As speculation swirls as to whether the European Union (EU) or the International Monetary Fund will bail out Greece - a deal that in either case would stipulate crippling austerity measures on Greek workers--questions are emerging about the role that large banks played in making the crisis worse, and then profiting off it. Specifically, the question is whether the banksters hushed up the scale of Greece's debt situation, and then used that inside information to speculate on a potential default. Goldman Sachs is at the center of the scrutiny. Recent reports show that the firm consulted Greece as far back as 2000 on ways to take on more debt--and then hide it by packaging the liabilities into complex securities that were then counted as assets. It's the same kind of financial trickery that contributed to the massive housing boom and bust in the U.S. By hiding its new debts, Greece could circumvent stringent conditions on government budgets that the European Union imposes on member countries. And if that's not bad enough, it seems that Goldman used its insider knowledge of Greece's precarious financial situation to bet on a potential default by Greece. Thanks to its complicated financial maneuvers, the super-bank stands to make a killing in the event Greece defaults or needs to be bailed out. The culprit here is a familiar one. Goldman and other speculators are using credit default swaps as a way of gambling on the possibility that Greece will default--that is, it won't be able to repay its debts on time.
Credit default swaps are a kind of insurance policy that pays off if a particular bond or security defaults. The ostensible purpose of these credit default swaps--a form of the financial instruments that Wall Street calls "derivatives"--is for big investors to obtain financial protection against the possibility that a number of their investments could go bad. The idea is that the firms issuing credit default swaps agree to pay off what the original debtor owed. These swaps were popular during the sub-prime mortgage boom--they were supposed to be insurance for investors who bought securities that were based on large numbers of mortgage loans being paid off on time. It sounds fine in theory. But there are huge problems with credit default swaps. For one thing, the market for swaps is completely unregulated, and they aren't traded on public exchanges. That means a lot of backroom dealing can occur. Moreover, there's no limit on how many credit default swaps can be created and issued. So the market can swell to many times the size of the original assets or investments being "insured." Thus, the possibility that credit default swaps can turn from financial insurance to a gamble by speculators on whether homeowners or companies or whole countries will default on their debts. The lack of regulation allowed the market for credit default swaps to swell to such an enormous size, so that movements in the prices of derivatives can have knock-on effects on the real economy. Since 2000, the market for such swaps has ballooned from $900 billion to more than $36 trillion.
Credit default swaps helped drive the insurer AIG into insolvency. AIG had issued so many swaps backing up securities based on mortgage loans that when the U.S. housing market collapsed, the federal government nationalized AIG and pumped billions of dollars into the company so it could pay off its swaps. Because of all this, complex derivatives can have a massively destabilizing effect on the economy; which prompted super-rich investor Warren Buffet to call them "financial weapons of mass destruction." Importantly, investors don't actually have to own the asset that they are arranging a swap to cover. Thus, swaps can become a tool for gambling on defaults occurring--and can even contribute to defaults taking place. This is the equivalent of everyone else on a street buying fire insurance on one person's house--and then collecting when the house burns down. There's a reason that's illegal in the insurance business--the incentive is for all kinds of people to load up on insurance and then commit arson to collect. But on Wall Street, the same sort of activity applied to financial investments--called naked credit default swaps--is perfectly legal. In the case of Greece, it seems that the speculators have pushed the country closer to default.The growing demand for credit default swaps covering Greece have made it increasingly difficult for the country to raise money with newly issued bonds unless it pays a steep price--if it can find buyers at all. That increases demand for swaps still further, and so on, as the vicious cycle plays out. These practices forced even Federal Reserve Chair Ben Bernanke--hardly a critic of Wall Street--to admit last week, "Using these instruments in a way that intentionally destabilized a company or a country is--is counterproductive."
In Greece's case, the firestorm began last October when the government revealed it had a budget deficit that amounted to 12.7 percent of its gross domestic product. Overall, Greece's debt stands at $300 billion. As a percentage of GDP, that's three times the limit for member nations of the European Union. Concerns about Greece--along with Portugal, Italy and Ireland--have shaken confidence in the EU's currency, the euro, and prompted the EU to pressure Greece to get its books in order. The Greek government promised to cut the gap to 3 percent of GDP by 2012 by freezing public-sector salaries and raising taxes. It raised taxes on fuel earlier this month and has announced a series of further measures, including making Greeks collect receipts for goods and services, like taxi rides, in an effort to fight tax evasion. But more painful cuts are in store.
Greece has until March 16 to convince EU finance ministers and the executive European Commission that the steps it has already announced are enough. It also needs to borrow or refinance $72 billion--with nearly half of that amount due in April and May. The interest rate that Greece would have to pay on bonds that can raise this money is currently being valued at 7 percent--nearly double what Germany has to pay to borrow and 3 percentage points higher than Greece's borrowing costs before this crisis. This is the result of investors betting in various ways against Greek bonds. The problem has become so vexing that the German government is trying to identify speculators in Greek debt to prevent them from profiting from any bailout. Here is where Goldman Sachs' damaging influence comes into play. In 2001, Goldman advised Greece to turn some of its debts into derivatives that could then be counted as assets rather than liabilities, thus hiding the real level of debt. As the New York Times described: "As in the American sub-prime crisis and the implosion of [AIG], financial derivatives played a role in the run-up of Greek debt. Instruments developed by Goldman Sachs, JPMorgan Chase and a wide range of other banks enabled politicians to mask additional borrowing in Greece, Italy and possibly elsewhere...Critics say that such deals, because they are not recorded as loans, mislead investors and regulators about the depth of a country's liabilities."
A report in the German newspaper FAZ indicates that AIG sold the credit default swaps on Greece. Ultimately, these transactions enabled Greece to borrow 1 billion euros without adding to its official debt--and according to Bloomberg, Goldman was paid $300 million for arranging the deal. And that was just one deal. According to the New York Times, a legal entity called Aeolos, created in 2001, gave Greece cash upfront in return for pledging future landing fees at the country's airports. A similar deal in 2000, called Ariadne, did something similar with revenue from Greece's national lottery. Similar deals were structured by Goldman and other banks, including from Europe. In late 2009, Goldman came calling again. A team, led by Goldman President Gary Cohn, proposed that Greece push debt from its health care system into the future by creating another set of derivatives. The proposal was rejected. But Goldman wasn't done. It had loaded up on credit default swaps covering a default by Greece. "Wall Street, led here by Goldman and AIG, helped to create the debt, then helped to create the hysteria about possible defaults," Marshall Auerback, a professor of economics at the University of Missouri-Kansas City, wrote. "As [credit default swap] prices rise and Greece's credit rating collapses, the interest rate it must pay on bonds rises--fueling a death spiral because it cannot cut spending or raise taxes sufficiently to reduce its deficit." The overall amount of swaps on Greek debt hit $85 billion in February, up from $38 billion a year ago, according to the Depository Trust and Clearing Corporation, which tracks swaps trading.
As a result of these activities, the Securities and Exchange Commission and Federal Reserve Bank are investigating the role that Goldman played. But given the kid-gloves treatment that Goldman has received--not to mention the extent that it's already been bailed out by the government--it seems highly unlikely that anything will come of these inquiries. As Gretchen Morgenson wrote in the New York Times: "If the past is prologue, we might see a case or two emerge from that inquiry five years from now. The fact is that credit default swaps and other complex derivatives that have proved to be instruments of mass destruction still remain entrenched in our financial system three years after our economy was almost brought to its knees." Worse, it's now clear that the U.S. government will do whatever it takes to bail out financial firms out and keep them solvent, even when their gambling blows up in their faces. This implicit guarantee is only encouraging more reckless behavior. Whilst Goldman cashes in and likely gets off scot-free for helping to cause the crisis, the working class stands to be punished brutally. Over the past month, the Greek government has already announced wage freezes, bonus cuts, tax crackdowns and pension reforms meant to save about $6.7 billion. New measures that could be part of a bailout plan engineered by the EU could include a 2 percent increase in the country's value-added tax--already at 19 percent--higher fuel prices and the possible abolition of one of two additional months of pay received by public-sector workers and employees at many private firms. In other words, the costs of Greece's default are being passed on to workers.
What's more, Germany's involvement in the bailout is creating a race to the bottom across national borders in Europe. "Germany has, in the last 10 years, been through very painful social reform, which means curtailing rights and social benefits, and pushing back the retirement age," Thomas Klau of the European Council on Foreign Relations told the New York Times. "The argument in Germany is 'Why should our workers work to the age of 67 to enable Greeks to retire earlier?'" The harsh measures in Greece will ultimately make things worse. As economists Simon Johnson and Peter Boone wrote, austerity programs in Greece and other countries with high debt loads could "massively curtail demand, lower wages and reduce the public-sector workforce. The last time we saw this kind of precipitate fiscal austerity--when nations were tied to the gold standard--it contributed to the onset of the Great Depression in the 1930s." In addition, privatizations--also done at the behest of financial firms like Goldman--mean that former sources of government revenue, such as toll roads, are no longer in the state's hands--leaving it even less able to pay its public debt. Thus, the pay cuts and austerity programs could end up exacerbating defaults and necessitating another round of reductions--exactly when governments should be running up deficits to hire unemployed workers, pay out benefits and stimulate economic activity. That's the cost of the vicious cycle that the banksters set in motion.
Monday, 10 May 2010
Sunday, 9 May 2010
Stand by Greek workers
As was not only predictable, but inevitable, the people of Greece have turned out onto the streets in their tens and hundreds of thousands to show their resistance to the draconian economic measures being forced on them by the European Union and the ECB. The organised Greek working class has sent and is still sending a strong message to its own government and those "friendly" governments that are supposedly bailing out the Greek economy. And that message is that they will not stand idly by while, under the pretext of friendly assistance to their country, the privatisers and market parasites of the EU strip them of their wages and their pensions, extend their working lives and demolish their public sector. They will not allow a weak, supposedly socialist, government to collapse under pressure applied by a pincer movement of the EU on the one hand and the finance sector on the other. Rather, they will fight on the streets and in the factories and offices to ensure that those who caused the crisis will pay for it and that isn't the Greek working class. In this country, the Greek crisis has produced an outbreak of appallingly bigoted national stereotyping, with the Greek people being variously described as lazy, shiftless and indolent and greedy in the Tory press. Such slanderous and vicious assaults on a people who are the victims, rather than the offenders, are distasteful in the extreme, but illustrate well just how far down the line the capitalist offensive will go to justify its raids on the living standards of ordinary people. We must be very clear on this. The Greek bail-out is no such thing.
It is an orchestrated attempt to turn Greece into a wasteland, a battleground where free-market capitalism can first kill civil society in the country and then pick over the corpse, stealing what it can and wrecking what it can't, a forced auction of a whole country's assets to the highest bidder. And what rankles deepest with the organised working class in Greece is that it is the representatives of capitalism who caused the crisis in the first place, it is those same capitalists who will benefit from the auction of the country and it is that very same class that isn't being asked for any sacrifices to remedy the crisis that they caused. Let's not forget also that the latest episode in the Greek crisis was precipitated by yet another capitalist edifice, the ratings agency structure that downgraded Greek debt to junk status - those same ratings agencies that gave AAA ratings to billions of dollars of residential mortgage-backed securities which precipitated the near collapse of the world economy. The Greek trade unions are quite clear about it. They will never accept the destruction of their country as the price of bailing out a rich class of greedy tax evaders and profiteers. And in their statements over the last few days, they send a warning to workers in other countries. They are right to do so. The measures being forced on them by the EU as the price of support are precisely the same measures being punted by the new Labour, Tory and Lib Dem friends of the ruling class to reduce the national debt level in this country.
This is no coincidence. It is part of the world-wide drive by capitalism to reverse the tide of history, to attack working class living standards and to shrink the edifices built up to benefit ordinary people. The price of a decent life for all is to high for capitalism to accept. The capitalist system has bought itself a continuation long past its sell-by date, but it is no longer prepared to tolerate the carrot. It's now time for the big stick, because they will not tolerate anything eating into their profits and civil society is doing just that. We wish the Greek workers well in their fight and urge everyone to show what solidarity that they can. Our fight will come sooner than we might expect.
It is an orchestrated attempt to turn Greece into a wasteland, a battleground where free-market capitalism can first kill civil society in the country and then pick over the corpse, stealing what it can and wrecking what it can't, a forced auction of a whole country's assets to the highest bidder. And what rankles deepest with the organised working class in Greece is that it is the representatives of capitalism who caused the crisis in the first place, it is those same capitalists who will benefit from the auction of the country and it is that very same class that isn't being asked for any sacrifices to remedy the crisis that they caused. Let's not forget also that the latest episode in the Greek crisis was precipitated by yet another capitalist edifice, the ratings agency structure that downgraded Greek debt to junk status - those same ratings agencies that gave AAA ratings to billions of dollars of residential mortgage-backed securities which precipitated the near collapse of the world economy. The Greek trade unions are quite clear about it. They will never accept the destruction of their country as the price of bailing out a rich class of greedy tax evaders and profiteers. And in their statements over the last few days, they send a warning to workers in other countries. They are right to do so. The measures being forced on them by the EU as the price of support are precisely the same measures being punted by the new Labour, Tory and Lib Dem friends of the ruling class to reduce the national debt level in this country.
This is no coincidence. It is part of the world-wide drive by capitalism to reverse the tide of history, to attack working class living standards and to shrink the edifices built up to benefit ordinary people. The price of a decent life for all is to high for capitalism to accept. The capitalist system has bought itself a continuation long past its sell-by date, but it is no longer prepared to tolerate the carrot. It's now time for the big stick, because they will not tolerate anything eating into their profits and civil society is doing just that. We wish the Greek workers well in their fight and urge everyone to show what solidarity that they can. Our fight will come sooner than we might expect.
Election egg on all faces
There was a great deal of egg on a few faces on Friday and it was on the faces of the three self-satisfied party leaders who so oleaginously greased their way across our TV screens over the last week or two in staged and rigged "debates" that were nothing of the sort. Tory toff David Cameron had the egg white all over his face after the electorate refused to back his party for a parliamentary majority even standing against Labour's attempt for a rare and difficult fourth term. No matter what gloss he tries to put upon it, his masters in the shires and the boardrooms will not be best pleased. He couldn't even beat a sitting government in the middle of a financial crisis. And the yolk was on media-manufactured Lib-Dem leader Nick Clegg, whose "Clegg bounce" turned out to be nothing more than press hysteria motivated by a desire to do anything possible to block Labour survival and resulted in a reduced number of seats for his party. New Labour's Gordon Brown took the rest of the oeuf. His walking-on-eggshells attempt to be all things to all voters backfired on him hopelessly and he has found himself clinging to power by his disintegrating fingernails. The message that came across was loud and clear for anyone with the ears to hear it. There was so little difference between the "nice-party" Tories, the business-friendly new Labour and the "I-don't-know-quite-where-I-stand" Lib Dems that voters ended up with no clear motive for supporting any one of them. That message was underlined by the votes for the few Labour candidates who have had the courage and the pride to stand up and be counted as socialists.
Their votes ran hard against the national trend and increased. In Hayes and Harlington, John McDonnell polled 23,377 votes as against 19,009 in 2005. In Islington North, Jeremy Corbyn took his vote to 24,276 from 16,118 in 2005 and, in Luton North, Kelvin Hopkins lifted his vote from 19,062 to 21,192 in 2010. In Hackney and Stoke Newington, Diane Abbott has had a belting result, with a rise from 14,268 to 25,500. Progressive activity against the fascists also helped the Labour vote. In Barking, where anti-fascists have fought hard and long, Margaret Hodge's vote soared from 13,826 in 2005 to a spanking 24,628 in 2010, while the disgusting Nick Griffin foundered dismally. The Tories are banging on about their "right" to attempt to form the next government, while the pathetic Nick Clegg bleats on about their "right" as the party with the most seats to try to do so. Of course, no such right exists. Constitutionally, the initiative rests with the incumbent Prime Minister, in this case Mr Brown. But where grabbing power is concerned, the constitutional arrangements that exist can go hang as far as the Tories care. Mr Cameron is already manoeuvring to try and talk the Lib Dems into a coalition, although without proportional representation on offer, it would be an absolutely unprincipled and opportunist Lib Dem leader who went for the deal - so it might happen. Labour, on the other hand, has fewer objections to PR and a deal is possible there, if Mr Brown can overcome his reluctance to offer more than a referendum, which has not met Lib Dem expectations in the past.
There could even be progressive benefits to be found on a deal on PR, provided a suitable system could be agreed, so it is tempting to watch and hope that an accommodation can be agreed that provides for an anti-Tory alliance of some form. Because the overwhelming priority is to keep the Tories out of office and keep their avaricious hands off the public sector. But we must keep this in mind. The biggest loser in this election has not been a party, but a poisonous clique. New Labour is dead and it just remains to accord it a suitable burial. Then we can set about building a working-class force that will bury the Tories that Mr Brown has been so signally unable to defeat with his pallid and bloodless apology for a socialist platform.
Their votes ran hard against the national trend and increased. In Hayes and Harlington, John McDonnell polled 23,377 votes as against 19,009 in 2005. In Islington North, Jeremy Corbyn took his vote to 24,276 from 16,118 in 2005 and, in Luton North, Kelvin Hopkins lifted his vote from 19,062 to 21,192 in 2010. In Hackney and Stoke Newington, Diane Abbott has had a belting result, with a rise from 14,268 to 25,500. Progressive activity against the fascists also helped the Labour vote. In Barking, where anti-fascists have fought hard and long, Margaret Hodge's vote soared from 13,826 in 2005 to a spanking 24,628 in 2010, while the disgusting Nick Griffin foundered dismally. The Tories are banging on about their "right" to attempt to form the next government, while the pathetic Nick Clegg bleats on about their "right" as the party with the most seats to try to do so. Of course, no such right exists. Constitutionally, the initiative rests with the incumbent Prime Minister, in this case Mr Brown. But where grabbing power is concerned, the constitutional arrangements that exist can go hang as far as the Tories care. Mr Cameron is already manoeuvring to try and talk the Lib Dems into a coalition, although without proportional representation on offer, it would be an absolutely unprincipled and opportunist Lib Dem leader who went for the deal - so it might happen. Labour, on the other hand, has fewer objections to PR and a deal is possible there, if Mr Brown can overcome his reluctance to offer more than a referendum, which has not met Lib Dem expectations in the past.
There could even be progressive benefits to be found on a deal on PR, provided a suitable system could be agreed, so it is tempting to watch and hope that an accommodation can be agreed that provides for an anti-Tory alliance of some form. Because the overwhelming priority is to keep the Tories out of office and keep their avaricious hands off the public sector. But we must keep this in mind. The biggest loser in this election has not been a party, but a poisonous clique. New Labour is dead and it just remains to accord it a suitable burial. Then we can set about building a working-class force that will bury the Tories that Mr Brown has been so signally unable to defeat with his pallid and bloodless apology for a socialist platform.
Wednesday, 5 May 2010
Noxious election campaign stirs up racial division
This general election has been the one most dominated by immigration since 1979. Consider the two most important incidents of the past month.The first was hapless Gordon Brown’s encounter with Gillian Duffy in Rochdale. Brown’s behaviour—polite and patient to her face, calling her “a bigoted woman” behind her back—played into a favourite myth peddled by the tabloids and the British National Party (BNP). This is that “liberal elites” are happy to see Britain flooded by migrants and refuse to acknowledge the legitimate concerns of “ordinary people” about immigration.Brown himself clearly subscribes to a version of this myth. Having been caught out, he rushed to apologise to Mrs Duffy. This no doubt reflected a conviction that “ordinary people” are generally “bigoted” and that all Labour leaders can do is pander to anti-immigrant prejudice, however much they may privately dislike it. This is a longstanding attitude. The diaries of Richard Crossman, Labour cabinet minister in the 1960s, repeatedly express the belief that his working class voters in Coventry were racists who wanted tighter immigration controls.The second key event for Brown was, of course, the final television debate between the leaders of the three main parties. This was descending into tedium until immigration came up. We were treated to the spectacle of Brown and David Cameron rounding on Nick Clegg to denounce the Liberal Democrats’ proposal to offer an amnesty to some illegal immigrants. This was partly about the representatives of the old two-party system whacking the new kid on the block.
But Cameron and Brown were also trying to signal that they were hard on immigration. The anger that Clegg displayed in his clashes with Cameron on this issue no doubt reflected anxiety that he was being portrayed as “soft” on migrants.The irruption of immigration in the final stages of the election has almost certainly worked to the Tories’ advantage. The Financial Times newspaper carried a piece on the subject last Saturday. Apparently Cameron initially resisted considerable pressure to make immigration central to the Tory election campaign, “fearful that the anti-immigration message peddled by his predecessor Michael Howard would spoil his attempts to detoxify the Tory brand. “Mr Brown’s travails and the debate questions have done Mr Cameron’s job for him, pushing immigration to the centre of the campaign without forcing him to look like the ‘nasty party’ of old. The subject was one of the hottest topics on Twitter on Friday.Tim Montgomerie, editor of the ConservativeHome website and voice of the party’s grassroots, was among those pushing for more aggression at the start of the campaign. But on Friday he told the Financial Times he was now ‘much happier’ with Mr Cameron’s strategy. It’s very interesting that the issue came up in all three debates and Cameron hit the issue very hard in the last one.’”Cameron’s strategy bears some resemblance to Margaret Thatcher’s in 1979. Immigration wasn’t formally central to the Tory campaign then either. But Thatcher had already, in her notorious World in Action interview of January 1978, made it clear where she stood: “People are really rather afraid that this country might be rather swamped by people with a different culture.”
This phrase—and particularly the use of the word “swamped”—was enough to signal to anyone hostile to migrants that Thatcher was one of them. It remains to be seen whether the way the election has tilted towards immigration will help to scrape Cameron together a parliamentary majority. Almost certainly it will benefit the hard anti-migrant parties—the BNP, but also UKIP. At 1979 general election, the Anti Nazi League had reversed the advance of the National Front. Alas, the BNP and the EDL are still on the offensive. Whoever forms the next government, anti-fascists will have plenty to do to undo the damage caused by this noxious election campaign.
But Cameron and Brown were also trying to signal that they were hard on immigration. The anger that Clegg displayed in his clashes with Cameron on this issue no doubt reflected anxiety that he was being portrayed as “soft” on migrants.The irruption of immigration in the final stages of the election has almost certainly worked to the Tories’ advantage. The Financial Times newspaper carried a piece on the subject last Saturday. Apparently Cameron initially resisted considerable pressure to make immigration central to the Tory election campaign, “fearful that the anti-immigration message peddled by his predecessor Michael Howard would spoil his attempts to detoxify the Tory brand. “Mr Brown’s travails and the debate questions have done Mr Cameron’s job for him, pushing immigration to the centre of the campaign without forcing him to look like the ‘nasty party’ of old. The subject was one of the hottest topics on Twitter on Friday.Tim Montgomerie, editor of the ConservativeHome website and voice of the party’s grassroots, was among those pushing for more aggression at the start of the campaign. But on Friday he told the Financial Times he was now ‘much happier’ with Mr Cameron’s strategy. It’s very interesting that the issue came up in all three debates and Cameron hit the issue very hard in the last one.’”Cameron’s strategy bears some resemblance to Margaret Thatcher’s in 1979. Immigration wasn’t formally central to the Tory campaign then either. But Thatcher had already, in her notorious World in Action interview of January 1978, made it clear where she stood: “People are really rather afraid that this country might be rather swamped by people with a different culture.”
This phrase—and particularly the use of the word “swamped”—was enough to signal to anyone hostile to migrants that Thatcher was one of them. It remains to be seen whether the way the election has tilted towards immigration will help to scrape Cameron together a parliamentary majority. Almost certainly it will benefit the hard anti-migrant parties—the BNP, but also UKIP. At 1979 general election, the Anti Nazi League had reversed the advance of the National Front. Alas, the BNP and the EDL are still on the offensive. Whoever forms the next government, anti-fascists will have plenty to do to undo the damage caused by this noxious election campaign.
A better democratic alternative
What could be done with £18.9 million? It could help fund a local hospital or school. But that figure is the limit on political parties for national spending in this general election. Cameron, Clegg or Brown's face on billboards, with a ridiculous message, are funded from the £18.9 million. And this figure is before the individual constituencies spend their money on their candidates. A British general election is nowhere near as expensive - yet - as in America, where a billion dollar election took place in 2008. But all three big parties have tried to get donations from companies. When Blair became leader and later prime minister, New Labour got millions from big business. However, the capitalists no longer believe that discredited New Labour can carry out the size of cuts to services and living standards that they require to make ordinary people pay for their crisis. And although Alan Sugar gave £400,000 recently, most big business funding to New Labour has dried up. The capitalists' hopes that the Tories will be elected were shown by Cameron's party getting the lion's share of donations in the week ending 13 April. They received nearly £1.5 million in a week from just 33 individual 'gifts'! They have also had millions of pounds in recent years from self-declared 'non-domiciled' Lord Ashcroft to spend in marginal constituencies.
The Liberal Democrats only received £20,000 that week but that was before the media-inspired 'Cleggmania' took hold. Increased donations will probably be reflected in the next figures. However, the Lib Dems have been allowed to keep a donation of £2.4 million from convicted fraudster Michael Brown! With the backing from big business cooling, New Labour has relied more on the trade unions to fund their campaign. The government has given workers very little in exchange over 13 years and trade unions have an even more restricted right to strike than in 1997. Yet still the trade unions fund this pro-capitalist party. Recently, the building workers' union Ucatt gave £371,000 and shop workers' union Usdaw donated £266,000 of their members' money. Unite has donated £11 million to Labour since the merged union was founded in 2007. Likewise Unison has given Labour around £1.5 million each year. Socialists do not believe trade unions should be non-political but they should donate money to parties representing their interests. New Labour does not do that. The Trade Unionist and Socialist Coalition (TUSC) has received donations from the RMT transport union but what effect could it have if trade unions funded genuine workers' candidates with millions of pounds? Trade unions must stop funding New Labour and put their resources into building a fighting alternative for workers.
The Liberal Democrats only received £20,000 that week but that was before the media-inspired 'Cleggmania' took hold. Increased donations will probably be reflected in the next figures. However, the Lib Dems have been allowed to keep a donation of £2.4 million from convicted fraudster Michael Brown! With the backing from big business cooling, New Labour has relied more on the trade unions to fund their campaign. The government has given workers very little in exchange over 13 years and trade unions have an even more restricted right to strike than in 1997. Yet still the trade unions fund this pro-capitalist party. Recently, the building workers' union Ucatt gave £371,000 and shop workers' union Usdaw donated £266,000 of their members' money. Unite has donated £11 million to Labour since the merged union was founded in 2007. Likewise Unison has given Labour around £1.5 million each year. Socialists do not believe trade unions should be non-political but they should donate money to parties representing their interests. New Labour does not do that. The Trade Unionist and Socialist Coalition (TUSC) has received donations from the RMT transport union but what effect could it have if trade unions funded genuine workers' candidates with millions of pounds? Trade unions must stop funding New Labour and put their resources into building a fighting alternative for workers.
Tory bigots fail to change ways
Homophobic remarks by Tory candidates have become an almost weekly occurrence in this election campaign. David Cameron claims that these comments do not represent the Conservative Party's real attitudes to same-sex relationships. But he constantly talks about "families" in a way that still upholds only one type of relationship as the ideal. In the run-up to the election, Cameron tried to present the Tories as friends of equality. The first major blow came only days before the election was called, with the release of a crackly recording of a private meeting in which shadow home secretary Chris Grayling said that guest house owners should be allowed to discriminate against same-sex couples. He argued that if someone is selling bed and breakfast "in their own home" they should have the right to discriminate on grounds of conscience. Grayling made his old Tory attitudes very obvious. His determination to see a guest house as a private house rather than a public service seems to have more to do with a belief in property than in liberty or conscience. It was some days before Grayling apologised, and the Tories have kept him well away from the front line of the campaign. They may have thought that they had managed to get through that controversy, but then a letter came to light in which shadow defence minister Julian Lewis argued that the age of consent for same-sex relations should never have been lowered to 16, because homosexual sex puts teenage boys at "serious physical risk."
Unlike Grayling, Lewis stuck to his guns when challenged by the press. Lewis's desire to protect young people from sexually transmitted infection might make sense if he wanted also to raise the age of consent for heterosexual acts. But while Lewis backs civil partnerships, his comments display a form of prejudice that is scarcely more subtle, associating gay and bisexual people with disease and assuming that it is acceptable for them to have fewer rights than others. The next two incidents involved less prominent individuals with rather more shockingly homophobic views. First Philip Lardner, Conservative candidate for North Ayrshire and Arran, claimed that homosexuality is not "normal." Then Philippa Stroud, candidate for the Tory target seat of Sutton and Cheam, hit the headlines for her involvement in the leadership of a homophobic church that "exorcises" people attracted to members of their own sex. While Lardner was removed, Stroud was allowed to stay. But then Lardner wasn't in a winnable seat. It seems that prejudiced and hateful attitudes lurk only slightly below the surface in Cameron's "new" Conservative Party. While Cameron has been keen to play down the embarrassing incidents, his own record of tolerance is hardly more laudable.
The Tory leader has said that his tax breaks for married couples would also apply to same-sex couples in civil partnerships, but he still hasn't adopted a policy of allowing same-sex marriage. In reality, the very existence of the tax breaks policy is based on a series of fundamental and fundamentally flawed Tory premises - that marriage is about going through a ceremony, rather than about what happens in people's hearts, that the interests of single people are not a priority, that couples must conform to conventional family structures and that - as Cameron said several times in the televised leaders' debates - it is "families" that really matter. Of course, it is not only the Tories who talk of prioritising families. The term "hard-working families" has been a catchphrase of both Gordon Brown and Tony Blair, who appear to believe that all single people are lazy. The main problem with this sort of rhetoric - and with the Tory Party's attitude to sexuality - is not homophobia as such, but "heteronormativity." In other words, same-sex couples are tolerated as long as they conform to certain narrow and restrictive expectations. Society's general acceptance of homosexuality and divorce has liberalised attitudes to sexuality, but the boundaries are still more rigid than is often acknowledged. Homosexuality and bisexuality are tolerated as outlying exceptions that need to be crammed into the heteronormative marriage model, rather than accepted fully as part of the diversity of human relationships. Heteronormativity is also oppressive towards heterosexuals. The word describes an attitude that assumes that the ideal relationship involves a couple in a long-term relationship bringing up children.
Of course, many people are suited to this form of family. But the idealisation of this relationship relegates many people to second class status - including single, divorced and widowed people, children whose parents do not live together, couples without children and those who practise polyamory or other unconventional forms of relationships. It can also cause huge harm even to married, mixed-sex couples with children, pressuring them to live up to the ideal. As someone who was brought up in a Christian family, I find it particularly outrageous that many of those who defend heteronormativity most strongly often link it with Christianity. They use euphemistic phrases such as "family values." Many people who have read the Gospels must surely find it baffling that so many followers of Jesus are keen to support "family values," given how much effort Jesus seemed to put into opposing them. He differed from the expectations of his time by not getting married, he allowed women to make physical contact with him in a society that disapproved of it and he shocked observers by befriending prostitutes. Jesus even redefined family, asking: "Who are my mother and my brothers?" and answering: "Whoever does the will of God is my brother and sister and mother." Cameron hopes to draw in Christian voters and others with "traditional values" with his rhetoric about "supporting families." Responding to a question about the Pope in the second leaders' debate, he said that the Roman Catholic Church still has "work to do" to convince people that its intolerant views have changed. So does the Tory Party.
Unlike Grayling, Lewis stuck to his guns when challenged by the press. Lewis's desire to protect young people from sexually transmitted infection might make sense if he wanted also to raise the age of consent for heterosexual acts. But while Lewis backs civil partnerships, his comments display a form of prejudice that is scarcely more subtle, associating gay and bisexual people with disease and assuming that it is acceptable for them to have fewer rights than others. The next two incidents involved less prominent individuals with rather more shockingly homophobic views. First Philip Lardner, Conservative candidate for North Ayrshire and Arran, claimed that homosexuality is not "normal." Then Philippa Stroud, candidate for the Tory target seat of Sutton and Cheam, hit the headlines for her involvement in the leadership of a homophobic church that "exorcises" people attracted to members of their own sex. While Lardner was removed, Stroud was allowed to stay. But then Lardner wasn't in a winnable seat. It seems that prejudiced and hateful attitudes lurk only slightly below the surface in Cameron's "new" Conservative Party. While Cameron has been keen to play down the embarrassing incidents, his own record of tolerance is hardly more laudable.
The Tory leader has said that his tax breaks for married couples would also apply to same-sex couples in civil partnerships, but he still hasn't adopted a policy of allowing same-sex marriage. In reality, the very existence of the tax breaks policy is based on a series of fundamental and fundamentally flawed Tory premises - that marriage is about going through a ceremony, rather than about what happens in people's hearts, that the interests of single people are not a priority, that couples must conform to conventional family structures and that - as Cameron said several times in the televised leaders' debates - it is "families" that really matter. Of course, it is not only the Tories who talk of prioritising families. The term "hard-working families" has been a catchphrase of both Gordon Brown and Tony Blair, who appear to believe that all single people are lazy. The main problem with this sort of rhetoric - and with the Tory Party's attitude to sexuality - is not homophobia as such, but "heteronormativity." In other words, same-sex couples are tolerated as long as they conform to certain narrow and restrictive expectations. Society's general acceptance of homosexuality and divorce has liberalised attitudes to sexuality, but the boundaries are still more rigid than is often acknowledged. Homosexuality and bisexuality are tolerated as outlying exceptions that need to be crammed into the heteronormative marriage model, rather than accepted fully as part of the diversity of human relationships. Heteronormativity is also oppressive towards heterosexuals. The word describes an attitude that assumes that the ideal relationship involves a couple in a long-term relationship bringing up children.
Of course, many people are suited to this form of family. But the idealisation of this relationship relegates many people to second class status - including single, divorced and widowed people, children whose parents do not live together, couples without children and those who practise polyamory or other unconventional forms of relationships. It can also cause huge harm even to married, mixed-sex couples with children, pressuring them to live up to the ideal. As someone who was brought up in a Christian family, I find it particularly outrageous that many of those who defend heteronormativity most strongly often link it with Christianity. They use euphemistic phrases such as "family values." Many people who have read the Gospels must surely find it baffling that so many followers of Jesus are keen to support "family values," given how much effort Jesus seemed to put into opposing them. He differed from the expectations of his time by not getting married, he allowed women to make physical contact with him in a society that disapproved of it and he shocked observers by befriending prostitutes. Jesus even redefined family, asking: "Who are my mother and my brothers?" and answering: "Whoever does the will of God is my brother and sister and mother." Cameron hopes to draw in Christian voters and others with "traditional values" with his rhetoric about "supporting families." Responding to a question about the Pope in the second leaders' debate, he said that the Roman Catholic Church still has "work to do" to convince people that its intolerant views have changed. So does the Tory Party.
Tuesday, 4 May 2010
Snog, marry, avoid election?
Just when you thought no-one could do any more damage to politics than politicians themselves, up steps the press. We are just days away from a general election in arguably the most critical decade in human history. So, what towering issue has the forensic scrutiny of the press homed in on? "Well, Mr Clegg, if push came to shove, who would you get into bed with?" I understand that there are over 30 permutations of what a (well) hung parliament might look like. Every press conference is dominated by questions about which position, in this political Kama Sutra, Nick Clegg is most drawn to for his next conquest. Does he prefer the cuddly self-inflatable Cameron or a bit of grumpy Brown bondage? I can't decide whether to weep, laugh or scream. We have passed the point at which serious climate damage can be avoided. What we do in the next five years will determine whether we manage our way through climate crises or slide inexorably towards climate chaos. To avoid global temperature rises of more than 2°C, annual carbon emissions have to peak by 2013 and reduce by at least 3 per cent a year thereafter. Britain's current reduction rate is 1 per cent. Even for climate sceptics, the alarm bells are ringing. Shell's 2009 annual report quietly states: "By 2015, growth in the production of easily accessible oil and gas will not match the projected rate of demand growth." Whether we face a single-dip or double-dip recession, there is an energy price spiral waiting at the end of it.
Peak oil will kick in at the same time that peak phosphate, peak soil and peak water do too. Energy security, food security, water and population migration will dominate the big picture politics of the next five years. Yet the press cannot get beyond asking Brown/Cameron/Clegg whose bum looks biggest in this picture. In all the kerfuffle about the volcanic disruption of air travel, the most important point was the least remarked on - Britain has become dependent on food imports to an extent that is as ludicrous as it is insecure. We store food in the air. Sixty-five per cent of the apples that we eat are flown in, along with 80 per cent of our apple juice, and all because we were stupid enough to tell British farmers to rip up their orchards because food was cheaper elsewhere. The volcano also brought about a mini-crisis in carnations (and roses and green beans) which could not be flown out of warehouses in Nairobi to adorn Britain's tables. No-one pointed out that this huge act of water sequestration from South to North goes on throughout a drought that leaves Kenyan tribes killing each other in pursuit of a trickle of water ... "but Mr Clegg, surely you must fancy one of them more than the other?" As each party finally gets round to unveiling their ecological agendas it is clear that the public choice is not one of change, but of small change.
Ed Miliband has brought the first fresh thinking Labour has had for years. Yet his best ideas have been scuppered or undermined by the infantile economics of the Treasury. On the occasions he escaped their clutches, the armlock of big energy and the drive of visionless officials turned any dash into a renewable energy future into little more than a shuffle. An energy crisis will hit us within five years. All the big transformations are being deferred until the decade after. Cameron seems to take the climate change issue more seriously than he is credited for. The hard question is whether the rest of his party gives a stuff. Radical decentralisation could turn Britain's towns and cities into the engine rooms of a new energy revolution, matching the leap into renewables you can already find in towns and cities across Europe. The trouble is that unless localities have the same duty as the country as a whole - ie meeting at least 15 per cent of their total energy needs from renewable sources by 2020 - none of this inventiveness will be unleashed. Devolution without duty is just hand-washing. And where is Clegg? Well, with Simon Hughes the Lib Dems have set off at a rare pace on energy and environmental transformation. He, and others, were willing to join Labour rebels and "boldly go" into seismic shifts that Downing Street recoiled from. The trouble was always in knowing whether their numbers would turn up to vote, making parliamentary votes a serious stand rather than a scouts and guides evening.
All parties talk about banking reform, but none will tell the financial sector that took Britain into the economic crisis, to pay the costs of bringing us out. Not one of the leaders promises that all future City bonuses must be matched by the same amount of bonds bought from the government's Green Infrastructure Bank. This would deliver at least £6bn a year as the City's contribution to direct ecological transformation. None of the leaders promise to end the scam of "trading" British carbon emissions, rather than reducing them ourselves. None are being challenged to do so. None will dump the delusion that Britain can offset its pollution by paying others to live a little more virtuously. None will change the rules of carbon accounting which claim that every transfer of production - and jobs - overseas pretends that Britain treads more lightly on the future. None will break the World Trade Organisation rules to prioritise British food security and more localised production. We live in a time where the central pillars in our economic system have become dysfunctional. They need to be broken and replaced, not because the British body politic needs a younger lover, but because we need a more meaningful and sustainable relationship with the future. Without this, the general election will resolve nothing. It will produce a parliament that is grumpy, fractious, introspective and short-lived. The dating game of leadership trysts will end in tears and recriminations. And the caravan of gossip columnists who used to be political correspondents will go off in search of a new romantic figure to take Britain out of the crises they currently choose to ignore. Without more fundamental change, the years ahead will spin Britain's economy round in a scarier way than any playground ride. No-one will have any doubt on which side the party leaders dress. They will all be pinned against the spinning wall of a ride that each remains wedded to. Britain's problems will not be addressed by a TV Snog, Marry, Avoid decision on May 6. If the press will not lift the debate onto a different level then the public - or ultimately the planet - will have to do so.
Peak oil will kick in at the same time that peak phosphate, peak soil and peak water do too. Energy security, food security, water and population migration will dominate the big picture politics of the next five years. Yet the press cannot get beyond asking Brown/Cameron/Clegg whose bum looks biggest in this picture. In all the kerfuffle about the volcanic disruption of air travel, the most important point was the least remarked on - Britain has become dependent on food imports to an extent that is as ludicrous as it is insecure. We store food in the air. Sixty-five per cent of the apples that we eat are flown in, along with 80 per cent of our apple juice, and all because we were stupid enough to tell British farmers to rip up their orchards because food was cheaper elsewhere. The volcano also brought about a mini-crisis in carnations (and roses and green beans) which could not be flown out of warehouses in Nairobi to adorn Britain's tables. No-one pointed out that this huge act of water sequestration from South to North goes on throughout a drought that leaves Kenyan tribes killing each other in pursuit of a trickle of water ... "but Mr Clegg, surely you must fancy one of them more than the other?" As each party finally gets round to unveiling their ecological agendas it is clear that the public choice is not one of change, but of small change.
Ed Miliband has brought the first fresh thinking Labour has had for years. Yet his best ideas have been scuppered or undermined by the infantile economics of the Treasury. On the occasions he escaped their clutches, the armlock of big energy and the drive of visionless officials turned any dash into a renewable energy future into little more than a shuffle. An energy crisis will hit us within five years. All the big transformations are being deferred until the decade after. Cameron seems to take the climate change issue more seriously than he is credited for. The hard question is whether the rest of his party gives a stuff. Radical decentralisation could turn Britain's towns and cities into the engine rooms of a new energy revolution, matching the leap into renewables you can already find in towns and cities across Europe. The trouble is that unless localities have the same duty as the country as a whole - ie meeting at least 15 per cent of their total energy needs from renewable sources by 2020 - none of this inventiveness will be unleashed. Devolution without duty is just hand-washing. And where is Clegg? Well, with Simon Hughes the Lib Dems have set off at a rare pace on energy and environmental transformation. He, and others, were willing to join Labour rebels and "boldly go" into seismic shifts that Downing Street recoiled from. The trouble was always in knowing whether their numbers would turn up to vote, making parliamentary votes a serious stand rather than a scouts and guides evening.
All parties talk about banking reform, but none will tell the financial sector that took Britain into the economic crisis, to pay the costs of bringing us out. Not one of the leaders promises that all future City bonuses must be matched by the same amount of bonds bought from the government's Green Infrastructure Bank. This would deliver at least £6bn a year as the City's contribution to direct ecological transformation. None of the leaders promise to end the scam of "trading" British carbon emissions, rather than reducing them ourselves. None are being challenged to do so. None will dump the delusion that Britain can offset its pollution by paying others to live a little more virtuously. None will change the rules of carbon accounting which claim that every transfer of production - and jobs - overseas pretends that Britain treads more lightly on the future. None will break the World Trade Organisation rules to prioritise British food security and more localised production. We live in a time where the central pillars in our economic system have become dysfunctional. They need to be broken and replaced, not because the British body politic needs a younger lover, but because we need a more meaningful and sustainable relationship with the future. Without this, the general election will resolve nothing. It will produce a parliament that is grumpy, fractious, introspective and short-lived. The dating game of leadership trysts will end in tears and recriminations. And the caravan of gossip columnists who used to be political correspondents will go off in search of a new romantic figure to take Britain out of the crises they currently choose to ignore. Without more fundamental change, the years ahead will spin Britain's economy round in a scarier way than any playground ride. No-one will have any doubt on which side the party leaders dress. They will all be pinned against the spinning wall of a ride that each remains wedded to. Britain's problems will not be addressed by a TV Snog, Marry, Avoid decision on May 6. If the press will not lift the debate onto a different level then the public - or ultimately the planet - will have to do so.
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