In the last week there have been a number of news stories circulating that have once again cast an utterly predictable and equally depressing light on the realities of the current state of play between our government, financial institutions and big businesses who operate on British shores.
First, the news came that all but two of the FTSE-100 companies used overseas tax havens, costing the UK government an estimated £18 billion per year in lost tax revenue. Then, Private Eye and The Guardian reported that Goldman Sachs had been let off paying £10 million in interest after bungling a tax avoidance scheme. Goldman Sachs wanted to employ London staff through a subsidiary firm in the British Virgin Islands tax haven. In April 2010 Goldman lost a legal action, leaving the government in line to collect £30.8 million plus £10 million in interest. But in a private meeting between Goldman Sachs and the permanent secretary of HM Revenue and Customs, Dave Hartnett, the £10 million in interest was simply waived, in what the Metro described as a, 'sweetheart deal.' Mr Hartnett, Goldman Sachs and HMRC have all declined to comment on the allegations although HMRC has said it 'could not respond to incomplete and therefore fundamentally flawed' accounts of arrangements.
This week also heralded the news in the FT that the European Banking Authority has ordered European Banks to raise their core tier one capital ratios - the key measure of financial strength - to 9%. For those not accustomed to financial jargon this means that the banks are being ordered to seek further recapitalisation, protecting what they are lending, so that they keep 9% in their reserves. However, this may well mean that instead of banks selling assets to raise the capital they simply stop lending as much. If they stop lending, a scenario the banks would prefer, there is a strong possibility that we could move into another recession. Unsurprisingly, commentators such as the BBC's Robert Preston on BBC Radio 4's Today Programme, has already predicted that in addition to a decrease in lending the banking sector will turn to the European taxpayer to help raise, according to Morgan Stanley's estimates, up to £240 billion needed to reach the 9% level in what will amount too yet another bail out to the banks.
These three stories serve to illustrate the state of play that I would argue prevails currently between government, big business and finance. The governments, as often as they can, seek to further the interests of capital without concerns that in so doing they are undermining the very real needs of the British public. Big business seek any and every opportunity in the name of their shareholders' quarterly profits to avoid paying the tax due to government, and financial institutions when asked to recapitalise and balance the books turn to the government and therefore the taxpayers for yet more bail outs.
Let us take the total sum of the money mentioned in these three stories. We, the electorate of the United Kingdom, will have suffered a combined loss from these three news stories of up to £28 billion in tax revenue, not taking into account the significant amount we would pay as part of a further bail out of the banks as they started to seek recapitalisation from European taxpayers. To put this in perspective the NHS has been ordered by the Coalition government to make "efficiency savings" of between £15-20 billion by 2015.
In New York Citiy's Liberty Plaza, in the last four weeks, a group of individuals who gathered under the banner of 'Occupy Wall Street' have morphed into the NYC General Assembly. In LA, Boston, Chicago and over 800 other US cities similar affiliations of faith groups, trade unionists, musicians and left-leaning individuals have joined the unemployed and victims of foreclosures. The groups have been inspired by the events of the Arab Spring and popular uprisings in Spain and Greece against austerity measures. Popular slogans such as 'we are the 99%', have captured the imagination of tens if not hundreds of thousands. Kanye West and Russell Simmons amongst other celebrities have started to throw their support behind the occupation, which after initially being the subject of a news blackout has seen hysterical responses in some of the more notorious right-wing media. Former Fox News anchor ,Glenn Beck, warned that the protestors would 'kill everyone'. John Stewart used his 'Daily Show' to showcase some of the more incendiary descriptions of those participating in the movement. In a montage of some of the worst offending journalists from CNN, FOX and other right-leaning media outlets in the US news commentators used terms such as 'hippy sludge' and 'weed-smoking fascists' to describe those joining the protests.
Journalist and author of 'No-Logo' Naomi Klein has firmly backed the notion that non-violent occupation of public space is far more effective at forcing the hand of government than by any other means. In a speech to the assembled masses she claimed that Occupy Wall Street was 'The most important thing in the world now.'
This Saturday, October 15th at 12pm at Saint Paul's Cathedral Occupy The London Stock Exchange will begin. On the groups facebook event the end date of the action is stated as December 12th 2011. Over 4,000 people have clicked on the event as 'attending'. Anyone who has ever clicked on a facebook event will tell you this probably means less than half that number can be expected to camp up and start the protest in the UK. Even so, over 2000 people camped outside the London Stock Exchange on day one is more than a meagre start, and if events in the US are anything to go by, the number of participants may well increase day on day on day.
People will be participating in Occupy London Stock Exchange because they have completely lost faith in the process of electing government through the ballot box.
Party financing by big business and the revolving door between large corporations and government has become so ever present that it is difficult to find an elected official who is not an apologists for the financial institutions who have brought the global economy to the edge of the abyss. And then asked government for help to regain their bumper annual bonuses.
In 2008, post-Lehman, many hoped the rapacious nature of finance would modify itself, but the truth is that the bottom line will always be profit at all costs. Government favours capital's interests over labour and every financial indicator is that with no growth in the economy and unemployment at its highest for a generation, the situation is only getting worse.
It is my opinion that the cuts the Coalition has embarked upon in the UK, with no mandate and with no forewarning in their manifestos, is simply privatisation and closure of the provision of public services by another name.
Institutions like the NHS, that we all consider our birthright, are being devastated because we are told, there is no other option, when that is manifestly not the case. A unified message must now resonate around the country that the public will not be cowed into a programme of change that none of us voted for. Alternatives such as the Robin Hood Tax and clamping down on tax dodging corporations (estimated to cost the UK tax payer £95 billion per year) exist but are simply ignored by government because they undermine the very same vested interests that government unfortunately appears to answer to.
We should also be going because coming together with the like-minded in the face of seemingly overwhelming opposition will create an engine of change, as well as hope. Hope that fundamental and seismic change is not idealistic, but absolutely necessary if we are to emerge from crisis after crisis with a form of capitalism that takes into account the very real human cost butchered by profit at all cost. I know that hundreds of thousands of people all over the world feel this. I know that they are as angry as I am at government's attempts to ignore the will of the people as they tell us that it's very complicated and that we couldn't possibly understand. We do understand. We understand all too well.
And I will be going because I need to remind myself that other people in the UK think change is possible too. As one speaker at a Labour rally at Occupy Wall Street put it, at this protest, "We found each other."
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