Many Western societies including our own are becoming organisationally dysfunctional and failing to serve the people – apart from the very rich. First there is the aberrant version of capitalism with which we are afflicted and which functions for the benefit of speculators, bankers, other disloyal outfits and the top few percent of the population. It increasingly fails to serve he majority who seek to work, work hard and pay their taxes. It sees them as milch cows from which to extract as much profit as possible – witness the banks, fuel and power companies, insurance companies and rail companies to name but a few – and pays no regard to employment exporting more jobs than goods. More than ever distant from a social market economy operating for the common good it is one reason why the gap between rich and poor continues to widen.
Then there is the political system and the lamentable government that arises out of it. One absolutely vital ingredient of a democratic political system fit for purpose is having the right amount of policy difference between parties so that the options placed before the electorate represent real alternatives that would lead to different trajectories and outcomes for society. But these days in this country you can hardly get a tissue paper between the policies of the main parties. For example none will contradict cutting and austerity even though this plainly and demonstrably does not work. At least two of the main parties actually believe in austerity as an economic policy. The third believes that the idea of cutting has been sold to the public and they are too frit to gainsay this and come forward with genuine Keynesian policies. There is thus effectively an informal political cartel forever looking over their shoulders and using the same focus group approach equally devoid of principle, courage or even an awareness of economic history.
What does it matter who gets elected if the policy choices are austerity, austerity or austerity? And of course it will continue not to work. Cuts push the domestic economy down and as countries, being each other's export markets, pile on the misery it is no use looking abroad. That only works if the others have different, more sensible and effective policies on which we can take a free ride. That isn't going to happen, as they all want export led recoveries. Instead we have national and international economic prescriptions equivalent to the 18th century medical 'cures' of leaches and bleeding. If the patient isn't recovering - then bleed some more.
This accounts for the interest in the United States with its mild Keynesian policies doing so much better than Europe. But for our cousins there the political situation is rather different. Their political system has been rendered dysfunctional by the capture of the Republican Party and much of the media by elements holding extreme right wing views and fat wallets. Checks and balances built into the constitution produce policy deadlock when faced with idiotic policies and a relentless, irrational and doctrinaire, refusal to compromise. Their Founding Fathers did not like the idea of political parties - you can now see why - and did not foresee the blight of spiteful intransigence with which their system is now afflicted.
The big worry is that short of a catastrophic upheaval here and elsewhere there is no evident solution to all of this - not even in the medium term. Elections need to matter, the common good should be to the fore, a basic morality should prevail and loyalty to community and country should permeate our economic as well as our social life. That's the essential change that we need to see along with an unwinding of globalisation. And yes, this latter could be done if the will was there in major western economies. The mutation of economic and political processes has taken deep hold but both are human creations not laws of nature as Smith and Marx would have had us believe. The economic and social world is what we choose to make it. Let’s hope there will be some real choices before us in the future.
Wednesday, 9 January 2013
Wednesday, 2 January 2013
Honouring Tolkien
Tolkien himself, ever modest, would probably have been surprised by this enthusiasm and the efforts that are made by local communities to commemorate and mark his legacy.
This year, the Tolkien Society is encouraging people to read Tolkien’s 1937 book ‘The Hobbit’ in the light of the success of Sir Peter Jackson’s recently released film: ‘The Hobbit: An Unexpected Journey’. The occasion of this year’s Birthday Toast will tie together the man himself, the books and the films – the Society will be encouraging people to talk about all of these on Facebook, Twitter and on its website, The Tolkien Society You can also be part of this at home or wherever you happen to be in a straightforward way. If you would like to join in, then at 9 in the evening by your local time, face West, raise a glass (containing whatever you like) and make the simple toast to 'The Professor'.
Birmingham is justly proud of its many close links with Tolkien and as a city we should do all that we can to increase the ways in which his unique legacy is commemorated. Tolkien was a Birmingham resident during his formative years and described himself as ‘a Birmingham man’. Each year in May Tolkien’s cultural legacy is celebrated at the unique, community-led Middle-earth Weekend that is held at Sarehole Mill.
Monday, 24 December 2012
Saturday, 22 December 2012
A Living Wage
The Living Wage has been in the news frequently after the figures for 2012 were published in November – and rightly so. It’s not a new idea though, the concept going back at least as far as 1894. 108 years on, The Living Wage Foundation is promoting its implementation and has done so for over 10 years. The new figure of £7.45 per hour is scarcely a king’s ransom but at least it is higher than the current minimum wage for adults of £6.19. That difference is important.
The Centre for Research in Social Policy calculates the Living Wage periodically by looking at the costs of a basket of goods and services that a family needs to reach a minimum acceptable standard of living. It covers more than just the items that are needed for rudimentary survival, such as food, clothing and rent. The calculation includes what is needed to reach a standard of living that is the minimum that is acceptable to a panel of members of the public. It is not at all surprising that this acceptable standard has gone down somewhat since impact of the financial calamity that began in 2008 continues to ripple through.
Almost all people wish to provide for themselves by working for a living (where work still exists and where jobs have not been exported by private sector companies or are being destroyed - as at Remploy – by government). In return, employees should clearly be paid a living wage for their work. People should be able to earn enough on which to live through their work alone. If companies want someone to do a job for them, then they should pay that person enough to reach the minimum standard.
The introduction of the Minimum Wage was a good first step towards paying a living wage, but the level is set too low for a family to live on. People on very low pay therefore often have to rely on support from the state to make ends meet. These benefits are effectively a subsidy to those employers who pay their employees less than enough to live on - with the balance taken from the pockets of the taxpayer. A Living Wage allows people to earn enough on which to live without the state having to intervene in yet another failure of the current rapacious and unprincipled version of capitalism.
All this of course stands in stark contrast to what typically happens at board level. There is an urgent need for sweeping, lasting and inescapable changes to the way in which top-level executives have their pay, bonuses and exit payments decided and the way that they are assessed for tax - and the many ways that legitimate tax is avoided both by individuals and companies some of whom pay less than the Living Wage.
It is entirely wrong that directors’ pay continues to rise at ten per cent a year while many employees are having their wages cut or frozen and their working conditions worsened. The values of fairness and responsibility should apply throughout companies, and in the setting of top-level pay there should be no further rewards for failure and no more huge and unwarranted executive pay increases – frequently made at the expense of low-paid workers.
The Fair Pensions' Just Pay! campaign aims permanently to embed Living Wage standards in the country’s private sector, beginning with the biggest companies listed on the London Stock Exchange, namely the FTSE 100. Companies today cannot be counted upon to do the decent thing of their own accord so it will have to be made a requirement to end the present injustice and exploitation.
The Centre for Research in Social Policy calculates the Living Wage periodically by looking at the costs of a basket of goods and services that a family needs to reach a minimum acceptable standard of living. It covers more than just the items that are needed for rudimentary survival, such as food, clothing and rent. The calculation includes what is needed to reach a standard of living that is the minimum that is acceptable to a panel of members of the public. It is not at all surprising that this acceptable standard has gone down somewhat since impact of the financial calamity that began in 2008 continues to ripple through.
Almost all people wish to provide for themselves by working for a living (where work still exists and where jobs have not been exported by private sector companies or are being destroyed - as at Remploy – by government). In return, employees should clearly be paid a living wage for their work. People should be able to earn enough on which to live through their work alone. If companies want someone to do a job for them, then they should pay that person enough to reach the minimum standard.
The introduction of the Minimum Wage was a good first step towards paying a living wage, but the level is set too low for a family to live on. People on very low pay therefore often have to rely on support from the state to make ends meet. These benefits are effectively a subsidy to those employers who pay their employees less than enough to live on - with the balance taken from the pockets of the taxpayer. A Living Wage allows people to earn enough on which to live without the state having to intervene in yet another failure of the current rapacious and unprincipled version of capitalism.
All this of course stands in stark contrast to what typically happens at board level. There is an urgent need for sweeping, lasting and inescapable changes to the way in which top-level executives have their pay, bonuses and exit payments decided and the way that they are assessed for tax - and the many ways that legitimate tax is avoided both by individuals and companies some of whom pay less than the Living Wage.
It is entirely wrong that directors’ pay continues to rise at ten per cent a year while many employees are having their wages cut or frozen and their working conditions worsened. The values of fairness and responsibility should apply throughout companies, and in the setting of top-level pay there should be no further rewards for failure and no more huge and unwarranted executive pay increases – frequently made at the expense of low-paid workers.
The Fair Pensions' Just Pay! campaign aims permanently to embed Living Wage standards in the country’s private sector, beginning with the biggest companies listed on the London Stock Exchange, namely the FTSE 100. Companies today cannot be counted upon to do the decent thing of their own accord so it will have to be made a requirement to end the present injustice and exploitation.
Wednesday, 19 December 2012
How to Make Companies Act with Integrity
When considering private sector regulation it is sometimes asserted by vested interests and their allies in parliament that competition from a state owned enterprise, or one that was operated by what remains of Local Government, would be unfair to the rest. But as the continued ruthless exploitation of consumers demonstrates, an effect on the rest is precisely what is needed.
The financial barrow boys who misled the country and dragged down the economy - and who have since had further shameful practices exposed -are not alone. This ‘industry’ is just one example of the unprincipled way in which private sector outfits now operate. Effective action – not simply cosmetic – needs to be taken if the interests of ordinary people are to be brought back to the fore. Government promises and procrastination until anger over the latest outrage subsides will not do.
‘Competition’ has come to mean little more than competition for maximum profit by whatever means. These include misusing the loyalty of longstanding – usually elderly – customers and by the use of complex charging schemes designed to confuse. In banking there is the common practice of slipping people into accounts with even more derisory rates of interest when bonds mature and salami slicing interest in ISAs so there’s hardly any difference to taxed accounts.
Creeping cartelisation is a feature of a number of other so-called competitive industries too – witness the power companies managing their latest round of price hikes. The regulators range from inadequate to useless. Orthodox consumer groups complaining into the ether and taking little action have also proved to be ineffective so it is good to see some direct action taking place.
Governments, not infrequently ideologically driven, not wanting to upset important political donors, do as little as they think they can get away with (and then complain about ‘apathy’ and low turnouts in elections). Unmitigated ‘competition’, meaning little more these days than an economic free-for-all, is well past its sell-by date.
But there is a way of making finance, fuel, power and other industries heed the public interest and behave with a measure of integrity. If each of these sectors had a publicly owned firm within it acting as an exemplar, treating people in a respectful, honest and straightforward fashion rather than merely as profit fodder this would introduce a form of competition that is worthwhile to society as a whole. It would offer security and fairness to ordinary people, presently suffering relentless abuse by commercial predators.
As I’ve often suggested, there would be no better place to start than with the recreation of Municipal Banks – in so far as the Government would still allow fully-fledged Municipal Banks to operate in a meaningful way. Once the success of this was demonstrated we could then move on to other areas, starting with the railways and the franchised companies’ love of cancellations, outrageous fare hikes, complex pricing schemes and overcrowded carriages.
The financial barrow boys who misled the country and dragged down the economy - and who have since had further shameful practices exposed -are not alone. This ‘industry’ is just one example of the unprincipled way in which private sector outfits now operate. Effective action – not simply cosmetic – needs to be taken if the interests of ordinary people are to be brought back to the fore. Government promises and procrastination until anger over the latest outrage subsides will not do.
‘Competition’ has come to mean little more than competition for maximum profit by whatever means. These include misusing the loyalty of longstanding – usually elderly – customers and by the use of complex charging schemes designed to confuse. In banking there is the common practice of slipping people into accounts with even more derisory rates of interest when bonds mature and salami slicing interest in ISAs so there’s hardly any difference to taxed accounts.
Creeping cartelisation is a feature of a number of other so-called competitive industries too – witness the power companies managing their latest round of price hikes. The regulators range from inadequate to useless. Orthodox consumer groups complaining into the ether and taking little action have also proved to be ineffective so it is good to see some direct action taking place.
Governments, not infrequently ideologically driven, not wanting to upset important political donors, do as little as they think they can get away with (and then complain about ‘apathy’ and low turnouts in elections). Unmitigated ‘competition’, meaning little more these days than an economic free-for-all, is well past its sell-by date.
But there is a way of making finance, fuel, power and other industries heed the public interest and behave with a measure of integrity. If each of these sectors had a publicly owned firm within it acting as an exemplar, treating people in a respectful, honest and straightforward fashion rather than merely as profit fodder this would introduce a form of competition that is worthwhile to society as a whole. It would offer security and fairness to ordinary people, presently suffering relentless abuse by commercial predators.
As I’ve often suggested, there would be no better place to start than with the recreation of Municipal Banks – in so far as the Government would still allow fully-fledged Municipal Banks to operate in a meaningful way. Once the success of this was demonstrated we could then move on to other areas, starting with the railways and the franchised companies’ love of cancellations, outrageous fare hikes, complex pricing schemes and overcrowded carriages.
Tuesday, 18 December 2012
The Lunar Society
We are fortunate in Birmingham to have such a splendid organisation as the Lunar Society. Since its welcome re-incarnation in the 1980s, the Lunar Society has played a key role as an independent and productive forum for debate on scientific, engineering, medical, economic and related issues.
The Society brings together people from a wide range of professional, academic and industrial backgrounds to address important concerns of today and possibilities for tomorrow. The resultant understanding achieved is highly relevant to the present and future of our City, our Region and the wider world.
The global aspect is there because, true to its origins, the Lunar Society has made a major input and helped to raise the profile of matters of international importance. One example is the memorable focus on climate change and sustainable living which attracted an audience of several hundred to its main debate.
The 'Lunar mindset' matters every bit as much today as it did over two centuries ago when the Society was originally formed. Indeed in these austere and straightened times the work of the Society is more important than ever, seeking as it does to promote and connect innovative thinking in science, economics and culture and to catalyze action for the enhancement of the common good.
That we have such a visionary organisation with its foundations here in Birmingham is a great credit to the country's premier city outside of the capital. The Lunar Society website is well worth a visit covering upcoming events, speakers and discussions and membership arrangements.
The Society brings together people from a wide range of professional, academic and industrial backgrounds to address important concerns of today and possibilities for tomorrow. The resultant understanding achieved is highly relevant to the present and future of our City, our Region and the wider world.
The global aspect is there because, true to its origins, the Lunar Society has made a major input and helped to raise the profile of matters of international importance. One example is the memorable focus on climate change and sustainable living which attracted an audience of several hundred to its main debate.
The 'Lunar mindset' matters every bit as much today as it did over two centuries ago when the Society was originally formed. Indeed in these austere and straightened times the work of the Society is more important than ever, seeking as it does to promote and connect innovative thinking in science, economics and culture and to catalyze action for the enhancement of the common good.
That we have such a visionary organisation with its foundations here in Birmingham is a great credit to the country's premier city outside of the capital. The Lunar Society website is well worth a visit covering upcoming events, speakers and discussions and membership arrangements.
Thursday, 13 December 2012
The Wonderful World of ‘Competition’
The recent outrageous further round of price hikes from power supply companies will have a severe impact on a wide range of people particularly, but by no means only, the millions already in desperate fuel poverty.
Average bills, already well into four-figure territory, will be pushed much higher still. The fuel companies benefit from a so-called ‘market’ where the main inter-company rivalry is about getting away with additional charges and inflated prices, making more profits, taking bigger bonuses and treating people as monetary cannon fodder. Another example, as if we needed it, of the wonderful world of competition.
Like banks and other notorious and parasitic sections of business today, they operate in effect, quite legally, as an informal cartel. They set their prices and margins in the same way and take it in turns to hike prices according to what they think they can get away with. Whether it’s gas, electricity or petrol, one thing is certain, unless there is official action these outfits will be getting a way with a lot more of your money and mine and their profits will not suffer one bit as a result.
Still, at least we needn’t lose sleep at night worrying about their oh-so-vital-to-the-economy executives’ remuneration or their shareholders profits - they at least will be comfortable in success or failure and can look forward to a tax cut next year. Even if pensioners can’t afford to keep a room warm, the board members will still have plenty of money to burn!
I would love to see a publicly owned exemplar company set up making fair, consistent and simple charges – some hopes! Failing this, in my opinion there should be frequent windfall taxes on fuel, power (and other) profiteering – the only questions should be about the extent and the use of the proceeds. It is clearly wrong that companies should make fat and inflated profits while people struggle to make ends meet, faced with rapidly rising costs for heating and other essentials such as food or even hanging on to their own homes.
Fuel and power supply are dominated by a small number of firms that are allowed in turn dominate you and me. These industries are classic ‘oligopoly’ structures, the shortcomings of which were once well understood. Industry ‘regulation’ in all quarters has been weak under successive governments and will remain so.
The exhortation to ordinary people to ‘shop around’ is worth little over time. It has been found out that a third of switchers make themselves worse off. And do they think that elderly and now vulnerable people who have built the country up should be spending their retirement time ‘switching’ between fuel companies (and banks) to reduce the extent to which they are exposed to highway robbery?
It is no defence for these organisations to retort that they are operating globally. Who has paid to make their fat global profits possible in the first place? We have! We’ve already paid ‘global’ companies with the British jobs they have exported and the higher prices they extract from us for the same products sold in other countries. This has fattened their profits and we’re entitled to a return on that too!
Since privatisation, foreign owned firms with even less concern for people in this country, sell North Sea gas to themselves during the summer for storing in Europe and reselling here at higher prices in the winter. Those companies who use (by whose consent?) the label ‘British’ should be made to act as if they were. Big business in general should not be a morality-free zone. They should think of those who have to eke out a small pension. They talk about their tough choices. How would they like to try the really tough choice between food and warmth?
Those who take big from society should also give back in comparable measure. Long gone are the days when those in near monopoly positions could be relied on to do this to some extent on their own account – or to be socially responsible and patriotic in the first place. So they need now to be taught how to be generous – or even pay their taxes. That would certainly be one way to create a warm glow all round!
Average bills, already well into four-figure territory, will be pushed much higher still. The fuel companies benefit from a so-called ‘market’ where the main inter-company rivalry is about getting away with additional charges and inflated prices, making more profits, taking bigger bonuses and treating people as monetary cannon fodder. Another example, as if we needed it, of the wonderful world of competition.
Like banks and other notorious and parasitic sections of business today, they operate in effect, quite legally, as an informal cartel. They set their prices and margins in the same way and take it in turns to hike prices according to what they think they can get away with. Whether it’s gas, electricity or petrol, one thing is certain, unless there is official action these outfits will be getting a way with a lot more of your money and mine and their profits will not suffer one bit as a result.
Still, at least we needn’t lose sleep at night worrying about their oh-so-vital-to-the-economy executives’ remuneration or their shareholders profits - they at least will be comfortable in success or failure and can look forward to a tax cut next year. Even if pensioners can’t afford to keep a room warm, the board members will still have plenty of money to burn!
I would love to see a publicly owned exemplar company set up making fair, consistent and simple charges – some hopes! Failing this, in my opinion there should be frequent windfall taxes on fuel, power (and other) profiteering – the only questions should be about the extent and the use of the proceeds. It is clearly wrong that companies should make fat and inflated profits while people struggle to make ends meet, faced with rapidly rising costs for heating and other essentials such as food or even hanging on to their own homes.
Fuel and power supply are dominated by a small number of firms that are allowed in turn dominate you and me. These industries are classic ‘oligopoly’ structures, the shortcomings of which were once well understood. Industry ‘regulation’ in all quarters has been weak under successive governments and will remain so.
The exhortation to ordinary people to ‘shop around’ is worth little over time. It has been found out that a third of switchers make themselves worse off. And do they think that elderly and now vulnerable people who have built the country up should be spending their retirement time ‘switching’ between fuel companies (and banks) to reduce the extent to which they are exposed to highway robbery?
It is no defence for these organisations to retort that they are operating globally. Who has paid to make their fat global profits possible in the first place? We have! We’ve already paid ‘global’ companies with the British jobs they have exported and the higher prices they extract from us for the same products sold in other countries. This has fattened their profits and we’re entitled to a return on that too!
Since privatisation, foreign owned firms with even less concern for people in this country, sell North Sea gas to themselves during the summer for storing in Europe and reselling here at higher prices in the winter. Those companies who use (by whose consent?) the label ‘British’ should be made to act as if they were. Big business in general should not be a morality-free zone. They should think of those who have to eke out a small pension. They talk about their tough choices. How would they like to try the really tough choice between food and warmth?
Those who take big from society should also give back in comparable measure. Long gone are the days when those in near monopoly positions could be relied on to do this to some extent on their own account – or to be socially responsible and patriotic in the first place. So they need now to be taught how to be generous – or even pay their taxes. That would certainly be one way to create a warm glow all round!
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