The FT reports that senior executives at several of the largest US banks have privately told the Trump administration they feared the prospect of a Labour victory if Britain were forced into new elections.
It then referred to a report by analysts at Morgan Stanley arguing that a Corbyn government would mark the “most significant political shift in the UK” since Margaret Thatcher’s election and may represent a “bigger risk than Brexit” to the British economy. It predicted snap elections next year, arguing that the prospect of a return to the polls “is much more scary from an equity perspective than Brexit”.
Jeremy Corbyn gave ‘a clear response’ to Morgan Stanley in a video (left) published on social media reflecting anti-Wall Street rhetoric from some mainstream politicians in the US and Europe, saying: “These are the same speculators and gamblers who crashed our economy in 2008 . . . could anyone refute the headline claim that bankers are indeed glorified gamblers playing with the fate of our nation?”
He warned global banks that operate out of the City of London that he would indeed be a “threat” to their business if he became prime minister.
He singled out Morgan Stanley, the US investment bank, for particular criticism, arguing that James Gorman, its chief executive, was paying himself a salary of millions of pounds as ordinary British workers are “finding it harder to get by”.
Corbyn blamed the “greed” of the big banks and said the financial crisis they caused had led to a “crisis” in the public services: “because the Tories used the aftermath of the financial crisis to push through unnecessary and deeply damaging austerity”.
The FT points out that donors linked to Morgan Stanley had given £350,000 to the Tory party since 2006 and Philip Hammond, the chancellor, had met the bank four times, most recently in April 2017. The bank also had strong ties to New Labour: “Alistair Darling, a Labour chancellor until 2010, has served on the bank’s board since 2015. Jeremy Heywood, head of Britain’s civil service, was a managing director at Morgan Stanley, including as co-head of UK investment banking, before returning to public service in 2007”.
A step forward?
In a December article the FT pointed out 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”. And an FT reader commented, “The single most important ethos change required is this: publish everyone’s tax returns”:
- In Norway, you can walk into your local library or central council office and see how much tax your boss paid, how much tax your councillor paid, how much tax your politician paid.
- This means major tax avoidance, complex schemes, major offshoring, etc, is almost impossible, because it combines morality and social morals with ethics and taxation.
- We need to minimise this offshoring and tax avoidance; but the people in control of the information media flow, plus the politicians, rely on exactly these methods to increase their cash reserves.
But first give hope to many by electing a truly social democratic party.
Is the rainbow suggesting a new party logo?
For the common good: economists advocate a moral vision to rescue our manipulated, extractive and highly unequal economy
Mark Mazower, a British professor of history based at Columbia University, writes in the FT that the moral reasoning that lay behind the Greek election result began from a simple insight: that the economic trauma of the severity Greece has suffered is destroying society:
“With youth unemployment above 50%, an entire generation is being consigned to the scrap heap. At the same time, the notion of the common good is being sacrificed through forced sell-offs of state-owned lands as well as businesses, with the prospect of ecological destruction as a result.
“What is the moral vision the creditor nations propose?
“Frugality is not a policy. And if finance is to serve Europe rather than run it, a notion of the common good needs to be restored. The alternative is an increasingly fractious continent”.
Urban Britain also has a disturbing level of youth unemployment and has sold its state-run utilities for a pittance to foreign companies
To replace our “desiccated, manipulated, disloyal, extractive and highly unequal economy that has been allowed, and – by some administrations – encouraged”, Birmingham-based economist Emeritus Professor Michael Wilkes advocates a new discipline, socionomics,
A citizenry of good intent
He acknowledges that the social and moral education needed to produce a citizenry of good intent that will make the socioeconomic system work properly and sustain it for future generations, and that winding back globalisation will take longer and will involve more people and organisations and other countries.
Wilkes advocates certain steps that could be taken immediately:
- the restoration of equitable and redistributive taxation,
- the introduction of living wages,
- the plugging of many loopholes for tax avoidance,
- the undertaking of thorough corporate reform
- and the recreation of an active, interventionist and self confident public sector.
He concludes: “These measures would represent leadership in its finest form. This, and the promotion of the concept of stewardship in place of the present self serving forms of ‘leadership’ ”.
Today, The Big Question (BBC1) discussed the phasing out of local hospitals. Professor Terence Stephenson, who was introduced as the new chair of the Academy of Medical Royal Colleges, insisted that they should be replaced by large medical centres of specialised excellence.
Julia Manning, who was merely named – with no reference made to her role in 2020 Healthcare – eloquently supported his proposal.
Dr Clive Peedell, who had to introduce himself as a cancer specialist and co-founder of the National Health Action Party, expressed the belief that there should be centres of excellence but also a network of local hospitals.
He pointed to the findings of the Organisation for Economic Co-operation and Development: the number of UK hospitals per 1000 of the population is already extremely low:
Dr Peedell added that many hospital beds had already been cut and that currently there is 90% occupancy – though the safe level is 85%.
Closures of hospitals or just A & E and/or maternity departments mean that emergency cases travel further and are treated later.
A & Es are being closed in many areas, or downgraded as Urgent Care Centres opening only12 hours a day. This happened at Chase Farm in Enfield, leaving what Nick de Bois, Conservative MP for Enfield North, described as a ‘confusing mish-mash’ of emergency services at the site. A child died there after his mother found the UCC closed.
She wondered if undertakings given could be trusted; the local Peterborough City Hospital had been funded by PFI, which – at the time -residents were assured was a sound decision. Now it is costing £40m a year, has 31 years left to run and the arrangement can only be ended by making a very substantial one-off payment.
She also reminded those present that similar undertakings were made about mental health care when hospitals were closed; adequate care in the community ‘didn’t happen’.
If local hospitals close, Ms Manning said that GPs and district nurses would give medical care in the community. However district nurses’ numbers are down and very few are being trained. The BBC reported that official figures show that the number of district nurses has fallen by 40% in the past decade; ten years ago there were nearly 13,000 NHS district nurses in England but last year there were fewer than 7,500 and many of those are approaching retirement age.
The consultation process was briefly touched on
Nicky Campbell wondered if fast track consultation would be ‘circumventing democracy’. A search revealed that clause 118 of the Care Bill, which is currently going through Parliament, gives Clinical commissioning groups (Cogs) just 40 days to consult on changes proposed by an administrator. Their views could be overruled by NHS England, so local decision makers would have no real power over proposed changes to their hospital services.
Dr Peedell said that the changes were not being made for clinical reasons, but were financially driven – the market in healthcare actually drives up costs and there would be an increase in private medicine and health insurance.
Both doctors agreed that there was clear evidence that large specialist centres offered a better outcome for some conditions – for instance heart attacks. But Dr Peedell insisted on the need for local hospitals for many other conditions, such as asthma, where a longer journey time could be dangerous.
Monitor, the health sector regulator, reports that by 2021 the NHS will face a £30bn funding gap. Dr Peedell and a member of the audience offered solutions: hospitals are more worthy of the money readily made available to bail out banks, HMRC should also address both tax avoidance and tax evasion.
Other areas might benefit from the example of the Tees, Ask and Wear Valleys trust which paid £18m to get out of the PFI contract 23 years early, but it now owns the hospital outright and expects to save £14m over the course of the deal – once maintenance and inflation is taken into account.
The writer would like to see the taxpayers’ money already being spent on preparation for High Speed Rail 2 and the huge sum for its implementation, used to help debt-ridden hospitals.
The doctors could agree but the healthcare industry stands to lose a great deal if they do
Julia Manning of 2020 Heathcare spoke eloquently in favour of this reform. Her company’s sponsors, who include Baxter Healthcare, Bosch Healthcare, Lundbeck & Pfizer Pharmaceuticals, Denplan, Gilead biopharmaceuticals, Tunstall Healthcare, Abbvie Pharmaceuticals, MSD (Merck) Pharmaceuticals, Abbott Laboratories, will agree that she is most persuasive.
But vested interest must not determine the future of Britain’s health service.
Vaughan Jones from Dorset writes that he finds the prioritisation of cuts in welfare over the obvious alternative irrational and lacking objectivity:
“As welfare is already tightly controlled, the scope for savings without inflicting harm is severely curtailed. Particular mention is made of the £26,000 annual benefit cap, a sum that most of your readers would struggle to survive on and which any self-respecting banker would consider a derisory bonus. Most of the £26,000 is invariably housing benefit, which goes into the pockets of landlords. It is the nature of welfare benefits that they go straight into the economy.
“Tax avoidance money does not – to anywhere near the same extent. It is well documented that HM Revenue & Customs is a soft touch for multinationals and the über wealthy, while at the same time being heavy handed with small and medium-sized enterprises and ordinary individuals. Tax avoidance by corporations and wealthy individuals is costing the country tens of billions, arguably much more than the £35bn often quoted. At the same time there was reportedly a £38bn taxpayer-funded subsidy last year to Britain’s biggest banks (New Economics Foundation).
“Quantitative easing has boosted asset prices and effectively transferred wealth to the already better off at the expense of the rest of society. Low interest rates have robbed savers but benefited bankers. Farm payments go to millionaire farmers and are not capped like welfare benefits”.
Arun Motianey, Bombay, Princeton, Cambridge educated mathematician and economist, also looks at the elites – a global class – the super-rich in New York having more in common with their counterparts in São Paulo or Mumbai than ever before:
“They work together and they play together. They are the industrialist and investor class with vast reserves of mobile capital. They feed from the same trough, gorging on an outsized portion of the economic surplus.
“Workers in both the developed and emerging world get the leftovers, though the easy availability of credit in the some of the poorer countries has temporarily fostered the illusion among the latter that they are better off. We’ll see how long that lasts.
“But herein lies the opportunity for populists. Unlike the mid and late-19th century, there is no Disraeli or Mazzini around to deftly harness capitalism to nationalism or a Bismarck to buy off the working classes with social benefits. If anything, the opposite is happening. This means the forces of reaction within western societies are greatly weakened. An international working class movement is now ready to be born, if only a leader will be found. And if I am right, this has the potential to strangle the new global capitalism and perhaps a more equitable order will come out of it.”
Government has never tried to recover legal costs from promoters of tax avoidance schemes and continues to award them taxpayer funded contracts
Despite the evidence of fraudulent schemes, no major accountancy firm has ever been disciplined by any professional accountancy body
Professor Prem Sikka writes that Her Majesty’s Revenue and Customs (HMRC) is investigating some 41,000 tax avoidance schemes, but there is still no investigation of the industry that designs and markets aggressive tax avoidance schemes . . .
Now the public accounts committee (PAC) chair Margaret Hodge has PwC, Ernst & Young, KPMG and Deloitte in her sights. The PAC should investigate the role of these firms in organised tax avoidance. An earlier internal HMRC study estimated that these four firms “were behind almost half of all known avoidance schemes” . . .
Despite the evidence, no accountancy firm has ever been disciplined by any professional accountancy body and despite spending millions of pounds to quash predatory schemes, the UK Treasury has never sought to recover the legal costs from the promoters of the schemes. Instead, the big accountancy firms continue to receive taxpayer funded contracts . . .
No government will be able to effectively tackle tax avoidance without shackling the designers and enablers.
Read the whole article here: http://www.guardian.co.uk/commentisfree/2012/dec/08/predatory-practices-accountancy-firms
Government: instead of saving ‘tiny sums’ on welfare reform, address tax avoidance & white-collar fraud
A lead from The Brummie:
“The ‘savings’ made by denying the basic human rights of the most vulnerable will do nothing to reduce the deficit as the sums involved are tiny compared to the tax avoidance, corruption and fraud perpetrated by the already wealthy and privileged.”
The blogger – The Plastic Hippo – sees these “reforms” as nothing more than ideological dogma, an attack on a fair society and an insult to civilization.
In America yesterday, the International Business Times reports that a well-disciplined coalition of community groups allied with Occupy Wall Street to hold a rally in front of the apartments of billionaires including Rupert Murdoch, Koch Industries vice president David Koch and New York Private Bank & Trust CEO president Howard Milstein.
They carried oversized cheques showing how much less the wealthy will pay when New York’s 2% ‘millionaires’ tax’ expires at the end of the year.
One organiser, Doug Forand, said: “99% of the residents of New York are going to suffer from this tax giveaway so the one per cent who already live in absolute luxury can put more money in their pockets.”
Escaping tax may be legal but it’s unfair
The protest-ridden London G20 summit in April 2009 ended with the ‘leaders’ declaring that they would take action against tax havens but the BBC website publishes Action Aid’s dramatic graphic itemising current practice.
David McNair, senior economic justice adviser at the charity Christian Aid, says: “We are facing austerity, governments are cutting basic services,” he says. “If companies are getting away with escaping tax, this may be legal but it’s unfair.”
Ban Ki-Moon: prophetic words: growing social unrest, weakened governments and angry publics
Before the 2009 G20 meeting, Radio France Internationale reported that UN Secretary General Ban Ki-moon wrote an article in the Guardian arguing that more than just economics is at stake and warning that unless decisive action is taken, the crisis could lead to “growing social unrest, weakened governments and angry publics who have lost all faith in their leaders and their own future”.