Two episodes of potentially enormous significance are now beginning to converge. The first, like a slow-burning fuse, is the spontaneous grass-roots anti-globalisation, anti-capitalism movement which has been smouldering for several years and is now gathering force sparked worldwide by austerity measures for the masses while the bankers and financial elite ride out the depression unscathed. This ferment, strengthened by the co-ordination which technology and globalisation now brings, may well, as austerity bites ever deeper over the next decade, have the potential for overturning an increasingly hated worldwide corporate domination on a scale which we have not seen since the upheavals in Europe in 1848. The second is the uncovering, which happened to coincide with the mass actions yesterday across the world’s capitals, of some of the secretive network insidiously consolidating the extreme right-wing corporate dominance which behind the scenes runs most Western countries. Both these two campaigns, as they widen and come together, represent the early stages of a major new force challenging a corrupt but not yet broken hegemony. (more…)
Liam Fox brought about his own destruction – that is the almost universal view, and it’s correct. However, much less attention has been paid to how Adam Werrity, his fellow-neocon friend, was able to weave his destruction over so long a period. We now know thanks to John Mann’s PQ that Werrity had met Fox 14 times inside the MOD in the post-election 16 months and had accompanied him on 19 of his official visits abroad. Yet none of this, which should immediately have raised suspicions about significant breaches of the Ministerial code, surfaced in the public domain. Even now it would not have come to light had it not been for the pure accident that one of the Werrity-arranged contacts, Harvey Boulter, a private equity boss, had appeared to blackmail a US conglomerate 3M over a contractual dispute which then 3M informed the Guardian about. (more…)
Huhne’s statement in the Commons on the implications of the Fukushima catastrophe for Britain is a fine mixture of complacency, obfuscation, bluster and highly selective commentary. The key issue for the Weightman report (by the UK’s chief nuclear inspector) is not whether Britain is likely to be exposed to a tsunami (though it actually was once on 29 January 1607 in Somerset when thousands were killed), but whether the spiralling costs of preventing a future catastrophic nuclear accident are making the cost of nuclear power inaffordable and uninsurable. Huhne admitted that Dr. Weightman did not look at the question of cost at all. He also admitted (because the Guardian got hold of the relevant emails) that the Business Department’s initial response immediately after the disaster was to try to cover up its seriousness because it feared it would derail their plans for a new generation of nuclear plants in Britain. The emails said that the accident had “the potential to set the nuclear industry back globally” and “we need to ensure the anti-nuclear chaps and chapesses do not gain ground on this” – a degree of collusion, irrespective of public safety, between the government and EDF, Areva and Westinghouse which really says it all. (more…)
The awful rise in joblessness, so long expected, is now under way – not from a base of a million as in the 1980s, but upwards now from a very high platform of 2.5 million already. Yet the Commons exchanges debating this yesterday were disappointing. Osborne, summoning himself up to his full stature of smug and dismissive arrogance, used two tactics to divert the Labour attack. He is a born provocateur of the most shameless and brazen kind, and constantly taunted Balls with every aspect of Labour policy with which he thought he could cause trouble, to which Balls unwisely responded time and time again, thus enabling Osborne to transform the occasion from a bruising denunciation of Tory economic policy into a long-drawn-out, pugilistic, knock-down brawl. Sadly, unemployment was the loser. But there was worse to come. (more…)
The Werrity saga gets murkier. In particular, apart from any personal matters, did he profit from his friendship with Fox? If he went with Fox on 19 of his trips around the world in the past 18 months, why did nobody in the civil service blow the whistle that something suspicious might be going on, contrary to the Ministerial code? As an ex-Minister who has experienced the very close contact that officials keep with Ministers on foreign trips, I ask how could some of these meetings have taken place without the relevant officials knowing, or if they did know, why did they take no action to get the Permanent Secretary to rein in Fox? Who paid for Werrity’s trips, and why didn’t MoD officials check up on this to get at what was going on beneath the surface? But even all that is not the real point. (more…)
I gather that someone called Luke Akehurst has complained that my comments on the recent Shadow Cabinet appointments did not compliment those who were successful, commiserate with those who were left out or discuss the personal qualities of the contenders. That response is symptomatic of everything that has been wrong with the Labour Party over the last couple of decades – that it’s all about personalities, managerialism and career advancement. One would have thought that the experience of New Labour over the last two decades would have unerringly demonstrated how shallow, misplaced and unconvincing such an approach is. Above all it ignores what Labour is really all about – it’s not about getting on or climbing the greasy pole, it’s about ideology, vision and a sense of purpose on behalf of a majority of the population who depend uniquely on Labour to protect their interests against a repressive and often ruthless elite. (more…)
The key point about the weekend revelations over Adam Werrity is not just, or even mainly, whether Fox keeps his job or not. The real scandal is that Werrity was able to inveigle himself into so many compromising situations without anyone calling a stop to it or blowing the whistle. Indeed had it not been for the legal spat between Harvey Boulter, a private equity boss and commercial partner of MoD, and the US conglomerate 3M which led to court proceedings in the US, even now it is likely that no alarm would have been raised about the Werrity affair. What is above all shocking is that despite all the previous revelations about lobbyists and defence contracts, nothing has been done to regulate lobbyists at Westminster. Even worse, when this latest affair has blown over, will anything be done even then? (more…)
There is extraordinary muddle-headedness among politicians and commentators alike on what to do about the appalling scandal of youth unemployment. With next Wednesday’s jobless figures likely to reveal up to 1 in 4 in the 18-25 age-group are now without a job, the angst over unemployment is reaching a new pitch, though not the common-sense. Jobs in the current climate are a demand side issue in the economic equation - are there employers who will take on new employees when the demand for the goods or service they will provide has gone through the floor? Yet all the ‘solutions’ proposed are supply side measures. (more…)
Ed Miliband, having won the right to secure a Shadow Cabinet entirely drawn from his own appointments, has now had the chance for the first time to show his political hand in his selections. Surprisingly he has increased the proportion of Blairites from a third (under the previous system of election) to half. Since his own orientation is centre-Left, this has to be explained as placating a faction which remains very numerous (arguably a majority) within the PLP and is well organised and extremely well-funded. Lord Sainsbury, a strong supporter of the Blairite Tendency, stopped funding Labour when Ed Miliband won the leadership, and transferred his affections – and more importantly, his money – to the Blairite pressure group, Progress. It goes without saying of course that if the Left had carried out a similar manoeuvre, it would have been disallowed as running a party within a party and any Left equivalent of Progress would have been disbanded. (more…)
Why should QE (quantitative easing, or printing money) work now when it didn’t before? It won’t, but the Government doesn’t know what else to do to get a stagnant, contracting economy working again – because it rules out on ideological grounds the one thing that certainly would get the economy going, namely a public sector works programme. The Bank of England has just published an account of the first round of QE where they estimate that as a result real GDP rose 1.5-2.0% at the expense of inflation being pushed up by 0.75-1.5% to a level now (4.5%) which is more than twice the government’s target. If that was the result of £200bn being pumped in by QE1, why should an additional £75bn applied by QE2 have any more positive effect? (more…)
As the party conference ends, with an air of unreality which lifts the divide between politicians and people to new unheard-of levels (which takes some doing), there has been one extraordinary omission from all the babble of the last 3 weeks which takes the breath away about the state we’re in. Everyone, including the Tories, proclaim we need growth, but just prodding the private sector to produce it is like pushing a piece of string when there’s a lack of demand to pull it. That’s why a public sector-driven jobs and growth strategy is urgently needed to inject new economic activity when the private sector is contracting, and to do so on a sufficient scale to achieve the turnaround to set the economy on a sustainable recovery course. But how then would that sustainable revival take place? (more…)
The 3-notch downgrade of Italy’s credit rating by Moody’s, plus the near-collapse of the French-Belgian bank Dexia despite the stress tests it passed only 3 months ago, plus the growing consensus that only a 50% haircut imposed on investors in Greek debt can save the country from insolvency, plus the drastic fall in share prices in the UK, Europe and worldwide of the last few days and weeks, plus the slowness and ineffectiveness of European leaders in addressing an overriding debt crisis that continues steadily to get worse despite all their efforts, plus the unwillingness of German creditors to increase payments much further and the unwillingness of Greek debtors to accept much more austerity – all this points to an impasse which the Eurozone in its current formation will not survive. What happens then? (more…)
Pace Osborne, the central economic problem in Britain today is not indebtedness, it is lack of demand. If Osborne’s speech yesterday was the clothing by which he presents his future policy over the next year, it would scarcely cover his nakedness. There is nothing there that deals remotely adequately with the only issue that matters now in the British economy – growth. The one proposal that purports to deal with this – credit easing (not his idea, but that of Adam Posen, the former member of the Bank of England’s Monetary Policy Committee) – won’t work because it deals with liquidity, not demand. Yes, pumping our money directly to businesses is better than quantitative easing which banks purloin for themselves rather than lending to companies, but it’s still no more effective than pushing a piece of string. What is needed is a strong pull at the other endwhich can only be provided by rising aggregate demand. (more…)
Now that the year-long Leveson inquiry is getting under way, it is essential that an investigation of this kind, which has not happened before over the last 40 years, does not become a missed opportunity. It was provoked by the phone-hacking scandal, but it is crucial that it covers many other areas of failure of the press which have remained dormant and unaddressed for far too long. It should start from what is the proper role and rationale for the media. To maintain a properly functioning democracy, its real objectives should be twofold: to keep the electorate fully informed about the key issues that affect Britain and thus to provide a genuine national agenda, and secondly to speak truth to power and thus to lay the foundations for systematically holding the government of the day to account. With some honourable exceptions Britain’s media have fallen far short of these democratic responsibilities.
Much of the media has used its key role to assert its own partisan power and to spread its own very one-sided propaganda. It has also degenerated into becoming a mindless purveyor of scandal, celebrity and sensationalism that may sell newspapers, but degrades the national consciousness.
Almost no constraints are placed on private ownership of the press being used as a bauble of public power by which wealthy tycoons can seek to shaped the world to suit their own interests. Britain imposes no nationality requirement. It only loosely controls the share of any media market held by any single proprietor. It does not limit cross-ownership between the print and broadcasting media. It is merely assumed that lightly applied competition law together with self-regulation is all that is needed, which the infamour Press Complaints Commission has shown to be a farce.
Several reforms are urgently needed. Since far too much market share is allowed to power-hungry moguls (reaching in Murdoch’s case to 37%) whose ambitions often run counter to the public interest, no proprietor should be permitted to own more than one daily and one Sunday paper, and ownership should be confined to British citizens. A newspaper proprietor should not be allowed to own any broadcasting company. To diversify the ownership of newspapers more widely to reflect the proliferation of public opinion in Britain, public financial support should be provided in accordance with strict criteria to support the start-up of new titles, especially via independent trusts which are balanced in their coverage and free of overt bias.
In addition a right of reply should be established, at similar length and with the same position and prominence in the newspaper, where wholly untrue and seriously damaging information has been printed. The useless PCC should be abolished and replaced by a statutory body with the capacity where necessary to impose real sanctions, and the media representatives on this new body should be in a small minority. And one of the key issues for Leveson should be to consider how freedom of the press can be reconciled with fair and balanced reporting.
After unveiling his 5 point recovery plan in Liverpool, Ed Balls concluded with a flourish: I don’t care what they call it, Britain just needs a plan that works”. I agree. Assuming the aim is to turnaround the slide into stagnation by generating sustainable growth which will steadily reduce unemployment, it is worth asking how far the Balls plan will achieve this. Repeating the bank bonus tax this year (£2.5bn) could, as he says, be used to build 25,000 affordable homes (if they cost no more than 100,000 apiece) and will certainly provide jobs for some youg people (though his 100,000 seems on the high side). Bringing forward long-term investment projects is worthwhile , though without the volume and timescale proposed it’s difficult to estimate how much. Reversing the January 2.5% VAT rise should increase spending, though it would increase the deficit by £13bn (unless compensated by an equivalent rise in tax for the rich) and most poor families may decide to use most of the rise in disposable income to cut their debts rather than increase their spending. A VAT cut to 5% on home improvements and repairs is welcome, but won’t provide many jobs. A 1-year NIC tax break for small firms that take on extra workers won’t create many jobs while demand is still falling. Something is missing. (more…)