Housing - the Benefit of Mutuals

Hidden as a footnote in the BBC business news today is the report from the mutual Building Societies Association that in 2011, approved lending in this not-for-profit sector rose by a substantial 15% overall, with a massive 49% increase in mortgage lending. At the same time, the corporate banking sector saw a small decline in overall lending in spite of the increasingly desperate efforts of the Con Dem Government to get the "Masters of the Universe" as the financial PLC sector used to refer to themselves to lend cash to get the economy out of the doldrums.

Mutuals have long been advocated by many in the socialist and green movements as a key part of the solution to a free market economy based on speculation and accumulation. Formed out of mutual aid friendly societies as long as the late 18th century, British building societies have always worked on the basis of sufficiency - never lending more than came in and limiting what members could take at any one time; and, critically, not seeking profits for any purpose other than reinvesting in the business. There are no shareholders, no owners and no money taken out.

The result was that by the late 1980s, the sector was large and healthy, and at that stage still relatively diverse in spite of a trend of mergers. But the Thatcherite era saw an infusion of new possibilities for financial mutuals first of all to diversify their services and then to "go public" - become publicly listed companies making profits for shareholders. In other words, to become banks. Key to this was the 1986 Building Societies Act, as Thatcherite a piece of legislation as you could possibly find, which paved the way for the cash-grab of the bankers.

I briefly worked for the Bradford-based National & Provincial Building Society in its last days as a mutual. As its Board tilted towards de-mutualisation, scores of high paid executives were imported from the banking sector in a veritable frenzy of backslapping bonus-sharing as they strove to find ways to become a bank. In just three years, the number of Directors increased from six to over 60. Many staff in what had been a major local employer and a means of fostering modest home ownership and savings became uncomfortable about the sponsorship of a culture of greed and pie-in-the-sky notions that, in future, N&P as it became, might sell anything at all - "even hamburgers!" one over-excited director declared.

The vanishing mutual: N&P's Bradford city centre branch, long since empty..

As it was, a couple of years after I left, the first big housing recession kicked in and their plans came to nothing. Instead of sailing their way into corporate supremacy, the financial wizards had to settle for being swallowed up first by Abby National PLC before in turn vanishing into the giant Santander PLC. The headquarters, a large building in Bradford city centre that appeared to have been architecturally inspired by lego windows, was symbolically dynamited as hordes of locals looked on, uncertain how to react other than run up the hill when the dust clouds billowed out much further than anticipated.

The intervening decade and a half up to 2008 saw the bankers egotistical bubble inflate and stretch horrendously. Old shibboleths that limited lending went by the wayside. Anything could be borrowed and repaid. Buy-to-let mortgages, where people could borrow to purchase property to rent out, were introduced after decades of being illegal - causing massive inflation in the first-time buyers sector and pricing many younger people out of the housing market for good. Mortgage limits, once pegged at 80% of house value, rose to 120% and beyond as the poison of overlending reached everywhere.

The banks have failed and failed comprehensively. Nearly four years on from the crash of 2008, most remain in hoc to the Government, which in turn is punishing ordinary people through higher taxes and reduced services, grinding the whole economy to a halt. The housing market is flatter than flat, with unscrupulous private landlords the sole beneficiaries. In spite of repeated demands from the government, small businesses especially complain that it is nigh impossible to get loans for vital investment in their businesses. Stagnation results, with unemployment and low wages driving the consequent cycle ever down.

In all, with offers of a few hundred pounds in shares to members, ten building societies took the crooked path from mutuals to plcs. Read the list now, and they have virtually all vanished or, in the case of Bradford & Bingley and the pisspoor Northern Rock, were nationalised after collapsing only for their profitable sections to be sold off to the private sector once more.

The Green New Deal, proposed just before the last election by a range of green economists and politicians, including GPEW leader Caroline Lucas, argued for the hastily nationalised banks to be broken up and re-mutualised rather than sold off. In this way, the link with the need to make profits would be broken and they could focus again on building communities and local businesses and co-operatives.

But the Government is not listening. The profitable bits of RBS are being sold off to Santander, all of which will go firmly back into the private banking sector, in spite of all the signs that it has not learnt its lessons from the avaricious mess it has got itself and all the rest of us into. 

But of course, the building societies don't make donations to the Conservative Party - perhaps the one investment that does still count these days.  

IF YOU WOULD LIKE TO STOP BANKING WITH BANKS, LINK TO THE NEW MUTUALS CAMPAIGN TO VOTE WITH YOUR CASH - MOVEYOURMONEY.ORG.UK

Minding Your Ns and Qs on WMDs - IRAN, not Iraq! Doh!

Well, it's an easy mistake to make...

From Facebook - "Labour: Taking Back Our Party" group


CHECK OUT - THE FIFTY AMERICAN MILITARY BASES SURROUNDING IRAN @ THE ECOSOCIALIST- click HERE

BUSH: "This notion that the United States is getting ready to attack Iran is simply ridiculous. And having said that, all options are on the table."
OBAMA: "“No options off the table means I’m considering all options (on Iran).”

WHY THE LONG FACE?

Public Say No to Porker Capitalism

Everything has its price - capitalism eats itself!

The last week has seen executive pay high in the headlines in Britain again as we saw first the damp squib of the Con Dem government's supposed assault on overpaid corporate bosses followed by the same Government's decision to allow a bonus of nearly £1 million to be paid to Stephen Hester, the head of struggling state-owned bank, RBS. With both their report and Hester's pay, they resorted to their faux calls for responsible capitalism and for him to "do the decent thing" and hand the money back. Needless to say, there is no sign of either on the horizon.

Repeatedly, all three main parties have taken part in a mindnumbing dance of twisting and turning on executive pay. They all condemn the huge disparities in pay awards - nearly 50% increases for directors and senior managers in the FTSE 100 this last year in spite of the same bosses insistence on pay restraint among "ordinary" employees. They rail against the soaring ratios of 500:1 and higher in the top to bottom pay in some companies - a far cry from the 10 to 1 ratio seen as the "acceptable face of capitalism" back in the 1950s, not that that face showed itself quite as often as some apologists of reformist capitalism like to fondly remember.

And yet when it comes to action, they all baulk at anything effective. The furthest the Government has gone has been to propose an exceedingly modest increase in shareholder control over executive pay; but nothing on punitive taxation of bonuses; nothing on giving workers a say on the remuneration boards of big companies; nothing on squeezing down the immoral and outrageous inequalities in pay in spite of the spiralling social misery and potential disorder this is creating. In spite of their failure to pay fair or even any tax and their track record of business failure and short-sighted greed, these people, the politicians argue, are too valuable to risk them leaving Britain.

Fortunately, the public do not agree.

An opinion poll published by ICM today shows that only 7% of the public believe any executive should be paid more than £1 million. Just 1% - one per cent - of the 2,003 people surveyed agreed that the very top executives currently earning £4 million per year are worth it. Two thirds want to see workers on remuneration committees - an option ruled out last week by Business Secretary Vince Cable on the bizarre grounds that where companies have employees working overseas, it would be too difficult for them to elect representatives to sit on these bodies. Risible to say the least.

So in spite of the clear antipathy of the public to the eye watering inequalities in pay, none of the main parties offer any political action to tackle these effectively. Meanwhile, of the parties "bubbling under" in national opinion polls, only the Green Party commits itself to taking mandatory action on pay.

Three years back, I was involved in a Green Left proposal to the Green Party of England & Wales conference to set a maximum pay rate as well as the current minimum wage rate. At that time, we suggested £150,000 p.a. - roughly ten times the living wage rate. The proposal received significant support but fell short of being passed. The following year, however, the Greens adopted a policy that commits them to statutory measures to enforce a ratio of ten to one between the highest and lowest wages within any company or organisation; and the party is committed to higher tax rates for higher earners, with an emphatic endorsement of progressive taxation.

So for progressives, there is a genuine option for action on pay inequality. And as "The Spirit Level" report by Wilkinson and Pickett showed, a more equal society is one where there is much less crime, better health, stronger communities and higher levels of happiness. It also paves the way to a more sustainable fostering and use of resources at a time when many of the most basic are under increasing pressure. So everyone would benefit.

Meantime, under the Old Grey Parties, Britain remains firmly set on a course towards social disintegration. Austerity and authoritarianism are the watchwords of our gradually more and more embattled elite as it seeks to suppress rather than resolve the despair of the squeezed majority. Like the ancient Spartiate nobility in its decline, terrified by the growing resentment of its helot underclass, British capitalism is teetering over the abyss between chaotic collapse and social fascism.

Another news item today, on the BBC website, highlights that in Papua New Guinea, the price of a bride is four pigs. Checking the current price of adult saddleback pigs in Britain, the monthly pay of someone on the national minimum wage is worth less than two pigs - and of course that falls to zero when compared to the cost of the greedy porkers sitting in the boardrooms of "broken Britain."

Trickle down economics - from The ConDem Effect

Tilting At Windmills - the Imaginary Crusade of Vince Cable

Con Dem heavyweight, self-styled "free radical" Vince Cable, Britain's Business Secretary, today unveiled his much touted crusade against crony capitalism and grasping executives. After a 4,000% (yes, four thousand per cent) real terms increase in the pay of the FTSE 100 executives over the last 30 years, quite a few of us have suggested for a while now this was more than past the time to take real action.

Let us briefly remind ourselves of how Vince's mate, Nick Clegg and his boss David Cameron trailed this latest Con Dem initiative.

Cameron talked of the executive pay merry-go-round of Directors sitting on each others remuneration committees and of "market failure" as top pay rocketed by 33% in one year, while corresponding company share values rose by only 24%, and ordinary staff pay by somewhere less than 4%. On 8 January, he promised real action - no gimmicks - in creating "responsible capitalism".

Clegg, meantime, promised to "get tough"on the abhorrent levels of executive pay back in early December. Like Cameron, he wanted shareholder power to be given legal status to ensure that company AGMs could vote down excessive pay awards (at the moment, such votes are not binding) and similarly he complained about the "I'll scratch your back if you scratch mine" arrangement of mutual participation on each others remuneration committees.

So, finally, today, Vince the Crusader unveiled his heavy hitting package of regulatory reform as he fearlessly TOOK ON the pirate captains of British industry:

ZAP!: shareholders will be allowed to have a binding vote on executive pay, if they ask...
POW! : shareholders may also be able to "demand more clarity"on executive pay deals...
KERCHANG!: Company boards are to be "more diverse" by ensuring that two people on each board should not have been board members before...
BLAM!: the views of ordinary staff should be "taken into account" if they ask for them to be..although Vince pointed out that this is already the completely ineffective and almost entirely disregarded law in large companies...
WHOOOOSH!....er...er...well, that's it really...

Cable's Crusade - the mask slips....

So much for the great assault on crony capitalism. The new shareholder right to have a binding vote is not unwelcome, but given the massive logistical difficulties of anyone wanting to communicate with and organise a majority vote among the shareholders of these huge companies, it is hardly likely to set the heather on fire. On the BBC tonight, Cable admitted that "no (executives) will be quaking in their shoes over this..." And earlier in his statement he had been at pains to stress the Government has no plans to "micromanage" company pay. Indeed, he was not even willing to give his opinion on the touted seven figure bonus due to be awarded to the head of the state-owned RBS bank. Apparently, any speculation was "above my pay grade."

It is hardly surprising. In spite of all the rhetoric of the last few weeks, it would have been far more of a shock if a government of committed neo-liberals and free marketeers had done anything at all to tackle the excesses of the moneyed class. It is striking that the sole piece of legislative action - the possibility of binding votes on pay - supports the owners of companies. The Government had made noises about supporting the High Pay Commission's call for a worker's representative to be put on each remuneration committee; but Cable turned this down on the pathetically laughable grounds that, as some companies have overseas employees, it would apparently be too difficult for them to participate in electing a representative. And as for Directors on each others remuneration committees, the shocking corruption condemned so fiercely by both Clegg and Cameron? Vince the Bold says it happens so rarely that "it isn't actually a problem..." So, no need to do...anything, after all.

And so, with both government parties sympathetic to cutting income tax for higher rate tax payers - the Lib Dems have opposed it mainly during the recession; many in their party, including Clegg ally David Laws still see cutting top rate tax as a longer term aim - the chances of any genuine redistribution of income or wealth are lower than zero under the current regime.

The upward climb of the rich goes on unabated. The ever-pompous Cable, meanwhile is revealed as the Don Quixote of delusional reform; except even his windmills are imaginary. If this is responsible capitalism, only the Invisible Hand can save us now.... Erm...

Supermarket Sweep

Frozen Planet Shock New Footage from The Poke on Vimeo.


When I read the other day of supermarket uberchain Tescos £5 billion collapse in its share values, I was unable to sleep...for celebrating. After initially pondering exactly just how much cheese and wine "celebrity" chef Anthony Worrall-Thompson had taken from their shelves, I reckoned that those who live by predatory capitalism will die by it too - apparently over Christmas, marketing initiatives by the other big chains, Sainsburys especially, made big inroads to Tescos customer base. And so now the shareholders are worrying about their dividends following the company issuing a profits warning - coincidentally just after their Chief operating officer sold some £200,000 of shares for "necessary family expenditure"; must be quite a family!

Really? What exactly?

Of course, given just how totally unethical Tesco has been in its rampant takeover and destruction of local high streets, reaching a point now where it has a third of the food trade in the UK and a fifth of the clothes trade - nearly one in every four pounds spent by Britons is handed over in one of its outlets - the prospect of one of the other three big chains (Asda-Walmart, Morrisons and Sainsburys) benefiting from its decline is frankly cold comfort. Between them, these four outlets supply nearly 80% of our food - a dangerously high concentration in anyone's book for a whole variety of reasons.

All the supermarkets behave in questionable ways - undercutting small local shops, hammering suppliers to produce goods at ridiculously low cost (which is passed on in the form of higher profits to shareholders, not lower prices for consumers), paying low wages to marginalised workers on insecure contracts and using production and distribution methods for their "Just-In-Time" delivery systems which are environmentally devastating.

With the focus in the last three years on the corruption and crisis in the banking and financial sector, the retail food sector and the supermarkets have quietly continued their aggressive expansion into every nook and cranny of our lives. With even corner shops and petrol stations now sucked up by the four chains, they have moved online as well with home delivery - so that you buy even more of your needs from the one capitalist supplier. Relentlessly pushing the concept of convenience, they provide everything - food is nearly a byline set next to any household good you might want, books, dvds, clothes, medicines and even banking and insurance.

The result is a super-concentrated and inherently precarious system of supply - as the petrol dispute ten years ago showed, when supermarket bosses warned they had only 3 days supply of food in their stores, any significant disruption to their national distribution arrangements could spell real crisis for ordinary people. Imagine a major dislocation of energy supplies, or severe weather, or a financial crash that bankrupted a couple of these chains - the bailout required by Governments would totally eclipse the banking crisis. With hunger a real prospect within a few days, the potential for riot and chaos predicted in the NEF publication "Nine Meals from Anarchy" would be a direct result. We could face a national emergency of unprecedented proportions.

So, ecosocialists and any others concerned about sustainable and just societies need to ensure that the food retailers and supermarkets are as much a focus of campaigns like Occupy as the banks. The damage they have done is arguably more significant than the financial sector's misdeeds and the continuing risk they pose is massive. We need to legislate to create local, community food initiatives and revive small-scale production and supply of food and other goods. It is not just good for the planet - it is safer for society too.

The Greek Myths: retirement at 55, lazy workers and a bloated public sector

On BBC TV on Sunday morning, our beloved Prime Minister, David Cameron, did one of these things he does so often to endear himself with the masses - he told a lie. Shock horror!

Yet, to be fair to the blue-blooded, blue-nosed Old Etonian, it may not have been a deliberate lie. It may well just have been another example of his arrogant sloppiness in half-baked factology, first detected with his rubbish about record national debt, etc.

Mr Cameron repeated something which a surprising number of commentators, politicians and the public believe - because, thanks in part to comedians, Conservatives and the corrupt xenophobic media, most British people seem to think that Greek people retire at 55 years of age, and that this has contributed to their economic woes which have so badly rocked the Eurozone and beyond.

In fact, this is a total nonsense.

May Zeus strike them! The neolibs fibs about Hellas

The average retirement age in Greece is over 61. As in the UK, some jobs do allow early retirement at 55, but in fact 86% of workers do not enjoy such a scheme. The normal state pension age in Greece is 65 years of age - the same as at present in the UK, though it is rising in both countries over coming years.

In the UK, because women still retire earlier than men and a significant number of men retire early (many at 55 or even earlier), the average British retirement age is just above 63 now, just a little older than Greece.

So, yet again, the rightwing mythmakers have been at work, stigmatising an entire nation as lazy good-for-nothings. The truth, of course, is that Greece is in trouble because it is tied into the Euro and no longer has any control over its own currency - if the drachma was still in use, they could have devalued it and be well on their way to fiscal recovery. But because they are tied into strict limits set by the European Central Bank, which has appointed the unelected neoliberal technocratic Prime Minister (the inappropriately named Mr Papademos, which translates as Father of the people!), Greece is unable to print its own money - hence it is trapped in the Euro-snare where the Central Bank rather than the elected governments calls the tune.

Greece's problems also stem from some rather dodgy lending to the previous New Democracy (conservative) Government by international financiers just after the millennium. But of course, the neolibs are not going to own up to that one, so they are more than content to pander to racist lies about lazy people and, of course, a supposedly bloated welfare state. In truth, the Greek public sector, accounting for less than 12% of all employees, is the 4th smallest in all the Eurozone countries and Greeks on average work over 160 hours longer each year than Germans and over 100 hours longer than the European average.

As ever, our politicians and media ignore the huge concentration of wealth in the hands of a tiny rich elite in Greece, in line with the trends in most other austerity-focused states, seduced as ever by the half-truths, lies and twisted statistics of our political-economic masters. They are myths we buy into at our own peril - because it feeds the plans of the elite to continue to grasp and command more and more of the wealth of all nations. And, as part of that, force all of our retirement ages up and up until our leaving does can be combined with our wakes. 

Scottish and Wry...

David Cameron, George Osborne and Muppet-in-Chief Danny "Beaker" Alexander have managed to get themselves totally twisted and hoist on their own petard today over the prospect of a Scottish independence referendum. Concerned about the plans by the SNP Scottish Government to play a long game of slowly building up to a referendum in 2014, with a multiple choice of status quo, more devolution within the UK and total independence, they have decided to bring forward legislation to force the vote to be held sooner.

Citing secret discussions between Cameron and Osborne and "global business leaders", the Con Dems have warned any further delay will damage the Scottish economy and, for alleged clarity, the punters are to be given only two choices - yes or no to independence.

Beaker and Osborne - taking Britain forward to oblivion

It is testimony to the total ineptitude of the so-called unionist parties that by their actions they have completely validated the SNP's claims of central government ignoring the wishes of the Scots - who voted in large numbers for the majority SNP Government, which had made its referendum plans clear - and have almost certainly hastened the break up of the UK.

So which is the worst piece of amateur, overgrown schoolboy brinkmanship? :
- Westminster politicians from the Tories and Lib Dems, both of whom were comprehensively routed in the Scottish elections, with the latter pretty close to the wipe out zone, lecturing the elected government in Scotland on when it is to hold a vote? And besides, didn't both these parties vehemently oppose calls by then  Scottish Labour leader Wendy Alexander to call the SNP's bluff and hold a "bring it on" independence referendum four years ago? Had they supported her then, the issue might have been voted down for a generation. Now, they just look deeply interfering to the point of bullying; and with no small whiff of despair in their deeds.

- Cameron and Osborne declaring that the vote on the future of Scotland (and indeed, the entire UK, by default) should be held on a timetable dictated by big business?  It may have escaped their notice, but now is perhaps not the best time to cite the grasping pirate captains of capitalism as the motivating factor behind your cause.

- Cameron, Osborne and Beaker thinking it is clever to deny people a third option of enhanced devolution, presumably calculating that by doing so, enough devolutionists will baulk at all-out independence and opt for the status quo. Dave Cameron's old University mate and former President of Oxford Uni Tories, BBC Political Editor Nick Robinson, obligingly spouting the latest Downing Street cheat sheet, suggested this morning that a multiple ballot wouldn't be possible because "no one would know which option had won" if none got more than 50% of the vote. Presumably the Lib Dems haven't got round to explaining AV to the Tories; oh, sorry, bad language...

- Changing the law to make any referendum result binding, unlike all the other referenda held in the UK, which have been consultative. Presumably they are gambling that the apparent finality of a binding referendum might scare some people off voting for change.

- Cameron, Osborne and Beaker saying anything at all about Scottish independence. After all, what better advert for Edinburgh breaking away from the union is there than a reminder that these smug people, with little support among Scottish voters, are still ultimately in charge?

I am a Scot, living in England. I am no nationalist of any type and no advocate of independence. But after this amateurish farrago of blatant political fixing, which these pathetic irridentists seem so blindly determined on pursuing, I can only feel that the day the Saltire is hauled above a fully independent Scottish Parliament has come much closer - and, for the first time in my life, I really wouldn't be in disagreement with a basically social democratic country that wants to cut its ties with the junta that is driving Britain to the neoliberal dogs.

Obama Campaign To Launch...Missiles at Iran?

OBAMA TO LAUNCH ELECTION CAMPAIGN ON THE END OF A PATRIOT MISSILE

From the Jerusalem Post:
"Last week, Lt.-Gen. Frank Gorenc, commander of the US’s Third Air Force based in Germany,
 visited Israel to finalize plans for the upcoming drill, expected to see the deployment of several thousand American soldiers in Israel."
http://www.jpost.com/Defense/Article.aspx?id=250249

It has long been anticipated, but it increasingly looks as if American-Israeli strikes against Iran are drawing near. This is in spite of repeated assessments by the Intelligence community that Iran is not actively developing nuclear weapons and in spite of the long standing historical fact that Iran has never attacked another country in modern times. It is worth reflecting though, that Iran is surrounded by hostile nuclear weapon states, including Israel and other US satellites.

But with rightwing Republicans cheered by the emergence of Rick Santorum in Iowa's primary caucuses, Obama will be wanting more than ever to appeal to the voters the surging challenger thanks God for wanting to "cling on to their guns and bibles!"

A bad new year looms in the Gulf. As ever. Arab Spring, followed by nuclear winter?

Iran's nuclear noose:

Iran's nuclear noose - its' neighbours India, Pakistan, Russia and Israel are armed with nuclear weapons, while US & UK forces based nearby in Afghanistan, the Persian Gulf, Iraq and Cyprus have ready access to atomic arsenals.

NYPD Raids OWS Livestream Studio, Arrests Volunteers | AlterNet

Click on the link: NYPD Raids OWS Livestream Studio, Arrests Volunteers | AlterNet 

Freedom of speech is struck another blow in the USA as Republican voters split 2:1 in favour of homophobic racists in Iowa.

Happy New Year - let the social cleansing begin...

The Chartered Institute of Housing has published a report showing that, as new housing benefits rules come into effect from this month, there will be a short fall in the availability of rented housing set against the permissible housing benefit levels to be paid of some 800,000 properties, many of them family properties. In effect, millions of adults and children are to be left with stark choices - eat or have a roof over your head; or, perhaps even more tellingly about this government's real intentions, walk the streets where you are now, or move...preferably far away.

The problem is at its worst, unsurprisingly, in the better off boroughs of London, where at a stroke, tens of thousands of people in need will no longer have their housing costs met in full. The result will be a huge increase in demand in poorer areas, which are already struggling to cope, and so the anticipation is that these social outcasts will move away altogether to inhabit the dead zones of many of our decaying seaside resorts, far away from their social superiors, and also from any prospect of living in areas where there might be some reasonable chance of decent employment.

It is unsurprising that this is happening - the Government has trailed it long enough, with the Lib Dems contented support, as part of its combined strategy of deficit reduction and breaking so-called welfare dependency. The Housing Minister, Grant Shapps, has even suggested people should move onto boats - perhaps hoping these new Boat People might be conveniently washed away, out of sight of Tory voters.

Yet how is it that driving people away from areas they have lived in and may have some work, however limited or low paid, is going to break welfare dependency if they end up in some poky bed and breakfast in Southend? Or is it just another way of creating a large pool of even cheaper seasonal staff to service the well-heeled on their summer jaunts down to the coast? Someone to do retired Aunt Agatha's shopping for a few beads and nuts when she heads off to her retirement flat in Eastbourne?

Driving people out of their homes and communities - somehow, this perhaps more than anything else we have seen from the Con Dems, is the epitome of the drive back to a society that would make Victorian times look like a paean to egalitarianism. It is moving beyond gated communities to entire boroughs and counties with gates which might be invisible, but no less firm and unyielding than the iron ones that close off the cowering middle class revanchists keen to cling onto their material wealth.

It is a social cleansing that will lead only to more division, more tension and isolation between different groups in our battered society - at a cost far, far greater than any pounds or pennies saved through this most bitter turn of the screw on some of the most vulnerable people in our town and cities.