Category Archives: Poverty
In December’s FT John McTernan set out the evidence: “Something deeper is going on. From corporate capitalism to housing, from climate change to transport, Labour’s ideas are framing the decisions the new government is making”. He continued:
Since this was written the Financial Times, which used to be ‘about’ supporting free trade, now has a new editor and a new noncommittal agenda:
Though the latest article by Rana Faroohar, Global Business Columnist and Associate Editor at the Financial Times, has been written from an American perspective, it relates to Britain’s situation.
She points out that many corporate sectors are deeply in debt and most are reliant on financial engineering to create the illusion of growth and innovation. companies used to reinvest their earnings to boost productive capacity. Now, they mostly generate “value” by downsizing and distributing to the richest.
In pure Corbynese she states:
- we cannot afford to repeat the mistaken “socialise the losses, privatise the gains” approach used a decade ago.
- We have to start by protecting individual citizens and consumers
- giving immediate cash payouts to individuals, recapturing unnecessary payments the other side of the crisis, via the tax code
- When it comes bailouts, small and midsized businesses should come first.
- They should be given grants, not loans. Many run tight margins as it is, and would not be able to survive any additional debt burden
- If big companies want government money, they need to protect their workers and
- government should consider taking preferred equity stakes in such companies
Ending in true socialist vein: “Unlike the bank bailouts of 12 years ago, let’s socialise not just the losses but also the gains”.
Due to WordPress problem I cannot upload an image to this site. It is included in the email alert
Discredited? Labour’s commitments made in opposition were jettisoned by Tony Blair when in power. For instance:
- the railways were not renationalised,
- anti-union laws were not repealed and
- the earnings link with pensions was not restored.
It supported the US President’s decision to make war on Iraq which led to the deaths of hundreds of thousands of innocent Iraqis and – according to Professor Goodman and many others – destabilised large areas of the Middle East.
Tony Blair’s hour-long speech on Labour’s 120th anniversary at Kings College (20.2.20): “We must redefine what radical means” may be heard here or read in full here.
He states that Labour has always won when it secured the centre of British politics and refers to the 2019 campaign as substituting ‘a narcissistic belief in our righteousness for professionalism’.
‘Three overarching strategic challenges’ are advocated by Blair to achieve ‘fundamental reconstruction’:
- First, we must build a new progressive coalition with LibDems, to put Labour values into practice.
- Second we need a re-imagining of the modern economy.
- Third: the right ideas in politics never work without the mentality of government.
Strangely enough he sees these three recommendations as ‘profound changes to philosophy, policy and practice’. Stating the obvious he concludes:
“2020 isn’t 1997 or even 2007. And 2030 will be a revolution different from 2020. It’s always about the future. Precisely because of that, because whilst pointing forwards, we have been travelling backwards, nothing less than “born again” head to toe renewal, will do”.
This performance recalls another such ‘poor player that struts and frets his hour upon the stage (offering) a tale . . . full of sound and fury, signifying nothing’.
Ellen Brown reports that Andrés Manuel López Obrador (known as AMLO) has been compared with the United Kingdom’s left-wing opposition leader Jeremy Corbyn. He and his left-wing coalition won by a landslide in Mexico’s 2018 general election, overturning the Institutional Revolutionary Party (PRI) that had ruled the country for much of the past century. Some points made in her article are recorded below.
Called Mexico’s “first full-fledged left-wing experiment,” AMLO’s election marks a dramatic change in the political direction of the country. AMLO wrote in his 2018 book “A New Hope for Mexico,” “In Mexico the governing class constitutes a gang of plunderers…. Mexico will not grow strong if our public institutions remain at the service of the wealthy elites.”
The new president has held to his campaign promises. In 2019, his first year in office, he purged the government of technocrats and institutions he considered corrupt, profligate or impeding the transformation of Mexico after 36 years of failed market-focused neoliberal policies. Other accomplishments (recorded here) have included
- substantially increasing the minimum wage
- while cutting top government salaries and oversize pensions;
- making small loans and grants directly to farmers;
- guaranteeing crop prices for key agricultural crops;
- launching programs to benefit youth, the disabled and the elderly;
- initiating a $44 billion infrastructure plan and building 2,700 branches of a government-owned Bank of the Poor.
At a press conference on Jan. 6, he explained that the neoliberal model had failed; private banks were not serving the poor and people outside the cities, so the government had to step in
Ellen Brown reports that when speaking to a local group in December, President Obrador said his goal was to set up a Bank of the Poor with 13,000 branches, more than all the private banks in the country combined. Two days later he explained, at a news conference on Jan. 8: “There are more than 1,000 municipalities that don’t have a bank branch. We’re dispersing [welfare] resources but we don’t have a way to do it. . . . People have to go to branches that are two, three hours away. If we don’t bring these services close to the people, we’re not going to bring development to the people. … I’ll invite you within two months, three at the most, to the inauguration of the first branches because they’re already working, they’re getting the land … because we have to do it quickly”. Digital banking will also be developed.
Branches will be built on land owned by the government or donated, and software companies have offered to advise for free. The 10 billion pesos ($530.4 million) needed to build the new branches would come from federal savings from other programs and the bank’s operating expenses will be covered by small commissions paid on each transaction by customers, most of whom will be welfare recipients.
López Obrador’s goal is to construct a “new paradigm” in economic policy aiming not only to increase gross domestic product but also to improve human welfare.
The vision laid out by the participants in the Labour leadership contest makes Roy Jones from Colwyn Bay – who prefers “the much maligned ‘Corbyn manifestos’ “- fear for Britain’s future (24th January).
He sees, in the contest, not a word on the economy, infrastructure and environment, from Labour’s would-be leaders.
Looking back over our previous reliance on empire with an abundance of minerals from home and abroad and an industrial revolution of science and technology which made us the workshop of the world, he continues: “This fell into decline, albeit with a brief period of hope after World War II, until faced with the inability of Britain’s bosses to modernise industries and Thatcher’s wilful destruction of most of them. All this leaves our balance of payments, income and expenditure, reliant on the financial service “industry” for 80% of those sums”.
Roy Jones lists some measures advocated in two Corbyn-inspired manifestos for a society skewed by years of preserving the status quo at the worker’s expense:
- a green industrial revolution, advancing science and technology and skilled jobs,
- the rebuilding of our public services
- providing rent controlled housing,
- addressing poverty and inequality – a living wage of £10 an hour
- increasing public ownership
- and setting up a people’s bank.
But ends: “I fear the worst kind of flabby Labour future”
In the Financial Times, noting that Conservatives and Labour are ‘neck and neck’ in the polls, Jim Pickard – formerly a severe critic of Jeremy Corbyn – wrote today “With British politics in a state of acute flux, there is increasing interest from business leaders about Labour’s policy proposals”.
At the launch of the annual Living Standards Audit by the Resolution Foundation, an independent think-tank that focuses on low pay, the Independent reports that shadow chancellor John McDonnell (right) will announce details of Labour’s commitment to ending in-work poverty over the course of the next parliament, due to cover the years 2022-27 unless brought forward by a snap election.
The Joseph Rowntree Foundation said last year that ‘in-work poverty is the problem of our times’ and McDonnell will make a commitment to ending this modern-day scourge, eliminating it by the end of Labour’s first full Parliamentary term.
In September it was reported here that the Financial Times appeared to have left the anti-Corbyn/McDonnell media caucus, somewhat warming to the shadow chancellor. Following Jim Pickard’s first respectful report on any aspect of Labour policy, an article, by Jim O’Neill, chair of the Chatham House think-tank and former Treasury minister, had the headline, “The UK opposition steps into an economic void left by a government grappling with Brexit”.
The second sign was the FT’s comment in a December article 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”.
As a paragraph in his address today says: “As Chancellor in the next Labour Government, I want you to judge me by how much we reduce poverty and how much we create a more equal society, by how much people’s lives change for the better. Because that is our number one goal.”
“The savage rules of the almighty Market have created the conditions that are speeding us to destruction”: Paul Halas
Paul Halas: “As we approach the 2020s there’s a growing awareness that we need change and we need change now. Running the country according to the savage rules of the almighty Market has created the conditions that are speeding us to destruction”.
In the Western Daily Press (26th April) Paul describes the Conservatives’ genius in persuading millions of long-suffering voters that the national economy operates like a household, so in order for the nation to “live within its means” we all have to tighten our belts.
But this concept – invented by Margaret Thatcher’s think tanks – was directed only at the 99% who always “suffer the destructive effects of austerity” as Halas points out.
The cuts to health, education, transport, disability benefits and other sectors go un-noticed by the I% who can afford to opt out of these systems – symbolised here by one of her ministers.
The household economics concept, Halas continues, ”echoed by every administration since . . . (is) easy to understand yet utterly meretricious”.
He refers us to sources such as the Office for Budget Responsibility, so the writer obediently found the latest report, which certainly did not confirm “the impression that everything in the garden is rosy”. Tax receipts have risen, but there is no indication that “lashings of money are flowing into the Treasury” as had been stated in the same column on 23rd April.
OBR: damned with faint praise?
- The economy ended 2018 growing a little less strongly than we expected in October. In recent weeks survey indicators of current activity have weakened materially, in part reflecting heightened uncertainty related to Brexit.
- The Government’s stated ‘fiscal objective’ is to balance the budget by 2025-26 and past forecast performance suggests that it now has a 40% chance of doing so by the end of our forecast in 2023-24.
- One risk to the public finance metrics that we do expect to crystallise over the coming months is an improvement in the accounting treatment of student loans . . . we estimate that it could increase the structural budget deficit by around £12 billion or 0.5 per cent of GDP in 2020-21.
- Net trade and private investment were markedly weaker than expected, weighed down by a slowing global economy and Brexit-related uncertainty. Business investment has fallen for four consecutive quarters – its longest continuous decline since the financial crisis.
Halas expands on tax issues and the misdirected quantitative easing adventure:
Although the prime function of tax is to regulate the economy and keep inflation under control, the failure of many of the richest individuals and corporations to pay their dues, thanks to absurdly flabby fiscal legislation, has helped fuel the UK’s runaway inequality and damaged society immeasurably.
It is estimated that 80% of new money created (by the government, via the banks) ends up into the coffers of the financial institutions and their clients, rather than funding investment and welfare as it should.
And ends: “The only sustainable way forward is to invest massively in greener forms of energy and greener transport, to create a greener infrastructure and a greener environment. This won’t be possible without a vast reduction in inequality, more public ownership, more localism, and a far more cooperative approach to economics – all policies the Labour Party is adopting. All those with vested interests will doubtless raise a billion objections, but the consequences of keeping our heads in the sand and trusting the Tories to come up with solutions would be catastrophic”.
Richard House draws attention to a letter by Ruth Steigman published in the Independent this week. She writes
In the 2017 general election, Labour gained 40% of the vote, and the largest increase in its share of the vote since the 1945 general election.
Jeremy Corbyn, who started the campaign 20 points behind in the polls, achieved this result following two years of attacks from all sides, and, in the words of the BBC, “in the face of a brutal onslaught from the print media”.
He had, again in the BBC’s words, “changed British politics” and “showed, amazingly, that Labour did not have to move to the centre to win votes but could do so from the unashamed left”.
Does this totally unexpected result explain the extraordinary escalation in the onslaught from the BBC and other establishment institutions since then?
Do the countless absurd smears stem from the fact that Jeremy Corbyn and his policies are now seen as a clear threat to the establishment in this country?
The Labour MPs opposing him see their power base in the party, established over the past 30 years, under attack, but know that with half a million party members behind him, a further challenge to his leadership would fail.
They do not understand that the era of submission to Thatcherite policies is over.
Anyone standing outside a polling station in May 2017 could see what these Labour MPs cannot: instead of the usual trickle of elderly voters, large groups of enthusiastic and optimistic young people turned out to demonstrate that they were not fooled by many of the unfounded smears of antisemitism, espionage etc, and that they understood the Labour leader was under attack from all sides because he stood outside the establishment, and because his policies threatened the political dogma that had prevailed since Margaret Thatcher won power 40 years ago.
Those who hold power naturally want the status quo to continue untroubled: power never cedes without a fight. But the people are eager for change, and want a government that serves the public, not powerful vested interests.
Jeremy Corbyn’s policies articulate their anger at the failed privatisations of public services, and widespread deregulation. Ordinary Labour Party members want MPs who will not undermine the party’s democratic processes, or sabotage their efforts to achieve a Labour government.
A Labour MP from the left of the party brought us our most treasured institution, the NHS.
Now that the country is suffering in every sphere under Tory austerity – from poverty to knife crime to slum housing – Labour has the policies to prove the BBC correct in their assessment that British politics has indeed changed, and moved, with the Labour Party, to the left.
This prompt led to the discovery of Ms Steigman’s signature below the following testimony in the Islington Tribune