Josh Ryan-Collins is senior researcher on monetary reform at the New Economics Foundation

As the economy slides towards recession, the Bank of England today announced today it was creating a further £50bn worth of ‘quantitative easing’ (QE).

If you read articles on the topic in the media, you will see statements like “the Bank is ‘printing’ money” or the Bank  will “pump a further £50 billion in to the economy”.  Both these statements are misleading.

QE actually involves the Bank of England buying financial assets – usually government bonds – belonging to institutional investors and sitting in Banks. The Bank buys these assets with newly created central bank reserves.  These reserves can only be held by banks – they do not and cannot go to businesses the real economy.

As explained in nef’s Where Does Money Come From?, central bank reserves are used by commercial banks to settle payments with each other.

By ‘pumping’ more reserves in to the intra-bank clearing system the idea is that banks will feel more confident about making loans to the real economy because they will know that other banks are in a stronger position to settle with them.

In addition, by buying up ultra-safe government bonds in vast quantities and thus pushing down the yield (the interest received on holding) on these assets, the central bank hopes to encourage investors to buy higher yielding corporate bonds – which again provides money for real businesses.

QE may reduce long-term interest rates, but there is little evidence it has stimulated commercial banks to start lending more to businesses, in particular small businesses, or soften the conditions banks are attaching to loans.

In fact the most recent figures published by the Bank show that net lending – the amount of loans minus the amount repaid – to small businesses has contracted by six per cent in the year to November 2011. And this despite the banks being given small business lending targets by the government through ‘Project Merlin’.  Not much wizardry there then.

The hard truth is that commercial banks are still in a process of ‘de-leveraging’, more keen on getting their loans repaid and building up their capital base than making new loans to productive businesses in what is perceived to be a risky real economy.

Evidence suggests the additional funds provided by QE are more likely to be used by banks to create more speculative credit, not least commodity speculation,  that provides shorter term returns.  As a result, the money supply in the real economy is contracting just at the point where new investment is most needed.

But there are alternatives. The central bank, working with the government, could find ways of channelling newly created central bank money more directly in to the economy.

In a pamphlet released today, economist Richard Werner, who coined the term quantitative easing whilst commentating on the Japanese economy in the 1990s, and Green Party leader Caroline Lucas, argue that the Bank of England needs to rethink its strategy.

They suggest a massive ‘green quantitative easing’ program, involving the creation of a new entity – or a beefed up green investment bank perhaps – that could issue corporate equity or bonds purchased by the Bank of England and then use the funds to embark on a £70 billion green QE program for solar PV and energy efficiency in homes.

According to the calculations in the report, this would create 200,000 jobs and save households up to £250 per annum in reduced electricity bills. On top of this, green QE could finance the £16 billion green deal energy efficiency program for homes the government is planning, creating 65,000 jobs in insulation and construction by 2015.

If the Bank of England objected to buying corporate instead of government assets, the Treasury could guarantee them much as Obama’s administration guaranteed green loans in the United States to help kick-start the economy following the financial crisis.

Pension funds should also be happy to buy up such assets given the long term (25 year) secure returns generated through the Feed-in-Tariff and household repayment of energy efficiency loans by households met through the savings on heating bills.

The government and Bank of England needs to accept the fact that our banking system is not currently longer fit for purpose – assuming the purpose is getting money in to the real, productive economy.  It could take decades to restructure our banks so that they become functional again.

In the meantime, we should abandon ‘orthodox’ QE and find better ways of exploiting the Bank of England’s power of money creation.  Creating hundreds of thousands of jobs, tackling climate change and fuel poverty and improving energy security seems like a reasonable place to start.

See also:

• We’re all economists now, part one – Ben Mitchell, February 4th 2012

• Will quantitative easing work this time? – George Irvin, October 9th 2011

• Quantitative easing: The latest windfall from us all to “country London” – Ranjit Sidhu, October 8th 2011

• Could earnings-based rent-control replace quantitative easing? – Peter Morgan, September 26th 2011

• Osborne set to U-turn on QE – so why not on Plan B? – Shamik Das, September 12th 2011

By Joe Fortune, parliamentary officer of the Co-operative Party and SERA executive member

Pleasing though it may be, the pressure mounted by politicians and the public over Network Rail’s overly generous bonus allocation is not a long term fix. If the governance of this organisation is left alone the next bonus allocation will be banked and many taxpayer pounds will find their way into high flying managers’ bank accounts.

The reason senior rail managers continue to get away with such sky-high remuneration is that Network Rail is not properly accountable to the travelling public.

We will not be able to lessen the amount of spending Network Rail gets through for the foreseeable future. Oddly, the McNulty Review into the cost of the rail industry focused in on increasing costs, but suggested higher ticket prices and a cut to terms and conditions was the answer rather than looking further and needed changes to the infrastructure manager.

The Labour government did well to construct Network Rail from the ashes of Railtrack. However, over time the company itself has shown that its corporate governance structure has not been good enough and is in need of reform.

It is not accountable enough to the public, which will continue to fund the organisation and has funded it through the last few years even while it carried the tag, given to it by its regulator, as being 30 per cent inefficient.

Not only has the current management structure presided over this inefficiency, but it has happened alongside high profile and harrowing preventable deaths and serious misconduct issues within senior staff.

Many politicians, whether it be parish councillors or Secretaries of State, utter sentences along the lines of ‘I just can’t get Network Rail to listen’ or ‘I have tried Network Rail but haven’t had much of a response’, and this needs to change.

The transport select committee, the coalition government, the opposition, trades unions, PwC, the Department for Transport and Network Rail all understand this need for change. It is the paucity of the radical, ultimately democratic and transformative proposals that hold us back.

Indeed both the chair of the transport select committee and the Labour Party’s shadow transport minister with responsibility for infrastructure called upon the government to look again at the Co-operative Party’s people’s rail proposal in Westminster last Thursday.

One aspect of the campaign calls for all citizens to be given the right to become individual members of a mutual Network Rail. This would allow rail passengers to have a say in how our rail system is run and hold the Network Rail leadership to account.

The mutual model we have advocated is one which recognises that we, the public, own the asset (in this case the rail infrastructure). Members of the public therefore put themselves forward for election; the elected members (who are currently selected by Network Rail management) then in turn elect the non-executive directors, who then elect the directors.

This allows true accountability to flow right through the organisation.

Good governance means that organisations are being managed effectively, goals are being met and decisions are being taken in the interests of those who matter – in this case, passengers.

While organisations with good management and poor governance may succeed in the short term, in the long run they remain vulnerable to poor performance, decision making in hock to managerial interests and possible collapse.

Network Rail is too important to be unaccountable and badly managed. We need a new mutual approach that puts passengers before bonuses. We need a People’s Rail.

See also:

• All signals are go for HS2 – Alex Hern, January 10th 2012

• Rip-off Britain: Our train fares are triple those on the continent – Sophie Allain, January 3rd 2012

• Serious concerns over transport commissioning – how will Greening respond? – Matt Dykes, December 16th 2011

• Scotland needs to get its transport infrastructure in order – Ken Macintosh MSP, October 27th 2011

• Train journeys from Hell: What is to be done? – Alexandra Woodsworth, March 23rd 2011

By Neil Churchill, chair of the Prescription Charges Coalition and chief executive of Asthma UK

The prospect of tax cuts is on the agenda as we approach the Budget. But if there is money to reignite that long lost feel-good factor and kick start growth by putting a bit of cash back in people pockets, how fairly will it be distributed?

One proposal would aid the squeezed middle who most need it: those with long-term conditions. The strain of recession doesn’t just make people feel bad, it makes them ill.

There are 15.4 million people in England with long term medical conditions and with dramatic increases to the cost of food, energy and transport, many are now struggling to afford their prescriptions and putting their health at risk by reducing or rationing their medicines.

An Asthma UK survey found that 34 per cent of people who pay for their prescriptions sometimes chose not to get some of their medicines because of the cost. Non-compliance with medication is a leading cause of avoidable and costly hospital admissions for asthma.

The prescription charges coalition is campaigning for a freeze on prescription charges until the next general election to make everyday medicines more affordable and keep people out of hospital.

This will benefit the huge numbers of patients whose medical conditions do not entitle them to free prescriptions, and who have been stung by rises in prescription charges every one of the last 15 years.

Research published by Rethink Mental Illness showed that 38 per cent of people with severe mental illnesses like schizophrenia have had to choose between paying household bills and paying prescription charges. People with long-term conditions are a significant voter population and many feel passionate about prescription charges.

They are disappointed with a Labour Party that never kept its promise to make prescription charges free and a coalition government that just says they can’t afford to introduce a fairer system.

This issue has been brewing for a while – surveys conducted as far back as 2009 show 37 per cent of people with asthma stated that the recession was making it harder for them to afford their prescriptions. However, the recent sharp increases in living costs could put more people at risk of being hospitalised unnecessarily for long-term conditions they have lived with and managed for many years.

It is quick and simple to support the e-petition and it could make a real difference. If it reaches 100,000 signatures, this issue will be debated in parliament. However, several thousand signatures would raise the profile of this issue enough for MPs to call the government to account in advance of the spring budget statement. That could mean a brighter outlook for the health of the nation and the economy.

The e-petition for a freeze on prescription charges can be found here: http://epetitions.direct.gov.uk/petitions/25087.

See also:

• Scots support “devo-max” as new Tory leader distances herself from Cameron - Ed Jacobs, November 7th 2011

• New warnings over UK cancer drug divide - Ed Jacobs, August 30th 2011

• Holyrood vote exposes Tory splits on free prescriptions - Ed Jacobs, March 3rd 2011

• Should we defend the middle class welfare state? - Ben Baumberg, October 17th 2010

• Irish budget cuts praised by British Tories but criticised at home - Duncan Weldon, December 10th 2009

David Miliband, speaking on the Today Programme this morning, is right to draw attention to the youth unemployment emergency as one of the most pressing issues facing the UK writes Tess Lanning, research fellow at the Institute for Public Policy Research (IPPR)

Launching the final report of the commission on youth unemployment that the former Labour cabinet minister chairs, Mr Miliband importantly drew a distinction between the current lack of demand for young people’s labour, and the deeper, structural problems in the nature of the education system and the labour market that mean youth unemployment has not fallen below half a million since the 1980s.

The dramatic social and economic changes of the 1980s saw the transition from learning to earning become longer and riskier. Deindustrialisation led to a decline in the availability of routes into skilled work for young people, such as apprenticeships, making it more difficult to move straight from school into work.

Good jobs in manufacturing (albeit mainly for young men) have been replaced by low skilled jobs in the service sectors, many of which by their nature – casual, insecure – lead to a more protracted transition and offer few opportunities for progression.

The drop in demand for labour after the global financial crisis exacerbated these long term trends leading to high unemployment among university graduates as well as school leavers.

First in are often first out, and as a result young people were hit harder and faster than more experienced workers.

The pace of redundancies has slowed, but the deteriorating outlook for demand, reduced business confidence due to austerity at home and turmoil in Europe, and a reluctance to recruit new workers have all contributed to the continued upward curve in youth unemployment. Indeed the unsung difference between how European countries have fared since the downturn is not growth levels but unemployment.

Youth unemployment is most alarming in the Mediterranean states such as Spain, where over half of all young people are unemployed. But other northern European countries have long had lower rates of youth unemployment than the UK, and in Germany the proportion of young people out of work has actually fallen since the economic downturn.

The ‘chaotic’ landscape of support for those who do not choose the academic route is partly responsible for this difference, as Miliband’s commission argues.

The strong apprenticeship systems in the German-speaking countries and high quality vocational education in the Scandinavian countries play an important role in preparing young people for work and responsible adulthood, as well as providing them with broad qualifications that support mobility and progression in the labour market.

In contrast, most of the recent increases in apprenticeship numbers in England have occurred for older workers in the low-skilled sectors where concerns about quality are most acute.

The structural youth unemployment problem will remain unless employers’ enthusiasm for hiring and training the next generation of workers improves. Forthcoming research by IPPR calls for a radical new approach to skills and the labour market designed to raise employer commitment to skills and training.

The lesson from other northern European countries – where many firms train more, and to a higher standard, than comparable British firms and sectors – is that this requires far more than education or welfare reform.

Raising both the quantity and quality of jobs and apprenticeships available to young people requires a return to an active industrial policy, with a combination of hard and soft measures to help firms to rethink the low road competitive strategies that underpin weak demand for skills.

Until this is addressed the country’s increasingly well-qualified crop of young people will continue to compete for limited opportunities, with school leavers most likely to lose out.

While the short term priority must be to ensure a return to growth and rising demand for labour, we also need to think hard about those young people who won’t necessarily be lifted by a rising tide, or those whose prospects may have been permanently scarred by the recession.

The commission’s call for the public sector to fill the socialisation gap, offering more high quality apprenticeships and job guarantees for young people unemployed for more than two years, offers a useful starting point.

See also:

• Ken stays ahead as Boris doubles-down on blaming young people for youth unemployment – Alex Hern, January 23rd 2012

• 2012: The year ahead for young people – Alex Hern, January 7th 2012

• Unemployment: How Cameron and Clegg are letting the next generation down – Rachel Reeves MP and Stephen Timms MP, December 14th 2011

• Million young unemployed figure highlights enormity of the situation hitting our youth – Rory Weal, November 16th 2011

• Clegg under fire over voter registration, party funding and youth unemployment – Shamik Das, November 15th 2011

By Jenny Jones AM, leader of the Green Party on the London Assembly and Green Party Mayoral candidate for 2012

If Boris and Ken have shown us anything, it is that the mayor of London can be a powerful voice in national debates.

In May voters have a chance to elect somebody who will speak up in the debate over banks for a fairer economy based on small businesses and a smaller pay gap. Right now, we can all speak up together in favour of the Robin Hood tax.

Boris has been on the wrong side of almost every argument to do with banking.

He has lobbied against the Robin Hood tax, and wrote to the European Commission president, José Manuel Barroso last year to warn against the implementation of a tax which could help millions of people. He gave the tired excuse that it would force companies to relocate oversees, and that it would devastate London’s economy.

Except the figures he uses show the government’s misguided cuts have actually reduced our long term economic prospects by several times more than the tax. What’s more, do we really want to base our future economic strategy on a small number of overpaid people gambling on complex, risky financial inventions?

We can happily give up some of that trade and focus on creating jobs in the real economy, betting on the Silicon Roundabout technology companies and a well supported renewable manufacturing sector instead of casino banks and fantasy airports.

As more and more European countries back the tax, including the very cities that companies may move to, we find ourselves on the winning side of the argument. The British public back the tax by a margin of two-to-one.

Our research shows that we are missing out on £1.2 billion every year that Boris and the government block this 0.05 per cent tax on financial transactions.

This money could bring much needed relief to our ailing public sector. For example we have calculated that it could be used to reverse all local authority cuts and cut council tax.

Alternatively it could fund the construction of 32 new schools every year, or pay for an extra 23,230 police officers.

It could help to end the unemployment epidemic and finance almost a quarter of a million apprenticeships, or we could use it to provide 4,221 hybrid buses and clean up London’s air.

In short, this tiny tax is the solution to many of the issues which you will hear about in this election.

As mayor, I would campaign vigorously on behalf of a financial sector that serves the interests and needs of our residents and businesses. The Robin Hood tax is a simple measure that would help ensure our city’s richest institutions make a more equitable contribution towards the recovery without scratching the surface of their massive profits.

See also:

• Robin Hood Tax gains momentum – on the continent – Tony Burke, January 3rd 2012

• Osborne starts to panic about the chance of a Robin Hood Tax – Owen Tudor, November 9th 2011

• Osborne in public: “I am not against Tobin taxes”; in private: “He remains unconvinced” – Alex Hern, November 9th 2011

• On the Financial Transaction Tax, why is Osborne on the side of the one per cent? – Shamik Das, November 2nd 2011

• Miliband and Balls need to be more vocal in support of the Robin Hood Tax – Vaughan Gething AM, October 17th 2011

Daisy Hooper works for Aequitas Consulting, an innovative public policy and public sector innovation agency.

Small and start-up businesses are essential to Britain’s economic recovery. But in order to support economic growth SMEs need to win new business. And despite government promises, red tape still prevents them from accessing government published contracts.

David Cameron has lauded the benefits of British SMEs, praising them for doing ‘incredible things’ and pledging his support for new businesses through the Start Up Britain.

The prime minister has pledged to support small businesses to access government contracts and reverse institutional bias against them.

However, procurement practices are still preventing SMEs from applying for and winning government contracts.

As part of a consortium of SMEs, we recently applied to join the central government procurement framework – consultancyONE, which is for central government contracts worth over £100,000, and purportedly has specific SME-friendly application criteria.

Working in a consortium can be a good way for small businesses to pool resources: working innovatively in partnership, as the government has urged SMEs to do, improves eligibility against contract criteria which theoretically improves the chance of winning contracts.

In fact, this partnership restricted our eligibility.

Applications for new contracts could only cite previous consortium projects worth more than £100,000. The consortium can’t get these contracts because it doesn’t already have them (individual partners’ contracts of more than £100,000 don’t count, no matter how relevant they are).

In the end our consortium was forced to withdraw from the application process for consultancyONE because of the complexity of the procurement hurdles.

The strict criteria that preclude SMEs from applying for contracts are intended to limit the risk to the government and to cut costs.

Yet there is no evidence that giving contracts to small businesses is more risky than giving them to large businesses – or that in the long run it cuts costs. Just look at the big businesses that have failed: one colossal example being CSC’s failure to deliver the NHS IT database project, which cost billions in taxpayers’ money.

SMEs have to be innovative in their approach to get the biggest ‘bang for their buck’. They create products and services that are more efficient, because they are delivered through tighter budget constraints. They also have a greater local and regional economic impact by creating jobs throughout the UK, with a better geographical spread than big businesses who want to be based in London.

And compare the benefits of SMEs (which create local jobs and a better distribution of wealth) with larger companies that outsource their staff and bank abroad to avoid contributing their fair share to society.

The government keeps telling us that small private businesses are already efficient and innovative, creating jobs and rising to the current economic challenges.

Small businesses obviously have the capacity to drive economic growth and to take up the slack from the public sector. But as long as the application process is a barrier to them winning new work, the outcome is likely to be an inefficiently slow and frustrating process.

See also:

• Small businesses can play a vital role – but only if they get the finance they need - Tony Dolphin, February 2nd 2012

• Obama puts manufacturing top of the agenda – time for Cameron to do the same? - Tony Burke, January 27th 2012

• Mandelson weighs in behind National Investment Bank - Alex Hern, January 27th 2012

• Design agencies face a second year of talent exodus in 2012 - Rachel Fairley, January 3rd 2012

• Will quantitative easing work this time? - George Irvin, October 9th 2011

Tulip Siddiq is a councillor in Camden Borough Council and Peter Allen is a sessional lecturer and doctoral researcher at Birkbeck College, London

Councillor turnover is an under-researched and under-addressed problem facing councils across the country today. It is best defined as a councillor leaving their council duties for any reason other than electoral loss.

The 2010 Census of Local Authority Councillors shows that only 67.5 per cent of councillors were certain that they would stand for re-election, with the remaining 32.5 per cent being either unsure or definitely not standing again. This is even worse in London, with just over half (51.3 per cent) of councillors signalling their intention not to stand again.

Explanations of councillor turnover are not straightforward and it is possible to highlight several factors that are in play.

What is clear is that it is a phenomenon that affects male and female councillors differently, with existing research has consistently finding that women councillors are more likely to drop out after a single term, a finding replicated across the 1990s and into the new millennium.

The 2010 Census of Local Authority Councillors finds 69.1 per cent of men definitely standing for re-election compared to 63.5 per cent of women.

Political scientists Colin Rallings and Michael Thrasher have noted that this leads to a ‘double-whammy’ for councils, whereby younger, more diverse councillors are standing down at the same time as older, more traditional councillors are remaining in their positions.

This is not a positive step in terms of increasing the number of individuals from traditionally under-represented groups like women and ethnic minority councillors.

However, another potential line of questioning is whether councillor turnover is a bad thing in itself?

It is possible to argue that it is not, and that having new faces in our council chambers on a fairly regular basis is good for our politics, and in turn the electorate. The catch here, though, is that if it is the same people staying for longer, and the same people dropping out quickly, the theoretically anticipated regular overhaul of practice and personnel simply doesn’t happen and instead facilitates the proliferation of the status quo.

Existing research has shown non-political factors to be the most instrumental in a councillor’s decision to drop out of their elected duties. The two key areas of note here are the impact of being a councillor on both their working and family lives.

Are there solutions to address these concerns which will in turn encourage councillors, especially women councillors, to remain in their elected positions for longer than they currently do?

Currently, the average basic salary for councillors is around £6,000, rising to an average of just under £10,000 in London. Therefore, most councillors will have another ‘day job’ in order to supplement their income.

This creates a vicious cycle whereby councillors work in a non-council job during the day and then perform their council duties in the evening. Unfortunately, council officers who are meant to support councillors work during the day which means there is often a time lag between cases being taken up and policies being implemented.

One possible solution is to create some sort of legal protection for councillors, whereby they could claim a day or two a week from their employers to work as a councillor, and that this would be seen as a prestigious thing (in time) for the company.

The main point is that it is not just a case of councillors putting in ‘face time’ at these meetings.

Hours have to be dedicated to doing casework for constituents especially in poverty-stricken areas. Time has to be spent preparing for meetings where councillors might be contributing to council policy or strategy. Days are spent researching and writing speeches for full council meetings especially if there are deputations from your ward.

As noted above, one explanation put forward for the high turnover of women councillors is that having two jobs leaves no time for family and children. The introduction of some sort of legal protection might mean that councillors could afford to solely concentrate on their council duties and perhaps, be in a better position to retain their status.

A second option is the introduction of term-limits for local councillors.

The introduction of term-limits to local elected service would ensure that the turnover of councillors discussed above was enforced as opposed to something that would be left to occur organically.

Existing evidence is mixed as to whether term-limits benefit women, although it should be noted that much of the existing evidence is taken from the United States, and as such, is not directly applicable here.

Having said that, it should be pointed out that term-limits would only achieve this desired aim of a more diverse set of local councillors if implemented in conjunction with the improved terms of both pay and working arrangements outlined above.

This is a two-strand approach which makes being a councillor both a desirable and possible activity for all kinds of people but at the same time prevents prolonged over-use of this new system by introducing legal limits on how long someone can be a part of it. As such, these ideas tackle issues of both recruitment and incumbency, traditionally gendered problems.

An obvious term-limit would lie around the current average length of service (more or less two four-year terms), although there are arguments in favour of both curtailing or extending this.

The ideas discussed above are simply that; ideas. There lie clear barriers between theoretical concerns and policy implementation, not least in the form of decreased levels of central government funding for local councils. Such barriers should not be transformed into methods of gaining tacit support for the status quo.

If anything, a time such as this is an ideal one to formulate new ideas and to get serious about the improvement of local government in this country.

See also:

• We need more female councillors for everyone’s benefit - Tulip Siddiq and Peter Allen, October 29th 2011

• The lack of women in Westminster has gone on for too long - Nan Sloane, October 25th 2011

• Two weeks after ‘fixing’ it, Cameron creates a new “women problem” - Alex Hern, October 17th 2011

• Clegg talks the talk on equality – but seat cull will make things worse - Shamik Das, September 19th 2011

• Where are all the women? - Ronit Wolfson, May 24th 2011

By Dr Kailash Chand OBE

From Greece to London; from Spain to Syria; from the occupiers in Zuccotti Park to the milling crowds at Ramlila ground - the forms are different but the anger and frustration of the people with the state of affairs is the same.

Be it the denial of human rights or economic deprivation, be it a clean system of governance or lack of transparency, be it price rise or corruption, the anger of the people is directed against those responsible for the manifold multiplication of their problems. It may be premature to draw parallels but only the naïve would miss the common thread running through such movements across the globe.

Analysts, many of whom represent the interests of the establishment are busy dishing out local, regional and social explanations for this world wide unrest because they would not likes to challenge the system that has benefitted them so long.

Sooner or later the world has to recognize that at the root of this unrest lies in the unviable economic system, concentration of power and wealth in a few hands and the unabashed corporate greed.

One cannot treat a malady without finding the bug that causes the ailment. People in the more advanced western democracies have been closer to the diagnosis while in countries like India we are striking at the symptoms of the disease.

While the slogans in the west are “one per cent versus 99 per cent”, “fight the rich, not their wars” and “human need, not corporate greed” the ire in India is directed against the scheming politician, the bribe taking babu or the Hawala trader with Swiss accounts.

In India the contribution of big business and the corporate world to the all prevailing corruption and social degeneration has not received the attention it deserves. Even the more ‘enlightened’ and ‘educated’ organizers and supporters of the Anna movement are silent on this issue. The western protester seems to be more aware of the reality.

The common man in India is perhaps too harassed by the day to day corruption, bribery, human rights violations etc to look beyond his nose and indentify the real culprit. In fact a section of the middle class is in awe of the corporate culture and views them as ‘achievers’ rather than ‘usurpers’. They are willing to be fodder for the corporate machine in the false hope of being in the driver’s seat sooner or later.

Their beliefs were strengthened by a corporate controlled media and entertainment industry that presented a rosy picture of the system run by them and a distorted picture of any economic system different than theirs.

Bedazzled by the glitter of wealth and extravagance; oblivious of the ugly reality that was clothed in an attractive attire of democracy and free market; the educated middle class in India has been behaving like hypnotised zombies.

The global discontent against the status quo is an indication that the zombies are coming out of the hypnotic spell. They may not be able to pin point the malady in political, social and economic terms but they are very near the mark.

The diehard supporters of the system are loath to admit this and are using all the tricks in the trade to ignore, belittle or defame this movement. One finds a striking similarity in the tactics of the critics of the occupiers and the detractors of the Anna movement.

They have been called naive, directionless and trouble makers. They have been called commies in the US and lefties in India. On their part the protesters have set up kitchens, organized medical care set up information cells and taken extreme care to prevent the protests turning violent be it the Zuccotti Park or the Ramlila ground.

Such commentators are either divorced from reality or are consciously trying to prevent the inevitable: the overthrow of an unviable, undemocratic, one sided political and economic dispensation. The weaknesses of capitalism stand exposed. It is not only a bad economic system but a poor democracy as well.

The real face of democracy is apparent from the fact that the biggest exporter of democracy is busy these days firing plastic bullets and tear gas shells on the protestors.

This what Stephen Lendman, radio host and author says about the system:

“Whoever controls the power of money has supreme power.

“The bankers in Wall Street have the power of money and literally run the government. Goldman Sachs runs the government, JPMorgan Chase, Bank of America - they run the government. This has to stop. The people in the streets across America have to understand this and demand that the power of money returns to the Congress.”

Recent reports from the US have exposed the tall claims of this country on human rights and freedom to protest.

Boston Mayor Thomas Menino told the local Fox 25 News in Boston:

“Civil disobedience will not be tolerated.”

Another report says:

“A new chapter in the annals of American police brutality has been written, as two Vietnam war veterans who joined Occupy Boston protests suffered injuries after being beaten by police and arrested along with some 50 other demonstrators.”

The Guardian reported:

“In New York a section of Occupy Wall Street protesters are planning a “millionaires march” to wealthy Manhattan residents’ homes.

“The action is being planned by UnitedNY, the Strong Economy for All Coalition, the Working Families Party, and New York Communities for Change, all of whom helped swell the largest Occupy Wall Street march so far last Wednesday”.

If the ‘experts’ are unable to see a precursor of a class division in the “millionaires march” they are either pretending or being a bit too clever.

The Indian middle class and their largely apolitical leadership have not yet grasped the dangerous dimensions of the ‘new world order’. The middle class is being rapidly pushed downwards as a result of price rise, increased cost of housing and shrinking job opportunities. The agriculture sector, an important component of Indian economy is severely affected by a slow growth.

On the other hand despite recession the number of the super rich has gone up. India has 55 billionaires, according to 2011 Forbes’ list. The combined fortune of the wealthiest citizens in India was pegged at about $247 billion by Forbes, which was well above 2010 total of $222 billion.

India has been aptly called “a rich country, where poor live.”

Indian rulers are ignoring the writing on the wall and are persisting with implementation of a western style economic system. And the common man is yet to realize and see the negative impact of corporate greed and power on their day to day life.

They dictate government policies; they corrupt government officials and have no hesitation in sabotaging the public sector enterprise. While they pay a pittance to their employees they fix absurd and astronomical salaries for themselves and their CEOs at the cost of shareholders. They oppose subsidy for the poor but want more for themselves in the form of SEZs, excise concessions and tax holidays.

How much they owe to the nation in the form of bank default, tax arrears, and Swiss Bank Accounts is not revealed to the nation. The tree of corruption gets its nutrition through its corporate roots. The wily politician, the bribe taking bureaucrat, the crafty middle man; they are all the front men of the corporate word.

Despite all this they are projected as image builders and flag bearers of the nation by the corporate controlled media and governments alike.

Successive governments of the “free world” have not only allowed this pathological greed for money to flourish but have actually helped it to grow into a monster that is threatening to devour the very system that created it.

This monster is not only cornering all the wealth and resources but is devouring the very fabric of society. Ethics and morality have been relegated to the background; money, money and more money is the modern mantra of success.

Gone are the days when intellectuals, poets, teachers, philosophers were the role models. The role models today are the successful and the only parameter of success is accumulation of assets or wealth for their companies.

The destruction of the value system, the deterioration of living standards, the concentration of wealth in a few hands and the blatant misuse of money as power to manipulate governments was bound to take its toll. The frustration, the anger and despair has burst out in the form of a global protest. The 99 per cent in the US are already braving plastic bullets and tear gas shells of the one per cent.

Whether the anger and frustration of the Indian 99 per cent translate into a struggle for economic equality and justice is yet to be seen. Will the Indian David be able to stand up to the corporate Goliath? Will the proponents of globalization of business in India get a taste of globalization of protest?

In the absence of a competent leadership there is always the danger of this movement losing its way.

World over there is a huge a vacuum of leadership for many reasons. The society has been systematically depoliticized by a corporate controlled media and entertainment industry. One hardly comes across a movie, a TV serial or a theater show that highlights any social issues. The emphasis is on religion, superstition and fundamentalism.

In such circumstances what type of leadership can one hope for?

The mainstream left has not just abdicated its responsibility but has covertly crossed the fence.

What is left of the left has been so demonized by the corporate controlled media that many genuine activists are avoiding the label. David stands alone with his sling broken and half the stones stolen. It is a tribute to his grit that he is still standing.

In fact the people are ahead of the leaders. Whether or not the protests evolve into a significant political force with a clear agenda or a concrete set of demands remains to be seen.

For this to happen, India needs more than anything a mass social and political movement to reassert the democratic control over the economy and the State and to effectively end the control of the corporate-driven neoliberal capitalism. The ‘Occupy Wall Street’ movement offers just the spark to trigger such a movement needed in India.

Will the civil society throw up a leadership that has the political maturity to indentify the genesis of the present moral, social, political and economic crisis? Will the progressive left in India rise to the occasion and grab this opportunity?

See also:

• Women turned away from refuge shelters told to sleep in Occupy camps - Vera Baird QC, January 10th 2012

• The new politics of protest - Matthew Sowemimo, January 22nd 2012

• Occupy LA evicted as America clamps down on protest - Alex Hern, December 1st 2011

• Seek solutions to protests, not problems - Mike Morgan-Giles, November 2nd 2011

• Occupy London needs to catalyse a new Left - Ben Mitchell, October 27th 2011

By Tola Ositelu

Michael Gove’s proposal for a new Royal yacht has raised questions about how best to celebrate the Queen’s 60 years as the British monarch. Such occasions have come to be known as ‘jubilees’, and in the past have involved much more than an extra bank holiday.

The original jubilee comes from the Jewish scriptures, and occurred every 50 years.

Rather than lavishing expensive vehicles on a monarch, in the jubilee year everyone took the whole year off from working the land – not just one day – living simply off surpluses from previous years.

All debts between people were to be cancelled. All slaves were to be released. All land was to be returned to the original sharing between the Hebrew tribes.

All these provisions were linked. Those working on the land got in debt when harvests failed. To feed their families they borrowed from their neighbours - supposedly without being charged interest - though many found ways to get round this law. As debts accumulated and families became unable to pay, they had to sell off their land to their creditors.

Rent was charged on the sold land, creditors got richer, debtors poorer, and debts were likely to increase. Now when struggling to pay their debts, debtors had to sell what was left to them; daughters, sons and themselves. And so many people ended up in slavery.

Another well known Hebrew word is Sabbath, the day of rest every seven days. Jubilee was a super-Sabbath, taking place after seven times seven years had passed.

Sabbath itself means ‘to stop’. The jubilee was a time to stop the economic system, ensure everyone lived well and simply, and bring everyone back to equality by freeing slaves, cancelling debts and giving everyone their land back.

The jubilee was not utopian, but was a radical way to periodically right inequality. The jubilee vision is a long way from buying a yacht for the Queen.

Today we live in a world of huge debts, both personal and national debt owed by everyone in the UK – individuals, companies, and the government – is 950 per cent of our annual income.

Debts owed between countries are large and growing rapidly. Since the millennium, the jubilee call for third world debts to be cancelled has led to $120 billion being written-off. But total debt owed to foreigners by the most impoverished countries still stands at $930 billion, an increase of $300 billion since 2006.

But huge debts between countries are not inevitable. Recent research for the Bank of England shows that in the post war period, when the creation of debt between countries was more heavily regulated, loans between countries were less than half the level they have been for the last thirty years. And in the post-war-lower-debt world, financial and debt crises were 50 to 95 per cent less likely.

Whilst slavery is formally abolished in many parts of the world, the burden of debts still denies people their freedom. A family with a large mortgage and negative equity are trapped where they live.

Deeply indebted countries, from Greece to Jamaica, have their economies run by foreign powers. Land and capital have become increasingly owned by a few at the top; the one per cent with the most are the ones who profit.

A real jubilee would be to stop and see what we have become. Ensure everyone’s needs are met this year. And then radically cancel debts and divide lands and assets out more equally.

The criticism of a jubilee approach is that it ‘only’ addresses past injustice, it does not prevent it happening again. At the time of Jesus, Palestine was a land where many were heavily indebted to landlords and tax-collectors. A few such as the Roman leadership, King Herod and chief priests lived in luxury, whilst most went hungry.

At the start of his public work, Jesus declared ‘the year of the Lord’s favour’ – widely understood as the year of jubilee. One of his central messages to his followers was to “release us from debt, as we release our debtors.”

But as well as endorsing jubilee he goes beyond it, telling those who have assets to lend without expecting a return; to stop making debt a moral obligation which has to be fulfilled.

The jubilee message from Jesus is to stop, cancel the debts, and then live in a way that life-destroying debts are no longer created.

It is estimated 925 million people - 1 in 7 - go hungry every day; 205 million people are estimated to be unemployed, a 15 per cent increase since 2007. Across the world, people continue to suffer in the fifth year of a global economic crisis caused by too much debt. For all those living under this burden, a real jubilee would be a true time of celebration.

See also:

• 2012 – the year the world must wake up to Christian persecution - Ed Jacobs, January 8th 2012

• Human rights as conditions for aid: how long is a piece of string? - Marta Foresti, January 5th 2012

• Gates tells G20: Innovate, lead and donate to save the world - Shamik Das, November 3rd 2011

• Christian Aid calls for World Bank action on climate change - Paul Brannen, January 17th 2011

• David Taylor, February 17th 2010 - OECD: Britain meets aid promises, EU partners fall behind

By Reema Patel

Cross-party talks began in social care last week – an area that has long been a political hot potato passed about from minister to minister. The last time such talks were held, they broke down acrimoniously. But it is right that they have recommenced.

Social care is a matter that demands urgent reform for the interests of the people in the United Kingdom, and it is a matter that will require the attention of more than one government.

There are two reasons for this. The first is that any substantive reform to the system will cost money. If Andrew Dilnot, who recently released his commission report on the way forward in the funding of social care, is correct, it will cost us between  ₤1.7 and ₤2.2 billion in additional expenditure.

The second is that substantive reform is direly needed; but before reform is found some clarity on the challenges facing social care is required.

The first, most obvious challenge is that social care costs a lot (at least ₤25,000 a year for a no-frills state funded care home and up to ₤57,600 a year). Most people spend around three to five years in residential social care which will cost them at least ₤75,000 – ₤180,000.

The second challenge is that the current system is disproportionately unfair on those with middle incomes. The government only pays for those who have below ₤23,250 in assets (including property). So suppose you have ₤150,000 – ₤200,000 in assets or thereabouts (your average middle-income family) and need care. Your finances will deplete very rapidly should you enter a care home.

The third (and oft neglected, it is argued) challenge is that the cost of care will increase in the future unless there is a strategic approach to place some checks on the rise of its cost, particularly as the baby boomers hit retirement and beyond.

There are clearly a few traps that ministers and shadow ministers ought not to fall into during the course of their conversations if they are to achieve a consensus on the way forward for dealing with these challenges.

Firstly, they must avoid the politicization of social care. A YouGov survey recently said 81 per cent of the public thought that more needed to be done by government on supporting elderly people’s care needs, and three quarters said they wanted to see a cap on the costs they could end up paying.

It is easy to see how social care could descend into a debate about the extent to which the welfare state should support the ‘’deserving’’ and ‘’undeserving’’ and to be seen as an opportunity for point scoring as it grows ever higher on the public agenda.

But it is precisely the point that the current system cripples, not those on low incomes or the very well-off, but those with middle incomes which should remain the area of focus for all political parties.

Secondly, cross party talks must take care not to focus exclusively on how people can fund their social care without considering wider social care market and legal reform. There is a very real risk that even as the well-received Dilnot recommendations (on fairer care funding) are adopted, a range of other important issues are disregarded.

The Dilnot report itself is the starting point for discussion and not the end. It suggests a cap on the cost of social care (of ₤35,000 in total).

Where the report needs greater scrutiny is the proposal to differentiate the cost of residential social care itself from the ‘hotel’ cost of living in a care home (which Dilnot recommends should invite an additional annual individual contribution of between ₤7,000 – ₤10,000 a year).

The Dilnot report also deals with demand (how can people better fund their care?). But we also need to realistically look at the supply of care.

We can expect demand for social care services to increase in light of an ageing population who are living longer (a point for celebration). However, if we do not have a strategy for the longer term issue of increasing scarcity of care home provision, then we can expect a rise in the cost of each individual care home place.

We have often taken a ‘hands-off’ approach to the provision of private sector social care (and this has led to the continuous increase in the cost per individual care home place). But we need to recognize that making sure that the state can make the most of its money to look after older people requires managing the social care and housing economies.

The Law Commission has also indicated the need for significant legal reform in this area (where local authorities set the care needs criteria at quite different levels and at their own discretion, for example), and where there is no clear consolidating statute that makes it clear to managers and workers what the rules are – which in turn must cost a huge amount.

This is certainly an area for greater efficiency and freeing up resources without impacting on front-line provision, and is arguably a ‘quick win’ for reformists in social care.

Thirdly, it is essential that the issue of regulating social care provision and safeguarding older vulnerable people in a rapidly changing healthcare context is not overlooked. Ministers must examine the ‘light touch’ regulation and oversight which consistently lets down older, vulnerable people in residential care homes.

This is likely to be exacerbated by the very real risk that social care is hijacked by the changes that are being rolled out in the NHS through a recently announced ‘integration’ between social care and the NHS (where private commissioners or GPs will manage the provision of health services).

What is meant by the government when it is proposed that social care and the NHS are to be integrated? That it will not be local authorities, but instead, GPs or private commissioners who will be managing the provision of social care services?

This is a proposal to be extremely wary of – not least because of the problems highlighted by the Panorama episode last year which cast light on the ineffectiveness of a hugely underresourced Care Quality Commission (the present regulator of social care services) in identifying the risk of badly treated residents in Bristol’s Winterbourne Park care home. They were secretly filmed being slapped, having cold water being poured upon them, and being pushed into cold showers.

It goes without saying that where the lives and the protection of vulnerable people is concerned, however we choose to provide care services (through the state, private or a mix of state and private providers), we cannot simply afford to just let the market determine its own course but must ensure that there are proper checks in place to safeguard against abuse.

This includes making sure regulatory bodies are well resourced and properly protecting whistleblowers.

The key message that our political leaders should now be looking to communicate is that old age is not a defining characteristic of a person but a phase in life we all go through.

People are living longer - and this is a cause for celebration. But we have to remember that the mark of a civilized society is how well it affords protection to its most vulnerable - and that includes the elderly, whose needs have too long been pushed into invisibility.

Political point scoring must take a back seat on this occasion.

See also:

• We can’t dodge the needed change to social care any longer - Jessica Studdert, January 4th 2012

• Though cost is important, we need to focus on the quality of social care - Laura Bradley, July 5th 2011

• Social care in crisis - Laura Bradley, June 10th 2011

• The social care system is at breaking point and needs reform - Hilary Evans, June 1st 2011

• Age UK outline vision for the future of social care - Hilary Evans, November 17th 2010