Tag Archives: austerity

Austerity Means The Rich Get Richer Whilst The Rest Of Us Suffer

Austerity for the rich:

Cameron and Osborne laughing in the house of commons as benefits are cut

  • Rising wealth – 50 richest people from this region increased their wealth by £3.46 billion last year to a record £28.5 billion.
  • Falling taxes – top rate of tax cut from 50% to 45% for those earning over £150,000 a year. This is 1% of the population who earn 13% of the income.
  • No mansion tax and caps on council tax mean that the highest value properties are taxed proportionately less than average houses.
  • Benefited most from Quantitative Easing (QE) – the Bank of England say that as 50% of households have little or no financial assets, almost all the financial benefit of QE was for the wealthiest 50% of households, with the wealthiest 10% taking the lions share
  • Tax free living – extremely wealthy individuals can access tax avoidance schemes which contribute to the £25bn of tax which is avoided every year, as profits are shifted offshore to join the estimated £13 trillion of assets siphoned off from our economy.

Austerity for the rest of us:

Old Labour election poster equality of sacrifice

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New Poster Available Now – Austerity Isn’t Working

We’ve got a new poster available
If you come to one of our planning meetings, then you can pick up copies there – if you can’t come, please email BirminghamAgainstTheCuts@Gmail.com and we’ll look to arrange delivery to you via someone in your area who can collect from us.

We’ve argued that austerity cannot solve our economic problems – and the GDP figures for the first quarter of 2012 confirmed that we are back in recession – a double-dip recession because we never grew back to where we were before 2008.

Put the poster up in your window or workplace and help spread the message – austerity isn’t working, Britain is better off with the alternatives.

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Budget Day Protest Video: Austerity Isn’t Working

Last Wednesday, workers, students and claimants formed a mock dole queue outside the Council House in Birmingham in protest at this governments austerity policies that are failing this country. Watch the video of the protest:

The protest was called by PCS Midlands, and supported by Birmingham Against the Cuts, Unison and Right To Work.

You can see more photos from the event, taken by Geoff, at his Flickr Page here.

Spread the video, get the message out – Austerity Isn’t Working, Britain’s Better Off With The Alternatives.
You can find out more about the alternatives to the cuts and austerity at these places:
False Economy – Cuts are Not The Cure
Birmingham Against The Cuts – Alternatives
PCS – Alternative To The Cuts

And get involved with anti-cuts and anti-austerity actions.
If you’re in or around Birmingham, look at our Upcoming Events page or see if there is a local group near you.
If you are outside Birmingham, look for a local campaign group near you on the False Economy website, or with a national group like UK Uncut or Right to Work.

Together we can defeat this government.

The video was produced by Tom with photos and filming by Geoff Dexter-Sherbourne Publications. Music is “No Banker Left Behind” by Ry Cooder.

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Austerity Isn’t Working: Budget Day Protest

2.67 million people are now unemployed in the UK. Austerity is not working. On Wednesday 21st March, George Osborne will unveil his next budget, which we already know will continue to follow a policy of austerity, a policy which is failing the people of the UK and Birmingham.
On Wednesday 21st March, we will join PCS, Unison and Right to Work to protest these policies and call for the alternatives to cuts. Come to Victoria Square at 4pm, to form a dole queue stretching out from the council house.

Perhaps you are one of the 31,000 NHS ringfenced staff who have lost their jobs in the past year, or one of the other 270,000 public sector workers. Maybe you are one of the million 16-24year olds who cannot find work, or a private sector worker whose company has closed due to the recessions caused first by the bankers and then by austerity.
Female unemployment is at its highest since 1988, and women make up 80% of those who lost their job in the last quarter.

Locally, austerity has directly cost around 6,000 council jobs, and 28,000 public sector jobs in the West Midlands. Birmingham has amongst the highest unemployment rates in the UK, with Ladywood and Hodge Hill constituencies vying for first and second place, with rates at 11.5% and 10.1%.. Youth unemployment in Hodge Hill is at 28.4%.

Join us, dress in your old uniform if you can, or make a placard telling us what austerity has cost you, or how many people at your workplace, sector, area, gender, age or race have lost their jobs.
Wednesday 21st March, 4pm, Victoria Square, B1 1BB

Accessibility information:
Event is outside and will last for 1-2 hours. Step free routes to Victoria Square are available from Snow Hill (approx. 1/2 mile), New Street and Moor Street (approx 3/4 mile), and from the main bus stops.
There is a single use and accessible public toilet in Victoria Square, with additional accessible toilets available in Paradise Forum, Pallisades and Pavilions shopping centres, within 1/2 mile of Victoria Square.

You can view and download PCS leaflet about the event by clicking here

Download and print Birmingham Against The Cuts Leaflet to be handed out on the day by clicking here

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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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