Posts Tagged ‘Nationalisation’

Does Anybody Really Believe that Alan Sugar Ever Really Supported Labour?

April 6, 2018

Alan Sugar, the multi-millionaire host of the British version of the Apprentice got himself into the news this week. He’s another one, who has joined the chorus of rich industrialists and Conservatives denouncing Corbyn as an anti-Semite. On Wednesday he put up on the Net a photoshopped picture of Corbyn riding in a limo with Adolf Hitler. Faced with a storm of criticism for this outrageous smear, Sugar took it down. But crucially, he didn’t apologise. Then yesterday he put up a nasty poem attacking Corbyn.

This little ditty was denounced by at least one female Corbynite as misogynist. And rightly so. In one of its stanzas, it describes Corbyn having sex with Diane Abbott, who ‘lies back and thinks of Russia’. Corbyn is supposed to have had an affair with Abbott. But as the female critic pointed out, it also shows the misogynist fixation with female sexuality, and discomfort at the fact that women are free to have sex with whomever they choose. In this instance, Sugar’s like the White supremacists of the Alt Right, who have a similar fixation with controlling women’s sexuality, as well as denying them the right to vote. There’s also a nasty undercurrent of racism in this as well. Most of the racist and sexist abuse sent to MPs is actually centred on Diane Abbott. She was one of the first Black MPs elected to parliament in the 1980s, and is notoriously concerned with combating racism. So much so, that the Scum quoted her in their infamous anti-Labour campaign during the 1987 election as saying that ‘All White people are racist’. I don’t know if she said it or not. If she didn’t, it wouldn’t be the first the Scum libelled someone. Not by a very long chalk.

As for thinking about Russia, this is just more of the Tory ‘Red Scare’ drivel that the party’s been running ever since the Zinoviev Letter in the 1920s. Labour is supposed to be full of Communists, ready to do Moscow’s bidding. Or, now that Communism’s fallen, Putin’s bidding. Sugar then goes on in the poem to rant about how Corbyn supports our enemies, listing them as the IRA, Hamas and Russia. All of which we’ve heard before, and despatched. He never supported the IRA, but recommended that the British government should talk to them. Which Margaret Thatcher was doing, all the time she was loudly denouncing the Labour party for daring to suggest that she should. Well, as someone once said, the Tory party is an organised hypocrisy. As for Hamas, I’ve seen allegations that they were either created, or helped into power, by the Israeli state, who thought that this would make it easier to control and disinherit the Palestinians. Corbyn isn’t an enemy of Israel, but he does want a just settlement for the Palestinians. Hence the outrage of the Israel lobby, who can’t bear anyone taking their side, even if they’re actually not opponents of Israel or anti-Semites.

He also claimed that Corbyn was the worse Labour leader ever. Well, I can remember the Tories making the same accusations, minus those of anti-Semitism, against Neil Kinnock in the 1987 election, and before that against Michael Foot and Harold Wilson in the 1970s. The CIA, MI5 and the Tories, including Maggie Thatcher, were convinced that Wilson was a KGB spy. He wasn’t, but they still smeared him.

As for Corbyn being extreme left, he stands for the renationalisation of the health service, a partial renationalisation of the electricity grid, and the renationalisation of the railways, as well as an end to the murderous benefit cuts. This is a return to something like the post-war social democratic consensus, and very far from the total nationalisation demanded by the genuine far left, like the Socialist Workers’ Party. Not that this bothers the Tories, who never let the truth get in the way of a good lie.

And I have always been uneasy about Sugar as a supporter of Labour. It never seemed quite genuine. There are, and always have been, businesspeople who supported the Labour party. But I don’t think Sugar was really one of them. I might be wrong, but I seem to remember Sugar appearing on Terry Wogan’s weekday talk show way back in the 1980s. He poured scorn on the idea that you needed an extensive education to become successful in business, and talked about how he’d begun his career aged fifteen selling things from the back of cars. Or something like that. I can remember my father looking at me, and remarking that he was the type who’d have children climbing up chimneys again.

Sugar left Labour three years ago, about the time Corbyn was elected leader, so he’s definitely no supporter of the current Labour leadership. It seems very much to me that he was one of the big businessmen Blair ingratiated himself with, and who were given seats in government in return for their support. Like David Sainsbury, who was another donor to New Labour, now departed. He’s basically another Tory, who was drawn to New Labour because Blair was continuing the Thatcherite programme of privatisation and benefit cuts, but was electorally more attractive than the Tory party itself under John Major.

His poem was basically another Tory screed of lies and hate, from someone, who only seems to have joined Labour out of political and commercial opportunism. There’s absolute no reason to take him, or his opinions seriously.

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Hugo Rifkind Declares Anti-Semites Attracted to Left because of Anti-Capitalism

March 31, 2018

Hugo Rifkind is the son of Maggie’s cabinet minister, Malcolm Rifkind, so it shouldn’t surprise us that he espouses the same noxious politics as his father. He is like Boris Johnson in that he also has higher view of his own intelligence than he deserves. He once turned up on Mike’s blog trying to argue against him, only to run away when he started losing.

He turned up in the pages of the Spectator last week holding forth on the latest anti-Semitism smears against Corbyn and Momentum, a snippet of which was duly quoted in the I’s ‘Opinion Matrix’ column of selected short pieces from the rest of the press. Rifkind junior opined that, rather than trying to rebut the allegations of anti-Semitism, the Labour leader should reflect on why so many anti-Semites were attracted to anti-capitalism. It was all out of jealousy of more successful ethnic groups, he breezily declared.

Now it’s true that there, and always have been, anti-Semites amongst the Left. I found a book by one very Conservative writer in one secondhand bookshop about how many of the founders and leaders of early socialism were anti-Semites. It was clearly polemical. The argument running implicitly through such books is that because many of its leaders were anti-Semitic, socialism is intrinsically anti-Semitic. Which isn’t the case. Anti-Semitism is there, but it’s actually far less than on the right. And the Tories and their puppet media definitely don’t want you knowing that.

British Fascism grew out of right-wing, Die-Hard Conservatism at the end of the 19th and beginning of the 20th century. It was fiercely anti-immigration, especially against Jews, who were held to be unassimilable orientals, like Muslims today. It spawned a range of racist organisations like the British Brothers’ League, and became particularly acute during the First World War, when Jewish industrialists of German origin, like Alfred Mond, were suspected of favouring Germany over Britain. While the Tories have subsequently tried to purge their party of racists and anti-Semites, they are still very much present.

It’s also a matter of considerable debate how anti-capitalist Fascism is. When Mussolini became president of Italy, he was backed by the industrial and financial elite, and declared that his party stood for Manchester economics – in other words, free trade. The corporate state he created, which boasted of having trade unionists and employers together in a Chamber of Fasci and Corporations, never did anything more than rubber stamp his own decisions as Duce. It was also designed to smash the power of the unions by leaving them under the control of the managers and proprietors.

In Nazi Germany, the Socialists, Communists and Anarchists were rounded up and sent to the concentration camps along with other dissidents and racial groups, including the mentally ill, male homosexuals, prostitutes and the disabled. So were trade unionists after the Nazis smashed them. And far from nationalising industry, as claimed by Conservatives in America and Britain, Hitler actually privatised a greater number of state-owned enterprises than other European governments at the time. He also made speeches hailing the biological superiority of the owners and leaders of industry, and declared his full support for free trade and competition, although later on he subjected industry to a weak form of corporatist organisation and imposed a rigid system of central planning.

The problem can therefore be reframed by asking why so many people on the right, believing in free trade and private property, are attracted to anti-Semitism? Part of the answer, it seems to me, is that they believe that free trade and private industry are the perfect system. The argument is that, if left alone by the government, industry will be run efficiently, workers receive their proper wages, people of talent will rise to the top, and society will become increasingly prosperous and well-organised.

When the opposite is true, when wages are falling and businesses closing, right-wingers look around for a scapegoat. They go a little way to realising that the fault is the capitalist system itself, but violently reject socialism itself. Hitler set on calling his party ‘Socialist’ because it appealed to those, who only had a hazy idea what the word meant, and as a deliberate provocation to real Socialists. They may reject laissez-faire free trade and impose some restrictions on private industry, such as subjection to central planning. But their critique of capitalism, in the case of the Nazis and the Fascist groups influenced by them, was based firmly on the notion that it was fundamentally good. It was just being undermined by the Jews. Thus Hitler in a speech started out by ranting about how the Nazis would overturn the exploiters, and throw their money boxes out into the streets. But he then turned this around to say it was only Jewish businessmen, who were the exploiters they would attack. Aryan Germans were entirely good, and respected their racial fellows in the workforce. They would not suffer any attack by Hitler’s thugs.

But Rifkind and the rest of the Tory party, and the Thatcherite entryists of the Blairites, really don’t want you knowing about all this. It would confirm too many ideas about racism in the Tory party, and their hypocrisy in the latest anti-Semitism smears.

They are using these smears to deflect attention away from the increasingly obvious failure of laissez-faire, neo-liberal capitalism. Don’t believe them, and their hypocritical smears and lies.

RT Reports on People Attacking Robots and Driverless Cars in California

March 9, 2018

This is a very short video – about 2 1/2 minutes long – I found over on YouTube by RT. It reports attacks on driverless cars and other robots by the good folks of California. The other robots attacked include a robot guard, designed to shoo the homeless away from business entrances, which was put out of action several times, and a robot burger chef. The machine is basically just an arm and hand, which is shown flipping burgers, and laying them out ready for the bun. The attacks on this machine have included comments about it taking people’s jobs.

The piece cuts to an expert, who says that when you have predictions that mechanisation will destroy half the jobs in America, which will cause massive social dislocation – people are going to be angry. He then makes the anodyne statement that they have to find ways to make automation work for the benefit of everyone.

There is no way under capitalism that automation will work for everyone. Value under capitalism is determined by scarcity. The scarcer and more vital a product or service is, the more people are willing to pay for it. Hence the neoliberal dictum that there must be a ‘reserve army of the unemployed’ to bring down wages, whatever George Osborne and the other liars in the Tory party say about reducing unemployment. Making half the workforce unemployed will create immense poverty, but I can see the Tories and their backers salivating over that, as it means jobs will become more precious, and the working and lower middle class more dispirited and willing to put up with even worse condition to get them.

Of course, one solution would be to nationalise the companies not using a given proportion of human labour, so that their profits could be used to benefit everyone, perhaps through a universal citizen wage. The Polish SF author, Stanislaw Lem, mentioned this option in one of his short stories in Tales of Pirx the Pilot. But there’s no way this is going to happen, as the Tories and other apologists for capitalism will scream blue murder about the sanctity of private industry. Even when that industry is destroying jobs for private profit.

There needs to be a complete change in the structure of our society, if such widespread automation goes ahead. And it should begin by kicking out the Tories and the other corporatist politicos.

Lobster: Torygraph Running MI5 ‘Red Scare’ Stories against Labour Again.

March 7, 2018

Robin Ramsay, the editor of Lobster, has some very interesting comments about the recent libels in the Torygraph about Jeremy Corbyn meeting a Czech spy, going under cover as a diplomat, in his ‘The View from the Bridge’ column in the latest issue, no. 75.. Or rather, not about that story so much – he considers most of it invention, especially the part about money changing hands – but about another story in the same issue of the Torygraph about Rob Hayward. Hayward was the General Secretary of the Labour Party from 1972 to 1982. According to the Torygraph article, he had secret meetings with KGB officials at the Russian Embassy, where he talked about circumventing the power of the parliamentary Labour party, which would allow him to come out with the same agenda alongside the Communists. The article was written by one Giles Udy, who is described in his publisher’s blurb as a member of the council of the Keston Institute.

The Keston Institute specialises in the study of religion in the Soviet Union and the Communist states. It was set up by the Reverend Michael Bourdeaux, Sir John Lawrence, Leonard Schapiro and Peter Reddaway. Ramsay writes of it and its founders

Schapiro wrote books for, and Reddaway was a member of, the Information Research Department (IRD) the Foreign Office’s anti-subversion, anti-Soviet organisation about which a great deal has been written, not least in these columns. Schapiro was also a member, and briefly chair of, Brian Crozier’s Institute for the Study of Conflict (ISC). 6 In other words, the Keston Institute is a product of the Anglo-American anti-Soviet and anti-communist apparatus created during the Cold War. This explains why Mr Udy was given access to surveillance tapes of the Soviet embassy in London. If it isn’t funded by them, Keston liaises with the British security and intelligence services. With the arrival of Jeremy Corby and a left-leaning Labour Party membership, the dust is being blown off a lot of old files all over Whitehall . . . .

The Cold Warriors are back. All the bug-eyed paranoiacs, who were convinced that Harold Wilson was a KGB spy, whose number included James Jesus Angleton, the head of the CIA, and Margaret Thatcher, are now back at it running red scare stories against Jeremy Corbyn. ‘Cos he threatens the course of western capitalism by wanting to renationalise the health service, parts of the national grid and the railways. And this is clearly enough to panic the secret state’s guardians of neoliberalism, the same kind of people who used to rant about ‘union subversion’ and thought up schemes to have left wingers, including journos, interned somewhere in the Hebrides or Shetland after a right-wing coup had overthrown the Labour government.

Lobster is at https://www.lobster-magazine.co.uk/. Go to number 75 on the side column, click on it, and open ‘The View From the Bridge’. This piece about the Torygraph is entitled ‘Just Like Old Times’, because, obviously, it is just like old times when the British Secret State was doing its level best to bring down Labour.

Tories’ Comments about Universal Credit and Self-Employed Show They Don’t Care About Small Businesses

March 2, 2018

Mike this evening put up a post about how the Tories are trying to justify the removal of benefits to the self-employed under Universal Credits by claiming that it ‘incentivises’ them. Mike makes the point that it clearly shows the cruelty behind the Tories’ policies. They’re all about cuts and making things harder, not about rewards. It’s always, but always the stick, not the carrot.

I’d have thought that to be self-employed, you have to be very well self-motivated anyway. I’ve heard from my father amongst others that to run your own business, you have to get up early and go to bed late. And about half of all small businesses fold within the first two years.

The self-employed and small businessman have it bad enough already, without the Tories making worse. And I think they should seriously consider voting Labour.

Oh, I’ve met enough small businesspeople, who say that they won’t vote Labour, because of the old canard that ‘Labour wants to nationalise everything’. That hasn’t been true since the rise of the Social Democratic consensus in the Labour party. As articulated by Anthony Crossland, this said that you didn’t need nationalisation or worker’s control, provided there was social mobility, a progressive income tax and strong trade unions. All of which have been destroyed under the onslaught of Thatcherism.

But even before then, socialist thinkers like G.D.H. Cole were arguing that Labour should also seek to protect small businesses as part of their campaign to defend and advance the cause of the working class. Cole was one of the most prolific of Socialist writers, and was one of the leaders of Guild Socialism, the British version of Anarcho-Syndicalism. Even after that collapsed, after the failure of the General Strike, he still beleived that workers’ should have a share in the management of the companies in which they worked. So definitely not a sell out to capital, then.

I am also well aware that many small businessmen are resentful of workers gaining wage rises and further employment rights. They argue that they can’t give themselves pay rises, because of the economics of their businesses, before complaining about how much it would all cost them. Well, perhaps. But they can decide how much they charge, and what they intend to pay themselves. And they control their business, not the people below them. I’m sure it’s true that some white collar workers are better paid than the self-employed, but that’s no excuse for not paying your employees better wages.

But a wider point needs to be made here: the Tories don’t support Britain’s Arkwrights, the s-s-small businessmen, who were personified by the heroes of Open All Hours, as portrayed by Ronnie Barker and David Jason.

And yes, I know about all the rubbish about how Thatcher was a grocer’s daughter, who slept above the shop when she was a child. But Thatcher, and her successors, was solidly for the rich against the poor, and big business against the small trader. That’s why they’ve given immense tax cuts to the very rich, and put the tax burden on the poorer layers of society. It’s why, despite repeated scandals, they will never willingly pass legislation to force big businessmen to pay their smaller suppliers promptly and on time.

And it’s why they will always back the big supermarkets, no matter how exploitative and destructive they are. George Monbiot in his Captive State has chapters attacking them. Not only are they parasitical, in that they pay their workers rubbish wages, so that they need to draw benefits, benefits that the Tories really don’t want to pay, they also destroy the small shops in the areas they move into. And they screw their suppliers with highly exploitative contracts.

In an ideal world, the big supermarket chains would be nationalised or broken up as monopolies.

The small businessperson needs to be protected. They, not the big supermarkets, create employment and healthy, living communities. They should be protected, just like the working and lower middle classes, which includes them, should.

And the only party I see willing to do that is the Labour party. Remember when Ed Balls said that Labour ‘wanted to grow your businesses’ to the small traders about this country? It was sincere. I think it was wrong on its own, as it shows how Labour under Blair had abandoned the working class, and was concentrating on hoovering up middle class votes. But ‘Red’ Ed did have a point. It should’t be a case of either the working class, or small businesses, but both the working class and small businesspeople.

Because the small businessman too deserves protection from exploitation. Which they will never get from the likes of Thatcher, Dave Cameron and May.

Trust in GPs Lowest for 35 Years, And That’s the Way the Tories Want It

March 2, 2018

A few days ago, a report in the news concluded that people’s trust in their doctors was at lowest for 35 years. I’m not surprised, and I have absolutely no doubt that people’s dissatisfaction with their GPs is part of their ongoing assault on the NHS. The Health Service is immensely popular. It’s been described as the closest thing our increasingly secular society has to a god. Which is why the Tories want to destroy public confidence in it so that they can privatise it and replace it with one where we’ll all have to pay the likes of BUPA, Circle Health, and Beardie Branson’s Virgin Health for treatment, while taking out expensive and unaffordable medical insurance from the likes of Unum.

I’ve already put up on this blog a video I found on YouTube, which featured an academic stating that the way the Tories will do this is by running down services so that the middle class – those that can afford private treatment – will abandon it, as a way of creating the public disenchantment necessary to make its privatisation anything less than electoral suicide. Margaret Thatcher, despite the self-serving lies in her autobiography, did want to privatise the health service, and was only prevented by a massive cabinet revolt. Afterwards, she merely confined herself to wanting to increase the proportion of Brits with private health insurance to 25 per cent or so. Jeremy Hunt has made it clear that he hates state medicine and the NHS. As does Daniel Hannan, the Europhobic Tory MEP for Dorset, who is flagrant his use use of untruths that Guy Debord’s Cat calls him ‘The Lyin’ King’.

And the Tories are privatising the NHS. 70 per cent of NHS contracts are going to private firms, despite the fact that these offer worse service and are much less economical that state medicine. They also want to make it possible for private firms to run whole regions. It won’t be long before they sell it off completely, if they have their way.

And some rightwing sites are very honest about it. While the Tories lie through their teeth about what they’re doing to the Health Service, claiming to ‘treasure’ it, in Hunt’s mendacious little words, some groups and blogs are quite open about their longed-for destruction of this most precious British institution. A couple of years ago I found a piece posted from the Traditional Britain Group, which said that they wanted to privatise the NHS. But it was so popular they were afraid it would have to be retained for reasons of electoral expediency. The Traditional Britain Group, I needn’t remind you, were that bunch of Nazi toffs, whose annual dinner Jacob Rees-Mogg happily attended before the Independent published the pics. Then he tried to excuse himself, saying that he didn’t know anything about them when he accepted their invitation. Which is a likely story.

And way back as the London Olympics, I found the Canadian Tory blog, Five Feet of Fury, moaning about Danny Boyle’s celebration of the NHS in the opening ceremony. After ranting about how terrible this was, the transatlantic rightists then began to discuss how they could destroy public confidence in it. They decided that the way to do so was to encourage people to complain about it, because that would apparently break our socialist brainwashing that makes us all praise it.

No, it’s not because we’re all brainwashed or conditioned to accept the NHS unconditionally. It’s because we know what a colossal train wreck private medicine is, if you don’t have socialised medicine. And many people in this country can still remember how expensive medicine was before the NHS.

So despite what the Tories may so to the contrary, I’m very sure May, Hunt and the rest of her corrupt gang and their supporters and donors in private medicine are absolutely delighted by this new. If you don’t want to see the NHS privatised, vote Labour and Corbyn, as he has promised to renationalise the Health Service. And that terrifies them, the Blairites and the right-wing press. It’s why Paul Dacre and the bizarre Barclay Twins have spent so much ink vilifying him as a Trotskyite.

One Eighth of Bristolians Living in ‘Fuel Poverty’

March 2, 2018

‘Points West’, the local BBC news show for the Bristol region had a little report Wednesday night on the number of people in Bristol living in ‘fuel poverty’. This term, they explains, applies to anyone, who pays more than ten per cent of their income in heating costs. And there are 25,000 of them in Bristol. This is one-eighth of the city’s population. This is higher than in the surrounding country districts, but nationally about 11 per cent of the population are hit by it. They programme then interviewed some of the people, who had a choice between heating their homes, or eating.

They also talked to a Tory MP from over the other side of the country, who is trying to introduce legislation to improve matters. This won’t address issues like low wages and benefits, which are the root cause of this. No, he just wants to make sure everyone has proper loft insulation. David Garmston, the interviewer, tried to press him about the problem of low incomes, but he refused to be drawn, merely saying that he thought that Theresa May was concerned about this issue, and returning to his main concern of getting people cheap loft insulation so that everyone has it. And there the interview ended.

1/8 of the population of Bristol, or indeed, anywhere else, in fuel poverty is too many by far. The Tory’s plan for everyone to have state-sponsored loft insulation is a good starting point, but it’s only a starting point, not a solution.

And I don’t believe that Tweezer or any of the other Tories have any interest in the plight of the poor or those on low-incomes. Indeed, Tory policy for the past eight years or so has been solidly based on keeping wages and benefits low. Wages have either been frozen, or when they have been raised, the increase is deliberately set below the level of inflation. Benefits are being cut, and new ways invented all the time to throw the poor and disabled off them.

May and her squad of privileged thugs have promised that they’ll introduce a cap on energy prices, but this will not arrive for several months. Always assuming that it will arrive at all. The Tories have form for broken promises, and this is going to be one of them. I think they only made the promise because the problem of fuel poverty was too great to ignore, and that Corbyn and the Labour party had promised to solve it by renationalising part of the electricity grid. The prospect of any assault on the precious free market and private industry absolutely terrifies them, even when it is absolutely obvious to anyone not blinded by Thatcherite ideology that the free market doesn’t work. And so to stave off the threat of nationalisation, they’ve had to make a few promises of their own to regulate energy prices. Promises that I doubt they have any intention of keeping.

It’s been estimated that if the electricity network had been kept within the state sector, electricity prices would be 10 to 20 per cent cheaper.

This could all come back in Corbyn gets in and nationalises the grid. Which will mean cheaper electricity for consumers, but reduced profits for the energy companies, who donate to the Tory party, on whose boards no doubt many Tory MPs sit, and whose interests the Tories are keen to represent, against the wellbeing of the rest of us.

Don’t believe Tory lies. If you really want to see fuel poverty reduced, vote for Corbyn and the renationalisation of the electricity industry.

Fabian Authors on the Tories’ Inability to Understand the NHS

February 9, 2018

I found the following passage in an old Fabian pamphlet from 1989, Does Society Exist? The Case for Socialism, by Brian Barry. It discusses the psychological reasons why the Tories hate the NHS, and why they are so keen to wreck and burden it by introducing market forces and private enterprise. They simply don’t understand how any public institution, which isn’t run as a private enterprise, works. And they despise the NHS because it is, and does. Barry writes

I can best illustrate what is at stake here by showing the two ides at work in analysing a particular institution – the National Health Service, which I take it to be (in its general principles if not its detailed operation) an exemplary socialist institution in that it replaces profit with service as the rationale of its activities.

No doubt that is enough to make the NHS highly distasteful to Mrs Thatcher and her more ideologically-driven colleagues. But it would be too simple to suppose that the only explanation for the Government’s proposed revamping of the NHS is the desire to destroy a stronghold of values alien to those of the market. A complementary explanation is that the denizens of the think-tanks whose advice the Government listens to really cannot imagine that an organisation can possibly work effectively unless incentives are rigged so that decision makers find it in their interest to do whatever they ought to do. They are so besotted by the rational-choice paradigm in this form that they just deduce from first principles what a health service driven by self-interest would be like and put that forward without feeling any necessity for looking in detail at the strengths and weaknesses of the existing system.

This seems to be precisely the case. The Tories and their think-tanks really don’t understand anything that works outside market forces and the profit motive. We’ve seen that in the various pronouncements they’ve made over the years about how public services run as state industries are inefficient, because they’re not run as private firms. And when Thatcher and Major began to reform the NHS along the lines of private industry by introducing the disastrous internal market, they did so arguing that making the NHS more like a private firm would improve performance and make it more efficient.

In fact none of this is remotely true. The internal market was a disaster, and repealed by New Labour. Blair, however, was a true-Blue Thatcherite, and continued Thatcher’s programme of privatising the NHS piecemeal. But the privatisation of public services has only made them more expensive and inefficient. It’s been estimated that we’re paying 10 to 20 per cent more for our electricity now than we would be if the electricity grid had remained in the hands of the state. The railway network is similarly falling apart. We’re paying far more in subsidies now to the private firms that run the railways than we did when it was British Rail. And the service is worse. The ‘I; reported in its business pages that Grayling was under pressure to renationalise the East Coast line, one of the latest of the train companies to fail. The NHS is failing precisely because the market reforms and privatisation of services introduced by Thatcher, Major, Blair, Cameron and Tweezer eat up the funding for it. Private hospitals and healthcare providers spend less of their money on actual healthcare than the NHS, and more on administration. Quite apart from the fact that the Tories are privatising the Health Service anyway to give it to their friends and donors in private industry.

Thatcherism is a complete failure. The only solution is to get the failed market out of the utility industries and renationalise the NHS, the electricity companies and the railways.

Another Crisis in the Outsourcing Industry: Capita Now in Trouble

February 1, 2018

Yesterday, Mike reported on his blog that the outsourcing giant, Capita, was now in trouble. Its share price has apparently halved, knocking £1.1 billion of its stock market value. It has axed its scheme to issue £500 million in dividends to its shareholders. Instead, it intends to raise £700 million, partly by selling off parts of the company, which it needs to balance the books. There are also fears that it will make part of its 67,000 strong workforce redundant as well as concerns for the firm’s pension fund.

Mike in his article notes that the company was responsible for assessing the infamous fitness for work tests, for which the government has imposed hidden targets. One of these is that 80 per cent of reconsidered cases should be turned down. Mike therefore comments that if the crisis means that some of these assessors get a taste of what they inflicted on benefit claimants, this would be a case of poetic justice. He also wonders what the firm was doing when it devised the scheme to issue those massive dividends to its shareholders. Did they believe that the government’s magic money tree would continue to allow them to give heaps of money to their rich shareholders? He also asks other searching questions, such as whether it was deliberately underbidding to get government contracts, and then using the money to help finance those projects it had already won.

Mike concludes

So: First Carillion collapsed. Now both Interserve (remember them?) and Capita are in trouble.

Who’s next? And what will happen to public services while the Tories dither over this crisis?

See: https://voxpoliticalonline.com/2018/01/31/in-the-crap-ita-government-contractor-responsible-for-benefit-assessments-is-in-deep-financial-doo-doo/

Capita, or as Private Eye dubbed it, ‘Crapita’, has a long history of incompetence behind it. Way back in the 1990s it seemed that hardly a fortnight went by without Capita turning up in the pages of the satirical magazine. And the story was nearly always the same. The outsourcing company won a government or local authority contract to set up an IT system or run IT services. The project would then go over time and over budget, and would be massively flawed. And then a few weeks or months later, the company would be given a contract somewhere, and do exactly the same thing there.

You’re left wondering how Crapita kept winning those contracts, when it was so manifestly unfit to carry them out. Who did it have on its board? Or was there a deliberate policy by Major’s government to support outsourcing, no matter how inefficient and incompetent they were, because it was private enterprise and so preferred and supported for purely ideological reasons?

In any case, what seems to have placed the company in a very precarious financial situation is the usual tactics of big companies in this stage of capitalism: award massive dividends to the shareholders. This usually goes along with starving the rest of the company of investment, which seems to have been done to. And granting massive, and massively unsustainable pay awards to senior management. There’s no mention of that in Mike’s article, but I don’t doubt that this was done too. I’ve got the impression that it’s just about standard practice across a huge swathe of industry.

This is a financial strategy that has driven far more than one company to the wall. I also wonder if the executives weren’t also trying deliberately to create a debt, so that they could dodge corporation tax for five years. This is one of the tricks Stewart Lansley and Joanna Mack describe in their book on contemporary British poverty, Breadline Britain.

Over the years the outsourcing policy has been in operation, there’s been one crisis after another. The outsourcing companies have repeatedly shown themselves to be incompetent, not just in the case of capita, but also notoriously with G4S and the scandals over the violence and brutality it meted out towards asylum seekers in the detention centres it ran. And, of course, when a whole load of prisoners escaped on their way to court. Or jail.

Private industry has repeatedly shown that it is incompetent to do the work of the state sector. These firms have the disadvantage of having to make a profit for their shareholders, as well as the demands of their management for multi-million pound pay packets. The only way they can afford this is by cutting wages to their workers, and spending as little as possible on the service they are meant to be providing. The result of this has been a series of financial collapses. Carillion was the first. Now Capita and Interserve, another outsourcing company, is in similar trouble.

The only sensible recourse should be to cancel these companies’ contracts, and take everything back in-house. But this won’t be done. I think there’s a problem in that the state sector has been so decimated by the past four decades of Thatcherism, that it no longer has the capacity to run these services itself. There’s also the additional problem that too many politicians and media magnates have connections to these companies, or to firms in a similar position hoping for government contracts. Acknowledging that outsourcing was a failure would damage the interests of these politicos and press barons. There’s also the challenge of actually facing up to the fact that a central plank of Thatcherite dogma – that private enterprise is always more efficient than the state – is absolutely, undeniably wrong. Anybody who makes this point is denounced as a Communist in screaming headlines. You only have to look at the way the Tory press has vilified Jeremy Corbyn for daring to want to renationalise the NHS, the electricity net and the railways. His policies are very far from the total nationalisation demanded by Communists and Trotskyites, but you wouldn’t know it from the frothing abuse hurled in his direction by the Tories and Blairites.

There’s also another problem with calling an end to the outsourcing scam. PFI contracts and outsourcing allow some of the costs to be written off the official government accounts sheet. They’re still there, and we have to keep paying them, but they’re not included in the official figures. It’s why Mussolini used a similar scam when he was Duce of Fascist Italy. Any government that restores these projects to the way they were handled before risks putting millions back the official figures. And if that’s the Labour party, you can imagine the Tories making their usual hackneyed and untrue comments about ‘high-spending Labour’, and then re-iterating the spurious arguments for austerity.

I’ve no doubt that the government will do what it can to shore up the current mess the outsourcing companies are in. But the collapse of Carillion and now the severe financial troubles faced by Capita and Interserve show that outsourcing does not work. And given these companies’ highly checkered history, they should never have been given governments to begin with.

And it bears out exactly the description the author of Zombie Economics used for them in the very title of his book. Outsourcing, and the rest of the Thatcherite economic strategy of privatisation, wage restraint, low taxation and declining welfare are ‘zombie economics’ as they don’t work, but haven’t yet been put it into the grave.

It’s high time they were, and Thatcherite free trade capitalism was abandoned as the failure it so glaringly is.

Nationalisation Is Better: Bail-Out of South East Trains Shows Privatisation Doesn’t Work

January 17, 2018

South East Trains was in trouble again last week, and had to be bailed out by the government. The Labour Party made a statement that this showed the precarious state of the entire privatised rail network, as many of the other train companies could also claim they are in serious financial trouble, and pull out of the contracts.

This isn’t the first time aa privatised rail company has had to be bailed out by the government, or an alternative company found after one of them collapsed. And it shows very clearly that private railways don’t work.

Remember the old arguments for privatisation? State industries didn’t work. Instead, the state was subsidising inefficiency and these companies were a burden to taxpayers. They should be privatised, which would then make them more efficient, because they would have to respond to Maggie’s sacred ‘market forces’. If they couldn’t compete, they should be allowed to collapse. As happened with the mining industry.

Except that it hasn’t worked like that. We are now paying more in subsidies to the rail companies than we did when they were nationalised as British rail. And the service is actually worse than in the last days of the beleaguered nationalised rail network, when it was operating under the Operating For Quality programme.

Privatisation doesn’t work. Nationalisation of essential utilities, like railways, does.

But you won’t find this view promoted in the press, because the billionaires and magnates in charge of it consistently promote the idea that private industry is better, even when it is absolutely obvious that it isn’t. This is because, as businessmen, they see the rail network in terms of its money value to them. The corporate capitalism created by Maggie Thatcher and the Tories means that taxpayers are always bailing out inefficient and failing private firms, while punishing the poor, the unemployed and the disabled. It’s all about giving more money to the rich, regardless of whether the services they provide is any good. Capitalism has to be supported and promoted regardless. And if anyone says anything, then the Tories automatically rant on about the inefficiencies of the state sector in the 1970s, and how wonderful it was when Thatcher sold everything off.

But the failure of South East Trains, and the parlous state the other rail companies are in, show that this argument doesn’t work. It’s time to call end to the private ownership of the railways. They need to be renationalised, and a proper, public service given to the people of the Britain.