Tag Archives: economy

Propaganda alert: UK economic growth is nothing to crow about and here’s the reason

Back in business? But how far will the UK economy restore itself after Covid, with the shadow of Brexit hanging over it?

What a way to spin something we all knew would happen.

According to economic forecaster EY Item Club (who?), the economy is growing at its fastest rate in 80 years. Gosh!

But… isn’t that because it stalled altogether last year, due to the Covid-19 pandemic, and is just now bouncing back?

Is it not the truth that, rather than growing, we should say the economy is being restored to the level we might expect after the crisis?

I think it is.

As The Guardian‘s report puts it,

The EY Item Club said it now expected GDP to grow by 7.6% … The UK economy shrank by 9.8% in 2020.

So that’s 2.2 per cent of shrinkage that the economy won’t make up this year, meaning the nation as a whole will be worse-off than before the pandemic hit.

There are other elements likely to affect the UK’s economic performance, including inflation and unemployment.

The recovery is extremely fragile, and another Covid wave could bring it crashing to a halt or even into reverse.

And there’s also the elephant in the room. I notice that nobody involved in this article has mentioned Brexit.

Source: UK economy growing at fastest rate in 80 years, says forecaster | Economic growth (GDP) | The Guardian

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Rising price of Grenfell proves Tory cost-cutting is a murderous false economy

Ravaged: this destruction happened because rich Tories wanted to cut a few farthings from their council tax bills. It has ended up costing them more than a thousand times what they hoped to save.

Tory-run Kensington and Chelsea council has spent more than £400 million trying to cope with the consequences of the Grenfell Tower blaze – a fire caused by its attempt to save just £300,000.

Could anything demonstrate more plainly the bankruptcy of Tory thinking?

If these rich, irresponsible, selfish office-jockeys had not been so keen to shave a few quid off their council tax bills, they would have saved themselves from paying out more than 1,300 times as much.

And 72 human beings would not have died.

I wonder if those responsible ever remember that?

The public costs of the Grenfell Tower fire have exceeded £500m after the Royal Borough of Kensington and Chelsea revealed it had spent £406m on its response and recovery efforts in almost four years since the disaster.

The sum is in addition to the costs to the taxpayer of the ongoing public inquiry, which hit £117m by the end of March this year, most of which was taken up with lawyers’ bills.

The figures stand in stark contrast to the £300,000 saved in a cost-cutting exercise during the refurbishment of the 24-storey council block between 2014 and 2016 that led to combustible aluminium panels being substituted for the planned non-combustible zinc on the exterior of the block.

The plastic-filled replacements fuelled the fire on 14 June 2017 which killed 72 people, the inquiry has already concluded.

Source: Grenfell costs surpass £500m as council bill revealed | Grenfell Tower fire | The Guardian

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The Tories have run the UK into the dirt and Labour needs to ram the point home. Here’s how

Money, money, money: Boris Johnson thinks it’s for handing out to his party’s friends and donors rather than for investing in the UK economy. Labour needs to explain why his Tories, despite their false claims, are silly with our cash.

It’s no secret that Labour under Keir Starmer is failing to make the right points against Boris Johnson’s lying Tories.

Some of the worst falsehoods in the Tory narrative are about the economy – but, as Mainly Macro‘s Simon Wren-Lewis mentioned (on which I expanded), Labour has consistently failed to address them in any meaningful way.

Professor Wren-Lewis has followed up his article with a new piece suggesting possible pressure-points Labour could attack.

I think he’s wrong to suggest Keir Starmer should do so, as Starmer is unlikely to want to – or indeed to be around for long after the local elections next month, but the ideas are sound and whoever becomes the new leader should certainly consider them seriously. They are:

1. Austerity – Conservatives from David Cameron onwards claimed austerity was a vital response to the economic crisis of 2008 onwards; in fact it harmed the economy.

Labour should assert – forcefully – that there was no debt crisis and the economy needed stimulation rather than starvation. Tory austerity not only delayed any recovery, but diminished it so that wages are now – perhaps permanently – lower.

So the Tories attacked the UK’s economic well-being in order to impoverish the wider population.

2. The second wave of Covid-19 was much worse that it could have been because Tory Chancellor Rishi Sunak resisted an early lockdown.

This delay meant not only that many more lives were lost to the virus than ever needed to be, but also that the lockdown that eventually had to be imposed had to be much longer.

So the Tories attacked the UK economy – and caused many thousands of unnecessary deaths – by failing to lock down strongly and early when cases started rising.

3. Brexit has created a bureaucracy mountain that has hit exports and many firms very badly. I suspect Professor Wren-Lewis wrote his piece before the extent of the violence in Northern Ireland became clear to him, otherwise he could have mentioned this.

It means the Tory-created bureaucracy has harmed the UK economy in a way that has actually re-kindled the Troubles in Northern Ireland after 23 years of hard-won peace.

Professor Wren-Lewis goes on to state that Labour avoids the argument because party leaders know the Tories will answer it with claims about “overspending” by the last Labour government.

But these claims have always been false:

Prof Wren-Lewis also suggests a few responses to the usual attacks we can expect from the Tories and their lackeys in the mainstream media. For example:

No, the Coalition government’s austerity measures did not save the UK from a financial crisis. The Conservatives have demonstrated, many times now, that the Bank of England will create any money needed to cover the UK’s debts, if the markets won’t or can’t do so. Risk of inflation is negligible for reasons we’ve seen in action in the Covid crisis.

No, it isn’t reasonable to suggest Labour was partly responsible for the damage the crash of 2008 onwards caused by pointing at its failure to regulate the banking sector. At the time, the Conservatives were demanding even less regulation, meaning they would have caused more harm to the economy if they’d had the chance.

And no, Labour did not “overspend”. That party left office in 2010 with a record deficit of more than 10 per cent of GDP, but only because of global economic events and measures taken to prevent job losses after banks started collapsing. After 11 years of Conservative rule the UK has a record deficit of 17 per cent of GDP – because of “overspending”? Arguments that Labour would also have introduced austerity can be overcome by pointing out that the party’s critics can’t criticise the party for both over- and underspending.

Finally, Prof Wren-Lewis suggests that the argument about Tory economic incompetence may be wrapped up in a larger attack on Tory incompetence in general:

Boris Johnson and his Tories have been incompetent in handling Covid, running the NHS, looking after law and order, and handling public money.

Their only success has been in handing public money to their personal friends and funders.

Put it like that and Labour is on a path to electoral victory again – if that party can devise policies that capture the public imagination (Jeremy Corbyn was very good at that) and defend them against Tory attack lines (he wasn’t quite so successful there).

But Keir Starmer won’t put it like that because he simply doesn’t have the grit for it. That’s why we have to wait for the next Labour leader and hope that they will.

Source: mainly macro: Labour should start contesting the Tory record in running the economy

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Banning protest won’t save the Tories if a hot summer of discontent boils over into violence

Sound and fury from 2011: discontent with the government of the day boiled over into riots – and for much less reason than might present itself in 2021. Boris Johnson is hastily banning large protests – but will anybody care?

Here’s a disturbing truthbomb from Richard Murphy:

He makes good points.

Boris Johnson is promising a much better summer than we had in 2020 but the early indication are that he will disappoint us yet again.

As matters stand, history is sure to remember him as the prime minister who promised us the world and then took our world away from us instead.

So he reckons Covid-19 will be under control. Why are our health experts planning for another surge in cases, to hit us around July?

At the moment, half of the UK population is half-vaccinated, and there will be shortages from April onwards. That’s the reason variant strains of Covid are appearing; the virus is mutating to beat the defences of a half-protected population.

Johnson reckons we’ll all be able to resume our foreign holidays. How can we, considering the state of foreign nations’ vaccination regimes?

And Johnson reckons the UK’s industries are going to bounce back – what’s the phrase? “Build back better”? – with a boom during the summer. But post-Brexit problems indicate that any such economic explosion is likely to be a damp squib.

He knows all this.

Why else do you think his government has legislated to restrict protest events to the point where anything that is actually noticeable is to be punished with imprisonment?

It is exactly the wrong response. But he’s a Tory and doesn’t know how to do anything apart from punish the poor.

His decisions are all wrong. They are equivalent to clamping the lid on a pressure cooker and turning it up to maximum. What do you think will happen?

I hope I’m wrong.

If I’m not, I just hope that anyone resorting to violent protest remembers that indiscriminate vandalism won’t do anybody any good – 2011 taught us that. It is pointless harming the innocent.

If you’re angry with the government, make sure it’s the government – and its enforcers – who feel the brunt of that anger.

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Here’s why a DECENT NHS pay rise will help us all

Paying NHS staff more money will improve the UK’s economy massively.

That’s the educated opinion of Tax Research UK’s Richard Murphy, and who are we to argue with him?

In his latest video clip, Mr Murphy explains that the Tory government’s decision to offer only a derisory one per cent pay increase – less than the rate of inflation – is actually harmful to its own hope of economic recovery.

The Tories have based their offer on a false belief that the NHS does not contribute to the economy. This is easily disproved because a person who is fit and healthy is clearly more able to create profit than somebody who is ill or injured.

The benefit to the economy provided by the NHS has actually been measured and it seems that for every £1 invested in the health service, the economy benefits by between £2 and £4.

That’s a hell of a markup!

Think about it. Most supermarkets operate on the basis of profits between – what – five and 15 per cent, if I recall correctly. This is a profit of up to four HUNDRED per cent.

In a nation that badly needs to re-establish its economy after Covid-19 – not to mention Brexit – that’s not to be sniffed at, but sniffing at it is exactly what Boris Johnson, Rishi Sunak and the other Tories are doing.

At the moment there are 80,000 staff vacancies in the health service because the wages aren’t enough to compensate for the long hours, stress and heartbreak involved.

This, along with the ongoing effects of Covid-19, means that patients aren’t getting the treatment – even the routine work – they need and there is a knock-on effect for the economy because they are being prevented from getting back into it and producing the content of work they should be able to provide at the standard they are expected to.

“It’s as much as we can give,” said Boris Johnson. But this is sheer short-sightedness. A five per cent pay rise, as suggested by Mr Murphy, would pay for itself as the benefits spread through the economy.

This Writer is left wondering whether Johnson is deliberately sabotaging the health service in order to make privatisation more acceptable; if it can’t recruit staff, then perhaps it should be handed over to private firms.

The trouble with that is, private firms won’t pay any better because they’ll be busily grubbing for profits for their shareholders.

And they won’t provide the service the NHS offers because most people simply won’t be able to afford their prices.

So the economy will suffer a much greater downturn as increasing numbers of people fall into illnesses from which they simply won’t be able to get up.

It is economic idiocy.

But don’t take my word for it. Here’s Mr Murphy:

One part of the clip that I don’t understand is where he says the NHS is perceived to be free. It isn’t and never has been.

Originally, the cost of the service was said to be paid by National Insurance. Nowadays I think that is not true – or certainly not as true as in the past. Much of the cost is now said to come from general taxation (although we know that tax doesn’t actually work like that; the money taken back by the government is more correctly said to be recycled into use to pay for the NHS).

Either way, the NHS is at least partially supported with payments from the general public. It isn’t free and never has been.

Isn’t it funny how that disappears from the minds of politicians whenever it becomes convenient?

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Labour backs away from credible opposition by copying Tories on economics

Annaliese Dodds: do you really think you could trust this woman with the economy?

Keir Starmer’s Labour has announced that its new economic policy is to copy the Conservatives. Why not? Starmer’s copying the Tories in everything else!

Starmer, now well on his way to infamy as the worst leader in the more-than-100-year history of the Labour Party, may have turned the announcement over to his shadow chancellor, Anneliese Dodds, but it has his naive pawprints all over it.

Because it’s yet another example of an inexperienced politician, who doesn’t stand for anything apart from grabbing power for himself, blowing in the wind.

The Financial Times gave the game away.

Shadow chancellor Anneliese Dodds will signal on Wednesday that the Labour party is backing away from the hard-left economic policies of former leader Jeremy Corbyn

Sorry, what? “Hard-left” policies?

Corbyn was never hard-left and the author of the FT piece – Chris Giles, whose criticism of the Tories over the number of people dying due to Covid-19 has been exemplary – should know better. Perhaps he is being led by his ideological nose.

If Corbyn had been hard-left, he would have been demanding the nationalisation of everything and the end of individual property ownership. Hard-left policies require everything to be owned by the state and he never advocated that.

Corbyn’s policies were most similar to those of the Scandinavian countries – and anybody with an eye on international affairs will know that, economically, those nations are much more stable than the UK; their people far more prosperous. The UK would have been better-off under Corbyn’s economic policies.

But Starmer wants to turn his back on them because he is a Conservative at heart.

The trouble is, we already have a Conservative Party in the UK. Returning to the policies that lost Labour two elections (in 2010 and 2015 respectively) will not help a Labour leader who has failed to win a single victory against Boris Johnson’s inept and imbecilic Conservatives.

But that is exactly what Dodd’s is announcing.

In the annual Mais Lecture, she will cloak Labour’s strategy to become the UK’s next government in the latest thinking from international organisations such as the IMF, which recommends waiting until unemployment falls and the recovery is complete before thinking about the sustainability of public finances.

So, it’s back to austerity for Labour. That will be a long wait.

The best way to increase employment is to invest in it – not to leave everything to the market. That is hard-right neoliberalism and Labour should not have anything to do with it. Sadly, Labour members elected a Conservative as their party leader and he is imposing hard-right Conservative policies on them whether they want them or not.

The fact that he lied, lied, and lied again to get himself elected only partially excuses them (as it was clear that he was lying).

Strangely, in her speech, Dodds will distance herself from the economic programme Labour put forward in the run-up to the 2019 general election, that offered spending increases of £83 billion – a modest amount in comparison with the hundreds of billions splurged by Boris Johnson in the last year.

Instead, she will align Labour’s economic policy with that of the Tories, while referring to “responsible” policies no fewer than 23 times. There is nothing “responsible” about Conservative economic policy, or about aligning with them.

There’s an easy test for this. Conservative neoliberalism has been the dominant economic policy in the UK since 1979, when Margaret Thatcher was first elected into office.

At that time, a family of four could afford to pay the mortgage on their house together with all household bills including groceries and vehicle running costs, from the wages of just one parent – and still had enough left over for a holiday away from home during the summer.

Is that possible now?

No, it isn’t. Most of us are much worse-off after 41 years of this nonsense – apart from people in positions of extreme power, including MPs like Starmer and Dodds.

So perhaps there is an intention to help in this policy change. Starmer and Dodds are planning to help themselves.

Their predictable lapse into neoliberalism has been greeted with a chorus of derision from everybody who understands what it means:

Who would? The voting public certainly won’t.

Source: Labour signals end of Corbyn era in setting out economic vision | Financial Times

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Yes, but what does Covid-19 do to people who DON’T die?

Spotted on Facebook:

Some other stats were discussed based on the question “if we let the virus rip through the population on an assumed 1% mortality rate, how could this shut down the U.K.?”
Here was the answer:
There are two problems with this question.
1. It neglects the law of large numbers; and
2. It assumes that one of two things happen: you die or you’re 100% fine.
The UK has a population of 66,650,000. If one percent of the population dies, that’s
666,500 people dead.
Six hundred thousand people dead would monkey wrench the economy no matter what.
That more than doubles the number of annual deaths all at once.
The second bit is people keep talking about deaths. Deaths, deaths, deaths. Only one percent die! Just one percent! One is a small number! No big deal, right?
What about the people who survive?
For every one person who dies:
– 19 more require hospitalisation.
– 18 of those will have permanent heart damage for the rest of their lives.
– 10 will have permanent lung damage.
– 3 will have strokes.
– 2 will have neurological damage that leads to chronic weakness and loss of
coordination.
– 2 will have neurological damage that leads to loss of cognitive function.
So now all of a sudden, that “but it’s only 1% fatal!” becomes:
– 666,500 people dead.
– 12,471,600 hospitalized.
– 11,815,200 people with permanent heart damage.
– 6,564,000 people with permanent lung darnage.
– 1,969,200 people with strokes.
– 1,312,800 people with muscle weakness.
– 1,312,800 people with loss of cognitive function.
That’s the thing that the folks who keep going on about “only 1% dead, what’s the big deal?”
don’t get.
The choice is not “ruin the economy to save 1%”.If we reopen the economy, it will be
destroyed anyway. The UK economy cannot survive everyone getting COVID-19.
Here’s more information on ‘Long Covid’ from the British Medical Journal.

We’re not at one per cent deaths yet, but even the official figures (which are probably false) show 0.1 per cent deaths.

So we can assume current figures are one-tenth of those listed above.

That’s 1.25 million people hospitalised.

1.2 million with permanent heart damage.

656,000 with permanent lung damage.

200,000 with strokes.

131,000 with muscle weakness.

131,000 with loss of cognitive function.

Now.

How many of those are – or rather, were – contributing to the economy before catching the disease? How many will be able to continue doing so?

By failing to prepare properly; by selling off our PPE and failing to stock up on ventilators; by delaying positive action; by keeping the borders open (a contradiction of Tory policy, surely?); by using the emergency procurement procedure as a subsidy system for their spoilt friends; and by fooling around with the distribution of the new vaccines for the sake of a false public-relations coup, Boris Johnson and his Tories have crippled the UK’s population for years – possibly decades – to come.

And you know what’s going to happen?

It will be the people who can no longer work who will get the blame (and who won’t get any benefits).

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Sunak says home workers should spend cash they’ve saved when the pandemic ends. Including him?

Rishi Sunak’s last big idea was ‘Eat Out to Help Out’ – which pushed up Covid-19 infections dramatically. Now he wants us to spend all our savings to buoy up the economy after the crisis ends – but you’ll notice he hasn’t announced that he’ll do the same.

Tory Chancellor Rishi Sunak has said that people who work at home, and who have saved significant amounts of money during the Covid-19 pandemic, should spend it all when the emergency is over.

Does that include him?

He works from home – he lives at 11 Downing Street. And we all recently learned that he has enormous amounts of cash saved up, via his wife’s £430 million stake in her family firm.

So we should welcome his demand – right?

Well… maybe not.

He hasn’t said that he will be leading by example, after all.

He has merely demanded that people like This Writer – I work from home (although I can’t say I have built up large amounts of savings) – splurge everything that we have. He hasn’t mentioned anything about doing the same himself – or that other super-rich Tories should do so.

So this is just a call for people – who are normally poor but have become slightly richer – to throw away everything that they’ve saved.

And people have cottoned on to his con:

Personally, I am looking forward to Sunak’s announcement that he has spent his vast wealth to help regenerate the UK’s economy – and to seeing evidence of this spending.

When he has done this, I hope to see this example leading other super-rich members of the UK’s communities to do the same.

Only when they have put their cash into restoration work should the demand trickle down to those of us who are less rich than Rishi and his Tory chums.

That’s right – trickle down. This is one instance where the “trickle down” effect might actually work in the way Tories and other neoliberals used to pretend; not with money gathered by the super-rich trickling down to benefit poorer people, but with cash spent by them revitalising the economy for everyone.

Have YOU donated to my crowdfunding appeal, raising funds to fight false libel claims by TV celebrities who should know better? These court cases cost a lot of money so every penny will help ensure that wealth doesn’t beat justice.

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Should anyone be surprised that Brexit will cost more than Covid – in the long term?

This Writer’s initial reaction to Bank of England governor Andrew Bailey’s claim that a no-deal Brexit will cost more than Covid was:

Is that because most of the cost of Covid was due to short-term profiteering by Tory crony companies?

The cost to the UK of this nonsense is short-term, though; when the pandemic is finally under control, the profiteers won’t have an opportunity to screw any more cash out of the Treasury.

But the loss of the free trade deals the UK enjoyed as a member of the European Union will have long-term effects that may last many years:

LSE modelling estimates a reduction in GDP worth 8% over a decade compared with remaining in the EU.

Asked about the research, Bailey said economic models suggested there would be long-term consequences, as it could take a long time for the UK to adjust to a new trading relationship. “It takes a much longer period of time for the real side of the economy to adjust to the change in openness and change in the profile of trade,” he said.

Bailey was talking about the effects of a “no-deal” Brexit but be warned that even a deal will place the UK at a disadvantage.

Source: No-deal Brexit to cost more than Covid, Bank of England governor says | Politics | The Guardian

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George ‘Useless’ Eustace doubles down on lie that Tory government has provided money to feed kids

Defending the indefensible: Environment Secretary George Eustice believes children should starve during the holidays, asylum seekers should drown and people should die of Covid-19 rather than let the economy be harmed.

There’s a good reason his nickname is ‘Useless’.

Environment Secretary George Eustace has repeated the insistence of Boris Johnson’s government that it will not provide any funding to feed poverty-stricken children at Christmas.

Interviewed by Kay Burley on Sky News, he said:

Burley provided robust rebuttals of his claims, and could have also pointed out that there is a five-week wait before Universal Credit claims are honoured (if they are allowed) – and that free school meals were provided outside of term time earlier this year because of the Covid-19 crisis that has forced millions of people to take a huge pay cut and that crisis is still going on.

As for the £63 million fund to councils…

Useless – sorry, Eustice – covered himself with shame during his trip round the TV stations today (October 28).

After two adults and two children died on a boat trying to get into the UK, he supported Priti Patel’s line that, rather than creating a new system which would allow asylum seekers to apply for refuge in the UK from outside its borders, the UK should block off all legal channels to do so.

This, of course, creates a huge market for illegal traffickers to send would-be migrants on unsafe channel crossings in which they may die. To Dan Walker on BBC Breakfast, Eustice said:

As you can tell, he doesn’t care if Johnny or Jane Foreigner dies; he just wants to keep them out.

To top it all, when Walker asked why the Johnson government ignored the advice of SAGE to have a lockdown in September in order to avoid having more than 200 deaths a day by mid-November – advice which seems to have been borne out by the fact that 367 deaths were recorded yesterday (October 27) – Useless Eustice said Johnson had chosen to do what he thought was right for the economy, not for the people:

Eustice is a former public relations executive who apparently learned his journalism at Cornwall College in Pool, Cornwall – which happens to be where This Writer did a postgraduate course in journalism.

I don’t think he was there when I was. Otherwise I would now be filled with regret for missing the opportunity to contribute to the national well-being by putting him off politics.

Have YOU donated to my crowdfunding appeal, raising funds to fight false libel claims by TV celebrities who should know better? These court cases cost a lot of money so every penny will help ensure that wealth doesn’t beat justice.

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