Many will be thinking what now after a great display of co-ordinated strike action by some not all of the public sector unions over pensions dispute.
So where does the anti cuts movement go next ?
Well for a start i personally feel as good and successful as June 30th was i really do not think it will be enough to defeat this government intent on pushing our living standards back decades. Bigger and wider action will be needed to bring this government to its knees.
I do not think it is quite time for sustained strikes just yet but a 24 hour public sector general strike is not out of the question for the autumn certainly.
The trade unions who were out on strike on thursday now need to go back to their workplaces and start organised for bigger wider action come the autumn.
As far as the movement goes i feel groups such as the NSSN will play a key role in bringing together all of the more militant unions to put pressure on the bigger unions who have yet to ballot for mass strike action such as Unison and Unite and GMB.
The september 11th lobby of the TUC conference by teh NSSN will be key. Putting sufficient pressure on the TUC to throw its weight behind bigger more organised and ultimatly larger widescale strike action come the autumn.
I feel trade unins do need to start linking up with existing anti cuts bodies now and linking together the movement with charities and communitis creating a broad movement against the cuts. Withthe power of the trade union movement now awoken this should be the start of something big now.
One of the key lessons we need to learn from thursdays action is we must keep united, keep up the pressure on other unions but also not think this is just the end. If we win on pensions the government will just come for something else or something else. We need to stand together and firm behind our common goal. To defeat this government which is being driven by a idealology to shrink the public sector as they feel it is rich picking for their friends in the private sector.
The tories who many people think they are in a mess and have no idea what they are doing must be under no illusion they know full well what they are doing.
George Osbourne is at the beck and call of teh city and the banking sector in this country and also on a international stage. His ideas and vision are driven purely from a market position.
We as socialists and anti cuts activists must reject the market as a idea to bring prosperaty to all and instead put ideas forward for bringing the commanding heights of the economy under the control of the common ownership of the workers.
So i think we still have a really long way to go in this fight and we are just in yaer 1 of a 5 year programme of cuts. That's assuming the tories dont get back in in 2015. Even if they do not the Labour party as they have shown are quite ready to take up the mantle and cut into the welfare state and bring about further privatisation . They are not unfamiliar to this as they tried to do many of this whilst they were in government. With the attempts to sell of Royal Mail and introducing PFI - private funding into the NHS therefore opening it up to privatisation further down the road.
So lets be clear Labour are no alternative here. BOth the tories and labour are intent in making the working class pay for a crisis they did not cause and this only strengthens our ideas in the socialist party for the need for a new workers party. To stand up for working peoples interests, to stand with them in times of strike action and not cross picket lines, to give ordinary working people a voice on the political stage.
This is what we need to see but how long it takes could be soon or a way off things can change very quickly in times of economic crisis as Marx quite rightly pointed out. The mass's can shift their thinking from one direction to another fairly quickly and we as revolutionary socialists must be at the front of this thinking keeping ahead of the movement and where it is heading at all times.
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Showing posts with label George Osbourne. Show all posts
Showing posts with label George Osbourne. Show all posts
Saturday, 2 July 2011
Wednesday, 8 June 2011
Economic crisis in them and us Britain
this is the excellent editorial from this weeks edition of the socialist, a weekly paper by the socialist party of England and Wales. if you like this article and wish to view more just like this please do visit
www.socialistparty.org.uk
Wages fall: Office for National Statistics 2010 survey of hours and earnings
For a few at the top, Britain is still booming. In 2010, while the majority suffered the biggest squeeze on their incomes since 1977, the earnings of FTSE 100 chief executives rose by 32%.
The number of billionaires increased from 53 to 73. For the working class, by contrast, the economic crisis which began in 2007 has intensified a long-term trend for its share of the wealth to decrease.
The TUC has produced a report exposing the myth that living standards for the majority were increasing during the boom. On the contrary, the report shows that low-paid workers' incomes have fallen in real terms over the last 30 years.
The number of workers whose wages are at least a third less than median pay has soared from 12% in 1977 to 22% in 2009. Since 2007, as unemployment has rocketed and wages have been squeezed, poverty has increased dramatically.
In March this year the BBC Panorama programme carried out a survey of actual take-home pay. This showed that, on average, workers are taking home £1,088 less a year than two years ago when the sum is adjusted for inflation.
Their real pay has fallen by 5% since the beginning of 2009, which was half way through the recession. Nor is there any prospect of strong growth for Britain's economy, on the contrary stagnation is the rosiest scenario on offer.
As the weak growth in the US stutters, the IMF has also downgraded its growth predictions for Britain this year to just 1.5%, warning that there are significant risks of inflation, low growth and unemployment.
Nonetheless, the IMF has thrown some crumbs of comfort to chancellor George Osborne by backing the government's determination to forge ahead with the biggest cuts to public spending in 80 years.
This is the IMF whose policies have failed in Greece and whose structural adjustment programmes have caused untold misery to workers and poor people across the world.
The IMF's commendation is not, however, the unified position of the strategists of capitalism. The OECD has warned that if Britain's growth is lower 'than expected', as the OECD itself now predicts, the pace of the cuts should be reconsidered.
A number of capitalist economists, including some who wrote to the press supporting the government's strategy just a year ago, are now urging the government to rethink.
For example, Jonathan Portes, the director of the National Institute of Economic and Social Research, who until February was chief economist at the Cabinet Office advising the prime minister, said: "You do not gain credibility by sticking to a strategy that isn't working."
However, these commentators do not have a solution. Like Eds Miliband and Balls they are only arguing for the pain to be less deep but more prolonged.
Nonetheless Osborne's cuts will massively exacerbate the problems. George Osborne has attempted to brush off the criticism and to continue to insist that he 'has no plan B', however, the disastrous results of 'Plan A' are still to be played out.
The government's savage cuts are only beginning to be implemented. As more public sector workers are thrown on the scrapheap, and other cuts hit the public and private sectors, tax revenue will decrease and benefit claims, measly as payments are, will spiral.
The result will be enormous human misery and could even mean an increase rather than a decrease in the government deficit. There is no prospect of 'rebalancing' Britain's economy, of the puny manufacturing sector compensating for the cuts in public spending.
On the contrary, manufacturing is already suffering as consumer spending falls. It is already 2.1% lower than at this time last year, and is likely to fall further.
Production for need
The Con-Dem government can be forced to retreat from its plans. It has already been shaken by the TUC demonstration on 26 March - the biggest trade union demonstration in Britain's history.
On 30 June the government is likely to face the first coordinated strike against its policies by several trade unions. This has to be a step towards a one-day strike of the whole public sector.
This would terrify the government and give enormous confidence to the working class. At the same time a socialist alternative to the capitalist system needs to be put forward.
Capitalism is a blind system, based on the drive for short term profit. It is also in fundamental crisis.
The Socialist Party calls for the nationalisation of the big banking and finance companies. Compensation should be paid on the basis of proven need - without one penny going to the rich speculators who are demanding that the working class pay for the crisis for which they - the speculators - bear responsibility.
It would then be necessary to introduce a state monopoly of foreign trade - so that it would be a democratically elected government - not the market - controlling imports and exports, including capital.
A socialist nationalised banking sector would be democratically run by representatives of banking workers and trade unions, the wider working class, as well as the government.
Decisions would be made to meet the needs of the majority, for example offering cheap loans and mortgages for housing and for the planned development of industry and services and ending all repossessions of people's homes.
However, that would only be the start. The capitalist crisis has led to enormous economic destruction.
In Britain around 10% of wealth has already been lost as a result of the recession, due to factories and workplaces closing, resulting in 2.5 million, and rising, officially unemployed.
That is why a crucial step towards solving the economic crisis would be to also take all the big corporations that dominate Britain's economy into democratic public ownership.
This would then allow for production to be planned to meet the needs of all people and the planet and not for private profit.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Socialist Party editorial
Economic crisis in 'the
www.socialistparty.org.uk
Wages fall: Office for National Statistics 2010 survey of hours and earnings
For a few at the top, Britain is still booming. In 2010, while the majority suffered the biggest squeeze on their incomes since 1977, the earnings of FTSE 100 chief executives rose by 32%.
The number of billionaires increased from 53 to 73. For the working class, by contrast, the economic crisis which began in 2007 has intensified a long-term trend for its share of the wealth to decrease.
The TUC has produced a report exposing the myth that living standards for the majority were increasing during the boom. On the contrary, the report shows that low-paid workers' incomes have fallen in real terms over the last 30 years.
The number of workers whose wages are at least a third less than median pay has soared from 12% in 1977 to 22% in 2009. Since 2007, as unemployment has rocketed and wages have been squeezed, poverty has increased dramatically.
In March this year the BBC Panorama programme carried out a survey of actual take-home pay. This showed that, on average, workers are taking home £1,088 less a year than two years ago when the sum is adjusted for inflation.
Their real pay has fallen by 5% since the beginning of 2009, which was half way through the recession. Nor is there any prospect of strong growth for Britain's economy, on the contrary stagnation is the rosiest scenario on offer.
As the weak growth in the US stutters, the IMF has also downgraded its growth predictions for Britain this year to just 1.5%, warning that there are significant risks of inflation, low growth and unemployment.
Nonetheless, the IMF has thrown some crumbs of comfort to chancellor George Osborne by backing the government's determination to forge ahead with the biggest cuts to public spending in 80 years.
This is the IMF whose policies have failed in Greece and whose structural adjustment programmes have caused untold misery to workers and poor people across the world.
The IMF's commendation is not, however, the unified position of the strategists of capitalism. The OECD has warned that if Britain's growth is lower 'than expected', as the OECD itself now predicts, the pace of the cuts should be reconsidered.
A number of capitalist economists, including some who wrote to the press supporting the government's strategy just a year ago, are now urging the government to rethink.
For example, Jonathan Portes, the director of the National Institute of Economic and Social Research, who until February was chief economist at the Cabinet Office advising the prime minister, said: "You do not gain credibility by sticking to a strategy that isn't working."
However, these commentators do not have a solution. Like Eds Miliband and Balls they are only arguing for the pain to be less deep but more prolonged.
Nonetheless Osborne's cuts will massively exacerbate the problems. George Osborne has attempted to brush off the criticism and to continue to insist that he 'has no plan B', however, the disastrous results of 'Plan A' are still to be played out.
The government's savage cuts are only beginning to be implemented. As more public sector workers are thrown on the scrapheap, and other cuts hit the public and private sectors, tax revenue will decrease and benefit claims, measly as payments are, will spiral.
The result will be enormous human misery and could even mean an increase rather than a decrease in the government deficit. There is no prospect of 'rebalancing' Britain's economy, of the puny manufacturing sector compensating for the cuts in public spending.
On the contrary, manufacturing is already suffering as consumer spending falls. It is already 2.1% lower than at this time last year, and is likely to fall further.
Production for need
The Con-Dem government can be forced to retreat from its plans. It has already been shaken by the TUC demonstration on 26 March - the biggest trade union demonstration in Britain's history.
On 30 June the government is likely to face the first coordinated strike against its policies by several trade unions. This has to be a step towards a one-day strike of the whole public sector.
This would terrify the government and give enormous confidence to the working class. At the same time a socialist alternative to the capitalist system needs to be put forward.
Capitalism is a blind system, based on the drive for short term profit. It is also in fundamental crisis.
The Socialist Party calls for the nationalisation of the big banking and finance companies. Compensation should be paid on the basis of proven need - without one penny going to the rich speculators who are demanding that the working class pay for the crisis for which they - the speculators - bear responsibility.
It would then be necessary to introduce a state monopoly of foreign trade - so that it would be a democratically elected government - not the market - controlling imports and exports, including capital.
A socialist nationalised banking sector would be democratically run by representatives of banking workers and trade unions, the wider working class, as well as the government.
Decisions would be made to meet the needs of the majority, for example offering cheap loans and mortgages for housing and for the planned development of industry and services and ending all repossessions of people's homes.
However, that would only be the start. The capitalist crisis has led to enormous economic destruction.
In Britain around 10% of wealth has already been lost as a result of the recession, due to factories and workplaces closing, resulting in 2.5 million, and rising, officially unemployed.
That is why a crucial step towards solving the economic crisis would be to also take all the big corporations that dominate Britain's economy into democratic public ownership.
This would then allow for production to be planned to meet the needs of all people and the planet and not for private profit.
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Socialist Party editorial
Economic crisis in 'the
Sunday, 22 May 2011
The worst is yet to come
I thought i'd share a excellent article which featured in socialism today a monthly publication of more in depth look at articles from our party. I foundt his a interesting read and shows we have not seen the start of this crisis barely and it is bound to get a lot worse before getting better.
The following article is by Lynn Walsh a good comrade in the labour and trade union movement for many years now.
Lynn Walsh, Editor of Socialism Today
The Con-Dem chancellor, George Osborne, claims his budget (24 March) is the "most pro-growth budget for a generation". But the British economy is barely crawling along, and the budget will do nothing to promote growth.
The government previously predicted 2.3% growth of gross domestic product (GDP - value of the total output of goods and services) for 2011. Now, the Office for Budget Responsibility (OBR) forecasts meagre growth of 1.7% of GDP for 2011. Even that may prove to be optimistic given the scale of spending cuts and tax increases.
Consumer spending, which has been the locomotive of the British economy over recent years, is falling. This is the chilling effect of job losses, escalating prices, and fear of what is to come. The former boss of Asda supermarket, Andy Bond, warns that worse is yet to come. "You’re kidding yourself if you think the worst is over and we’ve had a consumer recession - it’s ahead of us." The bosses of big supermarkets and high street stores, like Dixons and Mothercare, are warning of reduced sales and company profits.
"The economy," comments the Financial Times (6 April), "has been much weaker over the past six months than almost any economist expected." It was "practically stagnant over the past two quarters even before the impact of higher inflation and deeper spending cuts, according to a respected economics research group [National Institute of Economic and Social Research]."
As bad as they are, the Con-Dem cuts have so far merely been nibbling at public services: "The deeper cuts will bite with increased severity over the coming years." (Financial Times editorial, 25 March) Osborne’s fraudulent ’expansionary austerity’ is going to be austerity, austerity, austerity.
Squeezed incomes
Living standards have already been severely hit by inflation and squeezed wages. Prices are rising by 5.1% a year, according to the RPI (retail prices index, which includes housing costs).
At the same time, wages are only increasing by 2%, which means a 3% fall in real (inflation-adjusted) wages. Every 1% fall in real wages means a loss of £250 a year. This has resulted in the first fall in disposable income for over three decades, and there is likely to be a further fall in 2011.
The BBC Panorama programme recently carried out a survey of actual take-home pay (BBC News, 28 March). This showed that, on average, workers are taking home £1,088 less a year than two years ago. Their real pay has fallen by 5% since the beginning of 2009, which was half way through the recession.
The sharpest drop in real pay was in the construction industry, where it was £99 a month less. In the public sector, average pay was £45 a month less, while in the retail sector it was £41 a month less.
Privatising debt
One of the most alarming predictions for the next few years is for a huge rise in household debt. The Con-Dem government is aiming to cut public debt by £43 billion. At the same time, the OBR estimates that private-household debt (including mortgages and credit card debt) will rise by a staggering £245 billion. With increased unemployment, squeezed wages, higher prices and taxes, people will borrow more simply to survive.
In effect, this is the privatisation of the state debt, a huge share of which came from the nationalisation of bank losses. Now, spending cuts and tax increases will push millions deeper into debt, throwing a huge burden onto working class families.
By 2015, according to the OBR, debt as a percentage of household income will increase from the current 160% to 175%. In hard figures, this means a rise from an average of £58,000 debt to £66,291 by 2015.
Petrol tax
Faced with explosive public anger over the soaring price of petrol and diesel, Osborne cut fuel duty by 1p a litre and postponed a further 3p rise until January 2012. Undoubtedly, the government fears the possibility of another fuel price protest on the lines of September 2000, when lorry drivers and farmers blockaded oil refineries and jammed motorways. At that time, protests were encouraged by the Tory opposition, but new protests would now pose a threat to the Con-Dem government.
However, the 20% VAT on fuel will remain, and pump prices will no doubt continue to rise as a result of the rise in world oil prices, due to the crisis in the Middle East and North Africa.
To pay for the fuel duty cut, Osborne has raised taxes on oil production. The windfall profits tax on UK oil and gas production will increase from 20% to 32%, which is expected to bring in an additional £2 billion. Despite their increased profits from the 35% increase in oil prices over the last five months, the oil companies are screaming about this very limited tax increase, peanuts to these giant corporations. Malcolm Webb, chief executive of Oil and Gas UK, said: "This change in the tax regime will decrease investment, increase imports and drive UK jobs to other areas of the world."
This is a barely disguised threat of a ’strike of capital’ if the government increases its tax on oil production. They are unlikely to carry this out, at this time, however, because of the immensely profitable reserves that remain in the North Sea, especially given the fact that oil has now risen to around $120 a barrel.
Nevertheless, it is an indication of the likely reaction of big business, like the banks, to the threat of a ’Robin Hood tax’ proposed by the TUC. Without measures to take control of big business and mobilise mass support for such measures, big business will attempt to sabotage any such steps through withholding investment, etc.
Heading for disaster
The Con-Dem government’s leading economic policy guru, Oliver Letwin, has revealed the private discussions of Con-Dem ministers. "Leading up to the recent budget, we took the view collectively in cabinet that we faced an immediate national crisis in the form of less growth and jobs than we needed." (The Guardian, 31 March) Nothing in Osborne’s budget will overcome this crisis, which will deepen in the coming months.
In response to the budget’s supposedly pro-growth measures, the ’independent’ OBR concluded: "We do not believe there is sufficiently strong evidence to justify changing our trend growth assumption in light of policy measures announced in budget 2011."
It is predicting a mere 1.7% growth in GDP for 2011. At the same time, unemployment is projected to continue to an appalling 2.52 million or 8.2% of the workforce. This includes over a million unemployed young people.
The Con-Dem government’s aim is to reduce the government’s budget deficit to near zero by 2014-15. This is an unrealistic objective even from the point of view of big business and their system - and is likely to prove counter-productive. It is a doctrinaire policy dictated by the interests of the big banks and wealthy speculators, who manipulate bond markets in search of speculative profits.
Wiping out the budget deficit depends on faster economic growth, which is why Osborne continually claims he is promoting "expansionary austerity" through pro-growth measures.
His budget, however, did not impress the financial markets that much. The rating agency, Moodys, which assesses the credit status of borrowers, including governments, warned that "slower growth combined with weaker-than-expected fiscal consolidation could cause the UK’s debt metrics to deteriorate to a point that would be inconsistent with a AAA rating."
Near zero growth or even a new recession would mean even higher unemployment and reduced tax revenues. The Con-Dems’ savage austerity policy could then result in an increase in the deficit, the worst of all worlds.
The so-called ’expansionary austerity’ cannot provide a way out for sickly British capitalism. The crisis referred to by Letwin can only deepen. The Con-Dem government has already been shaken by mass opposition, especially the mighty 26 March TUC demonstration in London. It has been forced to partially reverse the abolition of education maintenance allowance, and to announce a ’natural break’ on the savaging of the NHS through accelerated privatisation.
The 26 March demonstration was only a beginning. It should be the prelude to further action, especially coordinated public sector strikes against cuts, a massive weekday demonstration, and a 24-hour general strike.
Black Wednesday budget
There are 44 changes in tax and benefits in Osborne’s budget. With such a complex tax/benefit system it is very hard to calculate their exact effect. But one thing is certain: most of the changes will cut the incomes of working-class families. The government’s claim that everyone - apart from the rich - will benefit is completely false.
One organisation, Credit Action, calculates that, on average, the changes will reduce household income by at least £200 a year. The Institute for Fiscal Studies (IFS) reckons that the average family income is expected to still be lower in 2013 than it was in 2008, making it the biggest five-year drop for more than 40 years. The IFS also calculates that the typical pensioner household has seen its real annual income fall by 2.4% (£456) since 2008.
However, these estimates come before further price rises, job losses, squeezed pay levels, and benefit cuts. The Centre for Economic and Business Research reckons the higher cost of living in 2011 will mean that the average family will be £910 worse off this year - the tightest squeeze on finances since 1921.
This year’s budget, moreover, is a supplement to last year’s horrendous Con-Dem spending review which spelt out £81 billion cuts and £33 billion tax raises by 2013.
The basic personal tax allowance (the threshold below which no income tax is paid) is to rise by £1,000 to £7,475, which means around 500,000 workers will not pay income tax.
This small gain, however, will be wiped out for many by the loss of services through cuts and reduced benefits. In particular, changes in tax credits and a freezing of child allowances will mean a sharp cut for working parents.
•Many middle class families will be squeezed by the lowering of the threshold for the higher (40%) tax rate from £37,401 to £35,000, which will mean around 750,000 workers paying significantly more tax (as well as higher national insurance contributions). Osborne tried to provide some populist window dressing through a number of taxes aimed at big business and the wealthy.
•The levy on windfall bank profits (heavily subsidised by state support during the crisis) is being marginally increased. North Sea oil companies will have to pay another £2 billion on their soaring profits.
•There will be a tax on passengers in private jets, and the stamp duty on the purchase of houses over £1 million will be raised to 5%. At the same time, however, there are concessions on stamp duty for developers and landlords buying multiple properties.
•The fee paid by wealthy overseas visitors to register as ’non-doms’ will be raised to £50,000, but they will continue to enjoy the privilege of paying no UK tax on their offshore profits.
•In the small print of the budget, there is a whole series of tax allowances for big business. Big companies will be able to offset against tax investments in enterprise zones, research and development, and many forms of new capital investment.
•Above all, corporation tax, currently 28%, has been cut by 2% with the promise of further cuts to 23% in three years’ time.
•Osborne has also promised that the 50% top rate of tax on those earning over £150,000 will be reduced in the future. This highlights an important aspect of the Con-Dems’ policy. Many of the current taxes levied on big business and the wealthy minority are regarded as temporary, to be reduced in the future. On the other hand, the cuts in public spending, with the massive loss of services and public sector jobs, are regarded as part of the permanent reduction of the public sector - in other words, a permanent blow to the living standards and well-being of many millions of workers.
The following article is by Lynn Walsh a good comrade in the labour and trade union movement for many years now.
Lynn Walsh, Editor of Socialism Today
The Con-Dem chancellor, George Osborne, claims his budget (24 March) is the "most pro-growth budget for a generation". But the British economy is barely crawling along, and the budget will do nothing to promote growth.
The government previously predicted 2.3% growth of gross domestic product (GDP - value of the total output of goods and services) for 2011. Now, the Office for Budget Responsibility (OBR) forecasts meagre growth of 1.7% of GDP for 2011. Even that may prove to be optimistic given the scale of spending cuts and tax increases.
Consumer spending, which has been the locomotive of the British economy over recent years, is falling. This is the chilling effect of job losses, escalating prices, and fear of what is to come. The former boss of Asda supermarket, Andy Bond, warns that worse is yet to come. "You’re kidding yourself if you think the worst is over and we’ve had a consumer recession - it’s ahead of us." The bosses of big supermarkets and high street stores, like Dixons and Mothercare, are warning of reduced sales and company profits.
"The economy," comments the Financial Times (6 April), "has been much weaker over the past six months than almost any economist expected." It was "practically stagnant over the past two quarters even before the impact of higher inflation and deeper spending cuts, according to a respected economics research group [National Institute of Economic and Social Research]."
As bad as they are, the Con-Dem cuts have so far merely been nibbling at public services: "The deeper cuts will bite with increased severity over the coming years." (Financial Times editorial, 25 March) Osborne’s fraudulent ’expansionary austerity’ is going to be austerity, austerity, austerity.
Squeezed incomes
Living standards have already been severely hit by inflation and squeezed wages. Prices are rising by 5.1% a year, according to the RPI (retail prices index, which includes housing costs).
At the same time, wages are only increasing by 2%, which means a 3% fall in real (inflation-adjusted) wages. Every 1% fall in real wages means a loss of £250 a year. This has resulted in the first fall in disposable income for over three decades, and there is likely to be a further fall in 2011.
The BBC Panorama programme recently carried out a survey of actual take-home pay (BBC News, 28 March). This showed that, on average, workers are taking home £1,088 less a year than two years ago. Their real pay has fallen by 5% since the beginning of 2009, which was half way through the recession.
The sharpest drop in real pay was in the construction industry, where it was £99 a month less. In the public sector, average pay was £45 a month less, while in the retail sector it was £41 a month less.
Privatising debt
One of the most alarming predictions for the next few years is for a huge rise in household debt. The Con-Dem government is aiming to cut public debt by £43 billion. At the same time, the OBR estimates that private-household debt (including mortgages and credit card debt) will rise by a staggering £245 billion. With increased unemployment, squeezed wages, higher prices and taxes, people will borrow more simply to survive.
In effect, this is the privatisation of the state debt, a huge share of which came from the nationalisation of bank losses. Now, spending cuts and tax increases will push millions deeper into debt, throwing a huge burden onto working class families.
By 2015, according to the OBR, debt as a percentage of household income will increase from the current 160% to 175%. In hard figures, this means a rise from an average of £58,000 debt to £66,291 by 2015.
Petrol tax
Faced with explosive public anger over the soaring price of petrol and diesel, Osborne cut fuel duty by 1p a litre and postponed a further 3p rise until January 2012. Undoubtedly, the government fears the possibility of another fuel price protest on the lines of September 2000, when lorry drivers and farmers blockaded oil refineries and jammed motorways. At that time, protests were encouraged by the Tory opposition, but new protests would now pose a threat to the Con-Dem government.
However, the 20% VAT on fuel will remain, and pump prices will no doubt continue to rise as a result of the rise in world oil prices, due to the crisis in the Middle East and North Africa.
To pay for the fuel duty cut, Osborne has raised taxes on oil production. The windfall profits tax on UK oil and gas production will increase from 20% to 32%, which is expected to bring in an additional £2 billion. Despite their increased profits from the 35% increase in oil prices over the last five months, the oil companies are screaming about this very limited tax increase, peanuts to these giant corporations. Malcolm Webb, chief executive of Oil and Gas UK, said: "This change in the tax regime will decrease investment, increase imports and drive UK jobs to other areas of the world."
This is a barely disguised threat of a ’strike of capital’ if the government increases its tax on oil production. They are unlikely to carry this out, at this time, however, because of the immensely profitable reserves that remain in the North Sea, especially given the fact that oil has now risen to around $120 a barrel.
Nevertheless, it is an indication of the likely reaction of big business, like the banks, to the threat of a ’Robin Hood tax’ proposed by the TUC. Without measures to take control of big business and mobilise mass support for such measures, big business will attempt to sabotage any such steps through withholding investment, etc.
Heading for disaster
The Con-Dem government’s leading economic policy guru, Oliver Letwin, has revealed the private discussions of Con-Dem ministers. "Leading up to the recent budget, we took the view collectively in cabinet that we faced an immediate national crisis in the form of less growth and jobs than we needed." (The Guardian, 31 March) Nothing in Osborne’s budget will overcome this crisis, which will deepen in the coming months.
In response to the budget’s supposedly pro-growth measures, the ’independent’ OBR concluded: "We do not believe there is sufficiently strong evidence to justify changing our trend growth assumption in light of policy measures announced in budget 2011."
It is predicting a mere 1.7% growth in GDP for 2011. At the same time, unemployment is projected to continue to an appalling 2.52 million or 8.2% of the workforce. This includes over a million unemployed young people.
The Con-Dem government’s aim is to reduce the government’s budget deficit to near zero by 2014-15. This is an unrealistic objective even from the point of view of big business and their system - and is likely to prove counter-productive. It is a doctrinaire policy dictated by the interests of the big banks and wealthy speculators, who manipulate bond markets in search of speculative profits.
Wiping out the budget deficit depends on faster economic growth, which is why Osborne continually claims he is promoting "expansionary austerity" through pro-growth measures.
His budget, however, did not impress the financial markets that much. The rating agency, Moodys, which assesses the credit status of borrowers, including governments, warned that "slower growth combined with weaker-than-expected fiscal consolidation could cause the UK’s debt metrics to deteriorate to a point that would be inconsistent with a AAA rating."
Near zero growth or even a new recession would mean even higher unemployment and reduced tax revenues. The Con-Dems’ savage austerity policy could then result in an increase in the deficit, the worst of all worlds.
The so-called ’expansionary austerity’ cannot provide a way out for sickly British capitalism. The crisis referred to by Letwin can only deepen. The Con-Dem government has already been shaken by mass opposition, especially the mighty 26 March TUC demonstration in London. It has been forced to partially reverse the abolition of education maintenance allowance, and to announce a ’natural break’ on the savaging of the NHS through accelerated privatisation.
The 26 March demonstration was only a beginning. It should be the prelude to further action, especially coordinated public sector strikes against cuts, a massive weekday demonstration, and a 24-hour general strike.
Black Wednesday budget
There are 44 changes in tax and benefits in Osborne’s budget. With such a complex tax/benefit system it is very hard to calculate their exact effect. But one thing is certain: most of the changes will cut the incomes of working-class families. The government’s claim that everyone - apart from the rich - will benefit is completely false.
One organisation, Credit Action, calculates that, on average, the changes will reduce household income by at least £200 a year. The Institute for Fiscal Studies (IFS) reckons that the average family income is expected to still be lower in 2013 than it was in 2008, making it the biggest five-year drop for more than 40 years. The IFS also calculates that the typical pensioner household has seen its real annual income fall by 2.4% (£456) since 2008.
However, these estimates come before further price rises, job losses, squeezed pay levels, and benefit cuts. The Centre for Economic and Business Research reckons the higher cost of living in 2011 will mean that the average family will be £910 worse off this year - the tightest squeeze on finances since 1921.
This year’s budget, moreover, is a supplement to last year’s horrendous Con-Dem spending review which spelt out £81 billion cuts and £33 billion tax raises by 2013.
The basic personal tax allowance (the threshold below which no income tax is paid) is to rise by £1,000 to £7,475, which means around 500,000 workers will not pay income tax.
This small gain, however, will be wiped out for many by the loss of services through cuts and reduced benefits. In particular, changes in tax credits and a freezing of child allowances will mean a sharp cut for working parents.
•Many middle class families will be squeezed by the lowering of the threshold for the higher (40%) tax rate from £37,401 to £35,000, which will mean around 750,000 workers paying significantly more tax (as well as higher national insurance contributions). Osborne tried to provide some populist window dressing through a number of taxes aimed at big business and the wealthy.
•The levy on windfall bank profits (heavily subsidised by state support during the crisis) is being marginally increased. North Sea oil companies will have to pay another £2 billion on their soaring profits.
•There will be a tax on passengers in private jets, and the stamp duty on the purchase of houses over £1 million will be raised to 5%. At the same time, however, there are concessions on stamp duty for developers and landlords buying multiple properties.
•The fee paid by wealthy overseas visitors to register as ’non-doms’ will be raised to £50,000, but they will continue to enjoy the privilege of paying no UK tax on their offshore profits.
•In the small print of the budget, there is a whole series of tax allowances for big business. Big companies will be able to offset against tax investments in enterprise zones, research and development, and many forms of new capital investment.
•Above all, corporation tax, currently 28%, has been cut by 2% with the promise of further cuts to 23% in three years’ time.
•Osborne has also promised that the 50% top rate of tax on those earning over £150,000 will be reduced in the future. This highlights an important aspect of the Con-Dems’ policy. Many of the current taxes levied on big business and the wealthy minority are regarded as temporary, to be reduced in the future. On the other hand, the cuts in public spending, with the massive loss of services and public sector jobs, are regarded as part of the permanent reduction of the public sector - in other words, a permanent blow to the living standards and well-being of many millions of workers.
Wednesday, 27 April 2011
latest GDP figures make bleak reading for the government
The UK economy returned to modest growth in the first three months of 2011, official figures revealed today, following a shock decline at the end of last year.
Gross domestic product (GDP) - a broad measure for the total economy - grew by 0.5% in the first quarter of the year, following an unexpected drop of 0.5% in the final weather-hit quarter of 2010, the Office for National Statistics (ONS) said.
All this makes bleak reading for George OSbourne as he looks to re balance the economy. I think these figures clearly show a failiure to bring in growth for the UK. These figures include figures since VAT went up in January to 20% but dont account for teh oncoming savage spending cuts by the government. THe next quarters figures will be very interesting indeed.
In the figures we can see that construction took a big hit no doubt as a result of loosing many contracts for building schools projects and a stagnation in house building market.
All this confirms mine and many others thoughts that cutting our way out of a recession is never the way to go. George Osbourne and his tory pals have not learnt the lessons of history. Although this 0.5% shows growth it is only returning to what it was in the third quarter of last year. This is in affect a 6 month stagnation . Whatever spin these political types and media who do a good job of spinning them for them too there is no way these figures show the tories plans are working.
Labour of course have no reply on this whatever they say they would have only cut 2 billion pounds less this year and had no ideas for real growth either.
Time after time i remind people that capitalism is broken and you cannot reform the system. Only a over throw of the system to bring the heights of the economy into public ownership will fill the public purse with funds to reinvest in the services we so badly need.
Removing the economic power of the rich and redistributing wealth to the many would by my idea of making society a fairer society.
2011 with spending cuts ahead looks to be anotehr bumpy year for the British economy. With growing fears in the global market of the likes of Greece and Spain defaulting on its debts the fear of a crisis in the capitalist society is bound to spread.
Gross domestic product (GDP) - a broad measure for the total economy - grew by 0.5% in the first quarter of the year, following an unexpected drop of 0.5% in the final weather-hit quarter of 2010, the Office for National Statistics (ONS) said.
All this makes bleak reading for George OSbourne as he looks to re balance the economy. I think these figures clearly show a failiure to bring in growth for the UK. These figures include figures since VAT went up in January to 20% but dont account for teh oncoming savage spending cuts by the government. THe next quarters figures will be very interesting indeed.
In the figures we can see that construction took a big hit no doubt as a result of loosing many contracts for building schools projects and a stagnation in house building market.
All this confirms mine and many others thoughts that cutting our way out of a recession is never the way to go. George Osbourne and his tory pals have not learnt the lessons of history. Although this 0.5% shows growth it is only returning to what it was in the third quarter of last year. This is in affect a 6 month stagnation . Whatever spin these political types and media who do a good job of spinning them for them too there is no way these figures show the tories plans are working.
Labour of course have no reply on this whatever they say they would have only cut 2 billion pounds less this year and had no ideas for real growth either.
Time after time i remind people that capitalism is broken and you cannot reform the system. Only a over throw of the system to bring the heights of the economy into public ownership will fill the public purse with funds to reinvest in the services we so badly need.
Removing the economic power of the rich and redistributing wealth to the many would by my idea of making society a fairer society.
2011 with spending cuts ahead looks to be anotehr bumpy year for the British economy. With growing fears in the global market of the likes of Greece and Spain defaulting on its debts the fear of a crisis in the capitalist society is bound to spread.
Sunday, 12 December 2010
Are we really all in this together ?
As George Osbournes now famous line we are all in this together gets heard almost on a daily basis now in my tweets on twitter and various social media outlets i just think we should not let the public at large forget that this is a complete lie.
We are not all in this together at all. The poor are disproportionatly paying more for the bankers mistakes and the huge debt we have run up. It is not fair to say we are all in this together when a certain section of society is clearly being forced not becuase they want to to pay for this mess. After it was our money that was used to bail these retchid banks out in the first place we continue to hear of the poor being asked to take pay cuts, redundancies, VAT hikes, benifits being taken away and merged.
I just still think that line will be one of the lines in history that will show the tories up to have been out of touch during a time of hardship throughout the western world.
If we area ll in this together why are the bankers and the rich not paying more tax's to help the less well off avoid the brunt of these cuts. So for example if big business's like Vodafone who still owe our country 6 billin pounds of tax would just be foreced to pay up the 6 billion taken out of the welfare state earlier this year would never have had to happen.
But are we all in this mess together ? no we dam well are not. Untill this class war is ended and the attack on the less well off is heard to the mainstream media and everyone gets to hear of the real ideaological reasons behind these cuts the arguement about cuts will not ahve been won. We must fight and campaign to keep the welfare state one of the greatest things about this country in its present state.
If the NHS is taken on to privatise it or cut it back majorly then the student protests seen over the last few weeks in london will be sure to be repeated.
I fear we are in for a rough couple of years now under this tory lead coalition so lets buckle up and be ready to fightback when they say cutback.
We are not all in this together at all. The poor are disproportionatly paying more for the bankers mistakes and the huge debt we have run up. It is not fair to say we are all in this together when a certain section of society is clearly being forced not becuase they want to to pay for this mess. After it was our money that was used to bail these retchid banks out in the first place we continue to hear of the poor being asked to take pay cuts, redundancies, VAT hikes, benifits being taken away and merged.
I just still think that line will be one of the lines in history that will show the tories up to have been out of touch during a time of hardship throughout the western world.
If we area ll in this together why are the bankers and the rich not paying more tax's to help the less well off avoid the brunt of these cuts. So for example if big business's like Vodafone who still owe our country 6 billin pounds of tax would just be foreced to pay up the 6 billion taken out of the welfare state earlier this year would never have had to happen.
But are we all in this mess together ? no we dam well are not. Untill this class war is ended and the attack on the less well off is heard to the mainstream media and everyone gets to hear of the real ideaological reasons behind these cuts the arguement about cuts will not ahve been won. We must fight and campaign to keep the welfare state one of the greatest things about this country in its present state.
If the NHS is taken on to privatise it or cut it back majorly then the student protests seen over the last few weeks in london will be sure to be repeated.
I fear we are in for a rough couple of years now under this tory lead coalition so lets buckle up and be ready to fightback when they say cutback.
Wednesday, 17 November 2010
So Mr osbourne how do we afford a irish bailout ?
We are and have repatably been told this country is on its knees, we have a the biggest deficit in the EU, we are just like Greece we must act now to avoid financial melt down.
ALl things we were told and have been told to us by the tories since before the general election.
Well then how can George Osbourne claim today we will be there to help bail out Ireland ? if our finances are in such a mess isnt this plain irresponsible of him ?
Have we not got a mess of our own to sort out, or to make worse depending which side of the political fence you sit. I myself feel we are heading down the same route as irealnd by cutting too fast and too deep.
But my question is to you all how can George Osbourne and those financially estute tories say we will be able to bail outIreland, yes they are our neighbours but if we really are broke like the tories like to make out surely we cannot afford this ?
or unless we have been sold a huge set of lies that our finances were no where near as bad as the tories led us to believe ?
where is this money coming from to help out ireland ay ?
I'm not trying to suggest our finances werent in a mess of course we could have done with scaling back a few things, notably bankers bonus's for one example but huge scale public sector cuts more than ever seems very idealogical to me. I feel it is the tories seeing a golden chance to rip into the welfare state which they ahve never liked and take apart the public sector. All in the name of selling off these services to their private sector friends to make loads of money out of.
Really worrying i feel...
ALl things we were told and have been told to us by the tories since before the general election.
Well then how can George Osbourne claim today we will be there to help bail out Ireland ? if our finances are in such a mess isnt this plain irresponsible of him ?
Have we not got a mess of our own to sort out, or to make worse depending which side of the political fence you sit. I myself feel we are heading down the same route as irealnd by cutting too fast and too deep.
But my question is to you all how can George Osbourne and those financially estute tories say we will be able to bail outIreland, yes they are our neighbours but if we really are broke like the tories like to make out surely we cannot afford this ?
or unless we have been sold a huge set of lies that our finances were no where near as bad as the tories led us to believe ?
where is this money coming from to help out ireland ay ?
I'm not trying to suggest our finances werent in a mess of course we could have done with scaling back a few things, notably bankers bonus's for one example but huge scale public sector cuts more than ever seems very idealogical to me. I feel it is the tories seeing a golden chance to rip into the welfare state which they ahve never liked and take apart the public sector. All in the name of selling off these services to their private sector friends to make loads of money out of.
Really worrying i feel...
Is Ireland still a example to follow ?
Today The EU tried to downplay bailout talks with the Irish government of nothing to worry about
http://www.bbc.co.uk/news/business-11771574
With Ireland joining the growing list of EU countries facing hard times joining Greece, Spain, Portugal and Italy this is worrying times for the European Union.
What was set up on a wave of optimism with alot of the founding members doing well to start with since the economic down turn alot of these countries who cant independantly control their own currency or devalue it in any way are left in some rather difficult situations.
Ireland for example of which the posted link refers to has under gone round after round of deficit cuts. Something which our own Chancellor of the United Kingdom George Osbourne admired and priased lavishly a few years back now.
He saw them as a beacon and a example to follow. Well now Mr Osbourne lets look where Ireland stand now. On the brink of defaulting on their repayments and crippling debt. Ireland seem to be on the slide rather than picking up. With high unemployment in the Republic and little prospect for new job creation their economy seems to be stalling.
With the Uk looking like we'll step in and help with a big bailout of ireland is this really the route George Osbourne really wants to be taking the Uk down ?
With huge cuts cuts mass unemployment. As ireland have found out cuts dont create growth and growth leads back to recession.
George Osbourne has gone ratehr quiet on ireland and matters of this since these news stories ahve been coming out. Perhaps he is turning a blind eye to it and hoping our cuts over here will be alright. Well let me tell you they wont. They are the biggest peace time public sector cuts since the 30's back when you guessed it we cut too harda nd far too deep and found oursleves trapped in a depression for many years.
I do hope ireland pull through this but it is nothing new and i can only see things getting worse there before better.
http://www.bbc.co.uk/news/business-11771574
With Ireland joining the growing list of EU countries facing hard times joining Greece, Spain, Portugal and Italy this is worrying times for the European Union.
What was set up on a wave of optimism with alot of the founding members doing well to start with since the economic down turn alot of these countries who cant independantly control their own currency or devalue it in any way are left in some rather difficult situations.
Ireland for example of which the posted link refers to has under gone round after round of deficit cuts. Something which our own Chancellor of the United Kingdom George Osbourne admired and priased lavishly a few years back now.
He saw them as a beacon and a example to follow. Well now Mr Osbourne lets look where Ireland stand now. On the brink of defaulting on their repayments and crippling debt. Ireland seem to be on the slide rather than picking up. With high unemployment in the Republic and little prospect for new job creation their economy seems to be stalling.
With the Uk looking like we'll step in and help with a big bailout of ireland is this really the route George Osbourne really wants to be taking the Uk down ?
With huge cuts cuts mass unemployment. As ireland have found out cuts dont create growth and growth leads back to recession.
George Osbourne has gone ratehr quiet on ireland and matters of this since these news stories ahve been coming out. Perhaps he is turning a blind eye to it and hoping our cuts over here will be alright. Well let me tell you they wont. They are the biggest peace time public sector cuts since the 30's back when you guessed it we cut too harda nd far too deep and found oursleves trapped in a depression for many years.
I do hope ireland pull through this but it is nothing new and i can only see things getting worse there before better.
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