Government subsidies and advice for farmers? Or simply legislation ensuring a fair price?

Judith Evans reports in the Financial Times that Downing Street is concerned about the potential for struggling farms to be pushed into bankruptcy, according to one person briefed on the situation.

Research from Defra showed that subsidies make up 61 per cent of profit for the average English farm, while almost one-fifth of farms would be unable to meet production costs without subsidy payments, once depreciation is taken into account. Based on 85,000 farms that claim EU-style payments in England, this amounts to 16,150 farms unable to make ends meet.

A spokesperson for Defra said: “As we phase out direct payments ahead of the full rollout [of the new scheme] in 2024, we will offer financial assistance to help farmers prepare, and invest in ways to improve their productivity and manage the environment sustainably.”

Farmers view with foreboding the administrative burden of multiple new systems which have often led to delays to pay-outs such as those which dogged the Countryside Stewardship scheme.

 

 

 

 

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Bad decisions by government – 41: subsidies for polluting biomass: protests from dock to power station

In its Energy, Environment and Resources Programme, a Chatham House research paper, Woody Biomass for Power and Heat: Impacts on the Global Climate, concludes that although most renewable energy policy frameworks treat biomass as though it is carbon-neutral at the point of combustion biomass actually emits more carbon per unit of energy than most fossil fuels.

Peter Lazenby reports that protests took place along the railway line between Liverpool’s Peel Dock and a Yorkshire station today against the burning of wood to generate electricity by Drax Power Station, the UK’s single biggest carbon emitter, which releases 13 million tonnes of CO2 per year (Drax Annual Report 2018, p23) Actions included demonstrations at stations and banner drops from bridges.

In West Yorkshire, demonstrations were held at the stations in the Calder Valley towns of Todmorden and Hebden Bridge (above). Thirteen-year-old Isla Lay, at the Hebden Bridge station demo, told Peter: “We are against Drax because they claim to use biomass fuel as a clean energy source, but they are getting trees from places like South America”. Others add that the wooden pellets which are transported to Drax using fossil fuel come from forests felled in the United States, Russia, and South America.

Isla adds: “The government pays them to do that. They claim it is good for the environment, but actually it is really bad because they are cutting down trees, transporting them and burning them.” in 2019 Drax received £789 million in renewable subsidies coming straight from our energy bills according to its annual report (p58). These are expected to continue until 2027.

Hebweb reports that Twelve campaign groups have formed an AxeDrax group

They include Extinction Rebellion, Liverpool-based Save Rimrose Valley, which is working to defend parkland in the city, Biofuelwatch, Calderdale XR and Youth Strikers.

Hebden Bridge – youth activists, artists, and climate activists joined together to create a colourful action on the platform.

Sowerby Bridge – slow moving traffic was greeted with music and banners to drive home the message that we need to act now to stop climate change and cut down carbon emissions instead of trees.

Todmorden – protestors momentarily stopped the traffic as the Drax train made its way across the bridge above them. Bob Walley of Todmorden stated “Nobody likes stopping traffic and upsetting people. But this is literally life and death. People are dying because of climate chaos. Burning trees is part of the problem, not the solution. Drax can’t be allowed to keep lying to us”

However, and despite the legal challenge reported in January, Drax power station is to build a large new gas power plant. Though it was the first big project rejected by planners because of the climate crisis, Andrea Leadsom, secretary of state for business, energy and industrial strategy at the time of the planning application, rejected the advice and gave permission in October.

Drax is now asking for substantial new subsidies, in addition to the £2.36 million a day it is widely reported to receive for burning biomass.

 

 

 

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Shadow cabinet members refuse to serve in posts Corbyn might well not offer, citing economic policies they clearly haven’t read

So writes MP John McDonnell in the Guardian. Mr McDonnell is author of the superb book, ‘Another World is Possible: a manifesto for 21^st century socialism’, a challenge to New Labour that put forward a set of new ideas, principles and policies. He adds:

“As people wake up to the prospect of Jeremy Corbyn actually being able to win the Labour leadership, the reaction has become increasingly hysterical, especially from elements of the Labour establishment”

McDonnell notes that the ‘near panic’ is especially evident in its response to the counterproductive strategy outlined by Corbyn’s team of economic advisers, whose rebukes to Labour supporters have simply made them more determined to work for beneficial change. He continues (summarised):

The vast majority who didn’t cause the economic crisis shouldn’t have to pay for it

“Let me make it absolutely clear that Labour under Jeremy Corbyn is committed to eliminating the deficit and creating an economy in which we live within our means . . . (but) we don’t believe that the vast majority of middle and low-income earners who didn’t cause the economic crisis should have to pay for it through cuts in tax credits, pay freezes, and cuts in essential services.

“We believe we can tackle the deficit by:

• halting the tax cuts to the very rich and to corporations,
• making sure they pay their taxes,
• and by investing in the housing and infrastructure a modern country needs to get people back to work in good jobs.

“We accept that cuts in public spending will help eliminate the deficit, but our cuts won’t be to the middle-and low-income earners and certainly not to the poor.

“Our cuts will be to:

• the subsidies paid to landlords milking the housing benefit system,
• to the £93bn in subsidies to corporations,
• and to employers exploiting workers with low wages and leaving the rest of us to pick up the tab.

“All the factors that caused the 2007-8 crisis are currently reappearing on the scene – frozen or low incomes, low productivity, asset inflation especially in housing, a hands-off government turning a blind eye to loose credit expansion and City speculation, and a growing debt bubble.

“Just like 2007 all it needs is a spark like Northern Rock to set things off again. The rehypothecation taking place in the bond markets could be the trigger this time, when the US starts unwinding its quantitative easing programme”.

Alongside deficit elimination, the Corbyn campaign is advocating a fundamental reform of our economic system

“This will include:

• the introduction of an effective regulatory regime for our banks and financial sector;
• a full-blown Glass-Steagall system to separate day-to-day and investment banking;
• legislation to replace short-term shareholder value with long-term sustainable economic and social responsibilities as the prime objective of companies;
• radical reform of the failed auditing regime; the extension of a wider range of forms of company and enterprise ownership and control including public, co-operative and stakeholder ownership;
• and the introduction of a financial transactions tax to fund the rebalancing of our economy towards production and manufacturing.

“Public ownership does have an important role to play, but this will be through smart forms of 21st-century common ownership and control. For example, rail will be renationalised, but with a form of joint management involving workers and passenger representatives. Energy would be socialised from below by the massive expansion of renewable energy production and supply by local communities, local authorities and co-ops on the successful German model, removing the monopoly of the big six energy companies.

“Politicians have patronised and talked down to us all when it comes to our economy, but ordinary working people have to manage on incomes significantly lower than the likes of George Osborne and his friends in the City. They could teach the bankers and many commentators a thing or two about managing a budget responsibly. Given the opportunity, we will use the sound common sense of our people.

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Better to harness society’s idle resources while removing the mechanisms of corporate malfeasance

So writes Yeomin Yoon, Professor of Finance and International Business, who teaches international finance, financial and economic analysis and a course in global business at Seton Hall University in New Jersey.

His educational philosophy is that every class is to some degree a class in ethics.

In the FT he recently discussed the advent of the electronic marketplace which currently offer shopping carts, e-catalogs, and support services such as order placing, payment and fulfilment.

The electronic markets supplanting companies as the organising force behind economic exchange will probably bring more benefits than costs to society, in his opinion:

Reduce corporate tax breaks, subsidies and political pressure

“The expected demise of corporations as the dominant economic institution driving exchange should be welcomed, as it would reduce corporate political pressure which distorts democratic processes; and corporate welfare in the form of tax breaks and subsidies deforming the course of the economy.

“Adam Smith, who warned in The Wealth of Nations that “negligence and profusion” would inevitably result when businesses are organised as corporations, would applaud the onset of a more automated economy — one that better harnesses society’s idle resources while removing the mechanisms of corporate malfeasance”.

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