Friday, September 30, 2011

Profiting from the sick and disabled

Disabled people and their supporters taking part in today’s nationwide action against the company enforcing government benefit cuts have asked doctors and nurses organisations to end their relationship with Atos Healthcare.

The global corporation which operates in over 40 countries was brought in by the New Labour government and was then awarded a £300 million three-year contract extension by the ConDems, with clear instructions to reduce claimant numbers.

A new benefit, employment support allowance (ESA), has replaced incapacity benefit and every claimant is being assessed by Atos. Thousands have been disqualified from claiming ESA by Atos staff.

The government claims that figures show that the "vast majority" of claimants for ESA are fit for work. But four out of 10 of those who appealed against the decision by Atos to deny them benefits are successful on appeal, a process that costs the taxpayer £50m a year.

The open letter says: “Since 1995, when medical assessments for incapacity benefit were privatised and taken out of public services, standards have steadily declined. But Atos has brought this to a new low. While none of the work tests deserve to be called a ‘medical’ as they have no basis in patient welfare, since Atos started carrying out the ESA tests in 2008, there has been a dramatic increase in the number of people with severe illness and disability being assessed as fit for work and denied benefits.”

Campaigners told the British Medical Journal and Royal College of Nursing: "We are outraged that Atos is profiting from denying those of us who are sick or disabled, the benefits we need to survive and maintain our level of health.”

The letter adds: “A Channel 4 News report in 27 July 2011 acknowledged what thousands have been saying: it interviewed the heartbroken partner of a critically ill man whom Atos denied his entitlement on grounds that he was ‘fit for work’ – he died less than three months later. How many more people have died following such cruel and callous treatment?”

In August, the it was reported that 12 Atos doctors are under investigation by the General Medical Council for improper conduct. The Royal College of Psychiatrists and many others have strongly criticised the devastating effect the Atos exam and cuts have had on patients.

GP Margaret McCartney, writing in the British Medical Journal, has questioned the ethics of doctors performing assessments without access to patients’ medical records, and the lack of specialist knowledge of physiotherapists and general nurses employed by Atos.

Earlier this year, Atos, whose staff assess around 11,000 benefit claimants a week, was severely criticised by Parliament’s work and pensions select committee after it found that many people had "not received the level of service from Atos which they can reasonably expect".

The open letter insists that doctors’ and nurses’ ethics are being “corrupted” by Atos’ offers of higher salaries and daytime reduced work hours, adding: “Claimants rightly fear that most Atos assessors are uncaring and prejudiced – they work to targets which have nothing to do with patients’ individual health needs or with the realities of the job market which sick and disabled people are being thrown into.

“The stress of the Atos examinations has hastened deaths and caused a number of people to commit suicide. For many others, it is exacerbating their already fragile health condition.” Atos has taken action to shut down websites which have attacked the company.

The Labour government introduced work capability assessments in 2008 when it replaced incapacity benefit and income support for new claimants with ESA. The Coalition government has accelerated the changes – with the support of Labour, naturally.

Paul Feldman

Communications editor

Thursday, September 29, 2011

Tea with Mussolini

Some media commentators have suggested that Ed Miliband’s speech to the Labour conference marked a clear break from the politics of the last 30 years and he deserves support.

Seumas Milne in The Guardian was particularly enthusiastic, calling it “the most radical speech by a Labour leader for a generation”, claiming: “Miliband signalled an unmistakable break with the corporate consensus of the past three decades and the model of unfettered market capitalism this has enforced.”

It’s hard to imagine a more wrong-headed assessment of Miliband’s speech than Milne’s, however.

The “break” that Miliband allegedly made in his speech was with a certain kind of capitalism – but only in order to embrace another, potentially even more sinister, version.

Miliband wants the state to decide between “good capitalists” and “bad capitalists”, and between honest, toiling workers and those who should be shunned by society.

The “good capitalists” will get tax breaks and the others won’t. Decent workers will get social housing and the feckless ones will end up living on the streets, denied a roof over their head by the local council.

The state will oppose strikes (Miliband actually praised the anti-union laws passed by Thatcher governments) and deny benefits to those who decline to work for a pittance (which New Labour introduced and the ConDems are implementing with gusto).

What is all this but a recipe for an authoritarian, corporate state? Miliband’s endless talk of “values” – the term peppered his speech – indicated what such a set-up would look like.

On the one side there would be a vast state bureaucracy – with a regulator called OffCapital – which would pronounce on the virtues of this or that capitalist enterprise. On the other side would be the Ministry for Moral Rearmament, implementing “values-based” policies on the majority.

“Radical” this may be. Progressive it isn’t. Red Ed? Give us a break! Radical populism is always right-wing stuff.

More Mussolini than Marx. The Italian dictator’s corporate state springs to mind as the logical outcome of Miliband’s ideas.

The good news is that Miliband – who told News Night, “I am in favour of capitalism, just for the record” – will never get the opportunity to practice his fiendishly unclever plan.

Globalised capitalism is not for reforming or regulating, or being managed like it was after World War II. That epoch came to a deafening end in 1971, when the post-war Bretton Woods system of controls on investment and currency movements crashed to earth.

Capital has subsequently freed itself, as much as possible, from the constraints of national state controls and operates on a global scale. This is true of both production corporations and even more so of the financial system.

Both departments of capitalism demanded and got deregulation so that they could move assets and money without hindrance. Assorted crises were overcome until the meltdown of 2008 plunged the world into recession and in 2011 has taken us to the precipice of outright depression.

The present crisis, however, is not a result of deregulation which is more a consequence than a cause. Inherent flaws within the capitalist system of production and consumption led to the vast overhang of debt that is now overwhelming economies, currencies and countries like Greece in a merciless fashion.

Fiddling about deciding which capitalists are good and which are bad could not be more irrelevant in this situation. Labour is a party that sold its soul to corporate-driven, free market capitalism. Under Miliband, it is a party that is lost in space, floundering around for something to say, appeasing right-wing voters while staying firmly in the capitalist fold.

We are not fooled.

Paul Feldman

Communications editor

Wednesday, September 28, 2011

Making a killing at our expense

As the European Union struggles to hold together, riven with differences over impending bail-outs to save the euro (while ejecting Greece), others are moving in for the kill.

The fact is that there are profits to be made in periods of economic turmoil. Buying at the bottom of the market and selling on at a later date is classic capitalist behaviour.

Not that the BBC News team grasped this when financial market trader Alessio Rastani was interviewed about the so-called rescue plan for the eurozone.

The candour of his “bring it on’” message at the prospect of economic collapse astonished his interviewers.

The interview is full of choice phrases and suggestions: “The market is toast”, “The market is going to crash”, “Hedge funds are moving their money to safer assets” and “most traders we don’t care about the rescue plan”.

While others hope for pleasant night-time experiences, Rastani said: “I’ve been dreaming of a depression for three years…Just like in the thirties, when the market crashes we can make a lot of money out of hedging strategies.”

After telling viewers that “this economic crisis is like a cancer. By the time you discover it, it’s too late”, he told them: “Governments don’t rule the world, Goldman Sachs rules the world."

Some, trying to undermine his message, are suggesting that he’s a phony, a member of the famous Yes Men hoaxers.

They’d like to think his message is the lie that encircled the world before the truth got its boots on. But the frenzy of withdrawal of funds from the junk bond markets confirms Rastani’s message.

The Yes Men issued a statement commending Rastani for his "masterful performance", adding:

"Who in big banking doesn't bet against the interests of the poor and find themselves massively recompensed – if not by the market, then by humongous taxpayer bailouts? Rastani's approach has been completely mainstream for several years now; we must thank him for putting a human face on it yesterday."

By observing the behaviour of traders like Rastani, Felix Salmon of Reuters news agency has arrived at an interesting hypothesis – capitalism has produced its own opposite from within itself. Salmon characterises some traders as anti-capitalists, writing:

“It’s a common misconception that all traders are die-hard capitalists. But in fact many of them are quite the opposite. They still want to make money, of course. But that doesn’t mean they want the stock market to go up.”

Make no mistake, hedge traders are not the new proletariat, but they do represent the contradictory nature of a capitalist economy that has become hopelessly, irretrievably over-run by the cancer of credit and debt which has metastasized throughout the entire system.

Under extreme pressure from the deepening world crisis, the world’s policy makers have adopted a plan which they hope will stop the cancer in its tracks, isolating it in Greece. But the medicine depends on vast sums of new credit to recapitalise the banks and to build up the as yet non-existent stability fund against further impending crises in Portugal, Ireland, Italy, Spain and France

Oh, and there is the small matter of getting the banks which are exposed to Greek debt to take a 50% loss. The IMF would also have to act as a backstop for the eurozone, standing by with another even bigger source of credit. The mind boggles at the numbers being talked about.

The costs of another meltdown are, according to Martin Wolf of the Financial Times, “too grave to contemplate”. The panic written all over the faces of political leaders across the globe tells us that, with the world economy contracting, such an event is indeed on the cards.

Gerry Gold

Economics editor

Tuesday, September 27, 2011

'New Bargain' gives us a one-party state

New New Labour (NNL) has not only confirmed that in essence it is indistinguishable from the other mainstream parties but that also the present form of what passes for politics in Britain is well past its use by date.

As to the first point, even before its conference kicked off NNL was scrambling to show that it was the party of market-led “solutions”. Ed Miliband – or should that be Moribund – declared that he favoured £6,000 a year university tuition fees instead of the Coalition’s £9,000.

Wow! The boldness of the idea took your breath away. Only joking.

Even the moderately-led National Union of Students had to say that far from advancing university education, the proposal reduced the whole issue of funding to a bidding war between the Coalition and Labour.

In power, when it was only New Labour (the other New is more recent), introduced tuition fees. In opposition, they opportunistically and hypocritically opposed the Coalition’s increase to £9,000.

Now they’ve accepted in principle that students should borrow the money to pay for their own degree. Once again there is not even a cigarette paper between NLL and the Coalition.

And that also applies when it comes to resisting government attacks on pensions. NNL is opposed to strikes scheduled for November 30. Even the ever-so-cautious Dave Prentis, leader of Unison, was aghast.

"It's no time to sit on the fence when this country faces a stark choice between taking on the powerful and privileged, or letting the price be paid by the poor and the powerless. My members are no militants. But they will stand up for what's fair, what's right," he told the conference.

Well, Brother Prentis, I have some news for you. NNL is not “on the fence”. It stands four square with the government. After all, the pensions’ attack was prepared by one of its former ministers, Lord Hutton.

Naturally enough, shadow chancellor Ed Balls then declared that a future NNL government would not reverse Tory spending cuts. As Labour councils are implementing most of the cuts with party backing, this was no surprise.

Balls, of course, together with Gordon Brown, helped created the “light touch” system of financial “regulation” which contributed to the 2008 financial meltdown and led directly to the Coalition’s axe on public spending. Of this, Balls had nothing to say.

He did, however, urge the Coalition to reduce VAT to 5% on home improvements. As someone suggested, this is a canny move for all those MPs wanting to do up their second homes at taxpayers’ expense.

From Miliband today, there was the disgusting equation of “anti-social tenants” with asset strippers in his "New Bargain" speech. Oh how the Daily Mail and the right-wing press will love this. Miliband is bidding to outflank prime minister David Cameron, who used the August inner-city riots to blame “feckless parents”.

Milipede’s appeal to what is known as the “law-abiding silent majority” is straight out of the Tory textbook. He was scheduled to say: "The hard truth is that we still have a system where reward for work is not high enough, where benefits are too easy to come by for those who abuse the system and don't work for those who do the right thing."

In practice, all this leaves us with is a one-party state where “politics” is reduced to a competition for the most right-wing policies. No wonder increasing numbers of people are sick of the whole charade and want nothing more to do with it.

Ultimately, however, we have to find answers to the catastrophic economic crisis that is beginning to engulf society. With the parliamentary channel patently a cul-de-sac, our future lies in practical, revolutionary proposals like people’s assemblies and not in the Westminster merry-go-round.

Paul Feldman

Communications editor

Monday, September 26, 2011

Statehood bid opposed by Palestinian activists

Key Palestinian organisations have united to denounce the attempt by president Mahmoud Abbas and his supporters to achieve a chair at the United Nations for a so-called Palestinian state.

His attempt to have a chair at the UN for his little fiefdom would be at the expense of the only body which truly has the right to represent the WHOLE Palestinian people.

The great achievement of the generation of Yasser Arafat and his supporters was the transformation of the Palestine Liberation Organisation into a unified representative body, with a Charter and the support and affiliation of all Palestinian organisations, inside Israel, in the occupied territories and in exile.

Then in 1974 they achieved recognition for the PLO as the sole legitimate representative of the Palestinian people at the United Nations, where it still has observer status.

Abbas’ move would replace the PLO with his own Palestine National Authority. That is turning the clock back to the time when a series of sheikhs and faction leaders of the old generation were patronised by Western leaders and permitted to speak for Palestine in international forums.

Abbas returned from the UN to his headquarters in Ramallah, through a series of Israeli army checkpoints, to declare that the "Palestinian Spring" has begun. But the rally he addressed had the orchestrated style of a New Labour conference. The carefully constructed UN “chair” held above the heads of the crowd was not made by an enthusiastic citizen, but commissioned by an advertising executive.

Ali Abunimah, editor of Electronic Intifada and a leading proponent of the one-state solution, points out that there is little support for this move, either inside the occupied territories or in the diaspora. The movement for an international boycott BDS, the Palestinian Youth Movement and many others are entirely against enshrining a fake government of a fake state in the UN to represent their interests.

The Palestinian Youth Movement declares itself "steadfastly against" the UN bid because it could jeopardise "the rights and aspirations of over two-thirds of the Palestinian people who live as refugees in countries of refuge and in exile, to return to their original homes."

The legal obstacles that Abbas is attempting to ignore are highlighted in an opinion written by Guy Goodwin-Gill, a professor of public international law at Oxford University. He says:

“Within the constitutional structure of the PLO … the Palestinian Authority is a subsidiary body, competent only to exercise those powers conferred on it by the Palestinian National Council. By definition, it does not have the capacity to assume greater powers, to 'dissolve' its parent body, or otherwise to establish itself independently of the Palestinian National Council and the PLO.”

Of course the Netanyahu government in Israel is ranting and bullying, threatening violence as usual. Foreign minister Avigdor Lieberman, warned of "tough repercussions" if the UN backed the Palestinian move. To underline his point, West Bank paramilitary “settlers” promptly made a punitive raid into a Palestinian farm near the West Bank village of Qusra, where they tore up 400 olive trees.

Abbas may claim that his move is the start of the Palestinian Spring, but this is nothing of the kind. The Arab Spring was a leap forward by the people of Egypt and Tunisia and elsewhere towards something new. It has entirely disrupted all the conspiracies and corrupt diplomacy that have dominated Middle East politics for decades.

Much more in tune with its spirit is the demand put forward in June by youth from all the different Palestinian parties in both Gaza and the West Bank for a renewal of the PLO, as a united voice for Palestinians everywhere.

The Israeli Summer shows that there too the social and political structures that supported Zionist ideology are increasingly under threat, as a result of their inability to deliver a decent life to citizens. The challenge for everyone in the region is to take a leap over the heads of Abbas, Liebermann and Netanyahu, and talk to each other about a common route to a shared future within a single, secular state.

Penny Cole

Friday, September 23, 2011

The capitalist leopard cannot change its spots

The dreaded “C” word is making its reappearance as commentators and economists alike openly question whether it’s capitalism as a system that’s in the mire rather than merely the banks or the euro.

When even the BBC is asking pundits whether “Western capitalism” has failed the day after large-scale falls on share markets, you know something is up.

And when Will Hutton, the former editor of The Observer and well-known reformer, says that “the way capitalism has been conceived and practised for the last 30 years has hit the buffers”, things must be really bad.

Others who earn their living directly from the system, like economist George Magnus who is senior adviser to highly-troubled Swiss investment bank UBS, are more explicit, writing recently:

It is a crisis of capitalism because our economic model and policy settings cannot produce sustainable growth, adequate income formation or employment creation. We have lost the housing, financial services and credit creation growth drivers and been left with excessive levels of personal and government debt to unwind, a dysfunctional financial system, and weak labour markets.

The capacity to produce and sell goods and services has outstripped that of consumers to borrow and spend. Without credit and jobs, other fault lines have been exposed, including the long stagnation of real wages and extremes of inequality. It is truly a crisis of aggregate demand.

While the acknowledgement that there is something fundamentally wrong with the present system of production and exchange, aka capitalism, is welcome, that’s as far it goes. Magnus, like Hutton, believes that the system can be reformed through intervention. Hutton advocates what he calls “good capitalism” brought into being by the actions of “democratic government” with the alternative being the “worst economic contraction for a century”.

A leopard cannot change its spots, however. And nor can capitalism. The globalisation process that accelerated following the breakdown of what now seems to Hutton and company a more reasonable, post-war capitalism cannot be put into reverse. Not by governments, not by the European Central Bank or the International Monetary Fund or the World Bank. And certainly not by Cameron, Obama, Merkel, Sarkozy et al.

Inherent contradictions of capitalism drove the transition from a managed economy to transnational corporations more powerful than national states and a global financial system to fund the expansion that accompanied huge increases in productivity.

The driving down of wages as a share of national income is well documented as capital expanded, moving production to cheaper labour areas, undermining local trade union bargaining power. So too is the fact that capitalism in the developed countries was no longer able to provide full employment as the technological revolution kicked in.

Yet the goods produced had to be sold to realise the profit they contained. And if workers couldn’t buy them out of earnings and savings, why endless credit would do the trick. And so it came to pass that the world was flooded with credit and debt, and that endless growth was here to stay (no matter if it destroyed the planet in the process).

Governments deregulated everything that moved and privatised what they could. The financial system went into an orbit where money seemed to create even more money.

No longer did we live under capitalism, New Labour told us. A paradigm shift had occurred.

Well, yes it had. But it was not the pain-free paradise that everyone was promised. Behind the spending frenzy was the slow-burn of the explosion of the very system of production and finance that New Labour and others had Merlin-like magicked out of existence.

There is no mystery about the solution. A system of production that is driven by co-operation has to replace the profit drive. The means of production already exist that can satisfy most human needs. Their ownership and control is simply in the wrong, shareholding hands.

The political class, experts and assorted advisors have no answers, not least because the crisis has spun out of control, driven by a self-generated momentum. Social, revolutionary change to put capitalism out of business is down to us.

Paul Feldman

Communications editor

Thursday, September 22, 2011

New Labour's devastating legacy

Take one struggling NHS Trust, add in an exorbitant build-and-maintain private contract – all this is New Labour’s handiwork – and the result is a financial disaster containing a threat to patient care.

Today’s government announcement that 22 trusts, which run 60 units, cannot afford their exorbitant “private finance initiative” (PFI) payments and have lost financial stability only confirms the worst. For some trusts, annual repayments take up more than 18% of their turnover.

PFI deals, under which the state enters into a cast-iron mortgage-leaseback deal with developers who own the assets and receive an annual fee, were favoured by New Labour for two reasons.

First, the cost of building hospitals, schools and other infrastructure did not appear on the government’s balance sheet (although it involves a state liability). Second, it fulfilled New Labour’s dream of private-public partnerships as an exemplar of 21st century capitalism.

The dream has, inevitably, turned into a nightmare for taxpayers and patients alike. Some hospitals were smaller than they might have been to allow for repayments, while PFI contract costs have become unmanageable. Professor John Appleby, chief economist at the King's Fund think-tank, says that there is already “a drive to keep patients out of hospital”.

The contractors are laughing all the way to the bank, however, as the state is obliged to pick up the tab if the NHS Trusts can’t. Renegotiation of the contracts is virtually impossible because lenders know the government won’t let the trusts go bankrupt.

Official figures show that yearly bills will rise by 75% in the next 18 years. By 2049, more than £70 billion will have been transferred from taxpayers to private investors.

Even taking services like maintenance into account, this sum is far above the £11.4bn value of the building projects.

According to a Commons committee, the taxpayer is paying well over £20bn in “extra” borrowing costs – the equivalent of more than 40 sizeable new hospitals – for the 700 projects that successive governments have acquired under the PFI.

Last month, the Commons public accounts committee found that tax assumptions built into the case for PFI contracts were laughable.

One of the largest PFI investment funds told the committee that 72% of the shareholders of its management company were registered offshore. HICL, a subsidiary of HSBC, which made £38m of profit from 33 PFI schemes paid just £100,000 in UK tax. Ultimate ownership of at least 90 projects has been moved offshore, potentially avoiding tax payments when they are sold on again.

The PAC report says that the “buoyant and profitable” secondary market in PFI deals. “We suspect that initial investors are able to make excessive profits from selling PFI shares, yet we lack the information to know for sure,” MPs admitted.

Figures from the National Audit Office suggest that up to £4bn has been paid in fees to financial consultants, lawyers and others to get the projects off the ground. The head of one big PFI investment fund earned £8.6m last year.

Health Secretary Andrew Lansley said: "The truth is that some hospitals have been landed with PFI deals they simply cannot afford. "Like the economy, Labour has brought some parts of the NHS to the brink of financial collapse." Yet PFI goes on and on.

Since the May 2010 election, however, the Conservative-Liberal Democrat coalition government has signed 34 contracts with a capital value of £1.8bn ($2.9bn), according to the Treasury. Hundreds more contracts are in the pipeline for schools and other projects.

The continued commercialisation of the NHS, with the direct injection of competition by the Coalition, is bound to favour healthcare corporations. Like New Labour before them, the Tories know how to favour their friends and keep capitalism happy.

Paul Feldman

Communications editor

Wednesday, September 21, 2011

Delusional IMF in the dark

Confusion and disarray is apparent in every national and global capitalist institution – and nowhere more so than in the corridors of the International Monetary Fund. Despite access to confidential data, they don’t really have a clue as to what’s going on.

When Olivier Blanchard, the IMF’s director of the research, introduced its latest World Economic Outlook (WEO) with sombre demeanour and measured words, he wasn’t pulling his punches:

"The global economy has entered a dangerous new phase. The recovery has weakened considerably and downside risks have increased sharply,” he announced. "Fear of the unknown is very high. Stock prices have fallen. These will adversely affect spending and growth in the months to come.”

Blanchard added: "Markets have clearly become more sceptical about the ability of many countries to stabilise their public debt.”

Bad enough.

But in the first paragraph of his foreword to the WEO, in which he calls himself “economic counsellor”, he makes an astonishing admission:

“Relative to our previous World Economic Outlook last April, the economic recovery has become much more uncertain. The world economy suffers from the confluence of two adverse developments. The first is a much slower recovery in advanced economies since the beginning of the year, a development we largely failed to perceive as it was happening. The second is a large increase in fiscal and financial uncertainty, which has been particularly pronounced since August“

To repeat – “a development we largely failed to perceive as it was happening”.

With all the resources they have at their disposal, how did they get it so wrong? It surely does no good at all for the reputation of counsellors of all kinds.

With their oft-repeated mantra of a recovery, of a return to growth, the IMF has consistently underestimated the scale of the crisis, and overestimated the ability of governments and central banks to do anything about it.

They have deluded themselves, and they have deluded governments and central banks. In 2008, for example they forecast that the UK economy would fall by 0.1 per cent in 2009 but it actually fell by almost 5%.

Now that the necessity of a global contraction is evident to anyone with even a smattering of an understanding of the limits to growth, the IMF both continues on its delusional path, but is simultaneously forced to change tack.

It has downgraded its economic outlook for the UK, the US and Europe through to the end of next year, effectively pulling the rug from all the deficit reduction plans in the world.

It now predicts that UK gross domestic product will grow just 1.1% in 2011, compared with its April prediction of 1.7% The US, it says will grow by just 0.4% more than the UK and may already be in recession.

But at the same time it warns that “if growth threatens to slow down substantially”, if activity were to undershoot current expectations, countries like the UK and Germany should “consider delaying some of their planned adjustment”.

Which means, says the IMF, that the UK Coalition, adamant that its brutal austerity programme must stand, will have to think again. Government spending cuts may have to be delayed to avoid a greater catastrophe.

If you or I put up a piece of work like the WEO we’d be out on our ears, but the IMF is accountable to no-one. Its enforcers are due back in Athens next week checking on the government’s progress with cutting wages, putting people out of work, selling off national assets etc etc.

So now it’s time to build alternative, revolutionary governments everywhere, with the power to implement the May 27th vote of the People’s Assembly of Syntagma Square which ends:

‘We will not leave the squares until those who compelled us to come here, leave the country: the governments, the Troika (EU, ECB, IMF), banks, the IMF Memoranda, and everyone who exploits us. We send them the message that the debt is not ours.”

Gerry Gold

Economics editor

Tuesday, September 20, 2011

A post postmodern world

The crosscurrents that flow in the world of style are usually at least one remove from the humdrum daily lives of millions of people. Which is why fashion and celebrity have such a grip on the imagination.

So it may appear that current debates in the media, spurred on by Postmodernism – Style and Substance, a major show at London’s Victoria and Albert museum opening this week, have little relevance to the struggle to achieve political and social change.

But the reflections about the meaning of postmodernism are important and relevant. Writer Hari Kunzru – who memorably rejected an award because it was sponsored by the Mail on Sunday – has noted that the era of postmodernism is now superseded because, he says, what it predicted has come to pass.

Postmodernism first arrived in the 1960s in the world of literature, philosophy and style as a rejection of the by now jaded Modernism of the early 20th century. The 1980s saw its rise as an all-pervasive way of interpreting the world around us – from architecture to styles in the arts – and also in politics.

The 1990s, with the collapse of the Soviet Union, became the heyday of postmodernist rejection of the notion that human beings can actually achieve social change. It held that perception is everything. It championed the ironic and in art the kitsch. Postmodernism had only contempt for the “naïve” view that things could have an essence, and that there is such a thing as “being”.

As Kunzru writes: “The essence of postmodernism [was] the idea that there is no essence, that we’re moving through a world of signs and wonders, where everything has been done before and is just lying around as cultural wreckage, waiting to be reused, combined in new and unusual ways. Nothing is direct, nothing is new. Everything is already mediated. The real, whatever that might be, is unavailable.”

Postmodernism’s popularity was due to its accurate description of a world in which the medium did actually become the message, as the Internet and the world of the image seemed all enveloping. In economics, the era of unlimited credit and plastic money fed in to the notion that real value created by human labour in the real economy no longer mattered. All that was solid melted into the air, to borrow from Karl Marx.

As a trend in thought – it was too amorphous and eclectic to be a coherent philosophy - postmodernism was derided by some for being utterly superficial in its championing of style over substance. But many of those who did this – from Tory conservatives on the right to Old Labour and Marxists on the left – failed to grasp that this wriggly, slippery, cynical, chameleon-like turn of thought itself reflected a deeper reality.

The years of corporate-driven globalisation were changing the world and people’s thinking much faster than those who thought the old truths were adequate.

Styles, which however superficial they may appear, are the foam on the surface of the ocean that his human society and thus can reflect and presage deeper movements to come. As the French writer de Buffon said: “The style is the man himself”.

That world was shattered by 9/11 in terms of the impregnability of the United States as a world power. In British politics the postmodern ethos was associated with the rise of New Labour with its focus on spin doctors and media image mongering – which ran rings around its opponents. But with the financial crash of 2008, that world also came to a definitive end.

A new epoch has opened up where deep, contradictory economic and political processes are asserting themselves and, in turn, shaping a new post postmodern consciousness. The challenge is to develop an understanding of the new period we are in and strategies for transforming it to our advantage.

Corinna Lotz

A World to Win secretary

Monday, September 19, 2011

Paying for energy profits in disease and death

This descent of the energy production industry into 19th century activities such as “fracking”, which was last tried in Scotland 150 years ago, and marginal drift mining show that capitalism cannot safely tackle the growing energy crisis.

The tragic deaths of four miners in South Wales last week highlighted one side of the increasingly desperate search for energy sources. Camp Frack, set up by local residents and climate activists on a site near Southport in Lancashire, to protest against plans by mining company Cuadrilla Resources to drill for shale gas, draws attention to an equally dangerous activity.

The camp is opposing plans for “fracking” – hydraulic fracturing – where water with chemicals is pumped into rocks to shatter them, releasing the carbon gas which is piped to tankers and transported to power stations. Cuadrilla, backed by Australian mining money and with BP's former chair Lord Browne in support, is one of a number given licence by the Coalition government to pilot fracking. The company is looking at sites across 437 square miles of Lancashire.

Its first operation was suspended in the summer, when geologists suggested they had caused two earthquakes that shook the seaside town of Blackpool. In the USA people living near fracking operations say it causes seismic shifts and serious illnesses. The US Environmental Protection Agency (EPA) is currently conducting a large-scale study on the impacts, and the Camp Frack protesters are demanding the British government halt all activity until it reports.

As well as the health and geological risks, burning shale gas gives off more CO2 than coal. But the risks to the people, the environment and the wildlife of the Ribble Valley have been simply ignored. The US anti-fracking film Gasland, was nominated for an Oscar last year and you can find out more about it here.

The sum total of possible shale gas deposits in Britain would meet the need for gas for a grand total of 18 months. It is only in the total absence of anything resembling a coherent strategy for energy that such a risky activity could be given the go-ahead for such short-term returns.

Meanwhile, the National Union of Mineworkers has warned that tiny collieries like the one at Gleision where four miners died as a result of an inrush of water, may be operating “under the radar” of mine inspectors. The soaring world price of coal has led to an expansion of small, privately-owned drift and open cast mining in the UK over recent years – operations that sometimes open and shut in response to commodity price fluctuations.

Gleision, which produced smokeless coal for boilers, is one of the smallest and remotest of these kinds of laissez-faire operations. Chris Kitchen, general secretary of the NUM, said: "We have grave concerns about safety standards in these kinds of mines. We fear that safety is often set at minimum standards so that costs can be kept down. They are not generally unionised or easily visited by inspectors."

Britain's five remaining deep-mine collieries, such as Kellingley in Yorkshire, have teams of safety personnel, high standards, and a unionised workforce alert to problems. "You are not going to have that kind of thing in a small drift mine that employs nine people."

As the Energy Bill currently going through Parliament shows, the reality is that government efforts to promote energy saving and efficiency, or local power generation strategies and clean sources, are minimal. The scale of what they plan – lots of advice and fine words but little funding or subsidy – shows they are not serious.

As long as we live in this undemocratic profit-driven energy society, the government will make sure the energy corporations keep the market sewn up. Only by challenging the ownership and control of energy production will we ever be able to put the focus on safety, clean energy and conservation.

Penny Cole

Environment editor

Thursday, September 15, 2011

Pension strikers should go beyond resistance

Whatever the Murdoch press may say ("Union leaders are off their heads" – The Sun) it is pressure from members, rather than the not-so-steely resolve of union bosses, that forced the TUC to act over pensions.

Finally, they had to do something to express the anger of public sector workers whose living standards have been cut to the bone and who have seen jobs cut by 110,000 in less than a year, with more to come.

Workers from 14 unions – including local government workers, nurses, care workers, civil servants, teachers, prison officers and firefighters – are planning co-ordinated action on pensions in the biggest joint union mobilisation since the "winter of discontent" in 1978/79.

Actions will range from a one-day strike on November 30, involving around 3 million people, to lunchtime meetings, rallies and joint events with community groups, service users and private sector workers.

Throughout New Labour, the major unions convinced members to accept sub-inflation pay rises, making many reliant on tax credits – which have now been cut. They stood by while services were contracted out, and both the public and private sectors cut pensions for new entrants.

Even now, union bosses pray the Coalition government will save them from acting. Unite general secretary Len McCluskey said: "Hopefully the government will see the anger and perhaps take a step back, be a little bit more flexible and less intransigent."

He wishes! But there IS no flexibility and the government is ENTIRELY intransigent. The attack on pensions is driven by the economic and financial crisis. Without cutting pensions the Coalition can't eliminate the deficit.

And as this bankers' government knows, the market will punish any country going soft on cuts. Nick Clegg explained: "Markets have stopped believing that all European governments can service their debts. We simply cannot afford to let that happen to us too."

As the general secretary of the NASUWT teaching union, Patrick Roach, said: "The attack on pensions is only one element of the assault on ordinary working people, on the public sector and on the welfare state. Be in no doubt – we are in the midst of a perfect storm. A perfect storm of assaults on pay, on jobs, on rights at work, as well as on pensions."

But the lesson from the perfect storms in Greece, Ireland and Italy is that one-day strikes do not force governments caught in the gravest global crisis in capitalism’s history to change course. The big question is what follows?

Why wait for negotiations which are a total fraud? Treasury Secretary Danny Alexander, announced the detail of the pension cuts back in June and nothing has changed since then.

If ever there was a time to defy the anti-union laws, it is now. Ballots are costly, time-consuming, open to endless legal challenges and give the government and their pet media in the BBC and newspapers, the initiative.

Better to just call members out now and save the cash for strike pay. All the unions, including those like the rail union RMT who are not directly involved, should call an indefinite strike to bring down the Coalition.

RMT leader Bob Crow told the TUC Congress that forms of civil disobedience beyond strikes would be necessary, uniting unions with others fighting to defend jobs and services. This is good but cannot be more protest.

At the end of the day, we need to find a way to go BEYOND resistance to a political solution. Otherwise what are we fighting for? To put a Milliband-led Labour, pro-capitalist government in office? No thank you!

This solution can be developed in the course of building People's Assemblies in every community, where union members unite with others – especially those in the private sector – not only to co-ordinate support for strikes and other actions, but also start building an alternative democracy.

Rejecting a state committed to the power of banks and corporations, they can plan a transfer of economic and political power into the hands of the people. Looked at in this way, November 30 can be a springboard to a real social transformation.

Penny Cole

Wednesday, September 14, 2011

Panic as new meltdown looms

On the eve of the third anniversary of the collapse of Lehman Brothers – the investment bank which became the icon of the crash of 2007/8 – the world’s financial markets are once again in a febrile state little short of panic.

Exposure to Greek debt this morning led the ratings agency Moody’s to downgrade two French banks, indicating how close to another financial meltdown we are.

A Greek default, which will threaten the euro as a trading currency, seems impossible to avoid. Interest charges on lending to the Greek government have gone off the scale. One three-year bond, which was trading at 20% in June, now commands an astonishing 172%.

Jeremy Warner, the Telegraph’s senior business commentator, warns: “Greece is already effectively a cash only economy. Most forms of credit has effectively dried up, the Greek banking system is finished, and capital controls to prevent what little money that remains from leaving the country are surely only a matter of time. European banking must prepare for the worst as far as Greece is concerned.”

Charges on Italy’s €1,900bn debt mountain have also soared to record levels. The desperate Berlusconi government is offering state-owned properties and power companies for sale to the managers of China’s investment funds.

As the second phase of the global capitalist crisis breaks through, stark new figures tell the human story of millions of lives throughout the world, already wrecked by failed and now abandoned attempts to bring about a return to growth.

In 2010, 46.2m Americans fell below the poverty line, taking the rate to 15.1% of the population from 11% in 2000. More US citizens are living in poverty than at any time since records began more than 50 years ago according to the US Census Bureau.

With the more affluent having so far managed to stabilise their income, the 2.3% drop in median household income of all Americans in 2010 from the previous year masks a much greater decline for those below the line. Increasing long-term unemployment has depressed wages and left many without any income at all.

The number of Americans without health insurance rose by nearly 1m people to 49.9m. Nearly a quarter of American children are now living in poverty. Their number increased for the fourth year in a row to 22%, the highest since 1993.

Across the border, Mexico had 53 million people - half the country's population - living in poverty in 2010, according to the Monterrey Institute of Technology, with almost 20% in extreme poverty. Even for those working, according to the Bank of Mexico, 95% of the 800,000 jobs created in 2010 paid only $10 a day.

In Greece, poverty has visibly increased on the streets of the capital of four million, where people huddle in sleeping bags in empty alleys and can be seen rummaging through rubbish containers, looking for food or scraps of metal or glass to sell.

NGO Klimaka estimated the population living on the streets has increased by a quarter to 17,000-20,000 over the past two years. With Greek unemployment now over 16%, the new homeless come from all walks of life.

In the UK, the number of homeless families rose by 10% to 44,160 households in the past year, the first increase since 2004. Real incomes for UK families have dropped by 3.5% in the last year, according to the Institute for Fiscal Studies (IFS).

IFS researcher Robert Joyce, predicted the future in quietly measured tones: “The current economic downturn began more than three years ago, and may seem like old news. But, as in other developed countries, the most severe consequences of the recession on UK living standards have only just begun to be felt, and will continue to be felt for years to come.”

The global economic contraction the collapse of Lehman Brothers set in motion is driving debt-strangled Europe and everywhere else towards a second, far more devastating implosion. The Arab Spring could well be followed by the European Winter.

Gerry Gold

Economics editor

Tuesday, September 13, 2011

Miliband takes union cash - and does a runner

In the summer of 2010, some union leaders met together and decided that they could buy their way to happiness by backing Ed Miliband’s campaign to become the new leader of the Labour Party.

With the help of the three major union bureaucracies of the GMB, Unite and Unison, Miliband squeaked home ahead of his brother David, who enjoyed most of the support from constituency parties.

Money down the drain, throwing good money after bad, a bad investment, a gamble that went wrong. All these phrases describe what has happened since. Miliband, to no-one’s surprise except that of the union leaders’, has become little more than Blair Mark II.

In fact, Miliband’s speech speech to the Trades Union Congress today was uncannily Blair-like in its content. “You know the new economy that emerges from this crisis must be built on foundations of co-operation, not conflict, in the workplace,” he said.

Co-operation? Trade unionists are being sacked in their thousands and/or losing hard-won rights and working conditions. Many are victims of cuts imposed by Labour-led local authorities.

If delegates were expecting some support for their upcoming struggles, they were soon disabused. Miliband acknowledged that Labour backed public spending cuts in the order of 12% (rather than the Tories’ 20%), defended opted-out academy schools and the Coalition’s new free schools.

And, naturally, Miliband repeated his assertion that strikes by civil servants and teachers in June against government attacks on their pensions were wrong and indicated he would take the same position in the event of more industrial action

Some delegates heckled during Miliband’s speech and Paul Kenny, leader of the GMB, struggled to find words of comfort for his hard-pressed members. In one of this week’s more vacuous statements, Kenny said:

"As Labour Leader he is not embarrassed by his association with trade unions and trade unionists. His engagement with trade unionists on the ground will bring to the fore what needs to be done to get the economy moving and to bring fairness to our communities."

Thank you and good night is all you say after reading that!

Even Bob Crow, general secretary of the Rail Maritime and Transport union, appeared to pull his punches, saying afterwards that "Ed Miliband needs to decide just whose side he is on” and warning the Labour leader that he was on “political suicide mission”.

The stark truth is that Miliband knows which side he is on – and it isn’t that of trade unionists and workers in struggle. Labour became a full partner of globalised capitalism back in the 1990s and stands by that position.

For the Milibands of this world, there is no alternative to rescuing the broken market economy to create the “prosperous capitalism” that the Labour leader called for in a speech earlier this year.

Were Labour in power now, you would hardly notice the difference between their policies and those of the ConDem government. In fact, many of the Coalition’s policies are a development of what New Labour did to the NHS and the welfare state.

Labour is happy taking the money from the trade unions to finance the party - and then doing a runner with it. Union leaders from Unite, Unison and GMB know this. But they are in denial mode.

Their members don’t have that luxury, however. Their jobs and pensions are on the line and they are waiting to see if, behind all the militant speeches, their leaders are actually prepared to do battle with the government.

Not having Miliband on their side is excellent news for the rank and file. The fact is that the alternative to the Coalition is not Labour (or any other combination of parliamentary parties). What is demanded is a democratic political system that responds to people’s needs. Achieving that goal will require independence of thought and action.

Paul Feldman

Communications editor

Monday, September 12, 2011

Laughing all the way to the bank

It’s hard to know what is more irrelevant – the report of the Independent Commission on Banking or Ed Miliband’s call for a code of conduct will allow bankers to be struck off in the same way as doctors.

Let’s talk about the official Vickers report, which today recommends that the banks build a wall between their traditional high street operations and the place where all the profits lie – the global, speculative money markets.

Make them separate operations, the argument goes, and the state will never again have to bail out and effectively nationalise many banks as it did in 2008/9 when the global financial system went into melt-down (NB: triggered by the collapse of Lehman Brothers, which was an investment bank).

If Vickers’ proposals were a solution – and they patently aren’t – the state would surely act immediately because the crisis is far from over. Instead, any changes are unlikely to be effective before 2019! The Vickers report makes cosmetic surgery look good.

British banks are sitting on countless billions of worthless Greek and other sovereign debt. They are not lending because their balance sheets are stuffed full of “non-performing” assets – bad debts to you and me.

Of course, none of these banks are truly “British” but parts of a globalised system that, particularly in Europe, is staggering from pillar to post. As the American economist Paul Krug noted over the weekend:

“Financial turmoil in Europe is no longer a problem of small, peripheral economies like Greece. What’s under way right now is a full-scale market run on the much larger economies of Spain and Italy. At this point countries in crisis account for about a third of the euro area’s G.D.P., so the common European currency itself is under existential threat… And now it’s all coming to a head. We’re not talking about a crisis that will unfold over a year or two; this thing could come apart in a matter of days. And if it does, the whole world will suffer.”

Krugman, however, along with many other economists, mistakenly believes this what we are living through is predominantly a financial crisis in which a misplaced emphasis on debt has overwhelmed economies and prevented a “return to growth”.

In truth, the financial system’s exponential growth was a state-encouraged response to a global economy that could only expand through pumping unlimited amounts of credit into the hands of consumers, corporations and governments.

Deregulation of banking, which accelerated from the late 1990s onwards, was not a cause but a consequence of globalisation itself. The production of commodities expanded so rapidly that there way no way consumers could buy them without credit. And when the price of homes got out of reach, people were lent more than they could ever afford to repay.

With money sloshing around global markets, it was no surprise that banks developed ever more creative ways of making profits with a range of exotic “products” like credit default swaps. But even these depended on some consumer somewhere along the line making interest payments. And when some US homeowners began to default in 2007, the financial system began its unravelling, which continues.

By the time of the crash, global financial assets were reckoned to be 4.5 times the value of the real economy. Measures that include derivatives increase the ratio to 10 and more times. Some observers like Market Oracle believe that less than half of the debt in the system still has to be accounted for.

Denied unlimited credit, the productive economy has gone into free fall and is heading for outright depression. The savage attack on living standards in Britain reported today by the Institute for Fiscal Studies – while bosses’ pay soars - is capitalism’s response.

In this context, striking off a banker for bad behaviour as Labour leader Miliband suggests, has got to be the feeblest idea of them all! The system as a whole is broken, unsustainable and needs replacing. Democratically-owned and controlled banks and corporations, run along not-for-profit lines, beckons. How to achieve this is another debate. What’s the alternative?

Paul Feldman

Communications editor

Friday, September 09, 2011

'A blank cheque for America's war state'

Ceremonies that will mark Sunday’s 10th anniversary of the 9/11 terror attacks cannot disguise the fact that the dead have been cruelly misused to justify building a militarised, surveillance state that is a greater threat to Americans than Al-Qaeda will ever be.

The so-called war on terror long ago turned into a war on the American people in terms of their rights and liberties subsumed by a secret state apparatus that registers every cough and sneeze right across the nation.

As the writer Tom Engelhard, whose forthcoming book is aptly named the United States of Fear puts it, September 11 “turned out to be a blank check for the American war state, funding an endless trip to hell”.

In the decade since the attacks, America’s economy may have gone into steep decline – there are now 10 million out of work and a “national crisis” according to President Obama – but one area of spending has boomed and remains immune from any cuts.

Defence spending has doubled since 2001 to over $700 billion a year while “homeland security” employs over 300,000 people and accounts for up to another $300 billion, making it a cool trillion altogether.

Earlier this year, construction started on the National Security Agency’s first data centre, in the desert 25 miles from Salt Lake City. Another one is being built in San Antonio, Texas. The massive facility is designed to capture trillions of emails, web searches and commercial transactions intercepted by the agency.

The state was given extensive powers under the Patriot Act that was introduced by the Bush administration. Interpretation of the clauses allowing the FBI to compel banks, doctors and business to hand over information is remains classified information.

Ron Wyden, a Democrat member of the Senate intelligence committee, admitted that the public would be “shocked” if they knew what the government was able to gain access to. Obama recently extended the legislation until 2015, also continuing the policies of “rendition”, assassination by drones and keeping Guantanamo prison camp open.

A secret intelligence network is now reckoned to constitute a fourth arm of government, with over 1,200 government agencies and almost 2,000 private companies in more than 10,000 locations across the country. Its annual budget is an estimated $80 billion. There are an astonishing 845,000 people with top secret clearance.

Bush and his ultra supporters in the Project for a New American Century took their war state into Afghanistan and Iraq in the arrogant belief that they could remake these countries in their own image. A decade and hundreds of thousands of dead later, Afghanistan remains unconquered and Iraq leans towards Tehran rather than Washington. Project for a new American Nightmare more like it.

Add in the global financial and economic crisis that has left America reeling, and the Financial Times, in its assessment of 9/11 can write about the end of US hegemony, noting:

“Thanks to cheap labour costs, China exported deflation to the rest of the world. China financed the US current account deficit by recycling its own surplus into US Treasury bonds. Now, three years into the financial crisis, the world economy has been turned upside down. The US is diminished, Europe sidelined, and Asia, for now, in the ascendant.”

The revolutionary Arab Spring that has topped stooge regimes – without the help of Al Qaeda – has also helped to diminish the power of the American ruling elites. The only reachable target seems to be the American people themselves, being made to suffer the consequences of the capitalist economic and financial catastrophe.

With the government’s ability to revive growth equally diminished by political deadlock, the monster that is the US surveillance state will more and more be turned against those who resist in defence of their jobs, benefits and communities. Endless ceremonies to mark September 11 won’t cut the mustard. As Abraham Lincoln famously remarked: “You can fool all the people some of the time, and some of the people all the time, but you cannot fool all the people all the time."

Paul Feldman

Communications editor

Thursday, September 08, 2011

Punish the poor 1930s style back with a vengeance

Fake data claiming that the majority of those who took part in the recent riots had previous records is behind the government’s plans for a new, punitive regime.

Actually, the figures only show that those who were caught had previous, and since the police have been knocking on the doors of everyone “known” to them in the weeks since the riots, that’s hardly surprising.

Now the Coalition wants to give the courts powers not only to fine people but also to withdraw their benefits or tax credits. Both the government and Labour accept the unsubstantiated claim that a small number of families in every area are the source of most of the problems in society.

They have brought in the architect of New Labour’s “anti-social behaviour orders” or Asbos, Louise Casey, to tell them how to “sort out” these “problem families”. As well as withdrawing benefits, they are looking at evictions, parenting orders, making people work for free in the community, and other measures.

On the basis of unscientific prejudice, teachers are asked to identify children who, whilst not a problem now might BECOME a problem because of what is known about their home circumstances. There is growing pressure on the NHS to abandon the principle of patient confidentiality, so that doctors and district nurses could identify families that MIGHT at some point in the future become “problem families”.

Also to be announced is a proposal that people leaving prison without a job to go to - i.e. almost everyone - will not be given time to find work but be automatically registered on a government “work for benefits” programme.

From next year, everyone unemployed for more than six months will have to either join a “volunteer” work programme or a “work experience” programme, which means, for example, working for a company for 13 weeks for Job Seekers’ Allowance plus £10.

And right now, thousands of sick and disabled people are being forced through a humiliating new testing regime, operated by private companies, in order to prove they are well enough to work – even though there isn’t any work for most of them.

This pretence that the poor and the unemployed are the state’s biggest problem is not new in Britain. History shows that in Britain, the criminalisation and punishment of the poorest people - the unemployed, sick or desperate - is the so-called democratic government’s knee-jerk reaction to economic crisis, and the situation is no different today.

During the 1930s depression, the state was obsessed with the imagined inability of the unemployed to take up work. From 1929 to 1938, thousands of unemployed men were sent to be “reconditioned for work”, with physical exercise and work projects at British Instructional Centres which were, in practice, labour camps.

At the same period the fake science of eugenics was common currency amongst the ruling class and in 1932, the Brock Committee was formed to make recommendations on how “feeble-minded people” in England and Wales could be sterilised. Voluntary sterilisation never got off the ground in Britain - as it did during the same period in the United States - but as a result of so-called “medical” decisions, many hundreds of men and women incarcerated in long-stay hospitals and asylums, were sterilised without their knowledge or consent.

In 1931 the means test was introduced, where government inspectors entered people’s homes and if anything was left worth selling, its value was deducted from their benefit. Cooking pots, chairs, tables, bedding - all were at one time or another classified as unwarranted luxuries.

Housing, education and health workers should refuse to join Lib-Tory-Labour attack on the poor. They should instead use their skills to work, through local People’s Assemblies, towards an employment, training, housing, education and support system that enables the disadvantaged instead of punishing them for being poor.

Penny Cole

Wednesday, September 07, 2011

'Go time' has arrived

The sudden appearance of the global contraction over the summer is inducing a state of chaos amongst the governments of the world’s major economies.

Three years after the financial crash all attempts to bring about a recovery lay in ruins.

Italy’s Berlusconi government yesterday announced VAT-rises as a further provocation to mass street protests and strikes against its previous round of austerity measures in an attempt to forestall a downgrade of its debt.

Greece's finance minister Evangelos Venizelos pledged to speed up delayed privatisation and market “reforms”, while his Irish counterpart said Dublin was considering making a deeper fiscal adjustment than planned next year to boost market confidence.

"We are in the middle of a peculiar war – if we lose, we lose everything," said Venizolos. "If we don't complete structural reforms, if we don't change the way the state and the economy work, we will be stuck."

The problem, however, is that even if they do what the IMF and European Central Bank demands, they will still be stuffed.

Britain’s economy is heavily dependent on the service sector which slowed at the fastest pace in a more than a decade last month while orders for new construction have fallen to the lowest since 1980.

Today’s call by 20 “leading economists” for the government to abandon the 50p tax rate for high earners to boost the economy – as if it would make the slightest difference – shows how far from reality these apparently learned men and women have drifted.

The US economy which needs close to 200,000 new jobs each month to prevent a dive into recession added no jobs at all in August. President Obama’s expected plan for a $300 billion job creation programme is certain to meet powerful Republican opposition and a replay of the political deadlock over the debt ceiling.

When governments rushed to the rescue of the bankrupt banks they took on responsibility for the three decades-long accumulation of credit. They attempted to shore up the already tumbling house of cards with props made of unrepayable sovereign debt, adding immense sums to existing deficits.

Government after government launched slashing attacks on all programmes of expenditure – health, education, social services, transport, police - you name it, under the guise of “austerity”. Wages were frozen, effectively reduced by rising prices, and pensions undermined.

But each and every one of the brutal attacks on their populations made only a small contribution to the deficit reduction. Every austerity programme so far introduced is founded upon an expectation of a return to growth which has not been and can not be forthcoming.

As Mark Dow, hedge fund manager and former IMF economist, puts it for Reuters global news agency:

“I am not by nature an alarmist. But the cancer is metastasizing at an ever-accelerating rate. Italy, Spain and even France are now genuinely at risk. Failure to stem the tide now could well undermine faith in the modern global capitalist system — a system already stretched by political polarisation and income inequality — with potentially massive social implications. In short: It’s go time.”

Amongst Dow’s proposals are to drive Greece, Portugal and Ireland out of the eurozone, allowing their economies to disintegrate, their populations to be abandoned to their collective fate. These are the kind of horror scenarios now being openly debated.

“Go time” it most certainly is – but not in the way Dow envisages. Time is up for the capitalist system of production for profit which is clearly beyond repair. And the bell has surely tolled for the political elites that know only how to force their populations to shoulder the burden of a crisis they didn’t create.

Gerry Gold

Economics editor

Tuesday, September 06, 2011

Unison fiddles while health service burns

A 1,000 amendments later and the health bill that returns to Parliament today still contains the plan to deepen market penetration and competition in the NHS, building on the previous New Labour government’s handiwork.

Remember Alan Milburn, the health secretary in the first post-1997 Blair government? When Frank Dobson was removed after abolishing the internal market, his replacement Milburn announced in 2002 that in future Foundation Trusts (FTs) would run the NHS.

That was followed by the creation of private treatment centres. They have been a financial disaster for the taxpayer. Only 12 of the original 31 contracts, worth at least £1.47bn in total, are still operating.

FTs are “public benefit corporations”, are free from central government control and can raise capital from both the public and private sectors. Trusts can retain financial surpluses – and, of course, have to bear losses and make cuts to balance the books. Up to 20 hospitals are in serious financial difficulties and the government has started talks with profit-driven corporations to take over their management.

Already, whole wards within Foundation hospitals are restricted to private, fee-paying patients only. Existing limits on the extent of private facilities are to be abolished by the Coalition’s bill. So too is the secretary of state’s present legal commitment to maintain a health service free at the point of use.

As two clinicians warn today: “Over time, all hospitals will have to become Foundation Trusts (FTs), effectively commercial bodies. They would have the power to close services without public consultation, and caps on income from private patients in NHS hospitals will be removed, tempting many to increase their income at the expense of NHS patients.

As in any commercial organisation, the main objectives for these FTs will be profit generation, they write, warning: “A profit driven model will undermine all that is precious about the NHS. Furthermore, it will produce an underclass of patients with chronic, debilitating illness, who will be seen as pariahs by those organisations who seek financial benefits over and above good health.”

Add in whole new layers of paralysing bureaucracy created by the bill, plus the £20 billion of “efficiency savings” announced by the previous government, and the wrecking of the National Health Service as originally conceived by the first post-war Labour government is well and truly at hand.

The response of the leaders of main health union Unison has, as usual, been pathetic. Having sat on their hands while New Labour undermined the NHS, Unison has restricted its present campaign to publicity drives. The current Labour leadership under Ed – I want a prosperous capitalism – Miliband also remains committed to market “solutions”.

Christina McAnea, the union's head of health, says the public “will not forgive Lib Dem MPs for colluding with the Tories to break up and privatise the NHS” and that “voting through this Bill will be the end of the NHS as we know it.” We await with bated breath Unison’s fine words being turned into action against the government.

The Coalition is driven by the deepening economic crisis to create conditions for a “return to growth” at any cost, which includes opening up the NHS to the corporations. A similar strategy is being developed around local government services. As the experience of private treatment centres shows, competition allows the private sector the privilege of state guaranteed-profits while services deteriorate.

Taking the profit out of health and other services will require more than fiddling with bits of legislation. We have a market state committed to doing whatever takes to revive a broken capitalist economy. The present parliamentary system and corporate power are the problems, not the solution. Replacing them with democratic, truly accountable people’s assemblies is the best way to answer the Coalition’s onslaught on the NHS.

Paul Feldman

Communications editor