Transition Earlsdon Events in March

The next two events for "Transition Earlsdon" ... if you want more information, you can contact Jo Rathbone on 024 7667 8735.

- Tonight, at 730pm, at Earlsdon Methodist Church Hall Room 1, Prof Liz Dowler from Warwick Uni will speak on "Local Food Ethics and Alternative Food Networks". Prof Dowler contributed to the Food Ethics Council's report on food distribution networks (published in October 08). How are people bypassing the supermarkets? How well are alternatives working?

- On the 23rd of March, 730pm, at St Barbara's Church hall meeting room (corner of Rochester Rd and Beechwood Ave, in Earlsdon), there will be a film screening of "Money as Debt" -- it's a 47 minute animated film which asks where does money come from? Why have we got ourselves into the mess we're in? What is link between the money issue and environmental sustainability?

It All Depends On China

The Financial Times's Alphaville column continues to be a good read:

"If the Chinese economy collapses, or even slows dramatically, then the raison d'etre for the country’s huge foreign exchange reserves - as a sterilisation measure to dampen domestic inflation - will evaporate. With that, so will China's US Treasury holdings. Or alternatively the Chinese could devalue the yuan. Either way, the US will be in trouble. Treasury prices could collapse (although given the current renewed banking collapse fears, not before a significant rally has occured) and if that happens, the Fed's yield-lowering credit easing policies will be left in tatters. As will any plans for economic stimulus packages. Hypothetically, that would leave just the nuclear option: devaluing the dollar."

A Peace Stimulus For Gaza

Daniel Noah Moses and Aaron Shneyer, Christian Science Monitor:

"Israelis and Palestinians have a choice. They can continue business as usual: violence, separation, hatred, and fear. Or they can recognize that they must look for mutually beneficial ways to share their small corner of the world. People-to-people diplomacy works on the assumption that if Israelis and Palestinians connect at a human level, they will build compassion and trust. They will change public opinion. Painfully, slowly, they will create cross-border movements to transform the cultural and political reality on the ground."

"Leading up to the Good Friday agreements in Northern Ireland in 1998, at least $650 million in mostly government funds was spent over five years to bring Catholics and Protestants together. This people-to-people diplomacy touched at least one-sixth of the population (250,000 people). There are nearly 12 million people within the borders of Israel and the Palestinian territories. To reach roughly the same proportion of people there as in Northern Ireland, let's assume we need to spend at least the same amount per capita. This would be about $5 billion over the course of five years – $1 billion a year."

"This is pocket change. The war in Iraq has cost the American government almost $600 billion so far. The United States gives more than $2 billion annually to Israel for military aid. Why not invest close to that amount in peace – $2 billion a year over the course of five years, just $10 billion for the first phase of a peace-building initiative worth its salt."

1 Billion Worldwide Go Hungry

We have had record harvests worldwide the last two years, but nearly 1 billion people are undernourished.

It's down to the cost of food.

Global wheat and maize prices have more than doubled. Rice prices have tripled. Kenya announced this week a food emergency, where a quarter of their people are under threat.

Part of this is down to a growth in biofuels (it's ominous that Obama is from a corn state). Instead of grain going to food supplies, it is made into fuel. If you fill a petrol tank of a 4x4 with biofuel, that's enough grain to feed one poor person for a year.

Instead of biofuels, we need more electric cars, powered by clean electricity (not electricity from coal-powered stations).

Instead of bailing out banks, perhaps we should use the 43% we own (in the new Lloyds HBOS) and help developing countries with credit, agricultural aid, and food aid.

Bishop Of Manchester On Credit Crunch

I'm in Manchester for Xmas (Worsley in Salford, to be precise). The Bishop of Manchester is wading in, as has John Sentamu, on the culture that led to the "credit crunch" ...

"What is happening globally to our finances threatens to disable our ability to use wealth in the right way. Desperate measures are needed to reverse the disasters of climate change, to cope with AIDS-related tragedies especially in Africa, and to end poverty across the world. The greed of the few who have corrupted our use of wealth becomes injustice for many."

"Health and happiness are, of course, aided by money. But in the end it is the things that money cannot buy that will rescue our economy and bring the joy and peace that we are currently much lacking."

Also read: The Bishops of Durham, Winchester, Carlisle and Hulme wading in to give New Labour a black eye.

Labour, Bailiffs And Emergency Loans

Labour is considering offering workers who lose their jobs during the recession guaranteed work or a retraining place within six months. This would go hand-in-hand with the proposed mortgage holiday for those facing house repossession, deferring mortgage payments for up to 2 years if workers lose their jobs.

It sounds good, but ...

- Labour wants to remove centuries-old restrictions on bailiffs. If you have unpaid credit cards or loans, and the bailiffs see you move a curtain to peer out, or if they hear a radio, they'll have the right to force their way in, and the right to restrain or pin you down.

- Youth who don't go to university are facing an even tougher time than ever.

- When demand for emergency loans from government is up, Labour wants to shift these loans to credit unions. Instead of being interest-free, they'll be anywhere from 12.6% to 26.8%.

Labour simply isn't doing enough.

£9 Million In City Council Cuts

Coventry City Council is considering £9 million in cuts in services.

They blame the rising energy/fuel prices for council buildings, the downturn in the housing market (a six-figure drop in revenue from planning application fees), and the need for 3% government efficiency savings.

- If we had shifted council buildings to having their own solar panels, and their own micro-CHP units, they would be "insulated" from energy price rises.

- I've sent an email to the council's head of "Finance and Legal" to see if their "corporate risk register," as of 1st Jan 2007, and as of 1st Jan 2008, had assessed the risk of a housing collapse. 5 times earnings, and 120% mortgages, were not going to go on forever.

- If central government can bail out corporate banks, why can't they give a "holiday" for a year to efficiency savings made by local government? Do you cut the fat when you're starving?

Pilot Projects For Free School Meals

Green councillors in Brighton have won a vote to ask the Government for funding for a pilot scheme to provide all young people at the city's primary and secondary schools with free school meals. It would be a big help for low income families facing rising food prices.

Pre-Budget Report - The Day After

- Only £3 billion of the £20 billion "reflationary boost" of the pre-budget report is capital spending. If we want a long-term boost, for long-term economic benefit, this isn't the right way to proceed.

- Two Doctors points out that Brown's 2005 conference speech proclaimed Labour as the party of economic stability ... precisely when we had a housing bubble, and all the sub-prime-shenanigans were starting to build up.

- Hamish McRae, in the Independent, says that when Japan was in crisis, "the more the government borrowed, the more frightened people became and the more they felt they had to save." He goes on to express alarm that the government is talking up the crisis as unprecedented. "The danger of talking up perils is that people will believe them. It is the reverse of Franklin D Roosevelt's phrase that the only thing we have to fear is fear itself – between them, Messrs Brown and Darling are trying to make us more fearful, not less." It's the need for a crisis that I talked about a few days ago. Once the crisis is over, people will turn to the soft/cuddly leader for "peacetime" - Cameron - rather than the Churchill/crisis figure of Brown. Brown needs to keep us afraid.

- There was no emphasis on grassroots financial arrangements (credit unions, co-operatives) in the Pre-Budget report. We need to get people saving in a sustainable way again. Instead, Labour are turning to the very institutions, High Street banks, that got us into this mess.

Brown Needs A Permanent Crisis

Jonathan Freedland: "Brown needs it to be 1943 for as long as possible. He needs voters to believe the crisis is ongoing, that we are still in the emergency phase. Ideally, he would go into the next election as Dr Brown, still wearing his white coat, still administering medicine to the patient on life support."

Credit Crunch IV: The Voyage Home

- The nef has a new £4 pamphlet - 20 first steps to rise from the ashes - "This year has been finance-led capitalism’s 1989. It is now as broken as the old Soviet Union. Now there is a huge opportunity to develop a new model for a real economy that does work for people and the planet." Hat-tip to Greenman.

- China announced a £374bn economic stimulus package yesterday

- Some guy named Obama wants to crack down on tax havens as part of the "new financial architecture"

If we want to start talking about "reembedding the economy", it's time to start talking about Polanyi, not Keynes.

Finally, Mary Kaldor has a long, but interesting, article on the crisis - "Underlying the financial crisis is a deeper structural crisis in the real economy. It has to do with the mismatch between our social and political institutions and the profound changes in society wrought by the so-called 'new economy' ... Any stimulus must provide a sustainable outlet for the extraordinary gains in technological know-how of the last thirty years."

Negative Equity

2 million households will be in negative equity by 2010. Adam Sampson, chief executive of Shelter points out that "dumping thousands of repossessed homes on an already depressed housing market is far less financially sustainable than finding ways of keeping owners in their homes until they, or the market, have staggered back onto their feet."

Credit Crunch Reading - China

The UK government now owns 2.5% of a state-owned, state-controlled and state-run Chinese bank. Pakistan is also turning to "the guys with the money." The President of ICBC wades in with his view. The Spectator thinks that how the Chinese political system copes with the credit crunch" will be help determine the global balance of power for the next fifty years.

Mike Davis - Obama And The Credit Crunch

Mike Davis, tomdispatch.com:

"Let me confess that, as an aging socialist, I suddenly find myself like the Jehovah's Witness who opens his window to see the stars actually falling out of the sky. Although I've been studying Marxist crisis theory for decades, I never believed I'd actually live to see financial capitalism commit suicide. Or hear the International Monetary Fund warn of imminent systemic meltdown."

[...]

"The third problem with the New Deal analogy is perhaps the most important. Military Keynesianism is no longer an available deus ex machina. A bigger Pentagon budget no longer creates hundreds of thousands of stable factory jobs ... although both candidates have endorsed programs, including expansion of Army and Marine combat strength, missile defense (aka "Star Wars"), and an intensified war in Afghanistan, that will enlarge the military-industrial complex, none of this will replenish the supply of decent jobs nor prime a broken national pump. However, in the midst of a deep slump, what a huge military budget can do is obliterate the modest but essential reforms that make up Obama's plans for healthcare, alternative energy, and education. In other words, Rooseveltian guns and butter have become a contradiction in terms, which means that the Obama campaign is engineering a catastrophic collision between its national security priorities and its domestic policy goals."

Ecological Mortgages

The Ecology Building Society specialises in funding green mortgages for properties offering an ecological payback. They lend money to people who want to build energy-efficient new homes.

As well, in 2004, 39% of the society's mortgages were for the repair and restoration of run-down property. You can read about a windmill restoration project in Worcestershire here.

Refurbishment and restoration is key to lowering carbon emissions. 80 per cent of the homes that will be in use in 2050 have already been built.

The Green Building Council is calling for a “pay as you save” system. A homeowner or landlord would borrow the costs of improvements (new windows and insulation) from a council or bank. We would then pay the money back, over a number of years, with the costs covered by lower energy bills. This would virtually eliminate up-front costs to the consumer. It could also lead to tens of thousands of "green-collar" refurbishment jobs.

In contrast to the tsunami unleashed by financial speculation, we need to get back to investing in the real economy.

"Credit Crunch" Reading - 14 October

Larry Elliot on the slaying of sacred cows:

"Last week's fall in the Dow Jones Industrial Average was the biggest in its 120-year history. Even during the Great Depression, the Dow never fell by 18.2% ... Structural adjustment plans for the poor have involved privatisation, liberalisation and deregulation. Structural adjustment plans for the west, it seems, comprise of nationalisation, subsidisation and re-regulation. The one-size-fits-all model of development is just one of the many sacred cows to have been slain over the past 14 months ... Gerard Lyons, the chief economist at Standard Chartered, believes the loss of output next year could be close to 2%, which would make 2009 a contender for the toughest year Britain has suffered since the second world war. As things stand, that looks entirely feasible."

Jeremy Warner on the effect of nationalised banks:

Counting the already nationalised Northern Rock, the Government thereby ends up effectively in control of three of Britain's largest lenders ... The competition issues posed by hegemony on such a scale, already bad enough as a result of the Lloyds TSB/HBOS merger, are extreme. It's as if the Government was suddenly in control of Britain's big four supermarket groups. You can imagine what the imperative of maximising returns across all four would do to prices at the tills.

Liam Halligan on the credit crunch and sovereign nations:

"All these multibillion dollar bail-outs are pushing Western governments closer to bankruptcy. Iceland shows it can happen ... Credit default swaps on the sovereign debt of some Western nations have shot up. The markets don’t yet think the likes of Italy and Spain will go bust, but the chances are growing they could ... The Treasury claims our national debt is around £550bn. That number – how can I put this delicately? – is total nonsense. I’m thinking, in particular, of the private finance initiative, quasi-private debts held by the likes of Network Rail and – above all – our enormous public sector pension bill. The UK’s true national debt – even before last week’s multibillion pound package – exceeds £1,300bn (some £50,000 per household)."

Unite And Bank Rescues

Christopher Hope in the Telegraph notes that Derek Simpson, the joint general secretary of Unite, said the partial bank nationalisations "must be bound to undertakings by the banks of no job losses, no repossessions and an end to the bonus culture." Unite donated £1.5 million to Labour in the three months to June of 2008. That was 40% of Labour's donations for the second quarter.

The Stock Market Fall

Airline Pilots And ID Cards

Airline pilots are on the front line of the ID card battle: "Our members are incensed by the way they have been targeted as guinea pigs in a project which will not improve security. We will leave no stone unturned in our attempts to prevent this, including legal action to force a judicial review if necessary."

- A profile of Tasmin Omond, one of the protesters who scaled the Houses of Parliament to protest against a third runway at Heathrow.

- The £303 trillion time bomb. Go back to sleep, Britain, Gordon Brown stood back and let all of this develop, but your government is in control. Go back to sleep, Britain, here's another season of X-Factor! Here's 56 channels of it!

- A victory for asylum-seeker health-care.

- 42 writers attack the idea of 42 day detention without charge: "We don't know how lucky we are to live in a nation where police officers have all of six weeks to discover why they've locked us up."

And finally, how do they come up with these top 100 lists anyway? Andy Atkins and Barbara Stocking not in the top 50?

Caroline Lucas - The Darling Plan

Caroline Lucas:

"If we're going to be asked to bail out the banks, we want something for our money. We want to know that the banks are going to be run responsibly from now on, and that means, as part owners of these banks, we want our fair share of the votes on the board ... Ordinary people, who have been landed with the bill, should be represented in the boardrooms. We should use those votes to cut the excessive bonus rewards to failing executives, clamp down on predatory, irresponsible lending practices, and to demerge the mega-banks into smaller, more accountable firms so that this can never happen again ... By creating cast-iron government bonds as a secure home for pension funds and personal savings, and investing that money in green-collar work such as renewable energy or mass transit, we could end the financial panic, generate jobs, revitalise money flows, loosen ties to unreliable oil markets and cut carbon emissions."