Stop Tinkering: Govern and Inform

Who is in charge?

The government is so poor at communicating that we have to guess what is going on. Gordon Brown and Hilary Benn tell us that there will be no immediate cash payment (£100 was floated) for pensioners - because the priority is long term measures (10 year,20 year) to save energy. This is likely to be of small comfort to people in their 80s and 90s.

From press reports, we learn that the reason for the non payment is that the energy companies will not play ball. The foreign controlled companies (French, German) fear that, if they agreed to the £100 payment, their own governments would demand the same.

All of this, of course, demonstrates the folly of privatisation. The position would, clearly, have been very different if energy companies had remained under public control.

Does Democracy mean anything?

We do not elect energy companies: we elect governments. We expect them not only 'to feel our pain' but to do something about it - and to remember that our gas and electricity bills have to be paid NOW.

The finance to support people, and the economy, at the level required (£20-30 Billion) could be acquired from two sources - and the action would receive overwhelming public support.

The first source is a windfall tax on companies (especially energy companies) making obscenely large profits. The government, we are told, hesitates because this would upset the City of London and result in companies moving their bases to other countries.

This would probable not happen on any significant scale. If it did, we should be pleased to say goodbye. The City of London (especially banks etc) contributed significantly to the current economic difficulties. They must not be allowed to govern the country.

The second source is to slash the defence budget, and borrow now against the funds which would become available next year and the year after. This means withdrawing from Iraq and Afghanistan and developing an international policy based on support for the United Nations.

This would, no doubt, upset the USA. But government from Washington is no more acceptable than government by the City of London.

Radical Policy Changes

For detail, including fuller explanation of the policy changes necessary, go to Ebay and buy (at cost £4, including p&p) Capitalism in Crisis: the Socialist Solution - which could be as aptly entitled 'the Common Sense Solution'.

This booklet is also available (same cost) from John Kyte, Flat 27, No 1 Park Hill, Moseley, Birmingham B13 8DU.

Buying Houses and the Government

Government's Small, Faltering Steps

Any help for people struggling in the housing market must be welcomed. It can only be hoped that the measures announced 2nd September will be followed by others in days rather than weeks.

What is striking is the contrast between the seriousness of the economic situation, as reflected in Chancellor Darling's recent comments, and the comparatively minor measures just announced.

The other depressing factor is the continuing evidence that the government is on the side of big business, rather than ordinary citizens.

For example, it appears that the bulk (if not all) of the additional funding for Shared Equity house purchases is to be allocated for new houses property developers wish to sell.

The shortage of funding to help young people to buy (and private citizens to sell) older houses in the housing market gives the impression, again, that the emphasis is on helping developers to sell houses, rather than helping young people to buy them.

If this is not the case, why is there no more support for individual citizens who wish to sell, and buy, houses?

What follows is an account of the experiences of one young couple who attempted to buy a house using the Government Shared Equity Scheme.

The Government’s Shared Equity Scheme and First-Time Buyers

Introduction
A scheme with a government backed loan at low interest acting as a deposit (say 25%), plus a mortgage at a competitive interest rate, appears ideal for First-Time Buyers on modest incomes.

For this reason, we attempted to buy a house for approximately £110,000 – an amount which our joint incomes matched comfortably for repayments.

Unfortunately, although we responded promptly to all requests for information - and met the criteria of the Scheme, when we finally had an offer for a property accepted we were told that the money had run out.

Yet, immediately before we made the offer, we had been told that the money was available for us to go ahead. As any reasonable interpretation of this must be that the money had been allocated, an explanation of what happened to it is obviously required.

The purpose of this report is to draw attention to the difficulties, especially for young people, arising from the way in which the scheme is operating.

Apart from the facts recorded below, there have been innumerable telephone calls and Emails.

There is supporting written evidence for the factors listed below.

Operation of the Shared Equity Scheme 2008

The details which follow show how the scheme operated in our case.

(i) 4^th April MY 4 Walls assessed, and approved, our application for a loan to support (as a deposit) a Shared Equity Scheme purchase.

(ii) 18 April we received a letter from MY Choice Homebuy to confirm notification from our local Homebuy agent.

(iii) We made an application for a mortgage to the Halifax to supplement the loan.

(iv) 20 May we received confirmation from Connells that an ‘in principle’ acceptance had been received from the Halifax for up to £90,000. This was confirmed on a Priority Card.

(v) 23 May we received an Email stating the fees for buying a house for £110,000.

(vi) 10 June we received confirmation to go ahead and make an offer.

(vii) In this context, we made an offer of £90,000. This offer was not accepted.

(viii) We then made an offer of £105,000 for a house in Cromwell Street.

30 June we were informed that our minimum purchase price was £107,000.

This mystified us, as it appears totally unreasonable that there should be a minimum purchase price. In any case, why were we not told this before we made the offer?

(ix) 30 June we received a letter confirming the Scheme acceptance of our application.

(x) As our offer of £105,000 was not accepted, we increased it to £110,000.

(xi) Our offer of £110,000 for 65 Cromwell Street was accepted by the estate agents, Saxon Mee on 11 August.

(xii) 12 August the Scheme administrator was informed (by Email) that our offer had been accepted.

(xiii) 18 August we received forms to be completed from the Scheme Administrator.

(xiv) 19 August the completed forms were returned to the Scheme Administrator.

(xv) During the afternoon of 19 August, the Scheme Administrator ‘phoned and stated that the money had run out.

This was a shock and, obviously, extremely disappointing. We cannot understand how, within days, we were told that the money had been allocated, and then that it had disappeared.

Policy Alternatives: Urgent

For alternatives to the Government's current policies see Capitalism in Crisis: A Socialist Solution. This is available on ebay at cost (£4, including p&p), or from John Kyte (same cost) Flat 27, No 1 Park Hill, Moseley, Birmingham B13 8DU

Capitalism in Crisis: A Socialist Solution

Government Action?

The 'credit crisis' has been with us for more than a year. The government, acting in days and weeks, has provided £s Billions to bail out the banks. This includes Northern Rock, which has been nationalised.

Wealthy bankers, largely responsible for the scale of the credit crisis, have been given what they asked for. But what about the rest of us?

A minor initiative to help first time house buyers is unbelieveably bureaucratic. I know of applicants who spent 3 months filling in forms, were frequently mislead, and then (having been told that their application had been accepted) were informed that the money had run out.

What a ridiculous situation, when the government claims to be concerned about the state of the housing market!

Action This Day

If the government is genuine in claiming to 'feel our pain' it must act immediately. It acted in days to save the banks but has not stopped the banks making people homeless.

It could have impossed a windfall tax in May (at the latest) and used the proceeds to keep families in their homes and help the poor with their food and fuel bills.

A radical programme is needed but, given performance so far, expectations cannot be high for the measures we are told the Chancellor will announce next month.

The Solution

The type of radical programme required is described in Capitalism in Crisis: A Socialist Solution. This booklet is available on ebay at cost (£4), including p&p. Or send £4 to John Kyte, Flat 27, No1 Parkhill, Moseley, Birmingham B13 8DU.

Buy it and, even more important, join the campaign for a fair deal for all - not just for bankers.

Callaghan's Defeat and the Country's Wrong Turning

It was after the weak and befuddled Callaghan government was defeated in 1979 that the country took a wrong turning. The first Thatcher administration started retrogressive policy trends that have continued until the present – through 18 Tory and 11 Labour years.

The key policy drivers throughout this, almost 30 year, period have been:

(i) the transfer of powers from local authorities, as part of a general intention to undermine democracy;

(ii) attacks on, and measures to weaken, the trade unions, as part of a general attack on workers’ rights;

(iii) the, in effect, giving away of the main benefits of North Sea Oil to commercial interests, and the privatisation of a whole range of other national assets.

Democracy was undermined by the transfer of powers from local authorities, controlled by elected councillors, to unelected quangos and other nominated bodies, such as school and college governors. Policies, and their implementation, were dictated from Westminster and Whitehall, with insignificant consultation.

Because local councillors no longer had the powers to address issues, for example in education, raised by members of their communities, citizens became increasingly divorced from the political process. The feeling that they do not matter, and they cannot make a difference, is why so many do not vote.

The most serious consequence of the Tory governments’ anti trade union measures is the removal of worker protection. The ‘free’ employment market enables employers to drive down wages and dismiss employees much more easily, often unfairly.

The enormous potential of North Sea Oil to raise the living standards of the poor was squandered. Effective control was given to multi-national oil companies and the £ billions the government received in tax were used to fund rising unemployment. The number out-of-work rose to over 3 million, as manufacturing industries were allowed to disappear.

The Thatcher and Major governments regarded a thriving City of London, not a buoyant manufacturing sector, as the measure of success. The Tory conviction was that if controls were removed the free market would solve all economic and social problems. The 2008 disasters in the housing market originated with these free market policies.

Building societies, in effect owned by their customers, were allowed to become banks. Many then embarked on irresponsible lending binges and paid large bonuses to employees who sold the most loans. It ended in tears, as the collapse of Northern Rock, and the difficulties of other banks, have demonstrated.

The Tory position, in accord with its tradition, has been that public expenditure is an evil and should be reduced to lower the ‘burden’ of personal taxation. In addition to giving the better off a good deal on tax, the Thatcher and Major governments gave them, what were, in effect, one-way bets: they were able to buy shares below market value when the public utilities (gas, electricity, water telecommunications etc) were privatised.

It took a long time for the majority of people to recognise the damage inflicted by these policies on the public services. However, by the end of the 20^th century, Labour, along with citizens who had experienced the damaging effects of the Thatcher cuts, recognised that public expenditure, especially on the health service and education, needed to be increased.

It was because, in so many respects, it was recognised that the Major government’s policies were heading in the wrong direction that a Labour government was elected in 1997. Many of us in the Labour Party believed that a Labour government would:

(i) improve public services by increasing expenditure;

(ii) transfer powers from unelected quangos;

(iii) take steps to create greater fairness and equality.

The next blog will show how naïve we were.

The Labour Party and Socialism 1950s-1970s

The Labour Party and Socialism I 1950s-1970s

The Failure of Capitalism

With a few notable exceptions, such as Tony Benn and Eric Robinson, people move to the right as they grow older. There are plenty of examples of this in the present government. Instead of challenging the Establishment, most cabinet ministers become part of it.

Although not notable, I have moved in the opposite direction. I have never doubted the relevance of socialism: with the experience under new Labour, I am more convinced than ever that if offers the only solution.

No doubt this is the reason I have been ignored for the last 30 of my 50 years membership of the Labour Party. Nevertheless, I am willing to help the present government in its hour of need. All it has to do is to ‘turn a deafen’ to the City of London, Washington, the Daily Mail and listen to me, representing (as I’m sure I do) the views of some 3-4 million people in the Labour Party and the trade unions.

As opponents of privatisation, and of restrictions on the range of public services, we are not associated with the policies of recent years. What we are saying, in a general sense, is that rampant capitalism has had its chance and has landed us in an almighty mess.

‘Socialism’ must not only dare to speak its name, but also have the courage to explain how its policies are the most relevant for addressing the economic and social challenges we currently face.

Labour in the 1950s

In the 1950s there appeared to be a real prospect of improvement in the quality of life of all citizens. A free health service had been established by the Attlee government, and the railways, coal mines and utilities (gas, water, electricity, communications) were under public control.

The post-war re-building by the Attlee governments 1945-1951 placed the economy on a firm footing. By the mid 1950s the standard of living had developed to the point where Harold Macmillan’s ‘we have never had it so good’ was widely recognised.

The ‘we’, however, was far from including everybody and there was a great deal to do to create a fair and equal society.

Labour in the 1960s

Harold Wilson, who had resigned with Aneurin Bevan when Gaitskell imposed health charges in 1951, believed that people could be lifted out of poverty as a result of the economic benefits flowing from ‘the white heat of the technological revolution’.

The strategy of raising the living standards of the less well off from economic growth, as an alternative to a more progressive tax system to redistribute wealth, has persisted throughout all Labour governments since.

By the 1970s it was clear that the ‘equality from economic growth’ strategy did not work and only very modest progress had been made towards a fairer society. However, taking a world view, the balance of power between capitalism (led by the USA) and communism (led by the USSR) appeared to be maintaining a relatively stable world.

For the UK, North Sea Oil held the prospect of improved living standards for all UK citizens with, in addition, sufficient resources for investment in developing countries. It was also possible to be optimistic about democracy; particularly given the balancing powers of government, local authorities and trade unions.

Rights, laws and recognised procedures to protect employees, won by working-class struggles over the previous century, provided reasonable protection for citizens threatened by vested interests and bureaucrats. Although there was a great deal to do to eliminate poverty, create equality, and improve public services, it appeared doable.

However, at the end of the 1970s, the country took a wrong turning which will be described in the next blog episode.

Who is well placed?

A frequently comment by members of the government is 'we are well-placed to survive the economic storms raging around us'.

I don't want to hear this any more. The 'we' may refer to senior members of the banking fraternity who, having been bailed out by the government, will continue to receive their obscenely large bonuses - or to hedge fund managers taking advantage of companies in difficulty to buy them on the cheap (and then make £ millions).

The 'we' is certainly not senior citizens struggling to pay their electricity and gas bills, or families with growing mortgages, or young people trying to buy a house.

Yes, the government has taken some minor steps to help, but nothing on the scale of the £ billions made available to the banks. We are a rich country (5th richest in the world, I believe).

But the riches are most unfairly distributed and the posts which follow will describe what must be done about this - not next year, or next month, but action now.

WHY SOCIALISM?

WHY SOCIALISM?

Policies and Principle

This Blog is not about intellectual reflections on socialism. But neither is its concern limited to a political programme. Its purpose is to explore the thinking and experiences of those who have gone before - as the basis for a strategy to address the political, economic and social challenges we face in 2008.

However, if the policies proposed are to have a beneficial, and lasting, effect on our quality of life, we must have a clear understanding of the principles on which they are based. The action taken by government must lead to a more fair and equal society.

From my own experience of 50 years in the Labour Party, I hope to strike a cord with other members - and ex members who have left disillusioned. Even more important, I urge them to agree that it is the members, and only the members, who can save the Party and the Brown government.

But there is no time to lose. In the present, difficult, economic circumstances millions of people need help – and they need it quickly. Unless the government acts immediately, there is no chance that Labour will win an election in 2010.

We Must Act Together

I am convinced that we, the members of the Party, can make a difference – providing we act together. We can play a particularly important part in convincing our friends and workmates that there is an alternative to our unfair and unequal society.

What I describe as a socialist programme is also easily seen as a common sense response to the political challenges of 2008. The policy strategy I propose is a number of urgent initiatives made necessary by the, very obvious, failures of capitalism.

There are several reasons for the current economic difficulties; especially the rising price of oil, gas, raw materials and food. Although these increases are not the responsibility of new Labour, Blair governments must take responsibility for the freedom they allowed the banks to act so recklessly in the mortgage market.

New Labour A Spent Force

It is now blatantly obvious that new Labour is disorientated because its supporters do not have the policies to address the 2008 crisis. The banks, which are largely responsible for the housing crisis, get what they ask for – for example, over £50billion in loans – without giving anything significant in return. Meanwhile, victims of the irresponsible lending are having their houses re-possessed.

However Labour, Clause Four and all, does have the answers. Blair treated members of the Party, and the trade unions, with contempt. The only hope for the present government is to ignore the advice of the captains of industry, the Daily Mail, Washington and return to democracy as a basis for decision-making.

The immediate task is to restore democratic decision-making in the Labour Party - because this is the only means of acquiring the policies needed to address our current economic and social challenges.