Climate change adding to health inequality

It's the Easter holidays, when households might have traditionally planned a Sunday feast of roast lamb, peas, roast potatoes, mint sauce, apple pie and custard. But it's a custom many families can only dream about.

With thousands of lambs dead in the fields and a drought in New Zealand so bad the browned earth can be seen from space, roast lamb is too pricy for many.

Peas, potatoes and apples will also be expensive. Waitrose managing director Mark Price has warned that last year's disastrous weather is working its way through the market causing big price increases. And that’s even before the impact of the current freezing weather is taken into account.

“In some commodities, the increases will be massive,” he says. “It’s bread, vegetables, all produce. The apple crop was down 20%-30%, so apple prices have to go up. You have only seen the tip of the iceberg.”

The price of 1 kg of Braeburn apples has risen by an average of 20% in the big supermarkets, from £1.62 at the beginning of 2012 to £1.95.

Meat prices are also soaring, because of high feed costs. And now farmers are having to bring early calves back indoors and buy in feed for animals that ought to be grazing spring grass.

Wheat yields in England are down by an average of 15% and in some places as high as 35%, according to the National Farmers Union. The world market price for wheat has risen by 29% compared to last year, after heat waves and drought hit the 2012 harvests in Russia and the US.

The UK government's chief scientist Professor Sir John Beddington, in his last week in the job, made clear that the extreme weather responsible for this growing food crisis is going to be a feature for many years to come.

"The variation we are seeing in temperature or rainfall is double the rate of the average. That suggests that we are going to have more droughts, we are going to have more floods, we are going to have more sea surges and we are going to have more storms. These are the sort of changes that are going to affect us in quite a short timescale," he warned.

He explained that climate changes lag behind the CO2 emissions that cause them. In other words, it is the CO2 already in the atmosphere that is causing the current weather extremes.

But capitalist economies are emitting more CO2 than ever, and in the UK, the government has taken measures to boost fossil fuel burning. The situation is not going to get better any time soon.

And of course the impact of higher food prices is worst for poorest people. The price of healthy produce such as fruit and vegetables has risen by 34% in the last five years and that is nothing to what is coming later this year.

Climate change is now a key contributor to the growing health inequality in the UK and the government's response shows its flagrant hypocrisy. They continue to spend millions on TV adverts urging people to eat their "5-a-day" when their own statistics show that  the 10% of families on lowest incomes are actually reducing their spending on fruit and veg to save money.

We need to bring the energy and food corporates into a new and sustainable economic framework. With profit driven out of the system, we can start acting to reduce greenhouse gas emissions and halt climate change.

And we will need to start adapting to the changes that have already taken place; that means supporting farmers to sell their produce at a fair price to not-for-profit co-operatives. Then every family can have a healthy diet - and the occasional celebration!

Penny Cole

Environment editor

Banks in 'collateral crunch' as debts mount

Thousands of high school students took to the streets outside parliament in Nicosia yesterday. They were protesting against the harsh consequences the people of Cyprus can expect from the deal imposed by the European Union, International Monetary Fund and European Central Bank.

This conspiracy of non-elected bodies is the technical arm of a near-dictatorship ruling throughout Europe. It is fighting belligerently to save a social, economic and political system that is wrecking the fabric of societies. The resources that are being consumed, let alone the lives ruined, surely don’t justify the results. As for the people of Cyprus, they simply get no say as the deal is not going to parliament, just in case it’s rejected.

The banking crisis in Cyprus is just one of the storms in the vast clouds of credit and debt invented to finance the global growth of production and consumption from the 1980s onwards. This one was triggered months ago when Greece was forced to write down the value of its government bonds as part of the bail-out punishment for its people. At the end of 2011, the Bank of Cyprus had $14 billion tied up in Greek debt, while Laiki Bank had more than $24 billion.

The botched and brutal temporary patch designed to prevent a formal default by the smallest member of the eurozone will reverberate throughout Europe and the rest of the world. The imposition of capital controls to stop instant transfer of funds out of the country undermines the fragile state of both the eurozone and the wider European Union.

UK  civil servants won’t have been the only ones working through the night to minimise the impact on ex-pat Cypriot bank branches, like those in Mayfair and Birmingham. President Putin’s people will have been hard at it too, searching for ways to extricate the remains of the vast amounts of Russian wealth that found its way into Europe via Cyprus in recent years.

Cyprus, already in a deep recession, now facing an estimated further 20-30% cut in its GDP as a result of the deal, will be devastated. Thousands of businesses and tens of thousands of jobs will disappear overnight. The story is being replicated throughout Europe.

Portugal, where unemployment is heading towards 20%, is entering a third year of contraction amplified by austerity; and Spain’s jobless rate will pass 27% according to its central bank as the Europe-wide contraction drives the country into a deeper slump. France, the second biggest eurozone economy, has seen 22 months of rising unemployment, now exceeding 10% and certain to rise further as car factories are shut down due to overcapacity.

The global recession is spreading like a virus across the United States too. Cities wrecked by the crisis, including Detroit in Michigan, San Bernardino and Stockton in California are seeking bankruptcy protection to exempt their pension funds from being raided to pay debts.

In the UK, observers are warning that the decision by the Bank of England today to require banks to raise another £25 billion of capital, will could lead to a “collateral crunch” that could shut down the market for credit. So don’t fall into the trap of thinking it’s just Cypriot banks that are over-stretched. UK banks have piles of debt that no one is paying interest on, which is why the Bank of England has stepped in.

Wherever you look, which ever way you turn, the conclusion must be the same. Capitalism as an economic and political system is in extermination mode. In this situation,  private and public sector employees and pensioners need to unite with finance sector workers throughout the world with one goal in mind. All the resources needed for production, distribution and exchange must come under social ownership and control. So long as they remain out of reach, the worse our prospects become.

Gerry Gold

Economics editor

Labour's 'opposition' to bedroom tax is phony

The campaign against the “bedroom tax”, with over 660,000 households due to start losing significant amounts of housing benefit from Easter Monday, has exposed the duplicity of a Labour leadership that has tried but failed to hijack the protests.

Labour is not actually opposed in principle to the ConDems’ punitive cut in benefit for those in social housing of working age deemed to be over-occupying by having a spare bedroom. In fact, New Labour introduced the criteria for private-sector tenants in 2008. The Coalition uses this fact to justify extending the policy into social housing.

Shadow works and pensions secretary Liam Byrne has actually linked a fake opposition to the bedroom tax to plans for tougher workfare. He was roundly booed at a recent rally in Birmingham. Byrne was behind the abstention by Labour in parliament  last week over the vote on retrospective laws to enforce workfare.    

By contrast, left MP John McDonnell was cheered at the rally for declaring that Labour councils should refuse to implement the policy. His is a lone voice.

If tenants are deemed to have one spare room, the amount of rent eligible for housing benefit will be cut by 14%. If they have two or more spare rooms, the cut will be 25%. This will mean an average loss of about £14 a week for council tenants. Those who rent from housing associations are facing an average loss of about £16 a week.

In Scotland, the Scottish National Party has said the local authorities the party controls will refuse to evict people who get into arrears as a result. No doubt the SNP has one eye on encouraging people to vote “Yes” in next year’s independence referendum. Whatever.

Meanwhile, not a single Labour council in Britain has made the same declaration (Green-led Brighton has, however). In Dundee, the SNP led-council was the first to pass a policy to stop evictions, but this was opposed by Labour councillors.

Just as Labour councils have busily gone about implementing ConDem cuts in local spending, destroying jobs and services en route, they will enforce the bedroom tax. Labour leader Ed Miliband has no intention of instructing them to do otherwise, although if he did the tax would become unenforceable.

For Labour, it’s about people moving to smaller homes as a “solution”. As shadow cabinet member Helen Goodman said: “We’ve said that the bedroom tax should only apply if people have been offered a smaller place to live and turned it down because, obviously, it is better to use the housing stock more efficiently.” Yet all the figures indicate that smaller properties simply do not exist in the required numbers.

In Liverpool, where 6,700 tenants of Riverside Housing Association alone face severe benefit cuts, senior staff acknowledge that the “impact on communities could be profound”. They, naturally, intend to carry out their orders should evictions become necessary.

Tenants groups across the city have come together to spearhead the national campaign against the bedroom tax. Labour set up its own “campaign” in a bid to limit the protests to petitions and pleas. Tenants saw through this and are planning their own Assembly on April 6 to plan further resistance.

Ultimately unaffordable rents are the reason for a housing benefit bill of £23 billion a year. This huge sum is, in effect, a subsidy to landlords of all types. With social housing rents due to rise further – thanks to New Labour’s policy of “convergence” across different sectors – the attack on tenants is certain to increase.

The obvious alternative is to slash rents, build more homes at affordable rents, requisition empty properties, socialise land ownership and create an economy founded on decent wages for ordinary workers. Labour’s policy, by contrast, is to encourage “responsible capitalism”, a society that only exists in dreamland. As we have said many times, what is the point of Labour?

Paul Feldman

Communications editor

  

Dancing to the tune of the far right

Prime Minister David Cameron has chosen the pages of the Sun newspaper to launch a crackdown on immigrants. In what the tabloid calls his “manifesto”, he claims that “Frankly this country became a soft touch”.

Whilst saying that immigration has benefited Britain, his words are a clear bid to win back those voters who have been migrating to the anti-immigration, anti-Europe UK Independence party.

The manifesto is Cameron’s attempt to outflank Ukip leader Nigel Farage, who recently met with the Sun’s owner, Rupert Murdoch for the first time. The PM’s attack on welfare for immigrants mimics proposals put forward by Ukip.

Cameron announced that immigrants would no longer receive benefits if they did not find a job after six months. They would only qualify to be on the waiting list (let alone be given) council homes when they have lived in the UK for up to five years. He said they would not be able to receive free treatment in the NHS.

The entire basis for his attack was that immigrants are an overall drain on the UK economy in general and on housing benefits and the health service.

But on BBC Radio 4 this morning, Jonathan Portes, director of the National Institute of Economic and Social Research (NIESR), put the record straight. He said that the Institute’s research for the Migration Advisory Committee of the UK Border Agency has shown that migrants “make a substantial net contribution to UK finance”.

This is because migrants are mostly young people who come to the UK to work and who pay taxes, he explained. They are far less of a burden on the welfare state than the average British citizen. The overwhelming part of UK benefits go to older people who need long-term health care.

While there obviously were some cases of abuse, “the figures tell us that the people from outside the UK are a miniscule cost to the NHS”.

The NIESR is not the only organisation challenging the increasingly shrill anti-immigration rhetoric. On Saturday, the Bishop of Dudley, David Walker, said the tone of the debate was “wholly disproportionate”. Walker, who has served on the board of the National Housing Federation pricked the “fear” bubble. 

“Public fears around immigration are like fears around crime,” he said.  “They bear little relationship to the actual reality. The true threats to our national wellbeing lie not with those who come to visit or make their lives here but with the increasing gap between the rich and poor among us."

It’s clear that Cameron is dancing to the tune of Ukip and the far right, is using the pages of the right wing press to whip up anti-immigrant sentiment based on a fictional scenario.

His stance, however, still fails to match up to that of Labour. Not long ago, Blairite Dan Hodges noted that Labour leader Ed Miliband “laid out some of the hardest policy lines ever drawn on the issue by a Labour leader”. And Shadow Home Secretary Yvette Cooper's agenda involved “arrest, incarceration and deportation. Not One Nation, but a one-way ticket out of Britain”. She called for greater powers to be given to the UK Borders Agency.

But that very same agency is guilty of repeatedly breaking the law in its attempts to deport those legally seeking leave to remain in the UK.

UKBA’s monstrous behaviour has led to the deaths of a number of asylum seekers whilst in custody (some whilst in the “care” of global security giant G4S), the separation of children from parents, wives from husbands and many other human rights infringements.

The continuing shift to ever more anti-immigration policies is a bankrupt racist attempt by all the main political parties to make immigrants into scapegoats as the economic crisis deepens. Former immigration lawyer Francis Webber’s call for “a braver alternative vision” in her new book Borderline Justice is spot on. It can help to inspire the development of a new constitution for the 21^st century.

Corinna Lotz

A World to Win Secretary

ConDems consign Kyoto to the dustbin

Big and dirty - that's the energy future envisaged by the Coalition government and backed up with tax breaks in the budget.

The ConDems are progressively dismantling the measures put in place to implement the Kyoto Protocol – the better-than-nothing emissions reduction treaty – which Britain signed but is now left withering on the vine.

The decrease in Britain's greenhouse gas emissions (GGE) achieved by the switch from coal to gas can only be maintained if a switch is made now to renewable energy sources, along with huge energy-saving measures.

The new policy is the exact opposite.

Chancellor Osborne is ready to let rip, exempting industries with high GGEs from the Climate Change Levy and using taxpayers’ money to subsidise fossil fuels.

Exploiting the big lie that tackling climate change means lost jobs and high fuel prices, he announced exemption for the ceramics industry and confirmed he will add others to add to the list.  The industrial lobbyists are queuing up outside his office in Downing Street.

Osborne confirmed that Drax Group plc will get a share in a billion pound subsidy to build a 425MW coal-burning power station in Yorkshire fitted with unproven carbon capture and storage technology. This will be, to all intents and purposes, a new coal-fired power station.

Oil corporations will get tax breaks to cover the cost of decommissioning North Sea rigs. This is part of the price they’re demanding for taking on expensive, environmentally-disastrous but very profitable, contracts for deep sea drilling in the North Sea.

Osborne promised to kick start shale gas drilling – fracking – with a "generous new tax regime" and looser planning regulations.

"Shale gas is part of the future," Osborne says, "and we will make it happen." The ConDems are oblivious to the disastrous environmental, health and human cost people in the US are paying for the fracking boom.

And it does not offer any kind of an energy future, as the new publication Drill, Baby, Drill explains. The authors note that once hooked up to a pipeline, shale gas wells decline rapidly: "For five of the biggest shale plays that account for 80% of US gas production, the well declines are such that production of the average well is down 80-90% after three years."  

The dash for shale gas in the US has put the country on a financial treadmill. As production rose in the initial boom, so gas prices fell. That made drilling in marginal areas unprofitable, so companies are holding off until prices rise again. Instead of being held to ransom by foreign oil, the US consumer is being screwed by home-grown profiteers.

Osborne boasted of the planning permission granted to EDF to build a Leviathan nuclear power plant at Hinkley point. But with no for storage for the waste and the energy corporation EDF demanding price guarantees, how sustainable is that?

China already has 16 nuclear plants and plans 24 more. As demand for uranium increases, prices will rise and consumers will have to pay to sustain EDF's profits. Uranium is a finite fossil fuel too, in case you didn't notice.

"Creating a low carbon economy should be done in a way that creates jobs rather than costing them," says Osborne. Or not at all - that's the real policy.

While the ConDems use our money to underwrite the profits of the energy giants, many small to medium renewables companies balance on the edge of bankruptcy.

Sooner or later we will have to switch to renewables, but that incontrovertible reality cuts no ice in an economic system that sees no further than this week's share values and next year's profits.

Penny Cole

Environment editor

Political system 'incapable' of solving crisis, warns leading Tory

The ConDem government’s plan to, in effect, engineer a state-financed, speculative housing boom in a bid to stimulate expansion, sums up the increasingly desperate state of both the economy and the political classes.

So much so that a leading Tory commentator suggests that yesterday’s Budget signals the absolute inability of representative democracy to tackle the crisis. A Coalition brought together to tackle the budget deficit and restore some balance to the economy, has patently failed to do either. Moreover, there are indications that the ConDems don’t really have a clue what to do next.

Chancellor George Osborne’s package of tax cuts for big business and state funding to underwrite house buying, combined with cheaper beer and a continuing pay freeze for public sector workers, was announced against a background of a worsening economy.

The Office for Budget Responsibility has revised its forecasts for growth down (yet again) and its projections for government debt up (yet again). Despite the savagery of Osborne’s austerity policies, the total of state debt is actually rising.

According to yesterday’s figures, it is scheduled to stand at approximately £1,400 billion in 2015, up from the £800 billion inherited from Labour in 2010 – a rise of £600 billion in just five years. Net debt is forecast to peak at 85.6% per cent of GDP in 2016-17. Back in June 2010, it was forecast to peak at 70.3% of GDP this year.  

The expansion of the economy that would bring the levels down through greater tax receipts exists only in the imagination. As the Financial Times gloomily commented: “Growth is, once again, jam tomorrow but never jam today.”

As to underwriting house buying through mortgage guarantees, the verdict is pretty unanimous. Builders and estate agents will get rich quickly, while house prices will soar and create another asset bubble ready to go pop when someone misses a payment.

Ian Williams, analyst at Peel Hunt, said: “As a policy for driving economic growth – limited. For solving the national shortage of housing – no impact. For wrecking long-term affordability of housing – tremendous.”  

With incentives to extract shale gas and various other concessions, the chancellor budget’s will accelerate climate change in pursuit of growth that simply won’t happen, in Britain or anywhere else. Today’s news about deepening downturn in leading eurozone economies confirms that.

With the Financial Times, describing the Budget as a “failure” which won’t make a difference, what will? The paper that speaks for significant sections of capitalism demands “greater radicalism”, without further elaboration.

As  resistance to austerity grows across in Britain and the rest of Europe, the ruling classes are faced with a serious problem. There are no rabbit-in-the-hat solutions, as the Budget shows. Political elites are struggling to cope, which brings us back to Peter Oborne of the Daily Telegraph.

An astute commentator, whose Triumph of the political class is worth reading, he now concludes that the political system is incapable of doing what’s necessary. He derides not only the chancellor but Labour for not having “the faintest idea how to confront the economic crisis” or appreciates of “the scale, let alone the nature, of the disaster we are now facing”. In other words, the political will to take the axe to public spending is not there (not that would actually do the trick, anyway). Oborne adds:

 “So we should all ponder whether there is an ugly truth lurking out there: is the British electoral system simply incapable of coping any more with serious economic crises?  Alexis de Tocqueville remarked that: 'The American Republic will endure until the day Congress discovers it can bribe the public with the public’s money.' This observation is just as true of British representative democracy.

“The Coalition, brought together to confront the national economic emergency, has failed in its mission. So we are entering a momentous period in our national life: if the politicians cannot address the problem – and they can’t – who will?”

So we have a combined crisis of the economy, politics and ecology which parliament cannot address. The implication of Oborne’s article is that some form of dictatorship may be the outcome. With the Bank of England getting new powers and the Privy Council dusted down for action, you can’t say we haven’t been warned.

Paul Feldman

Communications editor

  

Resistance by Cypriots deepens eurozone crisis

The deepening crisis in Cyprus, where every single MP voted against plans to steal a portion of people’s savings, has thrown eurozone leaders into turmoil. Clearly the snail pace of parliamentary processes forcing through austerity is proving too slow for Europe’s ruling elites.

Cypriot MPs effectively rejecting the blackmail letter drawn up by Berlin and sent via the dreaded Troika of European Union, European Central Bank and the International Monetary Fund. 

Buoyed up by the huge anger uniting its people and to everyone’s surprise, not even the MPs of the right-wing government voted in favour of the ‘deal’ which would have seen the EU dipping its hands into every bank account to extract 10% of any money they can find.

In saying ‘No’, the MPs joined the growing resistance across Europe – from Italy, to Spain and Greece – to austerity measures that are designed to rescue a capitalist system that is drowning in debt.

The attack on savings – while leaving bank creditors out of the frame – is a new tactic designed to extract tribute for the sovereign debt monster affecting so many countries blown up in the wake of the Great Global Crash of 2007-8.

Even the Church of Cyprus’ Archbishop Chrysostomos is with the opposition, at least for the moment: "The entire wealth of the Church is at the disposal of the country ... so that we can stand on our own two feet and not on those of foreigners." The church is a major shareholder in Cyprus's third-largest domestic lender, Hellenic Bank

Banks and the stock market remain closed. No one knows when (or should that be if?) they will reopen. The 1.1 million population of the small island, as well as the bevy of foreign tax-avoiders are denied access to their funds. But the threat of a Europe-wide bank run contagion is very real. People everywhere are eyeing up the security of their savings. Those that have any.

The fragile peace engineered by the co-conspirators of the Troika in the form of a Europe-wide banking union has been shattered. In a sign of nervousness in other eurozone countries, Spain’s finance minister declared savings accounts in his country

“sacred”, adding Cyprus was “special and unique”. Wishful thinking.

But as Cypriot finance minister Michael Sarris flew to Moscow seeking help, much to the consternation of EU officials, the problems mounted. Even if Russia granted an extension of an existing loan and reduced the interest rate, it wouldn’t make a difference. Cyprus may even offer newly-discovered gas resources could also be on offer.

Wolfgang Schäuble, German finance minister, is insisting that the Troika’s plan prevails.

After the vote in Cyprus, he said: “Cyprus is living with a banking sector with low taxes and favourable laws that is completely overdrawn and that makes Cyprus bankrupt. This business model is not sustainable.”

With the two big Cypriot banks living off emergency liquidity from the central bank, the real possibility is that the country will be ejected from the euro, plunging the single currency into a downward spiral.

Cyprus is part of a growing global contagion which austerity policies have deepened,

Inflation is rising just as manufacturing is declining. With only the faintest signs of life in the US economy, investors have now begun to assess the likelihood - and catastrophic consequences - of an end to the years of historically low interest rates.

Ben Bernanke, chairman of the US Federal Reserve ominously began a speech with these words: ‘Why are long-term interest rates so low in the United States and in other major industrial countries?’ Later today, he’s expected to give his views on the end of quantitative easing.

With these new developments in an increasingly desperate situation, our attention must turn from just resisting austerity to replacing the bankrupt system altogether. A global network of peoples’ assemblies has to take control of the banks and the financial networks. Then they could be converted into a democratically run not-for-profit service to co-operative enterprises producing for need.  

Gerry Gold

Economics editor

Beware the threat of rule by Privy Council

The agreement of the three main parties to use the Privy Council to create a Royal Charter to impose controls over newspapers shows their utter contempt for the democratic process.

Fearful of the right-wing media they want to corral, and desperate to avoid an open debate in Parliament, they have instead turned to a secret body that meets at Buckingham Palace to do their bidding.

The Privy Council, which has its origins in the 13^th century as secret advisors to the monarch, hasn’t actually met in full for 25 years. This agency of feudalism instead has a “quorum” of three or four. No one actually knows, because there are no written rules.

All members of the cabinet, past and present, are members of the Privy Council. So are senior judges, archbishops and members of the royal family. Although there are over 600 members, only senior ministers ever get invited to meet the queen, who then signs Orders in Council (OIC).

Prerogative orders have the same force as legislation – but need not go before parliament for approval. So the Royal Charter on the press will come into force simply when the queen signs it. No wonder Index on Censorship and others have condemned the moves as a blow to democracy.

The Privy Council may seem quaint and a relic but has a sinister side to it. It is a vehicle for executive decisions by the government, formally issued under the name of the monarch.

The dissolution and summoning of Parliament are effected by royal proclamation; so are the declaration and termination of a state of war, and the declaration of a state of emergency.

A key role in the development the British empire was played by the Privy Council, which

developed into an instrument for colonial administration. Councils of Trade and of the Plantations were established in the late 17th century. The Honourable East India Company was granted its Royal Charter by Elizabeth I, and many followed, including the Hudson's Bay Company Canada and the Royal African Company  “They normally exploited trade and slaving monopolies and privileges,” says Patrick 0'Connor QC, author of a study of the Privy Council for the campaign group Justice.

Prerogative Orders in Council are not laid before parliament at any time. There is no need, for example, to explain their compatibility with the European Convention on Human Rights. When trade union rights were abolished at government communications centre GCHQ, this was achieved through an OIC. Chagos Islanders were removed from their location by an OIC. Connor warns:

The PC [Privy Council]  is a body imbued with undemocratic values and practices, under the illusion that it is above democracy on a higher plane. It is both institutionally as a whole, and severally by its individual membership, inherently remote from any democratic instinct.
“The lack of accessibility and transparency of the PC means that almost no one understands its processes. In a serious emergency, the British people would simply be presented with its products: proclamations and OICs having various formal legal effects upon the rights and duties of us all.  

A QC chooses his words carefully so when Connor warns that “in a real constitutional crisis, this country would be ruled by OICs”, we should take him seriously.

Parliament once resisted the Privy Council. As far back as 1353, there was a protest against “legislation by ordinance”, which claimed the Commons was being by-passed by the Privy Council for law-making purposes. In the reign of Charles I, the Petition of Right 1627 listed various abuses by the Privy Council.

Although Charles agreed to sign the petition, in practice he ignored parliament’s wishes. Civil war between crown and parliament was the result. The Privy Council found its feet again with the restoration of monarchy in 1660.

In 2013, parliament is a poodle of the executive, which in turn relies on the Privy Council for its dirty work. If there as ever a case for a sweeping, new democratic constitution embodied in an Agreement of the People, the unholy ConDemLab coalition deal on the press is it!

Paul Feldman

Communications editor

Cypriots angry against bail-out at their expense

Punish the poor, protect big investors and retain Cyprus as an offshore banking haven for oligarchs. That was the meaning of measure rammed down the throats of Cypriots over the weekend under the direction of the infamous Troika.

Instead of restructuring broken banks, the right-wing government was told by the European Union, the European Central Bank and the IMF to cut the value of ordinary people’s deposits as the price for an £8.6 billion bail-out.

But if they thought it was a clever move, they have been proved completely wrong. Fears immediately grew of a run on banks around Europe after panic-stricken scenes in Cyprus. Cash points ran out as savers tried to pre-empt government measures to dock their accounts.

Even as an emergency session of the Cyprus parliament began, there were warnings that the Cyprus crisis could spark off of the next global financial crisis. Savers in Greece, Italy, Portugal and Spain may also panic if they think they are next. Anti-austerity Strikes and demonstrations around Europe are adding to the tension.

Eurozone finance ministers in Brussels and Berlin want to take 6.75% of the savings of those with less than €100,000 and 9.9% of those with over that amount. Cyprus’ new president Nicos Anastasiades’ claims that the measure will mainly hit Russian oligarchs who use the island for money-laundering has failed to convince as pensioners and life-savings are hit hard.

Financial experts like David Kotok of Cumberland advisors have expressed amazement: “The madness of this decision about Cyprus is unfathomable. We expect runs on Cypriot banks when they open on Tuesday. Europe has found a new way to shoot itself in the foot.”  

So is Cyprus – a small country of 1.1 million – simply a unique case? Well, of course every country is special, not least Cyprus, which has been divided into two for 40 years since being invaded by Turkey in 1974. Unemployment stands at a record high of 15%. 

Yet the banking sector has mushroomed – fuelled by speculation in the island’s property market – to become more than eight times the size of the nation's economy. The Russian mafia has exploited Cypriot banks for money-laundering and rubs  shoulders with native property-speculating millionaires in the luxury villas on the coastline.

And, in addition to its tax-evading oligarchs, the Russian government has strategic reasons for retaining influence there. It is a stop-off point for ships supplying the Assad dictatorship with arms. British bases on the island are to be turned into NATO bases, under a secret agreement made last autumn.

The rulers of Europe desperate to save the euro are bearing down on ordinary people to impose the needs of the banks and the economic system over which they preside. 

The needs of the ordinary people of Cyprus as well as modest pensioners from cold climates, let alone the country’s fragile eco-systems many of which have been destroyed by rampant speculative building, count for nothing in this entire debacle.

But this is the pattern, not only in Cyprus, but also in Ireland, Spain, Italy and UK. The demands of millions of people to end austerity have been ignored. In Italy, where a majority voted against further cuts, the electorate is left disenfranchised.

The disarray at the top of the European Union is leading to dismay in significant circles. Today the Financial Times commented: “The biggest risk is political. The prescription of universal austerity combined with kid-gloves treatment of big investors in banks is increasingly toxic to European voters. Leaders have just added fuel to the fire.”

Leaving the Euro, however, as some politicians in Cyprus and Britain are threatening to do, will not solve the deep debt crisis that lies behind the dictatorship of the Troika. That will require taking the power from the bankers and their political allies and re-structuring the economic system so that it works for people and not profiteering speculators.

Corinna Lotz

A World to Win secretary

Big Pharma more of a threat than a cure

The absurd notion that taxpayers should give money to the drugs industry as an incentive to develop a new generation of antibiotics demonstrates how a handful of corporations have their proverbial fingers round society’s throat.

Using fairly sensational language to set the alarm bells ringing, the government's chief medical officer Professor Dame Sally Davis says the threat posed by antibiotic resistance is on a level compared to global terrorism. Actually, the threat posed by Big Pharma is worse.

Big Pharma – the handful of corporations that control the global industry – haven’t produced a new range of antibiotics for 20 years because there’s little profit in selling this type of drug.

During that time, the over-prescription of antibiotics by health practitioners and their intensive use in livestock farming to make meat cheaper has spawned new bacterial strains that are immune to existing drugs. Others have become so difficult to treat that they kill some 25,000 Europeans yearly.

So Professor Davis is warning that without new antibiotics routine operations could become endangered by infections that cannot be treated, for example. But leaving it to Big Pharma will prove as dangerous as the new bacterial infections themselves.

In 2010, the top 10 pharmaceuticals had astronomical revenues totalling over $500 billion. Much of it comes from drugs we don’t need and from denying developing countries the right to sell generic equivalents at lower prices.

Ben Goldacre’s book Bad Pharma reveals how companies run bad trials on their own drugs, which distort and exaggerate the benefits. Data that doesn’t support the results is buried. Meanwhile, the medical profession is beholden to the same corporations and, he argues, are actually educated by the drugs industry.

As far back as 2002, an article in the British Medical Journal accused the industry of extending the boundaries of treatable disease to expand markets for new products. A decade later, the BMJ has launched a campaign entitled 'Too Much Medicine', saying: “There is growing evidence that many people are over-diagnosed and overtreated for a wide range of conditions, such as prostate and thyroid cancers, asthma, and chronic kidney disease.”

Former editor Richard Smith, who now works for a health care group, says that

only 11% of 3,000 health interventions have good evidence to support them, with 80% of new drugs copies of old ones.

When it comes to holding on to patents to enforce monopolies, Big Pharma has an appalling record. Dylan Gray’s film “Fire In the Blood” documents how the corporations and governments blocked access to low-cost AIDS drugs – causing millions of unnecessary deaths.

He says: “At the industry's behest, governments in the US and Europe use a dizzying variety of trade mechanisms, threats of sanctions and so on to curtail supplies of affordable medicine in the global south. The potential impact of these measures in human terms is nothing less than cataclysmic.”

There are solutions we could pursue if the profit motive was not the main driver. First, over-prescribing has to stop. Doctors have to put patients first instead and abandon the quick-fix approach as well as misplaced loyalties to drug firms.

Secondly, we should note that  84% of worldwide funding for drug discovery research comes from government and public sources, against just 12% from pharma companies. Apparently, researchers have already discovered new antibiotics but haven’t got the funds to develop them.

So the science is there. However, the technology and capacity to turn knowledge into products is in the hands of the top 10 – Pfizer, Astra Zeneca, Johnson & Johnson, Novartis, Bayer, F Hoffman-La Roche, Merck, Sanofi, GlaxoSmithKline and Abbot.

That’s what has to change. Global health cannot be determined by a handful of profit-driven corporations. Giving them funds, especially at a time when austerity is cutting key services, is a shocking idea. Instead, Big Pharma has to come into common ownership and no effort spared to develop drugs that benefit the sick and not shareholders.

Paul Feldman

Communications editor

Climate change reduced to a 'security' issue

Whilst publicly claiming climate change is no block to business as usual, and even a potential source of green profits, the world's ruling élites are planning for its impact on "security" (as they call their uninterrupted rule).

In the United States, in particular, the national security establishment is planning for a future of rising sea levels and battles over resources. While taking action on global warming is off the agenda, “security” certainly isn’t.

As part of this, the US navy is organising a major joint exercise this May along with forces from India and China and 22 other countries. Admiral Samuel J. Locklear III revealed details to the Boston Globe. He said that significant upheaval related to the warming planet is the most likely event "that will cripple the security environment, probably more likely than the other scenarios we all often talk about".

He added: “You have the real potential here in the not-too-distant future of nations displaced by rising sea level. Certainly weather patterns are more severe than they have been in the past. We are on super typhoon 27 or 28 this year in the Western Pacific. The average is about 17.”

His 40,000 strong Hawaii-based HQ, responsible for operations throughout the Pacific and up to the Indian Ocean, is "working with Asian nations to stockpile supplies in strategic locations and planning a major exercise for May with nearly two dozen countries to practice the 'what-ifs'."

The US is talking to Asian governments about "the imperative to kind of get military capabilities aligned [for] when the effects of climate change start to impact these massive populations".

Retired Rear Admiral David Titley was chief operating officer of NOAA, the US Navy's climate lab, and director of the US Navy’s Task Force Climate Change. He offers an insight into how the military views the changes that are on the horizon:

"When I was in the navy, we tried to strip away the emotions associated with climate change as a political issue. It’s a change, and just like changing demographics, political regimes and economic conditions, we need to deal with it. If we don’t, we’re putting ourselves at a competitive disadvantage — and the United States military never wants to be at a competitive disadvantage.

"The Department of Defence plans for everything, and particularly for potential changes in ‘the battlespace’,  the geography in which we operate. With global sea levels projected to rise anywhere from 20 centimetres (8 inches) to 2 metres (6.6 feet) this century as a consequence of climate change, that’s a change we have to account for and plan for."

So what frightens the United States and other countries? According to the Admiral Locklear, it is the displacement of millions of people by climatic events. After that, security “will start to crumble pretty quickly”. In other words, lots of angry people will start taking action themselves and established order will come under threat.

With climate change talks stalled for the indefinite future, a meeting of the UN Security Council in February focused on the global disruption global warming will cause. They heard from Hans Joachim Schellnhuber of the Potsdam Institute for Climate Research, who warned that when sea levels rise, space for human settlements will shrink and also supplies of clean water and food.

Battles over what is left would be "the logical result". He added: "Whoever wants to ignore the problem has to start right now building a high fence around their country. They can forget trade."  

There has to be an alternative to treating climate change as a trade and security problem. Going down that route is to accept that some people will survive and others won’t while the corporations cash in. Co-operating across all borders to reduce greenhouse gas emissions to begin to restore health to the eco-system is an option that puts people ahead of security and profits .

Penny Cole

Environment editor

Exploitation on the rise as recession deepens

Today’s forlorn protest by the TUC designed to put “pressure on chancellor George Osborne to change course” as he puts his final touches to next week’s budget will fall on deaf ears.

Prime minister Cameron last week insisted that the austerity programme would continue. It was brought in to deal with the spiralling increase in government debt which became unsustainable when the financial system crashed and recession followed.

The aim is to pass the burden of the debt on to backs of millions of ordinary people who have no say in government policy, not any influence on the contents of the budget.

Naturally, the austerity programme has failed. The debt has continued to soar as a result, claims Cameron, of external factors beyond the government’s control, like the ongoing crisis in Europe. But the Office for Budget Responsibility also made clear that deep spending cuts had contributed to the recession in the UK.

Despite extreme, unconventional measures taken by governments and central banks, the world economic system – aka global capitalism – shows no sign of recovering to anything like its pre-crash level. The sharp decline in UK manufacturing reported yesterday is a case in point.  

An almost covert, but massive devaluation of the pound has driven the cost of imports up but had minimal impact on exports. The Bank of England, unable to explain declining productivity, is abandoning its duty to keep inflation below 2%. By “looking through” the target, it is admitting that continuing with the attempt to slow price increases threatens to tip the economy into a new, more catastrophic slump.

Instead it will focus on its attempts to stimulate the economy, with low interest rates, issuing itself with the money to buy more government bonds and more lending. It is encouraging the government to do the same, even though the ConDems Funding for Lending scheme has flopped.

The BoE has floated the idea of negative interest rates, whilst those to the right of the ConDem coalition are pushing for even more stringent cuts. The Tory right want to intensify the current programme which, designed with absurdly optimistic expectations of a return to growth, is not even a third of the way through. People like Liam Fox have health and welfare budgets in their sights, combined with tax cuts. It’s all adding to the pressure on Cameron, whose political future looks less rosy by the day.  

But the real story is that the recession is deepening, confirmed by the so-called “productivity puzzle”. The mystery is that productivity measured both by output per worker, and output per hour has fallen by as much as 14% since the crash.

The pre-budget report from the Institute for Fiscal Studies thinks it has an explanation. In a simplified form it is clear that in the wake of the crash, investment in capital goods has fallen because, with no sign of a return to growth, investors are holding on to their cash.

Wages have fallen as unemployment has risen, but unemployment hasn’t increased as much as might have been expected.  Employers have forced wages down, turned to cheaper labour associated with part-time working and more labour intensive forms of production.

In summary then, the capitalist imperative of increasing productivity is operating in reverse. In terms that Marx might have used, the rate of exploitation of labour is increasing. And as the crisis worsens the impoverishment of the masses is certain to increase.

So the TUC’s shock headline figure, that within two years, almost 7.1m of the nation’s 13m youngsters will be in homes with incomes judged to be less than the minimum necessary for a decent standard of living, will prove to be a monstrous understatement. As for the TUC itself, fewer words and action against the government is needed if we are not to conclude that Congress House is actually a mausoleum.

Gerry Gold

Economics editor

Speculators cash in as homelessness grows

While homelessness grows and people struggle to pay exorbitant rents, rich property speculators in central London are cashing in.

There were 52,960 households in temporary accommodation in England when the figures were last updated six months ago. They include an estimated 70,000 children who have no permanent roof over their heads.

Homelessness has risen 25% over the last three years. And the official increase back in 2011 was itself the largest in nine years. Over the last year, 5,700 people were sleeping on London's streets while some our million are on council waiting lists for a home.

This does not take account of 400,000 “hidden homeless” – those who squeeze into the homes of families or friends and never make it to the council lists.

The ConDem cap on housing benefits, currently claimed by some 660,000 people, will make many more homeless in the months to come.

The right-wing free-market Institute of Economic Affairs notes that: “Runaway housing costs have become one of the most pressing issues for low-income households in the UK. House prices have doubled in real terms since the mid-1990s alone, from an already very high level. No other developed country except Australia has experienced a price explosion of such a magnitude.”

Shelter, the housing campaign, estimates that 3.6 million children in the United Kingdom live in poverty after their housing costs have been paid.

When it comes to buying, most new households are priced out of the market. But for those speculating in property, soaring prices are truly wonderful.

Yes, that will be the super rich who are buying up luxury apartments at One Hyde Park. They include British entrepreneurs, Russian and Ukrainian oligarchs, Nigerian and Arab oil billionaires.  

One tax-haven sleuth has found that five flats in London were bought for a total of more than £82 million by a group of Isle of Man companies under the name of Rose of Sharon.  Ukraine’s wealthiest man seems to have bought two flats in Hyde Park for £144 million.

Despite forking out such astronomic sums, of course, you won’t find many of the billionaires actually living at these properties. In the case of One Hyde Park, only 17 out of the 76 apartments will actually be lived in. It’s an investment and buying through a company means that the owners can avoid a lot of tax.

There is an inverse relationship between the haves and the have-nots. The higher property prices soar, the harder things are for those lower down the scale. Even middle-class professionals are finding themselves priced out of the market.  

The solution to the housing crisis lies within the problem itself. There are over 300,000 long-term vacant properties in England alone. Housing practitioners have long proposed creative ways of bringing them back into use.

Instead of property developers, land speculators and private landlords controlling the supply and price of housing, we need a housing programme that works for people.

Immediate measures are needed:

• End housing benefits cuts and phase out private landlordism
• Reduce council and housing association rents to make them affordable
• Cash for refurbishment as part of a consistent national approach
• Requisition empty and unused properties
• De-criminalise squatting
• Replace mortgage debts with payments re-negotiated according to ability to pay
• A ban on building in the Green Belt
• Improve public transport links to low price property areas
• Social ownership of land, builders/developers and the financial sector.

In short, a housing strategy designed to meet need and for ecological care rather than as a source of income or profit for developers, speculative builders, investors and landowners.

Corinna Lotz

A World to Win secretary

Action needed NOW as CO2 emissions take off

Hopes of holding the global rise in temperatures to 2˚C, an increase that would be disastrous in itself, have vanished after figures just released show that 2012 saw the second biggest ever annual increase in atmospheric carbon dioxide.  

The US government observatory at Mauna Loa in Hawaii measures the amount of CO2 present in the northern hemisphere and they have found this rose by 2.67 parts per million (ppm) in 2012, reaching a total of 395ppm.

Just to recall the historic figures illustrated by the famous "hockey stick graph", atmospheric CO2 concentrations have increased by almost 40% since pre-industrial times, from approximately 280ppm in the 18th century to 390ppm in 2010. As we see from the Mauna Loa reports, in the last two years there has been a further 5ppm increase and no sign of any slowing.

And this is not surprising since far from taking measures to reduce greenhouse gas emissions, governments and corporations are burning more fossil fuel than ever. Bringing coal tar sands into production, building new pipelines, extracting oil from deep-water sources and a leap in the use of coal to generate energy have combined to create this disaster.

To have a 50% chance of keeping global warming below 2°C , CO2 needs to stabilise at below 450ppm. To be sure of it, requires stabilising at 400ppm. As these latest figures show 400ppm will be reached in 2014 at current rates of GHG emissions, and 450ppm by around 2030 if "business as usual" is permitted to continue. A 2˚C increase in global temperatures would lead to:

• complete destruction of the world’s coral reefs
• 26 million people displaced by rising sea levels, hurricanes and cyclones
• 300 million people at risk of hunger due to failing crops
• 2.8 billion people without access to clean water
• spread of diseases such as malaria and Dengue Fever to new areas
• mass extinctions in the Arctic with only 42% of the Arctic tundra stable.
• the Greenland ice cap melted
• loss of the majority of the remaining major forests of China, Europe and America.

Temperature measurements published by the National Climatic Data Centre (NOAA) show we are already on the road to these kinds of disastrous outcomes. Particularly significant is the global split between areas of unprecedented heat and others of rain.  

Governments have demonstrated that they will not act; we must find ways to replace them with democratic assemblies of the world’s peoples who will act to protect the eco-system of which they are a part.

This cannot be postponed.  The Bolivian government should reconvene the World People's Conference on Climate Change, as an online crowd sourcing project. This should aim to create a global assembly of People's Assemblies in order to plan how to take forward the Cochabamba Accord, the declaration of Mother Earth Rights.

This rightly declared: “Under capitalism, Mother Earth is converted into a source of raw materials, and human beings into consumers and a means of production, into people that are seen as valuable only for what they own, and not for what they are.”

Sharing our efforts across the planet would allow us to connect the spirit of the Arab Spring, Occupy and other forms of resistance whilst going beyond protesting and demanding governments act, which they will not. Instead we can start to plan out the social, political and economic changes we ourselves will implement.  

Priority Actions for People’s Assemblies in Britain

• Consult widely on an energy transition plan, moving rapidly away from fossil fuels to renewables with a focus on energy saving 
• End fuel poverty by bringing energy companies into common ownership under democratic control; introduce a sliding scale for energy payments  
• Fund community-based local energy programmes, with insulation grants for households and small businesses, small-scale renewable energy, regulation of industrial and commercial energy use  
• Bring rail and bus networks into not-for-profit ownership, slashing fares and working with transport planners to create an integrated transport system  
• Reinstate rail and bus services in rural, semi-rural areas
• Create public transport/cycle-only boxes in the centre of cities
• discourage car use in cities by providing park and ride and better public transport    
• Support local car pools and car-sharing projects  
• Set upper limits on total flight miles in and out of Britain and distribute them fairly through an air miles system; halt airport expansion
• Halt plans to build a new generation of nuclear power stations and clean up and safely store existing waste.

Penny Cole
Environment editort

The age of profit has reached its limit

In the wake of the worldwide scandal of meat products boosted with horse, investigations into contaminated cakes sold by IKEA are certain to reveal more links in a contaminated global food chain. The actual cause will stay hidden, however.

Chinese inspectors discovered high levels of coliform bacteria in cakes exported by a Swedish supplier, Almondy, to IKEA outlets throughout the world. Close to two tonnes of the product were destroyed and it was withdrawn from sale in 23 countries.

Coliforms can be found in soil, vegetation, water and everyday human environments, as well as in the faeces of humans and other warm-blooded animals, though so far at least, there’s no report suggesting the presence of human intestinal bacteria.

As public safety concerns grow and more inspections are carried out, the physical causes will look different under the microscope as each new case of a polluted product comes to light. But the true cause common to them all can’t be seen through any laboratory equipment.

In the capitalist economy, the over-riding concern is for profit. If the shareholders in a company, now mostly giant investment funds,  see their unearned incomes – their shares in the profits extracted from the production and sale of commodities – falling, they move their capital elsewhere.

So to stay in business every company has to continuously compete to attract investors by driving the rate of profit up, and one of the key ways they do that is by reducing the costs of production.

As we’ve seen, the price of horsemeat is less than a quarter the price of beef – even the cheapest, worst quality beef. So there’s really no contest. The temptation to fraudulently change the composition of a product using less and less costly ingredients is irresistible.

It’s a law governed process that drives the dominant capitalist system of production in all its guises. Control systems involving regulations and inspections attempt to keep a lid on it, but they are always overwhelmed by the inbuilt inevitability of polluted, debased, denatured production and its consequent despoliation of the planetary ecosystem.

There’s another law, a universal. Everything – including every social system – is governed by specific laws that regulate its origin, existence, development, passing away and perhaps, as the science of evolution tells us, its replacement by one more suited to the changing circumstances. 

The profit which defines capitalist society is derived solely from the work people do in creating products. The cost of that labour lies at the heart of the problem. Competition means that the cost of labour must be continuously reduced. 

Reducing the cost of food helps to reduce the cost of labour. So there’s a downward spiral: competition demands cheaper food, cheaper food means lower wages, people on lower wages must have cheaper food.

It’s been a brilliantly successful strategy for a couple of centuries, alternating periods of rapid explosive growth with sudden, brutal and destructive contractions, extending its reach to every part of the globe and overwhelming all opposition.

But there are limits. There always are. That’s another universal law of nature. 

So when the process of competition finds IKEA feeding bacteria that occurs in sewage to its customers worldwide you know that the social system has arrived at a limit of its development.

Fortunately, nature has ensured that the replacement for capitalist society has been developing in opposition to it for some considerable time. It takes the form of democratically-run, not-for-profit organisations like worker-owned cooperatives, credit unions and community banks. These are mushrooming in the United States, of all places, as Marjorie Kelly explains.

The author of the book Owning Our Future: The Emerging Ownership Revolution: is right when she says: “When economic relations are designed in a generative way, they’re no longer about sole and despotic dominion. Economic activity is no longer about squeezing every penny from something we imagine that we own. It’s about being interwoven with the world around us. It’s about a shift from dominion to community.”

It’ll take a co-ordinated push to end the age of profit, but it can be done. It has to. 

Gerry Gold

Economics editor

Climate change deniers trade in disinformation

A draft of the next major report from the Intergovernmental Panel on Climate Change (IPCC) has been leaked on line by a small-time climate change denier, doubtless seeking to enter the big time.

Childishly grabbing one out-of-context sentence from the IPCC Fifth Assessment Report (AR5), US Republican blogger Alec Rawls claims the report supports the idea that any warming is due to natural effects. A riot ensues on the internet, the major well-paid climate denial bloggers pitch in and Fox News is ecstatic.

Then Professor Steve Sherwood, one of the report's authors and director of the Climate Change Research Centre at the University of New South Wales, responds saying: "Oh that's completely ridiculous. I'm sure you could go and read those paragraphs yourself and the summary of it and see that we conclude exactly the opposite, that this cosmic ray effect that the paragraph is discussing appears to be negligible."

So I did, and here's AR5's actual conclusion: “The lack of trend in the cosmic ray intensity over the last 50 years provides another strong argument against the hypothesis of a major contribution of cosmic rays to on-going climate change."

So there you go – I have single-handedly refuted the key plank of climate denialology in one short hour – assisted, naturally, by every single respectable and qualified climate scientist in the world.

AR5 is a highly technical summary of all the current climate change science. That a minor right-wing blogger with no scientific qualifications was able to get the draft by signing himself up as one of 800 "expert reviewers" underlines just how flawed the review process is. Indeed our very own climate sceptic eccentric Lord Monckton (qualification: a degree in Classics from Cambridge University) is signed up as an expert reviewer.

Rawls has done us all a favour by publishing this draft before the reviewers get their hands on it. Whilst the IPCC can ignore low-level bloggers like Rawls and Monckton, the politically appointed big guns brought in by, for example, the US and Chinese governments will have plenty of influence.

AR4, the first global report to state that man-made climate change is an undeniable fact, was changed at review to say it was 90% certain. In fact the IPCC has been accused of frequently underestimating the speed of climate change, because including all respectable studies creates a certain levelling effect.

For example, the 2007 report concluded that Arctic sea ice would not completely melt until 2070 at the earliest though even there was plenty of evidence of a faster trajectory, which has proved right with ice-free summers likely by 2030.

Meanwhile more information emerges about shady corporate funding for climate change deniers. Documents leaked to Desmogblog expose the role of the Heartland Institute in channeling corporate cash to climate change deniers.

For example Fred Singer, a history professor at a Jesuit University who is notorious for his role in the Channel 4 documentary The Great Climate Change Swindle, gets $5,000 per month, plus expenses.

In Australia, Robert Carter gets $1,667 per month. He is a paleontology professor at the University of New South Wales, but also has time to work for Heartland AND be a Senior Policy Advisor at the Institute of Public Affairs, a right-wing free-market Australian think tank.

Craig Idso, another US blogger, writes for the Heartland-sponsored Nongovernmental  International Panel on Climate Change, a shadow organisation that exists solely to challenge IPCC reports. Idso is now researching carbon capture and storage. You could ask why, if emissions are not a problem? Still it is likely to be a lucrative new field with funding from the US coal industry.

In spite of modest salaries and constant departmental cuts, not one respectable climatologist has been bought into the ranks of the deniers. That tells us that money only buys distortion, misinformation and downright lies.

Penny Cole

Environment editor

Chavez leaves an unfinished revolution

The death of Hugo Chavez at the age of only 58 has robbed Venezuelans of a president who was the first political leader in the country’s history to use oil revenues to fund social programmes.

His fourth election victory in a row last autumn was achieved on a turnout of 81% of the 19 million Venezuelans registered to vote, which is in stark contrast to falling turnouts in Britain. Chavez was a real hate figure not only for the right everywhere, but also for the liberal press in Britain.  

The Independent claimed that Chavez bribed people to vote for him by “spending heavily on public housing and bankrolling expanded social programmes”. Apparently, during the first quarter of 2012, the construction sector expanded by nearly 30% compared with the same three months of 2011.

Sitting here in the UK where Osborne is about to announce another package of deep spending cuts, you have to say: “Why can’t we have such bribes – we have oil and gas reserves too.”

Venezuela has the world’s largest oil and gas reserves, and the corporations have been greedily eyeing this prize for years and hate Chavez for keeping it from them. Because of limited access to expertise, it has proved hard for the Venezuelan state oil corporation to improve oil facilities and infrastructure. The explosion at the Amuay refinery last August in which 42 people were killed underlined this.

It has not even begun exploiting its gas reserves, and with refining capacity limited, this energy-rich country struggles to ensure power supplies and affordable energy. Petrol prices are extremely low but only because of a state subsidy.

To afford extensive social programmes and universal health and welfare benefits, the MVR government pushed to all sorts of fixes and deals. It has had $42bn in loans from China over the last five years. Of the 640,000 barrels of oil a day that Venezuela exports to China, 200,000 of them service this debt.  

Chavez’s manoeuvring, however, made him an apologist for reactionaries like Mahmoud Ahmadinejad of Iran and Vladimir Putin of Russia, party because those countries will make oil deals with Venezuela without demanding entry into the unregulated global market.

Venezuela is not immune to the problems of bureaucracy that afflict all attempts to build socialism centred not on popular ownership but on state control. Inflation is high and rising, and many state-owned industries are inefficient and corrupt.

But Venezuela is not some Stalinist state whatever liberal critics claim. The constitution has been reformed and there are popular committees with a real say. A recent poll showed that half the population of Venezuela agrees with the idea of building a socialist country, against 29% who opposed it.

Since Chavez became president in 1999, income inequality in Venezuela has been declining, and it has the fairest income distribution in Latin America. Government expenditure has risen 30% in real terms in the last year, whilst GDP increased by 5.4%.

Chavez has tried to follow a path that avoids putting the global corporations in control of his country’s assets, and to use them, however imperfectly, to improve life for the people.

That made him a thorn in the side not only of the right, but of so-called liberal media who hate trade unions, mock socialism, despise universal benefits and continually tell us such things are hopelessly out of date and unattainable.

Chavez formed an alliance with leaders of other supporters of his Bolivarian Revolution project, notably Evo Morales of Bolivia and the president of Ecuador, Rafael Correa. His anti-imperialist, anti-neoliberal stance won him respect from people throughout the region.

As academic and author Oscar Guardiola-Rivera wrote today: “Like Bolívar, Chavez swore to break the chains binding Latin Americans to the will of the mighty. Within his lifetime, the ties of dependency and indirect empire have loosened. From the river Plate to the mouths of the Orinoco river, Latin America is no longer somebody else's backyard. That project of liberation has involved thousands of men and women pitched into one dramatic battle after another, like the coup d'état in 2002 or the confrontation with the US-proposed Free Trade Zone of the Americas. These were won, others were lost.”

With the death of Chavez, who was once a tank commander who tried to seize power in a coup, the Venezuela’s immediate future is full of dangers and pitfalls. Washington will pitch in resources – mostly covertly – to support the right-wing candidate in the forthcoming presidential election. The White House’s hatred for Chavez stretched to the point where president Obama’s statement did not even offer formal condolences to the dead leader’s family. Even William Hague, the British foreign secretary, managed that minimum of decent behaviour.

For all the dramatic changes in Venezuela under Chavez, the state remains capitalist and the army a powerful force. Big business is waiting for an opportunity to seize the revenues that have been redirected to the people in the form of social programmes. Chavez’s legacy is that he launched a revolutionary process with all its flaws and contradictions, one that on his death remains incomplete.

A World to Win editors

See also:

State and revolution in Venezuela  

Chavez and the struggle for power in Venezuela  

Revolutionary Doctors