “Arms industry in the Clyde and renewable energy options” examined an arms dependent area in depth.
- The Unite trade union, withits dual commitment to world peace and disarmament and to the protection of its members’ jobs published “Defence Diversification Revisited” in March 2016. This looks at the history of “defence diversification” in the UK and elsewhere. At its July policy conference Unite committed itself to campaigning for a serious government approach to “defence diversification”, condemning the failure of successive governments to grapple with the issue after the Cold War.
- In 2016, MEP Molly Scott Cato commissioned a report “Devonport: Trident alternatives”, an overview of green employment potential.
In October this year, Andrew Smith cited a report from the Stockholm International Peace Research Institute which put the cost to tax payers of government support for the arms trade at more than £100m a year, adding, “This is to say nothing of the huge levels of political and logistical support that the arms companies are offered”.
Widely accepted figures from the Campaign Against Arms Trade (CAAT) are that arms exports only count for 0.2% of UK jobs and around 1% of exports. According to the MoD, 65,000 British jobs depend on arms exports and as the total number of jobs in the UK is just over 30 million the arms trade accounts for a tiny fraction of total employment.
And this manufacturing sector is not flourishing – the ‘defence’ industry now represents only 10% of all manufacturing.
A range of housing has been built on the Royal Ordnance site in Euxton, where the land is so contaminated that vegetable growing is forbidden. Last month, BAE, major employers in the area, announced that it will be cutting up to 750 jobs Warton and Samlesbury plants in Lancashire and up to 400 people will be made redundant in Brough, East Yorkshire.
The Trades Union Congress, passed a motion in October calling for the Labour Party to set up a shadow defence diversification agency to engage with plant representatives, trades unions representing arms industry workers, and local authorities. The agency would listen to their ideas, so that practical plans can be drawn up for arms conversion while protecting skilled employment and pay levels.
GND: “At the high skilled end (engineering and electronic) design; though to medium and unskilled work making every building energy tight, and fitting more efficient energy systems in homes, offices and factories . . . putting in place a new regional grid system, ranging from large-scale wind, wave and tidal electricity to decentralised energy systems that increase domestic and local energy production”.
We add to their recommendations the designing of emission-free rail, road and waterway vehicles and of advances in tidal and wave power, which have enormous potential but are currently lagging far behind solar, wind and hydropower technologies.
As Matthew Lynn wrote in The Spectator: “There might be a case for maintaining a modest, specialised arms industry to support our own army. But anyone who thinks an export-driven defence industry is important to the economy should stop kidding themselves”.
October: in a major speech on public ownership and the economy – which may be read in full here – Labour leader Jeremy Corbyn singled out Preston Council.
Relevant extracts from the speech:
The Tories have devolved austerity to local councils and, perversely, areas with higher levels of poverty have been hit hardest. Councils have on average faced 40 per cent cuts in their budgets. But in the face of this adversity councils such as Preston have responded with inspiring innovation.
They brought together major local employers in their community, what academics call the anchor institutions, and Preston Council worked with them to drive through a local programme of economic transformation.
By changing their procurement policies, these anchor institutions were able to drive up spending locally protecting businesses and jobs.
And they’re looking at the council’s own pension fund to see where investment can support local businesses keeping the money circulating in their town.
Alice Thomson of the Times writes, “Jeremy Corbyn in a recent speech hailed Preston for showing the way to a new post-Brexit Jerusalem” but ends “A move by Preston council to employ more of the talent in its area deserves to be copied, but not by Jeremy Corbyn . . . “
More from her article will be quoted next week on the LWM blog.
Today the FT reports that Jeremy Corbyn was given a ‘rapturous reception’ in Brussels on Thursday, as he warned that leaving the EU without a Brexit deal would be “catastrophic” for the UK economy. Mr Corbyn met Michel Barnier, the EU’s chief Brexit negotiator (above), the European Parliament President Antonio Tajani and the prime ministers of Portugal, Italy and Sweden on Thursday in Brussels.
Mr Corbyn received a standing ovation from Europe’s centre-left parties as he addressed delegates at the Europe Together conference, just hours before prime minister Theresa May was scheduled to meet her EU counterparts at a European leaders’ summit. He said:
“We’re here to make sure that negotiations get on track, that we defend jobs in Britain, and that we make sure there is trade access to Europe in the future . . . We cannot countenance the idea that we rush headlong into a no deal with Europe. No deal would be very dangerous for employment and jobs in Britain. We are clear in our priorities: a jobs-first Brexit which maintains free access to the single market.”
He advocated “radical alternatives” for Europeans after years of austerity, rising job insecurity and falling living standards. “The neoliberal economic model is broken. It doesn’t work for most people,” he said, adding: “Our broken system has provided fertile ground for the growth of nationalist and xenophobic politics.”
The FT ends: “Mr Corbyn’s enthusiastic reception was in stark contrast to Mrs May’s arrival in Brussels on Thursday. The UK prime minister was rebuffed from attending a meeting of Britain’s traditional European allies — including the Netherlands, the Scandinavian countries and the Baltic countries — on the sidelines of the summit, though Leo Varadkar, Ireland’s prime minister, was invited to that meeting.”
Britain’s next Prime Minister could be a 70-year old former winner of Beard of the Year who’s become a hit with young voters. Steve Beauchampé assesses Jeremy Corbyn’s chances.
My only surprise is that anyone was surprised. From the moment Jeremy Corbyn received sufficient nominations to qualify as a candidate in the Labour Party leadership contest, it was clear that here was someone who could articulate and represent the opinions of a considerable number of left leaning voters, both within the Labour Party and without. After two decades of Blairites, Blair lites and the worthy but unelectable Ed Milliband, Labour voters were being offered the choice of more Blair/Brown in the form of either Yvette Cooper or the unspeakably vapid Liz Kendall (strategy: ‘the Tories won the last two elections, so let’s adopt policies that are indistinguishable from theirs’) or decent, honest and likeable Andy Burnham, a slightly more radical version of Ed Milliband but without the geeky visage and voice.
That Corbyn has forged a sizeable and potentially decisive lead over his rivals under Labour’s new ‘one member one vote’ electoral system has caused a mixture of consternation and outrage amongst many of the party’s grandees (most of whom are backing either Cooper or Kendall) and demonstrates how disconnected with a large section of potential Labour voters they have become (the more so with opinion polls placing Burnham second). Meanwhile Corbyn, demonised and subjected to vitriolic attacks by some within his own party, and inaccurately dismissed as a 1980s throwback from the hard left of the political spectrum by Tories and most sections of the media, has fended off both the criticism and caricatures with ease, as befits a man with decades of experience of being outwith the political zeitgeist.
However, following several weeks of lazy, ignorant mis-characterisation of him across the press (not least by the BBC), a realisation finally seems to be dawning amongst the more thoughtful political commentators and scribes that Jeremy Corbyn is no joke candidate, no passing fad, but is instead a serious politician, and one with an agenda appealing to many voters previously disengaged from party politics. No cartoon firebrand Marxist he but a man of conviction and humility with a track record of being on the right side of the argument years before those in the ‘mainstream’ adopted the policies he espoused (Corbyn opposed Britain’s arming of Saddam Hussein in the late 1980s, supported Nelson Mandela and the ANC when the British Government was helping South Africa’s apartheid regime, held talks with the IRA nearly a decade or more before the Major and Blair governments did likewise, campaigned for gay rights when it was unfashionable to do so and voted against the invasion of Iraq in 2003).
And just as in Scotland, where the rise of the SNP, under the charismatic leaderships of first Alec Salmond and now Nicola Sturgeon, have helped invigorate politics, particularly amongst the young, so Corbyn’s leadership hustings have been passionate and at times electrifying affairs, populated by a sizeable number of youthful voters. A victory for Corbyn on September 12th could energise and transform British politics, providing a narrative with which a substantial number of the electorate – many of whom currently feel disenfranchised and perhaps don’t even bother to vote – can feel comfortable and might coalesce around. Because, with every media appearance, every public speaking engagement, all but the most politically jaundiced can see that Jeremy Corbyn is at least a man of integrity, putting an argument that has long been absent from mainstream British politics. Agree with him or not, but here is a politician to be respected and reckoned with, who is shifting the terms of the debate.
Thus those in the Conservative Party and its media cheerleaders who view a Corbyn victory as almost a guarantee of a third term in office may be in for a shock. Because, whilst the opprobrium directed at Corbyn from his opponents both outside and inside the Labour Party will only intensify if he becomes Labour leader, with a coherent and plausible genuine alternative to the Cameron/Osborne ideology and its attendant relentless tacking to the right of what constitutes the political centre ground, the Conservative’s agenda will be thrown into sharper definition in a way that a Labour Party offering merely a less extreme alternative to the Tories never can.
So could Jeremy Corbyn win a general election for Labour and become Prime Minister? Well, despite his current sizeable lead in opinion polls Corbyn’s campaign could be scuppered by Labour’s second preference voting system, whereby the second choices of the lowest ranked candidate (who drops out) are added to the cumulative totals of those remaining, this procedure being repeated until one candidate has over half of the votes cast, a system expected to benefit Burnham or Cooper the most.
If Corbyn can overcome that hurdle, and any subsequent move to oust him from the New Labour wing of the party, then don’t write Jeremy Corbyn off for Prime Minister. Few of life’s earthquake moments are ever foretold and by May 2020 who knows how bloodied and riven the Conservatives might be following the forthcoming EU referendum. Public appetite for the Tories and in particular George Osborne might have waned after two terms and ten years (and barely a quarter of the eligible electorate voted for them in 2015), with the Conservatives needing only to lose eight seats for there to be hung parliament. So a Corbyn prime ministership is not out of the question.
Perhaps the most likely – and intriguing – scenario to that coming to pass would be a coalition between a Corbyn-led Labour, the Liberal Democrats under the auspices of social democrat leftie Tim Farron, the SNP, Plaid Cymru and the Greens. Now that really would scare the Daily Mail readers!
August 5th 2015
Jeremy Corbyn’s policies include:
Re-introduction of a top rate 50% income tax
Tighter regulation of banks and the financial sector to prevent a repeat of the 2008 financial crisis (George Osborne is currently proposing to loosen these controls)
Substantial increase in the number of affordable homes being built
Re-introduction of rent controls to reduce the amount the state pays to private landlords
Support for Britain’s manufacturers rather than the financial services sector
The establishment of a National Investment Bank to pay for major public infrastructure programmes such as house building, improved rail, renewable energy projects and super fast broadband
The minimum wage to apply to apprentices
Removing all elements of privatisation from the NHS
Taking the railways, gas, water and electricity back into public ownership
Bringing Free Schools and Academies under the direct control of local authorities
Budget deficit reduction, but at a slower rate than that currently proposed
Scrapping Britain’s independent nuclear deterrent (Trident)
Support for significant devolution of power from London and opposition to unless voted for in a referendum
An elected second chamber
On the EU referendum, Corbyn has said that he is likely to vote to stay in, and then fight for change from inside.
Inside story: Corbyn’s campaign – the political shock of a generation
With thanks to the reader who sent this link.
Corbyn counters proposals which would mean marooned older people with lower incomes, spending more on heating
Today the Times reports that Jeremy Corbyn will reaffirm his party’s commitment to the concessionary travel scheme on his tour of marginal seats in Scotland.
The SNP has confirmed plans to raise the age at which Scots become eligible from 60 so that only those eligible for a state pension have a free pass – which is fine for those still employed . . . Ministers say it would protect the long-term viability of the scheme, which costs taxpayers £192 million a year.
Mr Corbyn plans to meet pensioners in Fife today and is expected to say: “Labour will protect pensioner incomes, by legislating to keep the triple lock, protecting the pensions of over one million Scottish pensioners . . . We’ll protect benefits like the free bus pass and the winter fuel allowance.”
An octogenarian reader who has an income slightly above the national average wage and uses only public transport, comments that her life would be adversely affected. As bus fares are so high she would limit journeys to two a week.
Millions of pensioners on lower incomes would be marooned in their locality most of the time – a locality which might or might not meet everyday needs as cuts close post offices and libraries.
How can affluent Conservative politicians (above, MP Kenneth Clarke) even contemplate such inhumane measures, whilst increasing capital gains and corporation tax relief to the affluent?
Kate Hudson observes that the outcome of the general election marks a significant shake-up in British politics and a surge in support for qualitatively different policies:
“It is clear that the narrative of investment in homes, health, education and jobs, has been very popular. In fact, it has led to Labour’s first increase in seats since 1997 and its biggest increase in the share of the vote since 1945”.
She views the election as a significant shift towards the politics of hope, peace, inclusivity, justice and equality.
“Jeremy Corbyn’s long – standing opposition to nuclear weapons, and his personal opposition to Trident replacement, did not deter millions of people from voting for him. Indeed the likelihood is that many – particularly young people – have voted for him precisely because he opposes war, intervention and weapons of mass destruction.
“Support for Trident replacement is negligible amongst the younger generation and it is clear that the narrative of investment in homes, health, education and jobs, has been very popular. In fact, it has led to Labour’s first increase in seats since 1997 and its biggest increase in the share of the vote since 1945”.
The right wing of the Labour Party, and a small but powerful section of the trade union movement, have ‘peddled the myth’ that Labour needs to look ‘strong on defence’ to win – and that this means supporting Trident replacement.
But, Kate believes, support for the party has surged because it has a radical vision of a different society, and because everyone knows that Jeremy Corbyn does not support Trident replacement. When he first became leader, he commissioned an extensive Defence Review throughout the Labour Party. That review has been shelved – because it showed the extent of anti-Trident opinion within the party?
She calls for that review to be published and debated at the next Labour Party conference: “This issue must not be kept off the agenda any longer”. There is no popular mandate for a Tory security policy, or a Tory-lite security policy pushed on the Labour party by a minority of pro-nuclear forces that are living in the past. Those trade unions that have put unreasonable pressure on Jeremy to keep Trident are urged to change:
“The way for them to secure and extend high quality, well-paid jobs is to support Jeremy’s policy on defence diversification. Rather than shunning this initiative they need to work with politicians and industry to develop a diversification plan, as part of a national industrial strategy that will secure their jobs without holding the rest of the country over a nuclear barrel”.
As she points out, there is now strong public backing for industrial planning and investment and this needs to go into sustainable industrial production to meet public needs, for energy, housing and public resources, not weapons of mass destruction.
Labour’s support has grown because of Corbyn’s policies based on peace, respect and our shared humanity. And this vision goes beyond national boundaries to his vision of how we relate to the rest of the world. No longer Blair’s ‘war-fighting nation’, ‘punching above its weight’, but a decent part of a shared community of nations.
Read her article here: http://www.cnduk.org/images/stories/Summer_2017.pdf
Kate Hudson, British political activist and academic, General Secretary of the Campaign for Nuclear Disarmament (CND)