Category Archives: West Midlands New Economics Group
- Everyone agrees that Transnational Corporations (TNCs) are so big that they can avoid any responsibility to local communities.
- Like any other business, TNCs are driven by profit for shareholders above all else.
- WMNEG does not condemn profit in itself but wants TNCs and all businesses to be accountable not only to shareholders but to employees, consumers and local communities.
- Citizens have so far ensured accountability through democracy but TNCs and business are on the whole not democratic.
- TNCs can and do by-pass local democratic institutions if they do not like what they do. National governments believe that they are powerless to control TNCs lest they put their economies at a disadvantage in the global market.
- If they want to control TNCs and make them accountable to communities all the nation states will have to get together and agree what is to be done.
- There is no supra-national machinery at present that can do this job. Those that do exist, such as the World Trade Organisation and the European Union are all the side of the TNCs and in favour of removing even more barriers to their freedom.
- The United Nations could do it if it were given the resources and the mandate to do the job. It could become an integral part of its role to prevent conflict between the nations of the world.
- In the meantime those of us including WMNEG who criticise the operation of TNCs in the global market can only protest and mount negative campaigns.
- The alternative strategy is to support local communities in taking unilateral action to protect themselves from the impact of TNCs and other irresponsible businesses.
The antidotes to globalism for communities to adopt are:
(a) increased seIf-sufficiency,
(b) resistance to TNCs and
inward investors so as to extract “responsible behaviour” agreements from them,
(c) diversification and break-up of over-dominant industries.
- These tactics could be supported by local authorities and trades unions in particular.
The role of WMNEG could be to
(a) promote locally self-sufficient economies that rely less on inward investment and TNCs,
(b) promote diverse economies that do not rely on a single large industry,
(c) campaign for a new supranational democratic body to agree the rules by which TNCs will be accountable to local communities and,
(d) argue for the democratic control of business by all its stakeholders.
Steve Beauchampé pays tribute to the community activist and Birmingham Press columnist who passed away earlier this week.
Alan Clawley, who has died from cancer aged 74, was the kind of tireless campaigner that every community needs more of. The causes that he became best known for – saving Birmingham’s modernist central library from demolition and championing the work of its architect John Madin – may not have been the most popular, but Alan fought for both tenaciously, assiduously and with a relentless determination that was both an example, and an inspiration, to others. That he was supported in his efforts by such informed and respected voices as those of English Heritage (now Historic England) and the Victorian and 20th Century societies, and by knowledgeable local architectural experts Joe Holyoak and Andy Foster, speaks volumes for the strength of his arguments.
Fearlessly taking on both councillors and senior council officials over the library, exposing their cant, their ill-informed interventions, the deep flaws in their arguments, Alan presented a coherent, convincing case for the defence. He scoured official documents, challenging a decision-making process that had clearly reached its conclusions before it had examined the evidence, shining a very bright light on its shortcomings in a way that no elected councillor came close to. And he did so incessantly, initially via the online pages of Adrian Goldberg’s Stirrer website and, following its closure, via its successor, the Birmingham Press.
What his Council opponents wanted at Paradise Circus were 60-storey towers, what they are now getting is a bland, urban office scape as forgettable as Madin’s imposing inverted ziggurat was memorable. Alan saw this coming; he read the planning applications, poured over the Paradise Circus development plans and strategy documents…and when it came to the new Library of Birmingham, Alan repeatedly warned of the project’s true cost and un-affordability, of how the city would end up with a central library reduced in size and offering a diminished service to that of its predecessor.
Whilst many councillors and high-ranking city officials derided John Madin’s work, readily approving or supporting the demolition of many of his key buildings, and colluding in trashing his reputation, Alan spoke out for surely the most important and influential of twentieth century Birmingham architects. This admiration resulted in a biography of Madin, published in 2011 (part of the RIBA’s 20th Century Architects series) and the first serious overview of Madin’s work. Alan wrote and researched two further books, Batsford’s Birmingham Then and Now (2013) and Library Story: A History of Birmingham Central Library (2016) and helped form the Brutiful Birmingham Action Group, its goal to increase appreciation of this much derided brutalist style of modernist architecture.
Yet there was more to Alan Clawley than the Birmingham Central Library and John Madin. Moving to the city in the early 1970s after training at the Architectural Association School of Architecture in London, where he had graduated in 1969, he became involved in the Small Heath Park Housing Co-operative and was an active member of the Green Party, standing (as did his wife Hazel) in many elections (both he and Hazel were on the ballot paper for yesterday’s council elections), and he was a friend of Moseley Road Baths amongst many other community campaign groups. Indeed, so much of what Alan Clawley did was undertaken without the thought or expectation of financial gain, but because it was worthwhile and needed to be done. Surely a significant measure of a life well-lived.
May 3rd 2018
First published in the Birmingham Press
There was also a tribute in the Birmingham Mail
Alan was chairman of the West Midlands New Economics group and some of his more low-profile activities will be recorded here in due course.
Transport for London has decided not to give Uber a new license, though its application (Uber requires drivers and users to have a smartphone) will still be operational in London while Uber appeals against the decision. Problems have arisen partly due to the company’s policy of not finding out whether the prospective driver has a criminal record.
An Uber executive from the scandal-prone company is said to have advocated hiring investigators to “dig up dirt” on journalists who criticize them. A commissioner in Virginia who opposed Uber was flooded with emails and calls after the company distributed his personal contact information to its users in the state.
Uber has been banned from or – due to legal restrictions – has voluntarily pulled out of Alaska, Oregon (except Portland), Vancouver, Bulgaria, Denmark, Hungary, Italy, German, London, the Northern Territory in Australia, Japan, and Taiwan.
The New Economics Foundation has called for a mutually-owned, publicly-regulated alternative to Uber, providing better working conditions for drivers and higher safety standards for passengers.
Stefan Baskerville (NEF: Unions and Business) said: “Digital platforms are here to stay and technology cannot be reversed. The question now is how they should be controlled and by whom, as well as the standards they set and how they treat people. It is time to develop alternative models which put people back in control”.
As NEF points out, drivers in different parts of the UK are developing their own platforms
In 2015 Cab:app was co-founded by London taxi driver Peter Schive, who said: ‘Cab:app draws on the heritage and expertise of the black cab industry and translates it for the digital world.
Other early examples included the Bristol Taxi App – abbreviated to Braxi – which will only employ drivers licensed by Bristol City Council. Farouq Hussain, ‘one of the brains behind the app’, described it as being “just like Uber, only local”, with no surcharge and 25% pay cut. He added: “Our app takes the best of Uber and makes it local”.
The most recent: in June Anlaby-based 966 Taxis in Hull designed and launched its Uber-style app which they believe could transform the service. Alice Martin (NEF: Lead for Work) said: “TFL’s move will send ripples across the country where there has been a recent surge in private hire licenses given out to support Uber’s growth, particularly in the Midlands, Yorkshire and the North West” adding:
“We’ve been working with drivers in different parts of the UK who are developing their own platforms. The time has come for the Mayor to back a better alternative to Uber and lead the way for other local authorities to do the same”.
Jeremy Heighway writes:
Years ago (but still after the dawn of apps) I thought about putting some effort into an app that would be more closely related to hitch-hiking than getting a taxi.
Basically, new trips by car should not be generated (aside for slight detours), and drivers would only be sharing the costs of trips they would have made anyway – and not making an actual profit.
I hope that a new platform manages to get the idea across that socially and ecologically sound mobility is not via job and journey creation using cars, but more efficient vehicle use.
Could you give us some guidelines about how you would change the present economic system to a new and greener economy, so that the current (political) parties have something to work on? They will need this if they are going to move from a market economy.
Good guidelines/practical strategies for moving towards a green, balanced economy were given on this website recently and last week the concept of a circular economy was summarised on Localise West Midlands’ website.
A regenerative ‘Circular Economy’ includes more localisation of economic activity and would replace and address the social and environmental damage done by the current ‘Linear Economy’ with its ‘take, make, dispose’ model, depleting finite reserves to create products that end up in landfill or in incinerators. It achieves its objectives through long-lasting design, maintenance, repair, reuse, remanufacturing, refurbishing, and recycling – reducing waste to zero. Some examples of such practice are presented on the website of the World Economic Forum.
The idea of circular material flows as a model for the economy was presented in 1966 by an economist, Professor Kenneth Boulding, in his paper The Economics of the Coming Spaceship Earth. In the 70s, Walter R. Stahel, architect, economist and a founding father of industrial sustainability, worked on developing a “closed loop” approach to production processes. He co-founded the Product-Life Institute in Geneva; its main goals are product-life extension, long-life goods, reconditioning activities, waste prevention, advocating “more localisation of economic activity”.
‘Resource’, the first large scale event for the circular economy was held In March 2014 and Walter Stahel joined the programme of 100 business leaders and experts. Many major stakeholders and visitors from across the globe attended. An annual large scale event is now increasing the uptake of circular economy principles.
The Waste & Resources Action Programme (WRAP) a charity, which receives funding from the Department for Environment, Food and Rural Affairs, the Northern Ireland Executive, Zero Waste Scotland, the Welsh Government and the European Union was set up in 2000. From its headquarters in Banbury it works with businesses, individuals and communities to achieve a circular economy through helping them to reduce waste, develop sustainable products and use resources in an efficient way. (Above: the header for its March report)
On 17 December 2012, the European Commission published a document entitled Manifesto for a Resource Efficient Europe. This manifesto clearly stated that “In a world with growing pressures on resources and the environment, the EU has no choice but to go for the transition to a resource-efficient and ultimately regenerative circular economy” and outlined potential pathways to a circular economy, in innovation and investment, regulation, tackling harmful subsidies, increasing opportunities for new business models, and setting clear targets”.
Ellen (right) established this independent charity in 2010 and eloquently outlines the economic opportunity of a circular economy, giving the concept wide exposure and appeal.
John McDonnell announces that Labour has set up a ‘working group’ to investigate universal basic income
The group is working with Guy Standing, one of its economic advisers. Guy is a British professor of Development Studies at the School of Oriental and African Studies (SOAS), University of London, and co-founder of the Basic Income Earth Network (BIEN).
Standing has written widely in the areas of labour economics, labour market policy, unemployment, labour market flexibility, structural adjustment policies and social protection. His recent work has concerned the emerging ‘precariat’ class and the need to move towards unconditional basic income.
During the summer of 2016 Mr McDonnell, who has been the MP for Hayes and Harlington since 1997, suggested he could “win the argument” on basic income within the Labour party. He now intends to publish a report on the idea to encourage discussion on the topic around Europe.
The Shadow Chancellor launched the first of Labour’s regional economic conferences in Liverpool on February 4th– read more here.
Transforming our Economy’ Conference in Newcastle Saturday 18th March 2017, details TBC
Annual ‘State of the Economy’ Conference in Birmingham Saturday 20th May 2017, details TBC
‘Transforming our Economy’ Conference in Bristol Saturday 8th July 2017, details TBC
‘Transforming our Economy’ Conference in Cardiff Saturday 28th October 2017, details TBC
Speaking about the idea – floated by Benoit Hamon during the socialist primaries of the French presidential elections – Mr McDonnell added:
“Interestingly, [Narendra] Modi’s government has brought forward a report in India as well about the need to develop basic income ideas and again see how they can implement it over a period of time. All of a sudden it’s become… an idea whose time may well have come . . .
“We’re exploring it. We think there are elements of it that we can bring forward as first steps towards a basic income that people can support.
“I was involved in the early campaigns many years ago on the development of child benefit – at that point in time there were all sorts of anxieties about whether you could bring forward a benefit for everybody that wasn’t based upon an assessment of need and we won the argument. I think child benefit is like one of the foundation stones of a future basic income”.
As John Nightingale who sent the link says, this ‘reads well’:
Each year the Financial Times conducts a survey of leading economists on the UK’s upcoming prospects. The New Weather Institute is part of that survey and predicts a bumpy ride. A lot of the FT material sits behind a paywall, so for interest here are the answers we gave to their questions (which are themselves interesting in terms of locating mainstream concerns) on issues ranging from economic growth, to Brexit, monetary and fiscal policy, inflation, immigration and, unavoidably, Donald Trump.
How much, if at all, do you expect UK economic growth to slow in 2017?
It is time to stop measuring the health of the economy using orthodox economic growth measured by fluctuations in GDP as the primary indicator. By mistaking quantity for quality of economic activity, worse than telling us nothing it can be actively misleading. It tells us nothing about the quality of employment, the intelligence of infrastructure, the economy’s resilience, the environment’s health, or the life satisfaction of the population. As the United Nations Development Programme pointed out (as far back as 1996), you may have growth, but it might be variously jobless, voiceless (denying rights), ruthless (associated with high inequality), rootless (culturally dislocating in the way that fed Brexit, for example) or futureless (as now, based on unsustainable resource use). All of this said, I would expect the undifferentiated volume of UK economic activity not to rise significantly over the course of 2017. If anything, the opposite is more likely due to a combination of the instability resulting from the lack of clarity over Brexit, and the unknown global impact of a rise in economic nationalism in the United States under a Trump Presidency.
Compared to what you thought 12 months ago about the UK’s long-term economic prospects outside the EU, are you now more optimistic or more pessimistic than you were?
I am more pessimistic than 12 months ago. Official optimism from the UK government over negotiating Brexit appears either disingenuous or extremely naïve to anyone with a wisp of experience of trade negotiations. If it is a case of being disingenuous to save political face, the sheer lack of public realism demonstrates a kind of poor management of expectations that is likely to feed a creeping disillusionment in the process, as deadlines are missed and compromises made. If simply naïve – and it is publicly recognised that Whitehall chronically lacks negotiating capacity – it raises the spectre of levels of incompetence that make it impossible to be optimistic about the UK’s long-term economic prospects.
Inflation has started to increase in recent months. To what extent do you expect inflation to rise in 2017?
The minor movements of inflation to a shred over 1 percent keep rates at historically very low levels. A bit more spending on shoes, clothes and furniture barely constitutes even cause for comment. You could say that the rate is rising because it doesn’t have much else to do. With broader economic uncertainties so strong, we are still in touching distance of a deflationary environment. And, with high consumer debt levels still worrying the Bank of England, the low inflation rate stands to exacerbate debt burdens. With the economy in a kind of limbo due to the opaque future ushered in by our unknown future relationship with the EU, I expect inflation to do nothing more dramatic than it has done for most of the last twenty years in an upward direction. But there is always a danger that it might weaken further, which will be a much bigger problem.
In December, the Monetary Policy Committee said the next interest rate move could as easily be up as down. Will there be a shift in this monetary policy stance by the end of 2017?
There is a strange and tenacious myth in economic commentary that a single, meaningful interest rate prevails across the economy. In practice, of course, this is nobody’s. What matters to the economy is that cheap, patient money is available for things that matter, such as building a resilient and efficient low-carbon infrastructure. Equally, the cost of money for risky and potentially damaging activities should be high. Unfortunately because of broader policy, pricing and market failures the opposite is often the case. Hence, tax breaks, subsidies and the way investment portfolios get managed means that money flows cheaply in fossil fuel infrastructure and operations. At the same time, necessary and successful emergent sectors like solar and other renewables can still struggle for affordable, patient capital. The privatisation and weakening of the mission of the Green Investment Bank is deeply concerning in this regard. Once again, prevalent economic uncertainties seem to be having the effect of putting everyone, the MPC included, on ‘watch’, and unlikely to do anything radically different in the ‘phony war’ period of approaching Brexit negotiations.
Immigration is likely to be central to the Brexit negotiations in 2017. How much do you think immigration will change and what effect do you think this will have on the UK economy?
It is tempting to ask how will we know how much immigration will change? Statistics are notoriously unreliable and, as the Financial Times has pointed out, become ‘less reliable the more detail you look for.’ A significant proportion of immigration is unrelated immediately to Brexit negotiations, though not to broader government policy. But on this, the government appears deeply divide, such as differences in approach to the control of foreign students between Philip Hammond, Theresa May and Amber Rudd. If anything, far from being downgraded by the Brexit debate, the economic importance of immigration to key UK sectors has been made more acutely obvious, ranging from higher education, to food, retail and a range of other service industries. Importantly, many of the drivers of population movement from inequality to conflict and environmental degradation show no sign of lessening and, if anything, growing worse. The tone and promise of government policy seems mostly to affect the degree of xenophobia experienced by immigrants rather than significantly changing their numbers. With all these things in mind, I doubt trends in immigration will change much in 2017 and that this will buoy-up a UK economy facing a wide range of threats.
Fiscal policy: Philip Hammond is expecting government borrowing to fall in 2017. His new fiscal rules provide headroom for more borrowing than currently forecast. To what extent will he need to use it and why?
The UK is weighed-down with an aging, creaking, high-carbon infrastructure. The case for public investment as necessary to rebuild the foundations for a modern, clean and efficient economy to underpin our quality of life is overwhelming. The cost of money for conventional borrowing is cheap. And the decision by the Bank of England to expand its quantitative easing (QE) programme from £375 billion to £445 billion in the wake of Brexit, demonstrates that public money creation is also possible when the situation demands it. Up to date, QE has benefited the banks, and the holders of certain assets, with broader economic benefits being questionable. But, as Mark Carney has previously indicated, there is no reason in principle why it cannot be used in a more intelligent and focused way to aid the productive, low carbon economy. I and others have consistently argued that far more good could be done if the same basic mechanism was used, for example, to capitalise a much larger and more ambitious green investment bank via bond purchases. The work subsequently undertaken such as large scale energy efficiency retrofitting of the UK housing stock and the roll out of renewable energy would generate good quality local employment and better prepare Britain for the future. There is no sign yet that the government intend to seize this opportunity and rather too many signs that any borrowing that is undertaken will not be put to as good use.
How do you think Donald Trump’s presidency will affect the UK economy in 2017?
The effect of Donald Trump’s presidency on the UK economy in 2017 will be as unpredictable as the bounce of an American football. Nobody seriously can know what it will be, other than increasing general levels of uncertainty, because nobody seriously believes that Trump himself knows what he will do in office. We can speculate that his brand of economic nationalism will be tempered by the full realisation of China’s leverage over America, just as we can question its initial sincerity. Especially as even as he was tub thumping against China, branded Trump products were available which carried globalisation’s legendary Made in China mark.
However, combined with the sentiments unleashed by Brexit, and the UK government’s active new embrace of industrial strategy, it is possible that the economic pendulum may swing back some degrees from globalisation toward localisation. Done in a purely autarchic way this might be negative. Done with respect to international cooperation and obligations, and to help build a more environmentally sustainable economy, it could snatch success from the jaws of chaotic self-destruction.
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