Author Archives: tombrum

Alternatives to the Cuts: Keynesian stimulus

This post forms part of the alternatives to cuts series, an exploration into why cuts won’t work, and what we could be doing instead.

As I wrote in the Will Austerity Solve the Deficit Problem? post, there is a clear relationship between the size of the deficit, and periods of growth/recession.  During periods of growth the deficit shrinks, and if the problem you are seeking to solve is the size of the deficit, then one thing you want to do is ensure that there is growth in the economy.  In that post I showed that austerity is not producing growth now, rather the economy has flatlined., and that this will fundamentally undermine the spending cuts in their effect on the deficit.

In this post I am not going to explore deeply the theory behind why governments borrowing and spending money produces growth, if people want it, I will try to write a post on that.

The basic idea is that recessions happen because of a lack of demand.  People stop spending money, and so the level of production/trade in the country decreases to match this new level of spending.  Unfortunately, there is a vicious circle effect, because as people lose their jobs, their spending (demand) decreases, causing further reduction in the level of aggregate demand, which in turn causes reduction in the level of production/trade and so on.

Governments have the ability to step in and produce demand during these periods, and to turn the vicious circle into a virtuous circle of rising demand and employment.  There are a number of ways they can do this, and Quantitative Easing was one of them.  But this produced jobless growth, as it reduced the level of debt (or at least the level of risk associated with the debt) of the private sector, allowing some growth in value of the economy, without a commensurate increase in employment.

Now is the time where a government should be spending money to invest in the economy, in order to stimulate demand and in turn stimulate the private sector back into growth.  There are many proposals as to how this money should be spent, and I will outline some of them here.

The best way to spend money for a Keynesian stimulus is by investing in infrastructure, or in areas which are either too risky, or have a rate of return that is too long for private companies to invest in.  If these investments can also help to forward other policy aims, then so much the better.

Please note that the inclusion of a possible policy here does not constitute a statement of support for that policy by Birmingham Against the Cuts.  There are other discussions to be had about the merits of each of them, which I am not going to enter here.

■Investment in Green Manufacturing / Green New Deal / Green Jobs for Growth

Variously called by different titles, this set of investment would see government funds invested in the manufacturing sector surrounding “green” industries.  The most likely place for much of this money to go would be into the design and manufacture of wind turbines – particularly offshore wind turbines- tidal and wave generators.  The UK has some of the best resources for renewable energy in each of these areas, and could be world leaders in these technologies.  Investing in these could replace some of the industries that have been largely lost, such as shipbuilding or steel production.

Additionally, it would make sense that the UK would start as the major customer of the industry in this country, and doing so would help us to reduce our reliance on fossil fuels and combat climate change.  Along with this, we need to reduce our dependency on oil and gas, and become (more) self-sustained in terms of energy usage.

I will do a lengthier post on this at some point.

■HS2 railway

This is particularly controversial at the moment, and I must emphasise that its inclusion here does not imply support or dislike for the project.  I am including it here because it is a good example of an investment whose returns will take too long for a private company to invest.  There is never likely to be the profit in a short enough space of time for a company to invest in such a project, which will take many years to construct, and many more before a return on investment is possible (if ever, given the amount of subsidies that are paid to railways already).

■Social Housing

The great council house sell-off, and the ban on councils investing in new housing is part of the reason why house prices are so high today (there are other factors, but the lack of a widescale, reasonably priced, rental market has allowed rent and house prices to rise).  We hear often of issues with affordable housing, particularly in London, or with a lack of housing.  These houses could be built to the highest environmental standards, and would be very cheap to heat during the winter.  With ever rising gas prices, this could be especially helpful for elderly people.

Additionally, the construction industry is always hit hard by a recession, and this would help that sector in particular.

■Buildings projects

Schools, Hospitals and many other public buildings could use renovating or replacing.  Such projects should not be done using PFI, which has been shown to be expensive, but would improve public services, through a one-off payment.

There are many other ways to produce a Keynesian stimulus.  The key is that increased government spending produces demand, and that it is easy for that spending to be removed once the need for the stimulus is over.  The unemployment benefit system is an example of an existing keynesian stimulus, which works almost naturally – as we enter recession, more people become unemployed, and government spending on unemployment benefits increases.  As the private sector moves back to growth, people get jobs and spending on unemployment benefits decreases.  But this is not enough – it is already existing in the system, it limits the depth of a recession but will not take us out of one.

Join us in calling for an alternative to austerity, on Sunday 18th September, outside the Liberal Democrat Conference in Birmingham.
For more information about alternatives, you can also see False Economy

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Stirchley and Cotteridge Against the Cuts September events

Following our meeting on Tuesday, a lot of activity has been planned. If you can help out in any of these activities it would greatly be appreciated.
Contact StirchleyAntiCuts@Gmail.com if you can help, or would like to get more involved with this group.
Saturday September 3rd. 11am.  Street stall to build support for the public meeting in town on September 8th and the demonstration at the Lib-Dem Conference, Sept 18th. Cotteridge Island, by Subways.

Monday 5th September. 10am  Join the lobby outside of the meeting between Chrissie Garrett, the Council official, and Merrishaw parents, at Hamstead House, Fairfax Road, West Heath, B31 3QY.

Wednesday 7th September. 7pm  Next campaign meeting against academy status for Bournville School. Rowheath Pavilion, Small meeting room. B30 1HH.

Thursday 8th September. 5:30pm-6pm. Lobby of Bournville School Governing Body. Bournville School. Griffins Brook Lane B30 1QJ

Thursday 8th September. 7pm. Rally against the cuts, with Bob Crow, Jack Dromey and others. Birmingham and Midland Institute, next to Council House, 9 Margaret St. B3 3BS.

Saturday 10th September. 11am. Stall at Stirchley Co-op to build support for the demonstration at the Lib Dem conference.

Monday 12th September. 6.30pm. Birmingham against the Cuts meeting. UNISON Offices, 19th Floor. McLaren Building, Priory Queensway. Dale End.

Sunday 18th September. 10am.Meet at Cotteridge Island by Subway for our local demonstration as we walk with our new banner down to Stirchley Co-op, before catching the train from Bournville Station to Fiveways to join the march to the Lib Dem Conference at 11am. (Assemble at Granville St. B1 1SB)

Tuesday 20th September. 6.30-7pm. Year 7 parental consultation meeting for Bournville Parents over academy status. Bournville school. Lobby.

Wednesday 21st September. 7.30pm. Next meeting of Stirchley and Cotteridge against the Cuts. Cotteridge Church Centre.

Saturday 24th September. Fund raising car boot stall. Studley?

Saturday 5th November. Social?

  • In addition, there will be leafleting sessions outside Bournville school and Kings Norton High School, details to be announced, Volunteers please.
  • There could well be union funded coaches going up to the demonstration at the Tory Party conference on October 2nd. UNITE?

See our Upcoming Events Page for details of city centre leafletting for the events on the 8th and 18th. Also check out a very useful article about how Iceland stood up to the cutters;
http://www.dailykos.com/story/2011/08/01/1001662/-Icelands-On-going-Revolution

 

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Save Our NHS – 38 Degrees legal findings

Campaign group 38 Degrees has paid for legal advice on the Health and Social Care bill, which goes to the house of commons for its third and final reading on September 6th & 7th.

The legal findings underline what campaign groups have said since the bill was first revealed, and which haven’t changed over the consultation period, which is that these reforms open up the NHS to wholesale privatisation, begin the removal of universal health care provision and pave the way towards the creation of a US style healthcare system – a system that has been shown in two recent studies to be worse than the NHS (Commonwealth Fund report: US Ranks last out of 7 countries on health system performance and Bournemouth University report in the Journal of the Royal Society of Medicine that finds the NHS to be amongst the most cost-effective systems in the world).

We do not have long to work to get this bill defeated in its vote next week. Save Our NHS West Midlands and 38 Degrees are calling for people to write to their MPs with these legal findings. You can get an easy email link and model letter from the 38 Degrees website.
We also call for people to write to the Birmingham Mail, Solihull Observer and other local papers to make sure this issue is in the news.

Locally we must focus on the two Liberal Democrat MPs – John Hemming and Lorely Burt in Yardley and Solihull constituencies. John Hemming has already indicated concerns over EU competition law, and any MP can be persauded to vote against a bill if they feel there is strong local opposition to it. The Health bill does not form part of the coalition agreement so there is no reason for them to vote for it because of the coalition agreement.

What follows is simply a repost of the 38 degrees legal findings for you to read:

Background

In July 2011, 38 Degrees members donated to fund independent legal advice on the implications of the government’s proposals to change the NHS in England. 38 Degrees engaged Harrison Grant solicitors and the specialist barristers Stephen Cragg and Rebecca Haynes to give their legal opinions on two aspects of the Health and Social Care Bill: The removal of Secretary of State for Health’s Duty to provide or secure provision of NHS services and the impact of competition and procurement law on the NHS.

This document summarises some key findings. The full legal opinions and executive summaries are available to download in the right-hand column.

1. Removing the Secretary of State’s Duty to Provide

What our lawyers have identified within the Health and Social Care Bill:

The bill will remove the duty of the Secretary of State to provide or secure the provision of health services which has been a common and critical feature of all previous NHS legislation since 1946. This is the means by which Parliament ensures the NHS delivers what the public want and expect. Furthermore, a “hands-off clause” will severely curtail the Secretary of State’s ability to influence the delivery of NHS care to ensure everyone receives the best healthcare possible.

What this could all mean:

No longer a National Health Service
The duty, that Parliament has given the Health Secretary, for ensuring that the NHS provides the service that people need will be lost and the NHS will from here on in simply be little more than a series of quasi-independent commissioning entities and providers, basically free to get on with the job

Loss of Accountability – The Government washes its hands of the NHS
Removing the Secretary of State’s legal duty to provide or secure provision of health services, and introducing a “hands-off clause”, significantly reduces democratic accountability for the NHS. The responsibility for securing the provision of healthcare services will lie with unelected commissioners who will only be accountable to an unelected national quango. The bill will make it impossible for the Secretary of State to direct that certain services are available and difficult for the Secretary of State to step in if these groups deliver poor healthcare to the local community. These changes would shift the main responsibility to unelected officials, representatives of private companies and GPs.

Loss of Accountability – Local representatives and health watchdogs lose their right to appeal

Because the Government is removing the Secretary of State’s duty to ensure the NHS delivers an appropriate service, appeals from locally elected council bodies and health watchdogs will no longer be decided by the Secretary of State but – if any rights of appeal survive – by a national quango.

Postcode lottery
Because of changes in the bill there is a real risk of an increase in the “postcode lottery” nature of the delivery of some NHS services. The power to choose what health services are closed or improved in a local area will be passed on to local unelected bodies with little scope for the government to intervene. This will mean patients can no longer expect the government to ensure a consistent level of healthcare regardless of where they live.

2. Opening the NHS up to competition law

What our lawyers have identified within the Health and Social Care Bill:

The Bill contains a number of measures which will increase competition within the NHS at the expense of collaboration and integration and/or make it almost inevitable that UK and EU competition law will apply as if it were a utility like gas or telecoms. This includes:

■ giving Monitor the duty to eliminate so-called “anti-competitive” behaviour
■ removing the limit on the amount of income NHS hospitals can earn from private health services
■ handing significant new procurement responsibilities to the new Clinical Commissioning Groups
■ permitting these new groups to outsource commissioning work to private companies
■ writing additional rules on competition into the law and making Monitor enforce them

What this could all mean:

Exposing the NHS to UK and EU Competition Law

Taken together, these changes increase the likelihood of NHS services being found by the courts to fall within the scope of UK and EU competition law. The likelihood of this is further increased by other government NHS policies, for example the extension, announced in July 2011, of the right of Any Qualified Provider to be given a contract to deliver health services.

Costly and complex procurement procedures
The new commissioning groups will be subject to EU procurement rules whenthey commission local health services. This is likely to be costly, given the likely larger numbers of commissioning groups as compared to PCTs now and our Counsel warns that it appears the government have not planned for this significant increase in cost. Furthermore, it is not clear that the commissioning groups have the necessary procurement expertise to deal with the complex procurement process and to avoid legal action from disgruntled private healthcare providers. This could mean that the NHS ends up spending a lot of time and money fighting legal action instead of investing in patient care. Or worse, it could mean they are reluctant to commission any services for fear of being sued.

Fertile ground for private health companies (and their lawyers)
Companies that bid unsuccessfully for NHS contracts will be able to challenge commissioning decisions in the courts. Private health providers have far more expertise and legal capacity than either public bodies or charities, and so are likely to be best placed to exploit these laws. Litigation could be time-consuming and costly for commissioning bodies.

Opening our NHS to private companies – privatisation by stealth

These plans will lead to a system geared heavily in favour of private companies. The legislation does not currently contain measures to stop:

■ private companies being contracted to provide commissioning services to consortia and therefore profiting from spending multi-million-pound health budgets
■ private companies poaching services in a way which undermines the ability of the NHS to deliver essential services like Intensive Care Units, A&E, emergency cover, teaching, training and research.

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Merrishaw Day Nursery Closes

UPDATE: Merrishaw Nursery is to re-open, following continued pressure on the Council. Parents and staff have been told it will re-open in April 2012. This is a great success for the campaign, and shows that sometimes even when something seems over, it really isn’t. We will of course cover the re-opening when it happens.

Despite a campaign by parents and Stirchley and Cotteridge against the Cuts, Merrishaw Day Nursery has closed, along with 7 other nurseries around Birmingham.

Workmen board up Merrishaw Day Nursery

A last minute push to save the nursery from closure did not succeed, with parents and supporters gathering at the Nursery for what looks to be the final open day. Although all three councillors had been invited, only Cllr Reg Corns turned up to hear parents concerns. You can hear what he had to say on the B31 Blog post.Cllr Ian Cruise, Labour councillor for neighbouring Longbridge ward took the photo of Merrishaw being boarded up and said this on Twitter:

A sad day as workmen board up Merrishaw Community Day Nursery in West Heath. A relic of the cuts

Marrishaw achieved the highest grade possible (Outstanding) in it’s last Ofsted inspection. It has served the community for 26 years, and done so very well. Now parents are being moved to private nurseries, some of which are up to two miles away in Stirchley, as nursery provision is oversubscribed locally.
Quite what logic is used to decide to close a high performing nursery, in an area which does not have overcapacity is hard to discern.

Our hope for the nursery, and for the parents, is that Labour take control of the council next year and reopen the nurseries that have closed around the city, restoring excellent state provided provision, and ensuring that the youngest residents of our city have access to the best facilities in a nearby location.

With more time, this service could have been saved, but in June, parents were told it would stay open – only to find out a week later that it would close. Since then they have been working tirelessly to try to keep it open.
If we are to stop these cuts, we must continue to resist them at the local level as well as the national level.
Have a look at our Local Groups page to see if there is a group in your area, and if there is not, then we can help you to create one, by putting you in contact with activists in your area and supporting events that you run.

Regionally, we are holding a meeting, called jointly with Right to Work, on the 8th September at 7pm, at the Birmingham Midland Institute. Build the alternative, Broaden the Struggle. Speakers: Jack Dromey MP, Bob Crow, Jody McIntyre and more talking about the cuts, resistance and alternatives. Please attend our facebook event and invite your friends.
Nationally the party conference season is almost upon us, with the Liberal Democrats holding their conference here in Birmingham, and a demonstration on Sunday 18th September, whilst the Conservatives are in Manchester and the demonstration there is on Sat 2nd October.

Join with us to fight these cuts, and prevent more services like Merrishaw Day Nursery closing.

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Statement on the Riots

The outbreak of riots in Birmingham, Sandwell, and Wolverhampton came as no surprise. Birmingham against the Cuts has been aware for months that the most deprived areas in the West Midlands were close to an explosion of rage.

The £212 M cuts imposed with glee by the Con-Dems on Birmingham City Council have seen youth services slashed, Connexions offices closed, Neighbourhood Offices shut or run down, as well as children’s and family support services cut to ribbons. Central government cuts to housing benefit and tax credits have reduced the income to the poorest families while prices have continued to rise most for essential goods like food, heating, and transport.

Youth unemployment now stands at 20%
in the UK, and far more than that in many areas. Abolition of the EMA has left many young people with no prospect of further education.

Charities that fill the gaps in public provision have fared no better. The list of charities facing funding cuts in the Midlands includes: 100 children’s and young people-related charities,47 elderly-related charities, 40 arts charities, 37 disability charities, and 33 adult care charities.

Recent protests at deaths in police custody also showed that relations between the police and local communities were at an all time low. The timing of the riot may have been triggered by events in London, but it already was inevitable.

No one should support or tolerate mugging of individual citizens, looting of family owned shops, or attacks on fire crews, but the scene for this has been set by the mugging and looting practised by our MPs, banks, and multinational firms.

The riots coincided with a new world financial meltdown, which showed up vividly the futility of the austerity policies being followed in Europe and the USA. It is time for our leaders to admit that their policies are destroying the fabric of our society while doing nothing to improve the short or long term prospects for recovery.

The killing of three innocent young men defending their livelihood underlines the tragedies which social breakdown can bring. The united response of all the communities involved is an indication of the strengths which multi-cultural Birmingham still has to address its problems.

Birmingham against the Cuts believes the solution is in our hands. We have to give alienated and disenfranchised youth hope of a better future, and a real stake in society. This can only be achieved by a policy of economic and social reconstruction. Stop the Cuts. Start public investment in housing, green energy, improved leisure services, and further education.

We call on everyone who agrees with this from every community in the city, including young people who took part in the riots, to join with us in resisting and defeating the cuts programme, and helping to establish a council and government committed to social cohesion and equality.

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Update on Merrishaw Nursery and new campaign for Park Road Sure Start

Walk to Save Merrishaw, 30th July

Following the walk to save Merrishaw Day Nursery, and a lively meeting with Cllr Randal Brew, on Saturday 30th July, the parents campaigning to keep their nursery open have had a reply from Cllr Brew:

I repeat what I said some 15 months ago when we first met on the subject that I felt the nursery provided an excellent service (backed up by an outstanding Ofstead report), and that the children were playing in a happy environment and that it provided an excellent service for working mothers.

As promised, although I did share with you on Saturday some of the restrictions & pressures we are facing, I have passed on your substantial petition together with the pages of comments to Chrissie Garrett, Director of Integrated Services for the City

In an email to Chrissie Garrett, forwarded to the campaign along with his reply, Cllr Brew said that:

I am extremely concerned about the affect that this will have on the neighbourhood and hopes and aspirations of young mothers trying to improve themselves, and children having meaningful play.

And detailed cases where the parents alternative provision is not suitable, and specific examples of how the closure of Merrishaw will negaitvely affect their lives.  Cllr Brew has said that he hopes that the closure will be suspended pending further consultation.  We hope that he is able to work within the council to ensure that does happen, and that his worse are not empty platitudes.

Merrishaw is widely acknowledged as a succesful nursery, rated Outstanding by Ofsted, it makes little sense to close such a good provider of services, forcing parents to take their children to (often it seems private) nurseries, some up to 2 miles from home, which will not neccessarily provide such a good service (I do not want to disparage any other nursersies, I am sure that some children will go to nurseries also rated Outstanding, but I’d also be willing to bet that some won’t – and in any case, all the children currently do go to one rated Outstanding – that is close to home, with friends, social networks and support networks all nearby – networks that will be weakened by having children scattered across nurseries in south east Birmingham).

Park Road Childrens Centre, Sparkhill

Meanwhile, in Sparkhill, Park Road Day Nursery (rated Good by Ofsted) is facing 5.9% cuts due to cuts to sure start centre funding.  Parents of children at Park Road have started a campaign to protect their nursery, supported by Sparkhill & Sparkbrook Against the Cuts, and have started a petition opposing all cuts to nurseries across Birmingham.  If you want to help this campaign, especially if you have children who used to attend the nursery, please get in contact with them at SparkhillAgainstTheCuts@Gmail.com

You can download the petition here. Download and print it, and get your neighbours or colleagues to sign, then send it back to us.  If you are a parent with a child at a nursery, take it to the nursery and get other parents and nursery workers to sign it – perhaps make a special sheet for the children to sign as well.

They are also calling for a lobby at the council meeting in October – of course that is likely to be too late for the nurseries facing closure, but we can work to ensure that cuts are reversed, and that if Labour win control of the council in 2012 (as is likely to happen), that they do so with a platform to re-open the nurseries and to restore funding – and know that the communities around Birmingham will keep them to their promise.

If you are a parent at a nursery facing cuts or closure, please get in contact with us.  As you can see, pressure can be brought to bear, and we hope that the council will recognise that these cuts and closures should not happen.  We will keep you informed of the campaign to save Merrishaw and other nurseries around the city.

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Jarrow March for Jobs 2011

Jarrow Crusade march for jobs 75 years ago

75 Years ago, Jarrow workers were forced to march for jobs. Today unemployment is soaring and we face an onslaught on jobs and services. We’re marching again from Jarrow to London in 2011

Youth Fight for Jobs are organising the march, more information can be found on the website dedicated to the march.

The route will pass through Nuneaton and Coventry, and a regional demonstration is planned in Coventry on October 22nd. We hope that many people from Birmingham will travel over on that day to support the marchers, who will have been on the road for 3 weeks by that point. Their eventual destination is London for a national demonstration on Saturday November 5th – by which time they will have been on the road for over a month.

If you would be interested in going to Coventry on the 22nd and/or London on the 5th to support their demonstration, please let us know – either by commenting here or emailing BirminghamAgainstTheCuts@Gmail.com.  If there is enough demand, then we will organise coaches.

Update: We will be taking the 11:03 Cross Country Train from Birmingham New Street to Coventry. An open return is currently £4.60. It would be great to occupy a carraige on our way over there!

The event is supported by Unite, CWU, UCU, RMT, PCS, Becut, FBU and Tssa unions.

Update: there will be a public meeting in Birmingham on Wednesday 19th October, from 7pm at Briar Rose hotel/pub on Bennets Hill. Full details are to be confirmed, see our Upcoming Events page for most up to date details / link to post with full details when they are confirmed.

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