Shock and Poor

Gordon Brown’s announcement today that he will be trying to sell off £16bn worth of government-owned assets is another worrying sign of the people in power using the current economic crisis to push through any old policy that they want, all in the name of saving our economy.

Echoing the MO illustrated so thoroughly in Naomi Klein’s excellent book, The Shock Doctrine, the chaos of last year’s banks and business collapse has already seen the mass plundering of the welfare state by our governments in order to needlessly bail-out the rich.  Now, with the public’s coffers completely depleted through the expense of all these bailouts (and the continuing funding of two seemingly never-ending wars in Iraq and Afghanistan) we are seeing phase two of disaster capitalism at work: the manufactured claim that the welfare state – no longer financially solvent – cannot, therefore, be afforded.

The money isn’t there, we are told. 

The country is in terrible debt. 

Things will have to change.

But instead of raising the taxes of the rich business-owners and bonus-claiming bankers who created this economic mess in the first place, and who have benefitted tremendously from the daylight-robbery of the bailouts, we are told that the only solution to our financial problems is to make cuts in public spending for the poor; to enact drastic pay freezes for public sector workers; to enforce cost-cutting redundancies all across the workforce; and now, to sell off yet more of the public’s collective assets to private businesses so that they can use them for private profit.

These are not the only solutions, but the sheer shock of the the scale of economic disaster – or at least the perception of such a disaster, as was sold to us in the press – has made us vulnerable and bewildered.  In the wake of all this trauma, we’re too stunned and confused to question the policies are leaders continue to insist are “good” for us, or “vital” for economic recovery, but by the time we wake up from the numbness of our stupor, it will already be too late and the theft will be complete.

Our benefits axed, our assets sold, our pensions stripped and our jobs lost forever; we will finally come to our senses and find that, in its sleep, the country has been robbed.

Technorati Tags: Economy,Economic Crisis,Gordon Brown,Shock Doctrine,Naomi Klein,Public Spending,Public Assets,Cuts,UK Politics,Politics

George Osborne’s £3bn Mistake

Hilarious news in this morning’s Guardian:

Revealed: £3bn mistake in George Osborne's budget plan - The Guardian, 10/10/09

Oh dear - It appears that, alongside all the other problems with Osborne’s Conference speech, Mr. Austerity got his numbers wrong :-)

Technorati Tags: UK Politics,Politics,George Osborne,Conservative Party Conference,Conservative Party,Public Spending,Cuts,General Election

The X-Factorization of British Politics

I don’t mean to sound insensitive here: I think the death of a child is a heart-breaking tragedy.  What bothers me though, is the amount of play David Cameron’s empty, platitude-filled speech on the last day of the Conservative Party Conference has been getting vis-a-vis the “emotional” moment when he spoke about the death of his disabled six year old, Ivan.

“When such a big part of your life suddenly ends nothing else – nothing outside – matters. It's like the world has stopped turning and the clocks have stopped ticking."

I couldn’t help but feel – every time the news report said something to the effect of: “but then Cameron spoke of the loss of his six year old son” – that we were seeing that bit in X-Factor where the contestant rolls out their sob story to gain the sympathy of the voting public.

“I’m doing this for my dead father who would’ve wanted me to follow my dreams….”

“It’s been a really hard year for me because my sister died of cancer just after Christmas and my dog got run over by a school-bus in May…”

I was almost expecting a few bars of Coldplay in the background and a slow-mo shot of Cameron wiping away devastated tears as he gets comforted by Dermot O’Leary.

The X-Factorization of British Politics is complete – emotive sob stories that blind you from any real substance the candidates might have, a limited pool of real talent from which to vote, and a foregone and manipulated conclusion as to who the winner will be.

Now here’s a deficit-busting solution for the 2010 General Election: a premium number phone vote! 

Put the election on a Saturday night, reel off a few well produced VT packages to sell the respective parties, have Simon Cowell and a few other unqualified guest panellists share their irrelevant sound-bite opinions and then let the public pay £1 a call to vote for their favourite MPs!  Democracy’s already a farce of public relations and spin, but at least this way we might raise a little money without public spending cuts?

Technorati Tags: X-Factor,UK Politics,David Cameron,Conservative Party Conference,Conservative Party,General Election,cuts,Public Spending,David Cameron Speech,Ivan,Mawkish,Politics

Alternatives to Austerity

Here’s why the debate has to change: cuts, pay-freezes and benefits witch-hunts are not the only solution for sorting out the mess of debt and deficit that we are told ails the treasury. 

Indeed, they are not even the best solution.

In a twenty-four hour period that has seen Labour announce a year-long pay-freeze for top civil servants, then be derided for doing so by the Tories, only for Conservative shadow chancellor, George Osborne, to pledge to do the exact same thing in 2011 if the Conservative Party get elected, it is easy to get wrapped up in the panic-stricken dominant narrative that our economy is in trouble, and the only way to save it is by taking a hatchet to our out-of-control spending.

But that is simply not true.

The economy is in trouble alright, big trouble.  Some of it has to do with the crisis of faith that led to last year’s global downturn, and some of it has to do with the billions of pounds pissed away on unnecessary wars in Iraq and Afghanistan, but none of it has to do with paying out too many benefits, paying public-sector workers too much money, or – despite the International Monetary Fund’s myopic and ideologically distorted opinion – providing decent healthcare.

We are not drowning in a mire of debt and destitution because we spent too much on schools and libraries; nor are we suffering because of the BBC’s licence fee.

The economy is in trouble because billionaire investment bankers decided to gamble with poor people’s mortgages; the economy is in trouble because taking control of the Middle East turned out to be a little harder than we thought, and the richest 2% are not yet getting the return on their investment.

At bottom though: the economy is in trouble because, although the money is there, no one has been bold enough to get it.

I am talking, of course, about raising the taxes of the rich.

Not George Osborne’s meaningless “man-of-the-people” gestures from earlier today – taking the Child Trust Fund away from wealthy parents who don’t need it anyway; denying tax credits to those who earn over £50,000.  Those sorts of superficial measures merely take with one hand whilst giving with the other (ask a person earning £50k a year whether they’d rather have a £250 Child Trust Fund Voucher and a thousand pounds in Tax Credits each year, or get to keep £5,000 more of their money at a lower rate of tax and guess which option they’ll choose?)

I’m talking about finally saying enough is enough, and taxing the rich properly.

I’m talking about finally admitting that, if you earn £100,000 a year or higher, you’re probably earning too much money.  That there is a point at which wealth becomes an obscenity; there is an acceptable limit to how many homes you should own; how many cars; how many yachts.  That, if you can’t live well on a salary of £5000 a month (£100,000 a year, taxed at 40%, and divided by twelve) then you have probably lost all sense of perspective.

When one considers that the much-lauded Tory proposal to cut down on Incapacity Benefit fraud is based around the idea that the £17.50 a week difference between Jobseekers Allowance and Incapacity payment is important enough to claw back that annual saving of £910 per person, it puts such figures into perspective. 

Raise the 40% “higher rate” of income tax to 50% for those earning 100k a year (as it is if you hit the £150k number), and you can add an extra £10,000 a year per person into the national budget immediately: the equivalent of nearly eleven individual Incapacity cuts, and all without having to pay the salary of an “assessor”, or the subsidies for the New Deal on top.

If the Conservative figures are correct, and one in five of the 2.6 million currently claiming Incapacity Benefits can be moved to standard Jobseeker’s Allowance, then they are claiming that taking £910 a year from 520,000 people will raise £1bn over a five year period. 

Yet if you taxed just 20,000 people earning £100k a year that £10,000 (10%) extra, then you would be able to get that extra billion over five years without making a single cut.

In 2007 there were 500,000 people earning £100,000 a year in the South-East of England alone!  By raising their income tax that extra 10%, over a five year Parliament, you would bring in a monumental twenty-five billion pounds in extra funding – twenty-five times the amount of the Tory Incapacity Benefits plan; and that’s not even the whole of Great Britain. 

But the Tories would rather force a disabled or mentally ill person to live on a £3,297 a year Jobseeker’s Allowance than force someone who earns £100,000 a year to pay an extra £10,000 in taxes and still keep £50,000 a year – a take-home salary almost £20,000 higher than the current pre-tax national average.

And this isn’t even mentioning the earnings of the super-rich.

Do you know what ten percent of a million pounds is?  It is £100,000.  Ten percent of a billion: one hundred million.

By raising the taxes of the super-rich millionaires and billionaires to 60% or 70% – even 80% – you could fix the hole in public spending immediately and still leave the ludicrously wealthy with ridiculously high annual incomes.

One million pounds a year, taxed at 70%, would leave our humble millionaires with £300k a year to live on.

One billion pounds a year, taxed at 80%, would leave billionaires with an eye-popping annual income of two hundred million pounds! 

One moderately taxed millionaire (a 20% raise) and one moderately taxed billionaire (a 30% raise) would therefore bring in one billion, five hundred and one million pounds worth of brand new money over a five year Parliament, on top of what they might already pay.  Two millionaire and two billionaires would bring in over three billion pounds in new investment.

I cannot understand why we don’t start talking seriously about doing this, and why taking £17.50 a week from the worst-off in society and freezing the pay of doctors and teachers is the best economic solution our political leaders can come up with?

Technorati Tags: Conservative Party Conference,George Osborne,Back to Work,Cuts,Economy,General Election,Incapacity Benefit,Labour Party,Public Spending,Taxation,Tax the Rich,Redistribution,Rich,Poor

The Economic Crisis is Over…For the Banks

 

Another depressingly true column from the always insightful Dean Baker…whilst the people continue to suffer, the banks go from strength to strength!

| Dean Baker | Comment is free | guardian.co.uk

 

Technorati Tags: Cuts,Public Spending,Economic Crisis,Bailout,Banks,Dean Baker,Links

The “Assessors” are Coming!

As the Conservative Party begin their Party Conference in Manchester today – thus completing the triangle of terror between the three major parties that marks the beginning of election season here in the UK – David Cameron and co. are already making troubling headlines with their seemingly paradoxical pledge to cut unemployment benefits in order to help Britain’s unemployed.

The logic of the proposal is this: by hiring thousands of new “assessors” to root out the alleged half a million perfectly capable “fraudsters” currently claiming the £80.90 a week Incapacity Benefit instead of the standard £63.40 a week Jobseekers Allowance, the treasury could – theoretically – save a whopping £1bn over a five year term in Parliament.  That £1bn (or £600 million over just three years) can then be ploughed back into funding a new “Back to Work” programme which will further extend the publically funded corporate slave labour programme of New Labour’s “New Deal” (whereby, instead of the government paying unemployed individuals their benefits directly, they pay private businesses the money instead, subsidizing companies to hire the previously unemployed individual at – usually – minimum wage, cut-cost price). 

At the moment, New Deal employers are only obligated to hire their subsidized jobseeker for twenty-six weeks, at which point, the money runs out and, often, the former cash-cow employee is then promptly fired – why keep a non-subsidized worker on when, by creating a new vacancy, you can get another New Dealer on the cheap to replace them?

The Tories new idea is to keep the public funding coming to the private employers for a whole year now instead of just twenty-six weeks, “putting the unemployed firmly back into the culture of daily work” (The Sun - 05/10/09), before they are then too, most likely fired.

So, to recap: to “help” the UK’s unemployed, the Tories will assume that one fifth of all claimants seeking Incapacity Benefit are liars, pay a large amount of public money to hire a heavy-handed team of “assessors” to find them out (3,000 new assessments a day is the stated goal, despite the fact that current opinion, compiled by Labour to fund a similar benefits witch hunt, suggests that only 10,000 medical assessments a week would be realistically manageable) and then, by mean-spiritedly taking the difference of £17.50 a week away from those formerly incapacitated workers found healthy enough to do some sort of work, they will fund a “Back-to Work” programme that allows over twice as much public money as Labour currently spends on the New Deal, to go to private businesses in order to subsidize the employment of former jobseekers for a year instead of just twenty-six weeks.

Now, without even pointing out the obvious – that all of these budget problems and debts could be easily sorted out, without making a single cut in public spending, if any political party in this country had the balls to increase the taxes paid by the rich – it seems to me that this proposed Tory cut essentially takes money away from the most vulnerable and marginalized people in our country – those on incapacity benefits; too ill to work – in order to provide further corporate subsidies to private UK businesses and increase the pool of cheap labour…thus further exacerbating the UK unemployment problem: why hire people off the street at full pay when, once they’ve been forced to sign on for six months, you can get them at half-price?

It bewilders me that a party who promotes such obviously terrible – and arguably unworkable (The Guardian - 05/10/09) – policies are so popular right now in this country.  Cutting benefits to divert treasury money away from public welfare and into private hands is right out of the playbook of the 1979-1997 Tories; the Tories we so resoundingly rejected at the end of the twentieth century after their eighteen year smash and grab…so why do we suddenly feels those policies are any better now?

For the most part – we don’t.  But the nation have become so jaded to the same old/same old approach of British politics for the last thirty years, that it has been duped into a dangerous delusion: the current guys in charge are so bad that the other guys can’t be any worse.

Well, they can be, and I fear that soon we shall see just exactly how much worse they can be. 

Today they came for the weak and the sick…how long before they’re coming for you?

Technorati Tags: UK Politics,Politics,Conservative Party,Conservative Party Conference,Labour Party,Incapacity Benefit,New Deal,Back to Work,Public Spending,Cuts,General Election,Unemployment