Bollocks to the cuts

commissar17

Hi, fellow Stroud Greeners! I'm back online after an extended break with the following proposition, one which will require us to pretend that we're members of the local -- and world-renowned -- N4 Polytechnical Tavern, Knocking Shop and Debating Society:

"This house (Oops! I mean neighbourhood) believes that the present draconian financial cuts and the axing both of public services and of public-sector jobs -- something being cravenly submitted to at the behest of the Con-Dems by all three of our local councils: Islington, Haringey and Hackney -- are cynical, anti-working class and unnecessary. Why are ordinary working people being made to suffer while the bankers contiunue to receive millions of pounds in bonuses and a dozen retail giants like Vodaphone still owe a total of more than £120 billion in overdue taxes?

"Instead, we call for mass, organised resistance aimed at forcing the bankers -- and the monopoly capitalists more generally -- fully to shoulder the burden of a crisis of their own making.

"We're not 'all in this together' as long as the super-rich continue to be let off the hook at our expense."

Discuss!

graeme

Bankers pay 40/50% tax to the Treasury, money from the profits of a private company. Or is it only bankers from state subsidised banks we're allowed to attack?

Arkady

The lesson that you, as a Stalinist, may not have accepted is this: you can’t have socialism in one country. However sympathetic one might be to the 'bash the bankers not the working man' argument it is doomed to fail. The British economy is subservient to the global one to an even greater extent than most other major economies due to the prominence of the City. If the UK government gets too vigorous with the banks they will move elsewhere. That would be bad for the UK economy, and therefore bad for the people working in it. We have to think outside of our nationalist conditioning. If you really want to make a difference, campaign for a stronger European and global regulatory system, with increased democratic accountability. Global socialism requires global governance.

sincers

I agree with Arkady. I'm not overly impressed that multi-million pound bonuses being dealt so soon after the crisis. I can't help thinking that Brown should have a imposed a more conditional agreement on the bail-out packages so that we as taxpayers benefit first when the banking sector started to improve. The bailouts didn't apply to all banks though, so I think this would probably have risked weakening the competitiveness of the city. But a globally competitive and leading banking sector here is critical to the treasury, not just in tax receipts, but in so many other areas. Having rich people in the UK is a good thing....discuss.

Arkady

To be clear, I’m all for reducing the gap between rich and poor. But the mechanisms by which government does that – such as regulating excessive bonuses – needs to have minimum standards at a global level – if implemented within a particular state it will result in reduced competitiveness and everyone in that state being poorer. In a global economy, national solutions are inefficient and insufficient- and sometimes counterproductive. This became true in the late nineteenth century and has accelerated since the end of the Cold War. Societies are struggling to realise and act on this due to two centuries of being conditioned to see things from a nationalist perspective, to the point where most people still see nations as natural and organic despite the opposite being true. Marx and Engels understood all that very well. Lenin understood it too, hence his surprise to find himself still in power in the 1920s when the revolution had failed in Germany. The eventual collapse of 20th century socialism of all brands is closely tied to the failure of the left to effectively organise at a global level after Stalin came to power, and its subservience to nationalist ideology. Old Labour’s traditional opposition to the EU is a textbook example of this short-sightedness. We now have a situation where the most important loci of power and decision making processes are at a global (or, in the cae of Europe, often continental) level, but we do not have the democratic institutional infrastructure to match. And still the nationalists whinge about those bodies that we do have – such as the EU – despite how much good they have done and are doing. In short – global democratic governance must come before any serious attempt to reform the global economy. Significant attempts to reform the economy at a national level will just make people worse off. Our efforts need to be focussed on a unit of human organisation rather higher up the ladder than the one we are used to thinking about. A bit long, sorry.

Ali

Sincers, Don’t assume the crisis is over , double dip is on the way maybe not in London but certainly elsewhere in the country. The Banks are rebuilding reserves to a much higher level than before because that is what they have been told to do, thus don’t lend out the money they are getting through QE. The people will get there money back as they bought the Bank Shares at very low process and they will be floated off later on with a nice fat profit to fund tax reductions in about 4 years time. It would be interesting to see what % of the UK total pay these bonuses actually are , mere static I would think ! It is though a political issue from the Lib Cons which mat come back to haunt them.

ADGS

I don't think that (most) bankers are the rootless, cosmopolitan pure capitalists they like to pose as. Up taxes and stop them awarding themselves huge bonuses out of taxpayers' money and yeah, sure, *some* will move to Dubai or Switzerland - but fuck 'em, they were tax-dodging parasites anyway, so we won't lose much. The rest won't fancy leaving the greatest city on Earth for places so dull, so they'll suck it up and stay.

Oh, and for the benefit of our local Stalinist, though it may amuse others too: <a href="">The Complete History Of The Soviet Union, Arranged To The Melody Of Tetris</a>.

sincers

I'd have thought it less about how the upping taxes/capping bonuses etc. will effect individuals, but rather how the corporations will behave. If they are less attractive to work for due to these measures, then they will find it harder to attract the BEST talent, who will ultimately be lured to the other financial centres. So the companies will have to themselves move to remain competitive.

Arkady

@ADGS – the fact that the majority of the City’s investment bankers are foreign nationals is worthy of consideration. Also, banks can and have moved their entire headquarters if it suits them. JP Morgan are threatening to do just that. Due to the lack of certainty over what the government would do with bonuses they have decided not to build their planned new HQ at Canary Wharf (Riverside South - <http://www.skyscrapercity.com/showthread.php?t=408708> – taking over the former Lehman Brothers HQ instead. That has cost us countless millions in funds to the construction industry alone. And they are poised to bugger off to Hong Kong if threatened again. The cold fact is that the government realised that the UK would lose much, much more if London stopped being the major financial centre than they could possibly claw back through making serious inroads into bonuses – bonuses that they couldn’t tax at all if the banker moved to HK, or NY, or Frankfurt. We need to stop looking at the small fry and think much bigger. Global problem – global solution.

ADGS

Lest we forget, this supposed 'best talent' turned out to be a bunch of idiots who didn't know what they were doing, tanked their firms, and nearly took the economy with them. Even a couple of bank bosses conceded recently that, while a select few employees were worth the money they got, most were not.

And London overall has a lot of foreign nationals in all walks of life, just as it has a lot of people who moved here from elsewhere in the UK. I think that's more proof of the awesomeness of London than anything specific to a stateless financial overclass.

I agree that co-ordinated international action is necessary, but even if you manage to get every pissant tax shelter, failed state and belligerent rising dictatorship on board (fat chance), then the hard core of absolute bastards who really don't want to pay a fair amount of tax would simply relocate to near orbit...

Arkady

I'd imagine that you couldn't get a peice of tracing paper between us when it comes to the merits of these guys, or the utility of their work. But they are central to capitalism in its emerging global incarnation. And if you want to substantively reform or replace global capitalism then you need a global approach. Especially as your 'hard core' are the ones who run the banks, and determine where they are based. Arky

graeme

Appreciate blaming the bankers is an easy target and to a degree they must hold their hands up, if they are taxpayer funded banks. However the witch hunt against all banks (successful ones like JP Morgan a good example) is pretty infantile. They're important to the wider economy, so why wilfully piss them off?

What would we expect individuals to do when told explicity, at all turns, by the Chancellor and then PM that "light touch regulation" was the order of the day - and not expect some of them to get carried away?

And an economy that ran for a decade on a 'borrow now and maybe pay it back later' mantra. The banks lent money because people wanted everything right now, not waiting and saving or thinking 'hang on, that's too expensive for me'. So why are interest rates so low now? Because feckless arseholes borrowed beyond their means in such number that there was little alternative to bail out overstretched masses at the expense of savers (who outnumber debtors by 7 to 1). Hence the fucking panic when inflation is rocketing and we need to put up interest rates.

Picking an easy target rather than looking at ourselves is a result of pure media manipulation, started by the previous failed Government as "it's all the greedy bankers faults, please re-elect us to solve this thing that we didn't cause in any way" ffs.

You are as well blaming fucking Location Location Location or Cash In The Attic for pushing this country up it's own anus for the sake of a quick profit.

Isn't there another thread with these same arguments on it?

dion

It is Vodafone not Vodaphone. And it isn't 'overdue taxes'. And £120bn is just a teeny bit far fetched. Legally, they don't owe anything.

Sevlow

@commisar17 what do you think about the 20p rise on a bottle of White Lightning?

commissar17

Sevlow:
White Lightening? I never drink the stuff. I'm a Skol and Kronenbourg lager man, myself, and I enjoy a decent carbernet sauvignon over dinner. Must have been living in France that taught me both preferences -- and, in said country, people don't just go to the pub to whinge about injustice with their mates and then placidly retire for Sunday lunch. They hit the streets en masse and try to fight back -- something we would do well to emulate. The rise in VAT is a serious issue though. What we need is progressive taxation, not a levy which disporoptionately hits the poorest in our society. If I make £25 grand a year, I'm not going to feel the effects of a flat-rate 20% tax in the same way as someone on benefits, am I? What about abolishing both VAT and council tax, and replacing them with a local income tax? Not the official policy of the Party I'm a member of -- just a contribution to discussion. We could even decide that anyone on less than the average wage (between £22-23k, I'm told) should be completely exempt. Wouldn't go down with the rich, public schoolboys at the top of the pile -- the Camerons, Millibands and Cleggs among us -- but it works for me.