Economics

The burden of financialisation: a case study of a Scottish police training centre

Published by Anonymous (not verified) on Fri, 16/08/2019 - 5:57pm in

Much of what I am noting in this blog comes from a recent submission that John Christensen and Nick Shaxson of the Tax Justice Network have made to Parliament on wealth inequality in the UK. Their argument is, in essence, that London does as a result of the excessive financialisation of the UK economy drag money out of all parts of the country and record it in the City and the surrounding area. They use an example that TJN has not highlighted on its website but which I think well worth promoting. As they put it:

In July 2002 HRH Prince Charles opened the Strathclyde Police Training and Recruitment Centre in East Kilbride in Scotland. Now renamed the Police Scotland College at Jackton, the project was part of the Private Finance Initiative.

Latest official data record the project as having a capital value of £17 million (though news reports said the project cost was £27.5 million.) However, the same official data show a stream of payments to the company delivering the project of £111 million over the 26-year financing life of the project.7 This fourfold to sixfold disparity between project capital cost and total repayments is only partly explained by standard discounted financing costs: it would have cost the government roughly £35-50 million had it financed the capital value of this project by issuing a bond paying five per cent interest, and used the proceeds to pay private contractors directly.

Such discrepancies are common for PFI, which is widely reported to be delivering poor value for money: “one hospital for the price of two,” as one expert has put it, with “grotesquely high returns on equity”. It is also well known that excessive financing costs go a long way towards explaining the high costs of PFI projects. However, a more forensic exploration of the corporate structure and financial flows involved provides useful new regional perspectives.

The equity holder for this particular PFI project was officially recorded in the government’s 2016 database as “Strathclyde Limited Partnership,” whose corporate structure – and this is a simplified version of the full ownership structure — went as follows (it is not necessary to do more than a skim-read in order to get a sense of it).

As Shaxson and Christensen add:

Nothing remotely illegal is being alleged here. Yet it raises an important question: what is the purpose of this astonishingly complex corporate tower sitting atop a police training centre in Scotland?

The shortest answer is that this is a classic example of the financialisation of apparently mundane parts of Britain’s economy. As explained below, this is not an outlier: it is increasingly the way business is done.

Such structures serve several purposes. Some may involve genuine wealth creation, such as the generation of economies of scale, the provision of investment finance, and the efficient pooling of resources. However, alongside these gains, many other, more extractive activities are evident.

Overall, the general purpose of such complexity is for the owners higher up in the corporate tower to obtain maximum possible rewards from a particular arrangement, while shifting maximum risks onto others’ shoulders.

I agree: that is precisely it.

And imagine just how much more efficient our economy could be if a police training centre did not have to bear the burden of all that financial admin, the burden of which all does fall onto the state?

I know PFI is ceasing to be used. But the message is clear: these structures have got to go. I have long argued that QE could be used to fund this at fair value, and stand by that argument now.

Axel Leijonhufvud

Published by Anonymous (not verified) on Fri, 16/08/2019 - 7:26am in

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Trying to delineate the difference between ‘New Keynesianism’ and ‘Post Keynesianism’ — during an interview a couple of years ago — yours truly was confronted by the odd and confused view that Axel Leijonhufvud was a ‘New Keynesian.’ I wasn’t totally surprised — I had run into that misapprehension before — but still, it’s strange […]

Fascism’s Advocacy of Privatisation and Financial Retrenchment

I’ve posted a number of blogs about the way some Conservative propagandists have tried to discredit socialism by claiming that Fascism was a form of it. The argument here is that Fascism advocated the state planning and management of the economy like state socialism, and so therefore must similarly be a form of socialism. For the Libertarians, any state intervention in the economy or industry is automatically attacked as socialism. They demand instead complete free trade and the reduction of the state to an absolute minimum, based on their ideas of 19th century laissez-faire economics. For them, any economic system that is not based on complete free trade and unregulated private industry is socialism, not capitalism. Left-wing commenters, on the other hand, have argued very clearly that this is a very unrealistic idea of capitalism, which has never existed in reality. Mussolini did indeed begin his career as a radical socialist, and Fascism itself emerged from Italian anarcho-syndicalism after the First World War.  However, Mussolini broke with the socialists and forces of the Italian left, to embrace capitalism and the parties and organisations of the right. The Fascists were supported by the rich landowners and the industrialists in their attacks on socialism, trade unions, and the peasant organisations. They were invited into the Italian parliament to join a coalition of right-wing Liberals and eventually merged with the Italian Nationalists. They also rejected, at least initially, state intervention in industry. In government, Mussolini stated that Fascism stood for the economics of the Manchester School, that is, absolute free enterprise.

The Fascists’ Conservative economic stance is clearly seen in their 1921 Party programme. This demanded a system of cuts to uneconomic businesses and public works projects that is very similar to the policy taken towards them by right-wing governments, including New Labour, ever since Margaret Thatcher. And it also declared its support for private industry against state control. In the section ‘Cornerstones of Fiscal Policy and Policies for National Economic Reconstruction’ are the following clauses

  1. Balancing state and local budgets (when necessary) by means of rigorous cutbacks to all parasitic or redundant entities and via reductions in expenditures neither crucial to the well-being of the beneficiaries nor justified by more general objectives.
  2. Decentralisation of the public administration so as to simplify the delibery of services and to streamline our bureaucracy, without falling into the trap of regionalism (which we firmly oppose).
  3. Shielding the taxpayers’ money from misuse by means of the abolition of all state or local government concessions and subventions to consortia, cooperatives, factories, special clienteles, and other entities similarly incapable of surviving on their own and not indispensable to the nation.

….

6. Cessation of policies favoring public works projects that are botched, undertaken for electoral reasons, or supposedly to insure law and order, projects that are unprofitable because of the irregular and fragmentary way in which they are distributed.

….

8. Return to private sector of industries that the state has managed poorly, in particular the telephone system and the railroads. Regarding the latter, competition needs to be enhanced between the major lines, which need, in turn, to be managed differentially with respect to regional and local lines.

9. Abolition of the state monopoly on postal and telegraphic communications so that private enterprise may supplement and eventually replace the state-run service.

The subsequent section, ‘Cornerstones of Social Policy’, begins with a statement of the importance of private property and industry as the fundamental basis of Fascist economic and social policy. This runs

Fascism recognises the social function of private property. At once a right and a duty, private property is the form of management that society has traditionally granted individuals so that they may increase the overall patrimony.

In its opposition to socialist projects for reconstruction that rely upon a dogmatically collectivist model of economics, the National Fascist Party has its feet firmly planted in the soil of our historical and national reality. This reality does not allow for a single type of agricultural or industrial economy. The party, accordingly, supports any and every solution, be it individualistic or any other kind, that will guarantee the maximum level of production and well-being.

The National Fascist Party advocates a regime that would strive to increase our national wealth by unleashing individual enterprises and energies – the most powerful and industrious factor in economic production – and by abolishing, once and for all, the rusty, costly, and unproductive machinery of state-, society -, and municipality-based control. The party thus supports all efforts to enhance Italy’s productivity and to eliminate forms of individual and group parasitism. 

see Jeffrey T. Schnapp, ed., A Primer of Italian Fascism (Lincoln, Nebraska: University of Nebraska Press 2000), 14-15.

Now the Fascist programme did contain elements of Socialism, such as the demands for an eight hour working day, and later in Mussolini’s regime the state ended up owning a sizable part of the Italian economy as it was forced to buy up failing corporations. But even if the regime was forced to go back on its stated policy of allowing failing companies to go to the wall, it still strongly supported private enterprise although subject to considerable state intervention.

It’s very clear from this that, at least at that stage, Fascist economic policy was very similar to the free enterprise economics of Thatcher and Reagan. There’s also a further similarity, in that contemporary politics in both America and Britain is also corporatist. The Italian Fascist economy was supposed to be run by a ‘Chamber of Corporations and Fasces’ in which both representatives of management and the trade unions sat together. In practice the trade unions were strictly controlled by the Fascist state, with the management and proprietors enjoying a far greater degree of freedom. Contemporary Britain and America has a form of corporativism, in that very members of Congress in the US and parliament in Britain are proprietors or senior management of private firms. The parties also receive substantial funding from private corporations, with the result that government policy is framed to benefit private corporate interests, rather than working people.

Unlike Mussolini’s later regime, however, the current right-wing governments haven’t worked out that free trade and an economy based on untrammeled, absolute private industry doesn’t work either. They’re what the Australian economist John Quiggin has described as ‘zombie economics’, because the ideas are dead and should have been discarded long ago, but are still haunting us.

Conservative propagandists are therefore completely wrong. Fascism was pro-capitalist, and supported private enterprise, despite the movement’s left-wing origins and Mussolini’s attempt to return to socialism during the brief period of the Nazi-supported Salo Republic. It is very similar to today’s Conservativism rather than socialism, although the Republicans and Tories haven’t outlawed rival political parties nor tried to replace parliament or congress with a personal dictatorship and corporativist chamber. But Boris Johnson over here and Donald Trump across the pond are sounding more Fascist day by day, as BoJob’s splenetic attack on British MPs ‘collaborating’ with the EU shows.

The Stepford Daughters of Brexit and Slavery and the Emergence of Capitalism

Yesterday for our amusement the awesome Kerry Anne Mendoza posted a video on twitter made by two very definitely overprivileged girls talking about the evils of socialism. The two young ladies were Alice and Beatrice Grant, the privately educated granddaughters of the late industrialist and former governor of the Bank of England, Sir Alistair Grant. With their cut-glass accents and glazed, robotic delivery of their lines, they seemed to fit the stereotype of the idiotic Sloane perfectly, right down to the ‘Okay, yah’, pronunciation. Mendoza commented ‘I don’t think this was meant to be a parody, but it’s the perfect roast of the “yah-yah” anti-left.’

Absolutely. In fact, what the girls were describing as socialism was really Communism, completely ignoring democratic socialism, or social democracy – the form of socialism that demands a mixed economy, with a strong welfare state and trade unions, progressive taxation and social mobility. It also ignored anti-authoritarian forms of socialism, like syndicalism, guild socialism or anarcho-Communism. They were also unaware that Marx himself had said that, regarding the interpretations of his views promoted by some of his followers, he wouldn’t be a Marxist.

But it would obviously be too much to expect such extremely rich, public school girls to know any of this. They clearly believed, and had been brought up to believe, the Andrew Roberts line about capitalism being the most wonderful thing every invented, a mechanism that has lifted millions around the world out of poverty. Etc. Except, as Trev, one of the great commenters on Mike’s and this blog, said

If “Capitalism works” why are there a million people using foodbanks in Britain today? Not working that well is it? Why did the Government bail out the Banks using our money? Why did the Banking system collapse in the first place, was it because of Socialism? I don’t find these idiotic spoilt brats in the least bit funny, I feel bloody angry. When was the last time they ate food they found in the street? Bring back the Guillotine!

See: https://voxpoliticalonline.com/2019/08/14/these-young-ladies-of-brexit-need-to-be-seen-to-be-believed/

The two girls were passionate supporters of the Fuhrage and his wretched party, and were really looking forward to a no-deal Brexit. It shows how out of touch these girls are, as Brexit is already wrecking the British economy, and a no-deal Brexit and subsequent deal with a predatory America would just wipe it out completely. Along with everything that has made post-war Britain great – the NHS and welfare state. But these girls obviously have no connection with working people or, I guess, the many businesses that actually depend on manufacturing and exports. I think the girls’ family is part of financial sector, who stand to make big profits from Brexit, or at least are insulated from its effects because they can move their capital around the globe.

The girls’ views on the EU was similarly moronic. They really do seem to believe that the EU is somehow an oppressive, communistic superstate like the USSR. It wasn’t. And the reason anti-EU socialists, like the late, great Tony Benn distrusted it was partly because in their view it stood for capital and free trade against the interests of the nation state and its working people.

And they also have weird views on slavery and the EU’s attitude to the world’s indigenous peoples. To the comment by David Lammy, the Black Labour politico, who dared to correct Anne Widdecombe for comparing Brexit to the great slave revolts, they tweeted

“Lammy being pathetic as usual. The chains of slavery can be intangible, as amply shown in China, the Soviet Union and the EU; to deny that just shows your ignorance and petty hatred for the truth”.

To which Zelo Street commented that there two things there. First of all, it’s best not to tell a Black man he doesn’t understand slavery. And second, the EU isn’t the USSR.

They were also against the Mercosur deal the EU wishes to sign with the South American nations, because these would lead to environmental destruction and the dispossession and exploitation of the indigenous peoples.

“As usual the GREED and selfishness of the EU imposes itself using their trade ‘deals’ in the name of cooperation and fake prosperity. The indigenous tribes of the Amazon need our protection not deforestation”.

To which Zelo Street responded with incredulity about how they could claim environmental concern for a party headed by Nigel Farage.

And they went on. And on, going on about how the EU was a threat to civil liberties. And there was more than a touch of racism in their statement that Sadiq Khan should be more concerned to make all Londoners feel safe, not just EU migrants. They also ranted about how Labour had sold out the working class over Brexit in favour of the ‘immoral, money hungry London elite’. Which shows that these ladies have absolutely no sense of irony or any self-awareness whatsoever.

In fact, Zelo Street found them so moronic and robotic, that it dubbed them the Brexit party’s Stepford Daughters, referring to the 70s SF film, the Stepford Wives. Based on the novel by Ira Levin, the films about a community where the men have killed their wives and replaced them with robots.

See:  https://zelo-street.blogspot.com/2019/08/brexit-party-presents-stepford-daughters.html

There’s a lot to take apart with their tweets. And perhaps we shouldn’t be two hard on the girls. They’re only 15 and 17. A lot of young people at that age have stupid views, which they grow out of. But there is one issue that really needs to be challenged.

It’s their assumptions about slavery and the genocide of indigenous peoples. Because this is one massive problem to any assumption that capitalism is automatically good and beneficial.

There’s a very large amount of scholarship, much of it by Black activists and researchers, about slavery and the emergence of European capitalism and the conquest of the Americas. They have argued that European capitalism was greatly assisted by the profits from New World slavery. Caribbean historians like Dr Richard Hart, in his Blacks in Bondage, have shown that transatlantic slavery was a capitalist industry. For the enslaved indigenous peoples and the African men and women, who replaced them when they died out, capitalism certainly did not raise them out of poverty. Rather it has done the opposite – it enslaved them, and kept them in chains until they were able to overthrow it successfully with assistance of European and American abolitionists in the 19th century.

And among some left-wing West Indians, there’s still bitterness towards America for its constant interference in the Caribbean and Central and South America. America did overthrow liberal and progressive regimes across the world, and especially in the New World, when these dared to challenge the domination of American corporations. The overthrow of Jacobo Arbenz’s democratic socialist regime in Guatemala is a case in point. Arbenz was overthrown because he dared to nationalise the banana plantations. Which upset the American United Fruit Company, who got their government to overthrow him in coup. He was replaced by a brutal Fascistic dictatorship that kept the plantation workers as virtual slaves. And the Americans also interfered in Jamaican politics. They were absolutely opposed to the Jamaican Labour party politician, Michael Manley, becoming his nation’s Prime Minister, and so did everything they could to stop him. Including cutting trade.

And then there’s the enslavement and genocide of the indigenous peoples.

Before Columbus landed in the New World, South America had a population of about seven million. There were one million people in the Caribbean. I think there were similar numbers in North America. But the indigenous peoples were enslaved and worked to death. They were also decimated through diseases carried by Europeans, to which they had no immunity. The Taino people were driven to extinction. The Caribs, from whom the region takes its name, were able to survive on a reservation granted to them in the 18th century by the British after centuries of determined resistance. The conquest of the New World was a real horror story.

And Britain also profited from the enslavement of indigenous peoples. I doubt the girls have heard of it, but one of the scandals that rocked British imperialism in the late 19th and early 20th centuries was that of the Putomayo Indians of South America. They had been enslaved by British rubber corporations. It was this abuse of a subject people that turned the Irish patriot, Roger Casement, from a British civil servant to an ardent Nationalist.

On the other side of the world, in the Pacific, British imperialism also managed to dispossess an entire Polynesian people and trash their island. This was in the 1920s. The island was rich in mineral deposits, and so moved the indigenous people out, ultimately relocating them to Fiji. Their island was then strip-mined, leaving it a barren, uninhabitable rock. In the 1980s the survivors were trying to sue the government over their maltreatment, but with no success.

This is what unfettered British imperialism and capitalism did. And what I’ve no doubt Farage and other far right British politicians would like to do again without the restraints of international law. It’s why I believe that, whatever the demerits of the Mercosur agreement are, it’s probably better than what individual nations would do without the restraint of the EU.

The girls are right to be concerned about the fate of indigenous peoples. But they are profoundly wrong in their absolute, uninformed belief that unregulated capitalism will benefit them.

It doesn’t. It enslaves, dehumanises and dispossesses. Which is why we need international organisations like the EU, and why the Brexit party isn’t just a danger to Britain, but to the world’s weaker, developing nations and their indigenous peoples.

Money’s too cheap to mention, and still no Green New Deal

Published by Anonymous (not verified) on Thu, 15/08/2019 - 7:59pm in

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Economics

The US 30 year bond rate fell below 2% for the first time ever today:

And still no Green New Deal from this administration.

Johnson’s Fascistic Denunciation of ‘Collaborators’ with the EU

Yesterday Mike put up a piece commenting on Johnson’s Fascistic rhetoric describing those opposing a no-deal Brexit in parliament. Simply put, he described them as collaborators with the EU. The Blonde Beast said

There’s a terrible kind of collaboration as it were going on between people who think they can block Brexit in Parliament and our European friends, and our European friends are not moving.

We need our European friends to compromise and the more they think that there’s a chance that Brexit can be blocked in Parliament, the more adamant they are in sticking to their position.

As Mike points out, Johnson is falsely claiming that the ordinary people, who don’t want a no-deal Brexit, have teamed up with the EU. It also identifies his enemies as a unified cause, which is also one of classic features of Fascism. Following the infamous forgery, the Protocols of the Elders of Zion, Hitler viewed everything that he considered damaging to Germany to be part of a massive Jewish conspiracy. Financial capitalism, socialism, Communism and democracy were all parts of this conspiracy to undermine Germany and destroy and enslave the White, ‘Aryan’ race. As were decadent modern art, music, literature and unAryan scientific theories, like Einstein’s Theory of Relativity, because Einstein was Jewish.

See: https://voxpoliticalonline.com/2019/08/14/terrible-collaboration-speech-johnson-flashes-his-fascist-credentials/

Johnson hasn’t gone quite that far yet, and Mike points out that he isn’t a Fascist. But he is showing many of the warning signs. So much so that one tweeter put out a picture of BoJob with the caption ‘This man is the biggest threat to Britain since Adolf Hitler’. It’s an exaggeration, but a forgivable one, considering that BoJob’s Brexit is already wrecking British economy and industry, and that he and his backers in the Murdoch press are looking forward to a trade deal with Trump’s America which would see our agriculture and industry bought up by the Americans, including the Health Service, the welfare state dismantled, workers’ rights removed completely, along with our environmental protection laws. All so that BoJob and the elite rich can enjoy absolute unfettered capitalism and massive profits for their own businesses.

And I’m not surprised that Johnson is sounding like a Fascist. He’s a massive egotist, like Donald Trump, and both men are extremely authoritarian. Trump talked about having newspapers and press people, who criticised him shut down. Johnson, when he was mayor of London, spent millions of taxpayers’ money on three watercannon that were illegal in mainland Britain. And BoJob’s the leader of a highly authoritarian party. Under Thatcher the Tories had links with very unpleasant South American Fascist regimes, like Chile’s General Franco. The Libertarians in the party, including Paul Staines, used to invite to their annual dinner the leader of one of the Fascist death squads in El Salvador. The Freedom Association also wanted the suppression of trade unions, workers’ rights and the welfare state and NHS, and unfettered capitalism. It was very much freedom for the rich, and wage slavery for the poor.

And he’s supported by a fanatically authoritarian press. Remember how the Tory papers demonised the judges and lawyers, who had ruled against one of Tweezer’s Brexit plans as the enemies of the people. It was the classic rhetoric of authoritarian, Fascist regimes.

And you can bet that as opposition to Boris mounts, he and his backers in the media are going to become even more splenetic and Fascistic in their denunciations. They’re already demanding anti-democratic measures to get what they want. This is the suspension of parliament, as advocated by the Torygraph, so that BoJob can force through Brexit without opposition from MPs. Who are our elected representatives.

BoJob is a menace to British prosperity, British industry, British working people and British democracy. Get him out!

 

Statistics and mathematics — not very helpful for understanding economies

Published by Anonymous (not verified) on Thu, 15/08/2019 - 5:53pm in

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Statistical science is not really very helpful for understanding or forecasting complex evolving self-healing organic ambiguous social systems – economies, in other words. A statistician may have done the programming, but when you press a button on a computer keyboard and ask the computer to find some good patterns, better get clear a sad fact: computers do not think. […]

Tax reform of the day: make the UK main corporation tax rate 25% with a small company rate 20%

Published by Anonymous (not verified) on Thu, 15/08/2019 - 4:03pm in

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Economics

As I mentioned yesterday, in my book ‘The Joy of Tax’ I argued that tax was the single best instrument available to any government to shape the society for which it was responsible.

And the fact is that any incoming progressive government will face massive social challenges. Leaving aside green issues, the biggest of these will be the income and wealth inequality that is crippling our society and leaving many in poverty. We need tax policies to help tackle these. This is the second in a series on that theme, and suggests higher taxes on income derived from capital.

Make the UK main corporation tax rate 25% with a small company rate 20%

The current UK corporation tax rate is 19%. It is planned to reduce to 17% in 2020. This rate is well below the Organisation for Economic Cooperation and Development and European Union averages, which are both around 25% when broadly equivalent countries are considered. It is also less than the basic income tax rate of 20%. This low tax rate creates a number of perverse incentives. First, it encourages the diversion of any income into a company to save tax. No tax system should undermine itself in this way. Secondly, it encourages increasing wealth inequality as those with wealth can let it accumulate at low tax rates. Third, it reduces the impact of fiscal policy as tax incentives and allowances have limited value. Most importantly though, there is no evidence that the reduction in UK corporation tax rates has encouraged investment or job creation, and business appears unenthused by such low rates. A main corporation tax rate at the OECD average does then make sense. If it was thought necessary, a small company rate set at the same rate as the basic rate of income tax would help remove many incentives to tax avoidance.

It’s time for a Brexit recession

Published by Anonymous (not verified) on Thu, 15/08/2019 - 3:50pm in

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The FT reported last night that:

US equities fell 3 per cent on Wednesday after disappointing data from China and Germany increased fears over global growth and bond markets signalled the chances of a recession were mounting.

The S&P 500 index finished down 2.9 per cent at its low point for the day, with energy stocks leading the declines, closely followed by financials. The tech-heavy Nasdaq was down just over 3 per cent.

Underscoring the rising concerns, the yields of US and UK 10-year government bond yields dipped below those of shorter-maturity debt for the first time since the financial crisis — an inversion of their normal relationship that has historically been a harbinger of recession and which crimps banks’ profitability.

Perfect timing for Brexit.

And I'd stress, I have little doubt Brexit has not helped this trend, but equally I'd say it's just one of a number of factors created by populist politicians intent on wrecking economies for their own ends, led by those in the UK and US.

Trump Post-Brexit Trade Deal Will Bring Hardly Any Real Benefits

This is very revealing. According to the BBC World Service, a post-Brexit trade deal between Britain and America would only increase the economy by 0.1%. And that would be 15 years from now.

As the Skwawkbox and Mike over at Vox Political have both pointed out, this means that the Tories will have sold Trump and the American companies backing him our NHS, workers’ rights, and environmental and consumer protections for hardly anything. In fact, Mike points out that even the 0.1% growth may not happen, as the economy is already faltering, and so any gains made later may be swallowed up by the losses that are occurring now.

This is despite yesterday’s Times enthusiastically hyping Trump’s offer of a trade deal with America. Zelo Street effectively ripped that piece of propaganda apart by pointing out that we would only get the deal if we became America’s poodle, a point that was also made by one of the columnists in today’s I. The Sage of Crewe also refuted what Trump’s negotiator, John Bolton, and the Times clearly thought would be an attractive demonstration of the deal’s benefits. Bolton stated that it would be easy to make such deals quickly for manufacturing and industry, but that service sector would take a bit longer. Nevertheless, next year could see cheap American cars coming into Britain. The Sage of Crewe pointed out the other side of the coin: British cars would be undercut by cheap American imports.

I can remember when something similar happened to the motorcycle industry with the Japanese way back in the 1990s. This was when the Japanese economy started contracting and there wasn’t quite so much a market for their bikes. Their solution was to start exporting cheap bikes to Britain, which would undercut our own, domestically made machines. Even those produced by Japanese manufacturers over here. As you might expect, British bike manufacturers, including the management of Japanese companies over here, were extremely upset and started arranging meetings about what they could do about this threat to British industry and jobs. I’d be interested to hear if British car firms are planning something similar to combat the similar threat John Bolton is making to them. But guessing from the glowing way the Times was pushing Trump’s grotty trade deal, I doubt we’d read of one in that Murdoch rag.

But the Americans would wait until after Brexit before requiring us to fall in line with their policy over Iran and the involvement of the Chinese firm Huawei in the 5G network.

Put simply, this deal would make us into America’s poodle. We’d have our industries and agriculture picked off by the Americans for their benefit, as the Zelo Street article also points out. He also states that Bolton is lying through his teeth about Congress easily passing such a deal. Congress’ Speaker, Nancy Pelosi, has said that it won’t pass any deal unless the Good Friday Agreement is honoured.

The Zelo Street article concludes by stating that BoJob loves to say that Britain is a vassal state of the EU, but doesn’t mention how this deal would make us a vassal state of America by the back door.

See: https://zelo-street.blogspot.com/2019/08/us-trade-deal-if-well-be-their-poodle.html

And Mike and the Skwawkbox point out how the BBC hid the news that Trump’s deal would bring hardly any benefits to Britain by putting on the World Service. This is the Beeb’s service for the rest of the world, not Britain. Presumably the people actually affected by it don’t count. Mike concludes in his turn that its shows once again that the Beeb is the Tories’ propaganda arm, and wonders if Ofcom are aware of it?

See: https://voxpoliticalonline.com/2019/08/14/boris-johnson-would-sell-out-our-nhs-and-our-rights-to-trumps-us-for-practically-nothing/

I’m not surprised by any of this. The Americans were less than altruistic in the deals they made for their entry into the Second World War. They drove a very hard bargain with us after the War. They and the Russians both wanted the dismemberment of the British Empire so that their goods could be allowed into our former colonies. It was also thanks to their demands for payment that Newfoundland became a province of Canada. Before then it was another British colony. However, we had to give it, or sell it to the Canadians in order to raise the money to pay the Americans.

I’ve also met former members of the aircraft industry, who were also very bitter at the way America had demanded cutting edge technical information from this sector after the War. The Americans’ breaking of the sound barrier by the X-1 rocket plane, flown by Chuck Yeager, was a tremendous achievement. But it was solidly based on British research, some of which was, in its turn, based on captured German material. But the British project had to be closed down and its results and information handed over to the Americans as part of their price for coming to our aid.

Counterpunch and some of the American left-wing news sites on YouTube have also pointed out that the lend-lease arrangements under the Marshal Plan also weren’t altruistic. This was the American economic scheme to build Europe and the rest of the free world up after the War using economic aid. But there were also strings attached, which meant that the aid went chiefly to American companies.

You can conclude from this that the American state and capitalism drives a very hard bargain, and that such deals are very one-sided. As many left-wing sites have argued over and over again in their discussion of the ‘Special Relationship’. Which actually means far less to the Americans than it does to us. That was shown very clearly by Clinton’s reaction to German unification. This made Germany the strongest economy in Europe, and Clinton showed, as Beeb newsman John Sargeant managed to get the Prime Minister to acknowledge, that Germany was now America’s most important partner in Europe, not Britain.

And I’m also not surprised at the Tories and Murdoch ardently supporting this sell-out of our country. The Tories admire American capitalism and its lack of worker protection and welfare state. I can remember previous episodes where the Americans were promising a better economic deal if we abandoned Europe and joined them. And the Tories cheering such schemes nearly always owned businesses in America. And in fact, as far back as 1925 the Tories, or a section of them, were forming plans for the political reunion of Britain and the US.

And that shows exactly what Johnson and the Tories are like. Now and in the past, and I’ve no doubt in the future, they are willing to sell out British industry, the welfare state, our precious NHS and workers, all in return for the victory of unfettered capitalism and their squalid economic gain.

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