Category Archives: Brexit
CityAM, London’s most-read financial and business newspaper, reported (“Economists give Labour a boost by backing spending plans”) that Professor David G Blanchflower (below, right) headed the list of signatories to a letter (25 November 2019). It added under an illustration: “Jeremy Corbyn’s Labour party would markedly increase the size of the state to roughly German and French levels”
Summary of the economists’ letter which opened: “The UK economy needs reform”
For too long, it has prioritised:
- consumption over investment
- short-term financial returns over long-term innovation,
- rising asset values over rising wages,
- and deficit reduction over the quality of public services.
- ten years of near zero productivity growth,
- corporate investment has stagnated,
- average earnings are still lower than in 2008,
- a gulf has arisen between London and the South East and the rest of the country
- and public services are under intolerable strain – which the economic costs of a hard Brexit would only make worse.
We now moreover face the urgent imperative of acting on the climate and environmental crisis.
Such investment needs to be directed into the large-scale and rapid decarbonisation of energy, transport, housing, industry and farming; the support of innovation- and-export oriented businesses; and public services.
It is clear that this will require an active and green industrial strategy, aimed at improving productivity and spreading investment across the country. Experience elsewhere (not least in Germany) suggests a National Investment Bank would greatly help . . .
As the IMF has acknowledged, when interest payments are low and investment raises economic growth, public debt is sustainable. At the same time, we need a serious attempt to raise wages and productivity. A higher minimum wage can help do this, alongside tighter regulation of the worst practices in the gig economy. Bringing workers onto company boards and giving them a stake in their companies, as most European countries do in some form, will also help. The UK’s outlier rate of corporation tax can clearly be raised, not least for the highly profitable digital companies.
As economists, and people who work in various fields of economic policy, we have looked closely at the economic prospectuses of the political parties. It seems clear to us that the Labour Party has not only understood the deep problems we face, but has devised serious proposals for dealing with them. We believe it deserves to form the next government.
Andrew Pendleton (New Economics Foundation) reminds us that since Margaret Thatcher first stood on the steps of Number 10 in 1979, successive UK governments have chosen to withdraw all but the barest bones of support from Britain’s foundational industries, of which steel is one. He questions whether any owner of steel manufacturers in the UK could thrive in the hostile environment UK governments have created.
Failed by the current government’s blind faith in markets, Pendleton writes, the people of Scunthorpe and many other places have had no voice whatsoever in how the economy was run, until ‘the blunt instrument of the EU referendum’. The loss of this significant company will intensify the sense of loss that contributed to the Brexit vote
There are risks in selling to the Turkish Military Pension Fund or to the Chinese Jingye Group, about which very little is known, industrially, but the interest of foreign buyers suggests that British Steel is seen as a potentially viable asset.
Many tonnes of steel will be needed to build a cleaner economy – for wind turbines, electric vehicles and the rail lines made in Scunthorpe, critical to a decarbonised economy. As Pendleton points out, steel production is ‘problematic’ for climate change – but steel production in Scunthorpe can be ‘greened’ by investing to reduce its carbon emissions, eventually reaching zero as coal-free production (below) becomes the norm.
In Germany, Thyssenkrupp recently demonstrated running a steel blast furnace completely on hydrogen – opening up the prospect of zero-emissions steel production by using renewable hydrogen.
Hydrogen will become cheaper as current methods, which rely on creating hydrogen fuel from purified water, are superseded by less expensive technologies such as one being developed by Stanford researchers, who have been separating hydrogen and oxygen gas from seawater via electricity.
And millions of tonnes of carbon used in shipping will be saved by using steel close to where it is manufactured
Pendleton sees the current economic model, ‘now the default preference of our policy-makers’, as absurd; in Fife, steel fabrication firm BiFab is in mothballs (right) while energy giant EDF imports the casings for the turbines on its new offshore wind farm from Indonesia.
He points out that Indonesia and some of our European neighbours’ governments habitually intervene to ensure that ‘foundational industries’ have guaranteed supply chains and amply-filled order books.
British Steel owners Greybull, a private investment company which owns many other industries, are unlikely to be seriously affected, but the company’s workforce, its suppliers, Scunthorpe and the wider economy will. It will be a disaster, politically and economically. Andrew Pendleton ends:
“Nothing short of immediate nationalisation is needed; anything less will be a betrayal of a whole town and will send shockwaves through the UK’s industrial heartlands . . .
“It is not too late for the government to step in and take the company over, which would have the immediate effect of keeping people in work and the economy of a town afloat. This is absolutely government’s proper role. But it shouldn’t stop there. After nationalisation should come a three-pronged approach:
- focus on industrial strategy for British Steel in order to secure its supply chains
- fill up its order book with a proactive procurement policy.
- and create a worker owned company who could then benefit from an ownership dividend
“Given the UK’s need to invest and build green infrastructure, such as railways, steel is of national strategic importance”.
Read Andrew Pendleton’s article here.
On 14 September 2017 The Grenfell Tower Inquiry began to investigate the causes of the fire and other related issues. The chairman, Sir Martin Moore-Bick, issued the phase one report on Wednesday 30 October 2019. In it, he concluded that the tower’s cladding failed to comply with building regulations; the principal reason the fire spread was the use of aluminium composite cladding filled with plastic on the building’s exterior.
In the dock?
- Past and present governments’ erosion of safety standards through programmes of deregulation, privatisation, outsourcing/subcontracting, localism and austerity: “Regulations were relaxed and eliminated, warnings were ignored and costs were cut, while profits and council reserves.
- David Cameron, as prime minister, promised and delivered a “bonfire of regulations” in the construction industry.
- Boris Johnson, as mayor of London, closed 10 London fire stations, took 30 fi re engines out of service and slashed over 500firefighter jobs to “save money” (charges made by Yvette Williams)
- The Conservative members of the Royal Borough of Kensington and Chelsea (RBKC) who covered the homes of working-class people with flammable tiles rather than fire-resistant tiles because they were cheap, prepared the way for the Grenfell Tower fire (Sasha Simic).
- “The true culprits of the fire are those who wrapped the building in flammable cladding, who gutted the UK’s fire safety regime, who ignored the warnings from previous fires, and who did not hear the pleas of a community worried for their safety”, Fire Brigades Union (FBU). Below left, see a brief video of firefighters during the fire
* In the 2012 Grenfell Tower Regeneration Project’s public consultation, which may be read here, residents were asked about the cladding’s colour and finish, but the issue of fire resistance was never raised.
The planning application’s engagement statement records that the choice of cladding – zinc or particle board was investigated and the final choice was Reynobond PE with a plastic filling – a cheaper option, saving nearly £300,000 – placed around flammable foam insulation.
The establishment – elite networks who close ranks to protect their own interests – spared the government & cladding company and scapegoated the Grenfell firefighters
Despite the Grenfell Inquiry’s finding that the principal reason the fire spread was the use of aluminium composite cladding filled with plastic on the building’s exterior, mainstream media chose to highlight criticism of the fire-fighters’.
The FT, though focussing closely on the performance of firefighters, did at least give details of the other companies involved, prudently noting that the report does not assign blame to any individual companies.
Hotpoint, a division of Whirlpool, made the fridge-freezer in which the fire began. Celotex, a division of the French multinational Saint Gobain, made the foam insulation used on the tower; Rydon, the design and build contractor on the refurbishment subcontracted the cladding installation; Harley Facade, and CEP Architectural Facades manufactured the cladding into “cassettes” for use on the tower.
The BBC (warned off after publishing this outspoken article about the cladding?), the Guardian and the Independent opted to focus on the fire service, the Metro achieving some balance by publishing a fiery article by Yvette Williams and one focussing on the fire service in the same issue.
Yvette summarised the feelings of many: “the real ‘villains of the piece’ should be in the media headlines, rather than the firefighters who risked their own lives to save people in a building that no-one should have been living in, with a fire that was unprecedented”.
Since the Grenfell disaster, Arconic has withdrawn Reynobond PE from the market for all building uses. The company is now being forced to disclose evidence to investigations by the police and the Grenfell Tower public inquiry and a second phase to investigate the broader causes will begin in 2020.
But, as the FBU concluded, “We cannot wait for years for the Inquiry to conclude. Change is needed now.” The Grenfell question: will Britain elect a government that puts people before profit?
* As with some other ‘sensitive’ documents, this link will not open. To read the report, the link has to be copied and pasted: https://www.rbkc.gov.uk/idoxWAM/doc/Other-960662.pdf?extension=.pdf&id=960662&location=VOLUME2&contentType=application/pdf&pageCount=1
A provisional Labour election “grid” which was leaked to the Sunday Times is said to reveal that while Mr Johnson is framing this as “a Brexit election” Jeremy Corbyn will continue with two main themes.
Mr Corbyn will first focus on the National Health Service, described by the FT’s George Parker and Laura Hughes as “traditionally Labour’s strongest suit”.
He sees Brexit leading to a “toxic Trump trade deal”, opening up the health service to rapacious US corporations and will challenge PM Boris Johnson about the claims in a recent Channel 4 Dispatches programme, alleging that the Tory government was secretly discussing NHS drug pricing in the context of a possible post Brexit US trade deal.
The FT journalists say that the risk that voting might take place against the backdrop of one of the NHS’s periodic winter crises, “keeps Tory strategists awake at night”.
The second campaigning focus will be on evidence that post-Brexit workers’ rights and regulations will be changed for the worse
The BBC and Financial Times have seen a leaked internal government document marked “Official Sensitive”. This “Update to EPSG (Economic Partnership Steering Group) on level playing field negotiations” was drafted by DExEU, the government department for exiting the EU.
The document suggests that Mr Johnson – a persistent critic of what he sees as unnecessary regulation from Brussels – wants to diverge ‘significantly’ from the EU on regulation and workers’ rights after Brexit, despite a pledge to maintain a “level playing field”.
The FT reports that it was told by one senior adviser to Mr Johnson, “We’re not confident at all. Of course this is a gamble. But it’s the least worst option.” Mr Corbyn’s supporters expressed confidence in his campaigning ability, first shown in the 2017 election, when he captured 40% of the vote.
“What exactly is Jeremy Corbyn’s stance on the Brexit Bill?” A friend asked this question and – suffering from Brexit fatigue – I’m ashamed to say that I could not answer off the cuff.
After returning home, the only relevant information was found in these paragraphs by Oliver Milne, written on Friday 23rd October, which I’ve printed for my friend.
Jeremy Corbyn and Boris Johnson meet to discuss a ‘reasonable timetable’ for Brexit Bill
“They met in Mr Johnson’s House of Commons office. Last night, Mr Corbyn said that Labour was prepared to work with the Government to agree “a reasonable timetable” to enable the Commons to debate and scrutinise the legislation properly. That would be the sensible way forward, and that’s the offer I make on behalf of the opposition tonight”.
“A Labour Party spokesperson said: “Jeremy Corbyn reiterated Labour’s offer to the Prime Minister to agree a reasonable timetable to debate, scrutinise and amend the Withdrawal Agreement Bill, and restated that Labour will support a general election when the threat of a No Deal crash out is off the table.”
“A Conservative source said: ‘PM met Corbyn this morning in his office in the House of Commons to discuss whether Labour would back a timetable that allows us to actually get Brexit done rather than yet more delay. Corbyn made clear he has no policy except more delays and to spend 2020 having referendums.’ “
But still mainstream media reporters and interviewers focus on ‘Jeremy Corbyn’s indecision’. This morning Chris Warburton on BBC Radio 5 hammered away on the theme that JC has long called for an election – despite the patient and repeated explanations ably given by MP Jasmin Qureshi.
Despite this – yet another item in the long list of attempted but unsuccessful character assassination directed at Jeremy Corbyn – huge crowds continue to turn out to hear and support him, to the dismay of ‘the few’ fearing a rebuilding of Britain ‘for the many’.
‘Why vote? they’ll just ignore you’, says Steve Beauchampé
The news that Sir David Attenborough has launched the 10,000-tonne hull of the UK’s newest polar ship – named after him – into the River Mersey, revives memories of the saga of Boaty McBoatface.
A 2016 article in The Atlantic, reported that the UK’s Natural Environment Research Council recently ran a contest to determine the name of the new $300-million research vessel (now launched, above):
“The new ship would explore the remotest waters, its side emblazoned with a name chosen by ‘the people’ of the internet. Or such was the idea . . . The name received three times more votes than the runner-up entry. The people of the Internet had spoken emphatically, and they were deemed to have spoken like a five-year-old”.
However BBC Science now reveals that a less imposing Boaty McBoatface, a small unmanned yellow submarine, “lives on”. These Boaty-class subs will frequently operate from the Attenborough, going into places the ship cannot reach, like the floating ice shelves that surround Antarctica.
Steve Beauchampé in the Birmingham Press gave Attenborough his due, continuing: “According to Universities and Science Minister Jo Johnson naming the ship Boaty McBoatface would have been ‘inappropriate’, whilst other critics suggested that doing so would have left Britain open to ridicule”. Alternatively, he suggests, “It might have added further to our reputation as a nation of quirky, eccentrics, the country that gave the world Monty Python, cricket, Prince Charles and a wealth of quirky, much-loved traditions and customs”.
Though this disregard for the result of a public vote might be seen as trivial, Steve pointed out, “It is consistent with a government culture that regards the result of elections, referenda and the architecture of democratic structures as expendable”. He gave some examples:
- In in 2012, despite overwhelming votes against the creation of such posts, including by voters in Birmingham and Coventry, little more than three years later an even more powerful mayoral post (that of West Midlands Metro Mayor) was effectively forced upon the region, without the electorate being given any say on the issue (this has also happened in other major conurbations).
- Similarly, Police and Crime Commissioner posts were imposed without a public vote, the government afraid that the creation of such rôles would have been overwhelmingly rejected in any referendum.
- Whitehall has forced significant changes to our system of local democracy. From 2018 councillor numbers in Birmingham will be reduced from 120 to around 100
- and the present electoral cycle, whereby a third of council seats are contested in three years out of four (with no elections in the fourth year) will be replaced with all out elections staged every four years.
- The city council did not seek these changes, the electorate did not ask for them and nor were they given any say in them.
- Government ministers are increasingly overruling local planning decisions, disregarding the will of communities and traducing the democratic mechanisms campaigners faithfully and honestly employed.
- Increasingly, major housing developments, road and other infrastructure schemes as well as highly contentious fracking licenses are being granted consent even where a majority of local voters are opposed.
“A disrespectful attitude to democracy is ingrained in our political system”
This is shown, Steve says, by the regularly reappearance of MPs rejected at General Elections in the House of Lords, “negating their own failure and voting in perpetuity on legislation, with seemingly no sense of shame or embarrassment”, by others simply paying their way into the Lords and by political donors being “regularly rewarded with a place in the nation’s legislature”.
The ‘let’s pretend we never had a vote’ mentality also infects elements of the Labour Party. Despite leader Jeremy Corbyn’s resounding victory in the party’s leadership contest, several hardline right wing Labour MPs openly sought a way of running a new leadership contest that denied Corbyn a place on the ballot paper.
“When the electorate’s wishes can be so flagrantly flouted, it seems reasonable to ask how secure the result of the forthcoming EU referendum will be, or what manoeuvres and machinations might be undertaken to negate the ‘wrong’ result. And I think we all know what result that is”.
Three years later such a comment seems rather prescient.
Steve’s original article may be read in full here.
Shocked by the unbridled tone of the Attorney General in the Commons today – recorded here – his fury mounting after the second minute – I searched online for information which would shed light on his character.
When practising as a barrister, Geoffrey Cox frequently led in commercial actions and arbitrations overseas, appearing in the Dubai International Finance Centre, Mauritius and the Cayman Islands. He served as MP for Torridge and West Devon from 2005-15.
- In September 2014, it was reported that Cox was one of a number of individuals investing in the Phoenix Film Partners LLC scheme run by Ingenious PLC which HM Revenue and Customs(HMRC) had alleged to be a tax avoidance
- In 2016, at that time Britain’s highest-paid MP, it was reported he had a number of office expense claims for items, such as a 49p pint of milk, rejected by the Commons authorities.
- In January 2016, Cox, a landlord, backed the Conservative Government in voting down an amendment in Parliament on rental homes being “fit for human habitation”.
- He was a member of parliament’s Committee on Standards and the Committee on Privileges, ‘the sleaze watchdog’ but was the subject of an inquiry in 2016 after ‘neglecting to register more than £400,000 of outside earnings.
In February 2016, Cox announced in the House of Commons that he supported the case for leaving the EU and would campaign and vote to do so in the forthcoming referendum.
He was appointed to the Cabinet as Attorney General for England and Wales and Advocate General for Northern Ireland by Theresa May in 2018 and, in February 2019, was put in charge of negotiating changes to the Northern Ireland backstop in the EU withdrawal agreement.
On 24 September 2019, minutes of a conference call seen by Sky News revealed that Cox had advised the government that the prorogation was lawful and constitutional and that any accusations of unlawfulness “were motivated by political considerations”.
On the same day, the Supreme Court of the United Kingdom ruled unanimously that Prime Minister Boris Johnson’s prorogation of parliament – as advised by Attorney General Cox – was unlawful.
The reasons for his astonishing parliamentary outburst can now be understood.
An earlier post – the first in a series ‘The Corbyn Revolution: How Labour leader Jeremy Corbyn’s economic agenda would impact Britain’s economy’ – was a fairly dispassionate overview of the proposed policies ‘breathtaking in scope’, but the other titles in the series indicated that they would fall well below the standards of ‘fairness and impartiality’ which the FT’s new owners had undertaken to maintain.
The writer cravenly decided to avoid them, but Judith Martin (below, right) had more spirit and took the FT – ‘One of the business world’s most-respected platforms’ – to task for its article, UK’s Labour would seize £300bn of company shares.
Though the FT edited or removed many sentences and gave it an anodyne and misleading title: Rewarding your workers makes sound economic sense, we can now present the full text, sent by the writer.
“Raid”, “stealth tax”, “expropriation” – I don’t recall the FT using these inflammatory terms when discussing the John Lewis Partnership, which has always given annual bonuses to the staff instead of to shareholders.
Your front page headline “Labour would cost UK companies £300bn by shifting shares to staff” (2nd September 2019) is one of the most partisan I have ever seen in the FT, and more like something I would expect from the tabloid press that I don’t choose to buy.
Only later does it become clear that the suggestion is for a gradual transfer of a mere 10%. The fact that the top 20% of income earners received 6 times the disposable household income of the bottom 20% (according to the government’s own figures (Income inequality in the UK, House of Commons Library, May 2019)) doesn’t get a look-in.
Henry Ford understood that it made sound economic sense to pay workers enough to allow them to buy the company’s products. Impoverishing your workers – even if, like Deliveroo, Uber and the rest of the gig economy crew, you claim they’re not actually employees – is not good for society, as numerous FT articles have noted in recent years. Most of our current worker protection has come from the EU.
As for the rights of tenants, I am agnostic on whether or not they should be given the right to buy but they certainly need a fair rent structure and decent protection. Not long ago there were headlines saying that a new generation of middle-aged renters was likely to face extreme poverty in old age, with resulting stresses on the health service and elsewhere. Compare this country’s attitudes to housing and landlords with Germany, where Berlin has just acquired nearly 700 flats from a private landlord, with plans for more. In March this year the FT noted approvingly that the start-up culture in Berlin was thriving. A city that protects its residents frees up initiative.
Is this really a good time to put the boot in to any policy that might suggest that capitalism was capable of improvement? The FT has spent the last three years insisting that the EU gives a better deal than the economic isolation that faces the country in November.
When Jeremy Corbyn (left, FT) has finally been dragged into co-operation with other anti-brexiters, and Boris Johnson’s Conservative Party is looking increasingly unstable, is this really a good time to put the boot in to any policy that might suggest that capitalism was capable of improvement just because it comes from the Labour party? Do you really want more of Johnson and his stated approach of “fuck business?”