Monthly Archives: April 2013

Tory MP tries to get Ken Livingstone thrown out

News

This is hilarious.

The Spectator is carrying the exclusive news that Ed Miliband faces calls to remove Ken Livingstone from Labour NEC after ‘disgusting’ remarks

Ken Livingstone said that American foreign policy ‘fuels the anger’ that drove such young men (from Boston for example) into acts of terrorism.

I think there is a grain of truth in that, but a bit simplistic.

Nevertheless, Conservative MPs never miss an opportunity to get some publicity for themselves. Brooks Newmark MP has written to Ed Miliband this afternoon, asking the Labour leader to condemn the remarks and remove Livingstone from Labour’s National Executive Committee.

ROFL.

Ed Miliband should focus on the campaigning rather than getting side-tracked by opportunistic Tory MPs.

Perhaps I should jog rightwing memories with this:

MI5 repeatedly warned Tony Blair that war on Iraq would trigger a “substantial” increase in terrorism against the UK, former director-general Eliza Manningham-Buller revealed today.
…
She said that by invading Iraq, Britain and America had given al Qaeda a powerful recruiting tool.

“Arguably we gave Osama Bin Laden his Iraqi Jihad. So that he was able to move into Iraq in a way that he wasn’t before,” she added.

Ken Livingstone says what ex-MI5 chief said earlier, shocker.

Dial M for Murdoch: a riveting read on the biggest media scandal of the decade

Blog, Media

by Nicola Moors

“Gutter journalism had sunk into the sewer”, aptly describes the moment when it was discovered the News of the World had hacked the phone of a murdered schoolgirl.

Indeed no one was more shocked at the actions of the newspaper than fellow journalists.

Dial M for Murder opens your eyes to the depths that the newspaper, and News Corporation, went to in order to deceive the public, police and politicians of their criminality.

With the Lord Justice Leveson’s report of his inquiry into press culture, practices and ethics now finished, you could be forgiven for never wanting to hear of phone-hacking, the Murdoch’s or News International again.

The tale of how the Murdochs, namely Rupert and James, and their empire single-handedly changed the face of British journalism is an infamous one. In fact, it’s a story so sensational that it would be, ironically, fit for the front page of tabloids like the News of the World.

From the closure of the 168-year-old to the resigning of several high-flying executives, including Rebekah Brooks, the chief executive of News International herself, this book tells it all and is simply a must-read.

Although many of the events told are already known to the public; the book gives a gripping account of the links between them and includes several revelations in the book. Ultimately immoral and unethical journalism is exposed throughout the scandal, however the trade’s positive points are also demonstrated – such as the persistent doggedness of journalists that never gave up investigating, despite threats of blackmail.

During the Leveson Inquiry, the Murdoch’s pleaded ignorance to knowing the extent of the phone hacking in their company – although whether you believe this is another matter.

Also during the Leveson Inquiry – which is delved into time and time again – Rupert is depicted a ‘doddery old man’. As the owner of a multi-billion pound empire, it’s safe to say that Rupert Murdoch is anything but doddery.

One recurring problem with the book is that Tom Watson, one of the authors and the Labour MP attacked by Rupert Murdoch’s organisation, has obvious bias against News Corporation – although he acknowledges this in the preface. ”But though the story is inevitably coloured by personal experiences, we didn’t want to overemphasize our roles”.

Tom’s close relationship in the ongoing saga means that he often confides personal facts to the reader, making it sometimes feel too much like a private diary, rather than an independent account of events.

Having said that, it’s a riveting read – as the events unfold, it’s difficult to put it down.

One piece of advice would be to take your time reading it; there are numerous people and events involved, so it can easily get confusing.

—
Nicola Moors is editor of University of Sheffield’s independent newspaper Forge Press, and a freelance journalist. She tweets from here.

The Week shows white Boston terrorists as brown

News

The Week is a British magazine, with an American edition.

Its American edition this week illustrates the Boston bombers.

Note their skin tone: it isn’t white. They look brown, even though US authorities describe them as white.

I find this interesting because one would almost think the magazine wanted to pretend white people can’t be terrorists.

Here’s the cover on their website.

(via Brofiling and @Dem_Tilly)

A majority think Tory economic plans have failed

News

A ComRes poll last night for the Independent makes quite a remarkable point.

According to ComRes, 58 per cent of people agree that the Government’s economic plan has failed and so it will be time for a change of government in 2015, while 31 per cent disagree with this statement.

Some 85 per cent of Labour supporters, 73 per cent of Liberal Democrat voters and 67 per cent of UK Independence Party supporters think it will be time for change in 2015 and that the Government’s economic plan has failed –as does one in four (23 per cent) current Conservative voters.

Furthermore, the public is already equally divided over whether the Tories should be given a chance to restore Britain’s economic prospects after 2015: 46% to 44%.

Some 68% of Ukip supporters do not believe the Tories should be given another chance, according to the Indy.

As I said over the weekend, the speed at which the Conservatives have lost credibility on the economy is extraordinary.

Do benefits for rich pensioners preserve ‘universal support’ for welfare?

Blog, Economy, The Left

Ed Miliband was today asked on Radio 4′s #wato whether Labour would cut benefits for wealthy pensioners. For now the answer is no, and I have a feeling it will stay like that.

I wrote earlier the Tories were not serious about cutting the social security bill because they ignored two major components: lack of well-paying jobs and the large proportion we spend on pensions (plus there’s housing benefit, which I missed out)

I’m not expecting to win any popularity contests, but I’ll say it anyway: I think Labour should commit to cutting benefits for wealthier pensioners in the form of the Winter Fuel Allowance, Freedom passes subsidised travel and free TV licenses. The definition of ‘wealthier’ is key, because I genuinely mean wealthy people not struggling middle-class people. I.e., people who earn the top rate of tax or have over £500k in savings.

The main leftwing case against stripping these benefits is that it ‘undermines universalism’. I’ll focus on this here, and make the case for in another post.

Owen Jones argues it will “breed a middle-class that is furious about paying large chunks of tax; getting nothing back”. The Guardian’s John Harris also asked in Jan: ‘Who will speak up for the universal welfare state now?‘.

I used to believe this too, but I’ve changed my minds for several reasons.

First, there is no evidence for the view that these benefits keep up support for the universal principle.

Despite increasing the number of universal benefits in recent decades (especially during New Labour years) – support has still fallen.

What actually happens is people support those specific benefits they get, but don’t extend that support to across to other benefits or the idea of universalism.

Or to put it another way, people are far more discerning than we give them credit for. Handing out a Freedom Pass to a rich pensioner is not getting us support for unemployment benefits in return. I’d love to see the evidence but it’s just not there.

Secondly, the argument that we’re chipping away the welfare state by cutting these benefits is a bit odd, since New Labour introduced the Winter Fuel Allowance. There are other universal benefits that can be preserved and supported. There seems to be an element of knee-jerk defensiveness here that assumes all changes are a one-way street and no more universal benefits can ever be introduced in the future.

Thirdly, the universal state isn’t just about cash benefits, and we shouldn’t assume that will buy support. We need a different kind of a universalist social security system, one that focuses on health and social care, education and training, child care and early intervention, and reducing inequality in a more fundamental way.

These benefits are a sticking plaster – like charity. The broader aim for the left should be to re-structure the state to reduce inequality, not rely on small handouts to wealth pensioners in the hope it buys support for other policies.

This is the short case against preserving these benefits on the basis of universalism. So why should Labour get rid of them anyway? I’ll write that in another post.

—

ADDENDUM
I’m going to simplify this by posing some questions:
1) Where is the evidence that, in the UK, means-testing one kind of benefit reduces support for other benefits such as for unemployed people?

2) I’m for universal benefits. All I’ve said is that I’d like the focus on other kinds of benefits rather than cash hand-outs to rich pensioners. So why are people saying that means-testing these pensioner benefits will undermine universal social security?

Another update: I think Daniel Sage was trying to write a critique of my point but ends up reinforcing it. His graphs show that offering universal pensions leads to more support for pensions, but not more support for other kinds of benefits such as JSA.

The political reason behind why it’s difficult to survive on benefits

Blog, Fight the cuts

Another sign of the times is the debate about how much people on benefits need to spend on food. The BBC says you can have “a healthy diet on £15 a week”.

Conservative MP Alec Shelbrooke thinks the problem is they spend their money on fags and booze and the Daily Mail says you can ‘survive’ on a pound a day.

Of course, most of us could take a holiday to poverty and get by for a day or two or even a week or two. Polly Toynbee is spot on about this, it’s the grinding effect that makes poverty different – the longer it lasts, the fewer resources you have and the more difficult it is to cope with an emergency or unexpected bill.

Just as important, the longer it lasts, the greyer life becomes, the more depressing. No wonder many people in long-term poverty are desperate to hang on to whatever “luxuries” they still have; lectures about this from the comfortable are beneath contempt.

It was George Orwell who had the clearest insight about the politics of poverty in the 1930s. In The Road to Wigan Pier, he imagined what would happen if the millions on the dole did actually cut their spending in the way the Daily Mail and Conservative MPs would still like.

Orwell had experienced French food culture at first hand and thought that the English could learn lessons about making food go further. But in the end that was irrelevant: people on benefits don’t have a hard time because they lack the skills to make the most of their benefits, their benefits are deliberately set at a level where most people will find it hard to cope.

This isn’t a conscious policy of forcing malnutrition on millions of fellow-citizens, it’s the inevitable result of a political conversation dominated by the obsession that the poor may be putting one over on the rest of us.

As Orwell put it:

If the unemployed learned to be better managers they would be visibly better off, and I fancy it would not be long before the dole was docked correspondingly.

People aren’t hungry because they’re incompetent, they’re hungry because the rest of us think that the possibility they may be getting away with something is more important than hunger.

—
A longer version of this post is on the Touchstone blog

Pessimism about the UK economy could be Labour’s biggest problem in 2015

Blog, Economy

There are two diverging views on the British economy, cutting across left-right divides, that not enough attention is paid to.

One is the optimists’ view. They say the UK economy is running well below trend. That is, it should have recovered after the initial recession and continued on an upward trajectory but, due to various reasons, has stagnated. This means there is now substantial spare capacity (aka high unemployment) in the British economy that is lying unused.

This is also called the output gap. The chart below makes the simplistic case.


From the FT Alphaville blog.

Broadly, most optimists also agree the UK needs a short-term jolt to the economy, but also major reform over the longer term to boost the economy. We have relied far too much on bubbles and speculation in the past to keep going. Chris Dillow outlined various supply-side socialism ideas that would fit the ‘major reform’ category.

But there are also the pessimists.

They say the crash permanently knocked out a substantial part of the UK’s capacity, which means we can’t actually grow all that much. This in turn means they think the state needs to be smaller permanently, as it can’t support previous spending levels. Some of them also think low growth is inevitable.

While the Labour leadership fall into the optimists camp, there is a danger most voters drift towards the negative end.

A poll in the Independent today says:
only one in five people expect to be better off in two years’ time.

Most of the media has already bought into this idea that Britain’s stagnation is inevitable, and there is nothing much even Labour could do in power. This ‘soft bigotry of low growth expectations’ has frustrated the hell out of Duncan Weldon.

UPDATE: Coincidentally, there’s YouGov polling out today that emphasises my point too:

By 46% – 19% people expect to worse off than today, rather than better off, by the time of the next election.

Less than half the public – 43% – think living standards will return to their pre-recession levels within the next five years (or ten years after the crisis erupted in 2008).

49% think that ‘whichever party was in government, they would be unable to alter this central fact’. Rather fewer, 38%, believe that ‘with the right government policies it would be possible for things to improve fairly quickly’.

The Labour party has to challenge this expectation forcefully now or there is a danger it becomes received wisdom. That would really hurt in 2015 because Labour voters could think that even if the party has nice ideas, those policies are simply not credible. Unlikely, you think? It actually happened to Ken Livingstone (many voters simply didn’t believe he could cut train fares).

The pessimism of the public, and convincing them that Labour has an alternative that would actually work, is likely their biggest challenge in 2015. It has to stop the national mood turning pessimistic.

—
Edit: I mistakenly used the wrong chart earlier. This has been corrected.

Ed M: these are six Bills Labour wants now

News

Ed Miliband will today set out six of the key economic Bills that would appear in a Labour Queen’s Speech next week.

The move us meant to challenge the rhetoric that Labour is not proposing what it offer as an alternative if it were in power. The party believes this would be a start to turn Britain’s economy around.

Labour’s economic plans include:

· A Jobs Bill to put in place a Compulsory Jobs Guarantee.
· A Finance Bill to kick-start our economy and introduce a 10p rate of tax.
· A Consumers Bill to tackle rip-off energy bills and train fares.
· A Banking Bill to help British businesses with new banks
· A Housing Bill that would take action against rogue landlords
· An Immigration Bill to put an end to workers having their wages undercut

He will use a speech in Newcastle-under-Lyme to highlight how this Tory-led Government has now had three years in office in which it has shown it is out of touch with the British people, run out of ideas on how to turn our country around, and carried on regardless with a failed economic plan.

He will say that in the last three years Britain has got worse, not better.

Jobs Bill
· Introduce a Compulsory Jobs Guarantee, a paid job for every adult who is out of work for more than two years. People would have to take up those jobs or lose benefits. The £1 billion costs can be funded by reversing the government’s decision to stop tax relief on pension contributions for people earning over £150,000 being limited to 20 per cent
· Guarantee a 6 month paid job for all young people out of work for over a year, paid for by a bank bonus tax. Those offered a job would be required to take it.
· Require large firms getting government contracts to have an active apprenticeships scheme that ensures opportunities to work for the next generation.

Banking Bill
· Create a real British Investment Bank on a statutory basis, at arms length from government and with proper financing powers to operate like a bank.
· Set out that one of its purposes is to support small and medium sized businesses, including across the regions of the UK through regional banks.
· Provide a general backstop power so that if there is not genuine culture change from the banks they can be broken up.
· Put in place a Code of Conduct for bankers so that those who break the rules are struck off.
· Toughen the criminal sanctions against those involved in financial crime.

Immigration Bill
· Double the fines for breaching the National Minimum Wage and give local councils the power to take enforcement action over the NMW
· Extend the Gangmasters Licensing Authority to other sectors where abuse is taking place.
· Change NMW regulations to stop employers providing overcrowded and unsuitable tied accommodation and offsetting it against workers’ pay.

Housing Bill
· Introduce a national register of landlords, to allow LAs to root out and strike off rogue landlords, including those who pack people into overcrowded accommodation.
· Tackle rip-off letting agents, ending the confusing, inconsistent fees and charges.
· Seek to give greater security to families who rent and remove the barriers that stand in the way of longer term tenancies.

Finance Bill
· Reintroduce a 10p rate of income tax, paid for by taxing mansions worth over £2m.
· Stop the cut to the 50p rate of income tax for those on the highest incomes to reverse cuts to tax credits.
· Reverse the Tory-led Government’s damaging VAT rise now for a temporary period – a £450 boost for a couple with children.
· Provide a one year cut in VAT to 5% on home improvements, repairs and maintenance – to help homeowners and small businesses
· Put in place a one year national insurance tax break for every small firm which takes on extra workers – helping small businesses to grow and create jobs

Consumers Bill
Energy:
· Abolish Ofgem and create a tough new energy watchdog with the power to force energy suppliers to pass on price cuts when the cost of wholesale energy falls
· Require the energy companies to pool the power they generate and to make it available to any retailer, to open the market and to put downward pressure on prices
· Force energy companies to put all over-75s on their cheapest tariff helping those benefiting to save up to £200 per year

Train
· Apply strict caps on fare rises on every route, and remove the right for train companies to vary regulated fares by up to 5 per cent above the average change in regulated fares.
· Introduce a new legal right for passengers to the cheapest ticket for their journey.

Pensions:
· Tackle the worst offending pension schemes by capping their charges at a maximum of 1 per cent;
· Amend legislation and regulation to force all pension funds to offer the same simple transparent charging structure so that consumers know the price they will be paying before they choose a particular scheme;

Key UKIPer went on marches with English Defence League

a) Section, News

This week UKIP had to disown a local election candidate Sue Bowen after it emerged she had been a BNP candidate.

Then it turned out another candidate, Anna-Marie Crampton, photographed with Farage two weeks ago, was caught spouting conspiracy theories about Jews and the Holocaust.

Now this blog has been sent evidence that a senior UKIP activist has close associations with the English Defence League.

Meet Cliff Dixon. He is chairman of the UKIP branch in Hillingdon, west London.

The founder of Ukip Hillingdon, Jason Pontey, is pictured here with Nigel Farage.

1. Dixon has been on demonstrations with the English Defence League. He earlier boasted on his blog that he “joined my friends from March for England to tag along on the EDL Tower Hamlets demonstration”.

2. Dixon has attended a number of nationalist marches with the relatively small ‘March for England’ group – who are close to the EDL. One event was co-organised with the British Patriots Society, which is described as “a tiny splinter of the English Defence League”.

Cliff Dixon has also posed with English Defence League activists and BNP figures.


(he’s on the right, and confirms the pic).

That isn’t the only image with EDL activists either.

The official UKIP position is that:

Membership is not available to anyone who is or has previously been a member of the British National Party, National Front, British Freedom Party, British People’s Party, English Defence League, Britain First or the UK First Party.

If UKIP thinks these parties are racist and wants nothing to do with them, then why does it tolerate prominent members associating with the English Defence League?

(hat-tip Stand for Peace blog)

UPDATE: The Hope Not Hate blog points out that another key member, Tony Nixon, has been caught saying lots of racist stuff on his Facebook account, and supporting the EDL.

George Osborne is watering down tax-avoidance changes to help Tory donors

a) Section, Blog, Conservative Party, Economy, Westminster

by Joseph Cottrell-Boyce

George Osborne’s recent budget day threat, that the government will no longer let tax avoiders ‘get away with it’ is unlikely to leave many quaking in their boots.

The coalition launched a consultation on the development of a General Anti-Avoidance Rule (GAAR) to tackle tax avoidance back in 2010.

In the intervening years, fears that a broad-spectrum GAAR might “erode the attractiveness of the UK’s tax regime” and undermine “sensible and responsible tax planning” have resulted in Osborne plumping for a watered-down ‘General Anti-Abuse Rule’.

Osborne doesn’t have to look far to see the scale of lost tax revenue through legal ‘tax-planning’. He could for instance look at the Conservative Party’s Millbank Tower landlords, David and Simon Reuben.

The Reuben brothers hold second place in the Forbes list of richest Britons, with a net worth of $10.5bn. They are long-time friends of the Conservatives, donating at least £563,290 to the party since 2008 via a spider’s web of companies. The biggest donor was ‘Investors in Private Capital Ltd’ which has coughed up £379,900 over the past five years. It turned over £37 million in 2011/12, and yet paid zero corporation tax.

Then there is Global Switch, the Reuben’s globe-spanning data centre company, which has former Conservative leader Michael Howard as a director. Global Switch turned over £133 million in 2011/12, but didn’t pay a penny in corporation tax. Other key Reuben Brothers’ companies such as Northern Racing, and Kirkglade Ltd have also managed avoid paying any corporation tax, despite multi-million pound turnovers.

How can this be? In the case of Global Switch, tens of millions of pounds of taxable profit vanishes from the balance sheets via huge loan interest payments to a fellow subsidiary undertaking based in the British Virgin Islands. A similar process occurs with Investors in Private Capital, with millions of pounds of interest paid to ‘TFB Mortgages Ltd’; a Reuben Brothers’ company registered in Ireland, with a British Virgin Islands parent company.

As a result of these ‘tax-efficient’ intra-group transactions, the Reuben Brothers legally get out of paying millions of pounds of corporation tax.

Their arrangements- and similar ones used by thousands of other rich individuals and companies in the UK- will almost certainly fall under the provision for ‘established practice’ in the new anti-abuse rule.

Tax Research UK estimate that the UK loses £25 billion a year in tax avoidance. This is revenue which could prevent further hardship for the millions of working families already struggling under austerity, and facing welfare cuts of £18 billion a year by 2015.

Osborne’s softly-softly approach to tax avoidance is more evidence if it where needed that the coalition is a government of the rich, for the rich, to the detriment of the rest of society.

—
Joe Cottrell-Boyce is a Policy Officer at the ICB’s Traveller’s Project