Saturday, 29 August 2009
Scottish Socialist Party on 50th Anniversary of the Cuban Revolution HERE
Details of the Saturday 12 Sept discussion HERE
Friday, 28 August 2009
Calling on the Scottish Parliament to urge the Scottish Government to conduct a public investigation into the impact the proposed closures of schools and nurseries by local authorities has on education policies, class sizes, childrens health and safety, social inclusion, jobs, and whether the process of consulting with parents and wider communities on the provision of education complies with local authorities statutory duties and democratic principles.
Wednesday, 26 August 2009
Friday, 21 August 2009
SAVE OUR SCHOOLS CAMPAIGNERS CELEBRATE RESIGNATION OF EDUCATION CHIEF MARGARET DORAN
The Glasgow Save Our Schools Campaign, which led the mass movement against school and nursery closures since January, is delighted at the resignation of Margaret Dorarn, chief education officer for the Labour council, given her central role in the closures.
Richie Venton, Glasgow Save Our Schools Campaign organiser, today said:
“The resignation of Margaret Doran from her £120,000-a-year job is a victory for those of us who fought the vicious closures of primaries and nurseries that she was at the heart of.
“The parents, carers and communities of 2,000 children who have been uprooted and dumped in bigger classes, further from home, will have a very simple response to Ms Doran’s departure: ‘good riddance to bad rubbish!’.
“The statement announcing her decision talks of ‘financial challenges facing the council’. Are the thieves falling out?
“Margaret Doran was a critical player in drafting the butchery of our kids’ education and community facilities – but under orders from the Chief Axe-man himself, Labour Council leader Stephen Purcell.
“Far from hinting at any disagreement with the elected Labour politicians’ closures package, Ms Doran was a strident advocate and defender of them. But the ferocious opposition of parents, carers and communities, led by the Glasgow Save Our Schools Campaign, undoubtedly caused private divisions amongst council leaders and officers on how best to cope with the public fury.
“So when Labour councillors sing hymns of praise for her ‘leaving a tremendous legacy’ for Glasgow kids’ education, it’s enough to make you vomit.
"Her ‘legacy’ includes chaos in the first week of school term, with kids packed into far bigger classes, many of them travelling dangerous and long routes, some teaching staff only hearing where they were to work a day before the new term started, and many parents facing loss of their jobs because they can’t juggle between childcare arrangements and working times.
“We celebrate the departure of one butcher of kids’ education – the unelected £120,000-a-year bureaucrat – but intend to work for the removal of the bigger butchers – the Labour councillors who rode roughshod over people’s needs and wishes.”
For more info contact Richie Venton on 07828 278 093 or email email@example.com
Sunday, 16 August 2009
Is The Crisis Over?
Over the last two weeks there has been lots of telling economic and financial data from which some commentators have drawn the conclusion that the worst of the economic and financial crisis is over. We set out here to examine this data and determine if these commentators are right by looking at the banks, stock markets, the Bank of England and global economies.
The four major banks and the wholly state owned Northern Rock reported their results, which were described as mixed, during the business week ending the 7 August 2009. We show these in the table below - all the figures are in billions of pounds sterling.
Barclays HSBC Lloyds RBS* Nthn Rock
Pre Tax Profits 3.0 3.5 -4.0 0.2 -0.7
Write-downs -4.6 -9.6 -13.4 -7.5 -0.5
Banking Profits 1.0 4.2 0.0 5.1 0..0
Profits ex 2.0 -0.7 -4.0 -4.9 -0.7
*RBS Suffered a post-tax loss of £1bn
The points of interest are: only Barclays made a profit when investment banking revenues are excluded; and the revenues from investment banking are a one off. Stock markets have rallied by nearly 50% from their March 2009 lows and the price fluctuations – called volatility – of financial assets have fallen making derivatives easier to trade and reducing daily profit and loss moves. In the credit markets the cost of buying insurance against bankruptcy has also fallen. All these factors have combined to create bumper investment banking profits. Normally stock markets would move no more than 10% over such a time span. But as we show later the sharp rally we have just seen is common in stock market crashes. In the past these have proved to be false dawns – often called sucker rallies - with the market falling again to levels below the previous lows.
The write downs in six months are nearly £36 billion. This money was lost as the value of assets the banks hold and loans to individuals and companies were written off. These losses are not paper losses but have to be matched from the banks capital. These are the losses from the banks exposure to the recession. They will continue dripping losses of this magnitude while the recession lasts and house prices continue to drop. If you add a major market fall and an increase in asset volatility, then on top of these losses will be potentially huge daily losses from derivatives – banks globally have a $700 trillion exposure to these assets. Such a scenario would lead to a similar financial meltdown as we experienced September 2008.
Even without a market correction the banks are likely to all return losses in the second half of 2009. The write-downs are probably underestimated as new rules give the banks leeway in accounting for “difficult to value assets”.
The Stock Markets
Stock markets around the world have risen by over 50% (to week ending 7/8/2009) from their low point in March 2009. Stock markets are where companies’ ordinary share capital (shares) is traded. They are usually seen as a leading indicator of what is happing in the economy. So does this rally mean that the worst is over for the economy and the banks in particular?
If one looks at the history of severe economic recessions a pattern emerges: after a sharp fall in share values over several months, shares make a partial recovery in the hope that the worst is over only to be disappointed and fall again to reach new lows.
In the 1930s depression shares fell from a high of 380 on the US Dow Jones Average (DJA) to a first low of 199 over two and a half months only to rise 48% to 294 five months later. This proved to be a false dawn as US credit dried up on the back of its banking crisis driving the world into a deep depression. The DJA then fell 89% from its all time high to a low of 41 two and a quarter years later.
Sounds familiar? This time the DJA took one and a half years from the credit crunch breaking to fall 54% from its pre-crash high. It has since rallied 44% to its close on 7/14/2009 of 9435. In the UK the initial fall was of the same magnitude but the rally less pronounced to 34%.
The rally – known as a sucker bear rally – in shares is as we write (17/8/2009) is running out of steam. We are likely to see a sharp fall in shares as the markets wake up to the effect of the “end of credit”. This will lead to an increase in the price movements of all financial assets and a big rise in financial volatility. The banks who therefore made gains in the first half of 2009 will suffer steep declines in profits as their exposure to $700 trillion worth of derivatives will create huge losses similar to those they experienced in the autumn of 2008.
Governments would then have to again step into bail out the banks but this time their scope for action is limited by the amount they have spent already and the steps they have to take to find the money to pay for it.
The Bank of England
The Bank of England (BOE) has made two important statements over the last two weeks (3/8/2009 to 16/8/2009). The first was on quantitative easing and 2009’s second quarterly report on inflation. These statements revealed more about the state of the economy and the financial system and its future than any vague optimistic comments that have come from government and City’ analysts.
On quantitative easing the announced that they would raise the total pot to £175 billion – an increase of £25 billion of which £125 billion of the original £150 billion has been used already. The new unused total of £50 billion would be put to use over the next few months. The £175billion represents 12% of our economy (gross domestic product - GDP) and together with other bailouts will take the total of our money spent by the government and the BOE on saving the banks to £350 billion or nearly 25% of our GDP.
Quantitative easing is a tool where the BOE of England prints money and buys back with this money government and other debt from Banks, Financial and other institutions. The idea is this will give the financial system money that they will then pump into the economy in the form of mortgages and loans to consumers and buinesses. All the evidence points to this not happening and instead the financial sector is hoarding the money as a buffer against further looses on mortgages, loans and derivatives.
The table below bears this out. It shows, in billions of pounds, the average monthly personal debt for 2006 – the last full year before the credit bubble burst, the average for 2009 and the figures for the latest month where data is available - June 2009.
Loans Secured Consumer Mortgages Re-Mortgages
On Homes Loans
June 2009 0.3 0.1 6.2 4.3
2009 1.0 0.1 4.6 4.1
2006 9.2 1.1 16.0 11.5
One can see the massive fall off in credit from 2006 that has driven the UK economy into recession. In June 2009 only mortgages – which account for bottoming out of houses prices - are significantly above the average for 2009 which is way below 2006’s average. Of the £125bn of quantitative easing only £1.7 bn has found its way into additional credit!
Why then spend another £50 billion on quantitative easing? The answer can be found in quote from BOE governor Mervyn King in an interview on the recent BOE inflation report. He said that the banking sector was still “in a very bad way” and predicted it would take years to “repair balance sheets” and wean the banks off public support.
In other words quantitative easing is nothing but another bank bail out that we will have to pay for through cuts in public services, wages and jobs and higher taxes. As well as quantitative easing the Royal Bank of Scotland and Lloyds TSB/HBOS have insured over £700 billion of their toxic assets – loans and derivatives – with the UK government, This means we will be liable for further losses which are likely to mount in the second half of the year as we pointed above on the section in banks. The future maximum bill we will be presented with and paid for by us through cuts and higher taxes is unknown.
The UK economy and is still in decline only the rate of decline has slowed. Unemploymnet contuses to rise with nearly 20% of 16-24 year olds unemployed. In the US official unemployment has fallen slightly although nearly 250,000 lost their jobs in July. This is mainly because millions have given up looking for work. Those claiming unemployment benefit are 9.4 % of the total US workforce. But the national labour office estimates that nearly 30 million are out of work which is nearly 20% of the national workforce. Consumer confidence continues to fall in the US and inventories of goods are also falling at a rapid rate. This shows that US corporations are unwilling to produce more goods as they no faith that they can be sold. Only government subsidies for the car industry have boosted production slightly.
US corporations’ economic results are only being held up by huge cost cutting programmes. Underlying sales are poor and once the one off effect of cost cutting passes their results will start to deteriorate
Outside of China only France and Germany, in Europe, and Japan have managed to stop the decline in their economies. This is mainly because the French and German governments had to spend less on bank bailouts and were able to put funds into stimulating consumer spending and the infrastructure. These economies had also much smaller level of consumer debt and a smaller housing bubble. But the stimulus is likely to be a one off as European banks losses will increase in the second half of the year as exposure to eastern European and emerging market property loans hit their balance sheets. They also have exposure to derivatives and there are likely to be losses in this area in the second half of 2009 and not the windfall profits that accompanied the stock market rally since March of this year. Outside of Germany and France, economies with a large housing bubble have been hit hard – Spain and Ireland primarily.
The Japanese economy grew 0.9% in the second quarter of 2009 below the median forecast of 1.0%. This ended 15 months of successive contractions with the sharpest in the previous quarter when the economy shrunk nearly 3%. The growth in quarter two was driven by a $2 trillion government stimulus programme and exports. But the financial markets believe the effect of this will be short lived as the stimulus wears off and the global economy continues to shrink in the third quarter of 2009 leading to a decline in exports. On day the figures were announced (17/8/2009) the Japanese stock market dropped 3%.
China though technically not in recession has seen tens of millions of people made unemployed over the last two years. Only a massive stimulus programme driven by the central government has kept its economy afloat. Nearly $3 trillion of new consumer debt has been created in the first half of 2009. But the government are turning this tap off as they see the first signs of a speculative bubble in property and the stock market. Of course this internal stimulus programme does not help the rest of the world’s economy apart for the commodity industries as China is a huge net exporter. And these exports continue to decline as the world’s overall economy continues to shrink.
The global finance system is so contaminated with bad debt and derivatives that we are likely to see years of declining and stagnant economies. Unlike the 1930s the crisis of credit is not a US one but a global one with the banks also geared up to derivatives which can bring the financial system to the point of collapse when the financial markets decline and volatility in financial assets increases as we saw in the Autumn of 2008.
This means governments will have to continue to use our money to bail the system out rather than create jobs and services. The majority of us will pay for these bailouts through public service cuts and tax rises and unemployment.
But there is an alternative which means taking the banks under our control and neutralising their rotting loans and cancelling their destructive derivative contracts. It means a society where resources and wealth are shared to meet human needs. It is the only rationale alternative to the harsh future that capitalism offers us.
Sunday, 2 August 2009
A rash of factory and workplace occupations is spreading across the globe as workers defy the brutal consequences of the recession.
Instead of surrendering to mass redundancies and outright closures – sometimes at a few minutes’ notice, often without even redundancy packages – workers are occupying their workplaces as a central method of struggling for justice.
Every example that wins concessions is boosting the belief of other workforces that there is an alternative to just resigning to the butchery in the boardrooms – that belligerent, militant class action can win at least something where workers have nothing to lose.
VICTORY TO VESTAS
Currently the sit-in at Vestas wind turbine factory on the Isle of Wight is creating a storm of international publicity and sympathy for the 600 workers who face the dole, at the same time as the Labour government recently pledged to create 400,000 new green jobs over 5 years.
The 25 Vestas workers who have staged this factory occupation, supported by a mass rally outside every night, have shown tremendous courage in the face of numerous separate attempts by the bully-boy, anti-union Vestas bosses to evict them.
They tried to starve them out, blocking food supplies being sent in by supporters. They threatened the sack and removal of redundancy payments from the workers staging the sit-in, to intimidate them. They took out an injunction to gain re-possession of the factory – in order to close it and move production to the USA and China! The RMT took up the workers’ legal defence and won at least a delay in the possession order being issued – primarily because of the visible display of widespread solidarity outside the factory gates every night and on several demonstrations.
The factory was due to close on 31st July – but the seizure of the factory by workers has just won an indefinite extension of that deadline. Vestas had no union recognition. Some workers joined a union and started organizing others. A group of them established a campaign committee and organised the sit-in from 20th July. This bold action won the active support of hundreds others – Vestas workers, other trade unionists, environmentalists, the local community – on an island where there are no other jobs to go to.
Vestas workers have gone further than any of the other recent factory sit-ins in terms of the demands they are making from their ‘campaign headquarters’ inside the factory: “Gordon Brown – Nationalise This!” declared the banner from day one.
A statement from the workers’ occupation declared, “If the government can spend billions bailing out the banks - and even nationalize them - then surely they can do the same at Vestas”.
EVERY VICTORY ENCOURAGES ACTION
As well as organizing solidarity for these heroic fighters for jobs and the protection of the environment, we have a duty to learn from workers’ experiences of sit-ins as a method of struggle, particularly as redundancies and closures sweep the land like a pandemic.
Vestas is only the latest in a series of workplace occupations in the UK. And Thomas Cook workers in Dublin, members of the TSSA union, have just (31st July) occupied in defiance of job losses through closure of 100 offices.
The recent outbreak of factory take-overs in Britain and Ireland began with Waterford Glass workers occupying the plant on 30th January, in opposition to the employers’ announcement of an immediate end to production and 480 job losses.
After 8 weeks’ struggle, they reluctantly accepted a deal that saved 176 of the 480 jobs.
But their example fed the appetite of other workers facing savage closures under brutal terms and conditions. On 31st March, over 600 workers at three Visteon (ex Fords) plants in Belfast, Enfield and Basildon occupied and picketed when they were declared redundant at a few minutes’ notice, without any redundancy pay and with their pensions frozen. A month later, appropriately on May Day, the workers won enhanced redundancy terms, payments in lieu of notice, and holiday pay.
As Kevin Nolan, UNITE union convener at the Enfield factory put it, “People ended up with a year and a half’s worth of salary. That’s a victory when you consider Visteon were hiding behind the recession as a way of completely abandoning all responsibility for 600 UK workers and just dumping them.”
Prior to that high-profile sit-in, a small group of non-unionised workers at Prisme in Dundee occupied their workplace, encouraged by Waterford Glass workers, (who subsequently visited the Dundee sit-in). They had been sacked without notice and without any redundancy pay. Fifty-one days later, the sit-in beat off the redundancies by establishing a cooperative.
VITAL PART OF HISTORY
Workplace occupations are not a new form of struggle, of course, but this new wave of sit-ins follows many years of the method receding into the background.
Italian car workers seized their factories in northern Italy in the 1920s. What were dubbed ‘sit-won strikes’ swept countries like France and the USA in the mid-1930s. Closer to home and to the present, the most famous workplace occupation was the 1971-2 Upper Clyde Shipbuilders (UCS) ‘work-in’ - in reply to the Tory government’s closure of the yards with at least 6,000 redundancies. This triggered a mass movement, saved many of the jobs after the Tories were forced into a U-turn, and was the impetus to at least 200 sit-ins across the UK in the first half of the 1970s.
For a time such audacious actions receded, although Lee Jeans (mostly women) workers in Greenock occupied in 1981; Caterpillar workers in Uddingston in 1986; and Glacier Metal workers in Glasgow won an outright victory after their seven-week occupation in November-December 1996.
Now, as the global capitalist crisis bites, with even more catastrophic closures and cut-backs on jobs looming, this form of struggle could come back into its own.
POWERFUL WEAPONS OF STRUGGLE
Sit-ins are a powerful weapon, paralyzing production; psychologically bringing the battle into the bosses’ ‘own territory’; preventing them from stripping the factory of machinery and equipment that they may want to shift to other production sites, including abroad, in their hunt for subsidies and cheaper labour; preventing bosses from bussing in scabs past picket lines that are hamstrung by anti-union laws and deployment of the police (as seen, for example, at Timex in 1993).
But a sit-in ‘with folded arms’ can still be defeated, or at best win shoddy concessions far short of the potential victories on the agenda if workers’ occupations are accompanied by concerted campaigning outside the sit-in.
When workers facing closures consider a sit-in they should also try to prepare for a campaign of seeking solidarity from fellow workers and local communities – or at least put that into action as soon as they occupy. Such outgoing, concerted campaigning is critical, firstly to help prevent employers evicting them, secondly to enhance the prospects of outright victory for their demands. That was the advice we put into action from day one of the Glacier Metal occupation in 1996. It is clearly what the Vestas workers are ably applying right now.
Touring other workplaces; taking to the streets with leaflets, bucket collections and megaphones to explain the case behind the sit-ins; organizing solidarity mass pickets, rallies and demonstrations – all this and more was done in conquering outright victory for the 1996 Glacier Metal workers sit-in, and is the method being applied at other current occupations to one extent or another.
DEMANDS FROM THE SIT-INS
The other key question that remains is: what do workers demand whilst they occupy their workplace? Of course that depends on what they are fighting against! In the case of Glacier Metal it was mass dismissal of the entire workforce in the drive to smash the union and rip up hard-won conditions. So full re-instatement of every worker, with continuity of terms and conditions, and continued union recognition, were the demands of the sit-in. And that was what was won!
In the case of Visteon, workers occupied to win redundancy payments and protection of their pensions. They won substantial concessions, though they still lost their jobs.
Vestas workers, as stated earlier, have made the most far-reaching demands – and absolutely appropriate ones to the situation, occupying in support of nationalization of the factory. With the need to save jobs and simultaneously save the planet from catastrophic climate change, the best route is public ownership of the UK’s only wind turbine factory, as part of the call for public ownership of the energy industry as a means of democratically planning clean, green energy production.
Most occupations arise from closures or mass redundancies. So defense of every job is the starting point. And instead of pouring a fortune from the public purse down the throats of profiteering bosses who are hell-bent on racing across the globe in pursuit of super-profits, workers and their unions shown champion the demand for public ownership of the assets, under democratic working class control, to sustain jobs.
REVERSE THE TIDE OF CLOSURES
Workplace occupations are not a ‘one-size-fits-all’ method of struggle, applicable on every single occasion. They should not be turned into a fetish. But they are an enormously powerful weapon of struggle that should be utilized far more widely in the teeth of closures and mass redundancies, and in the vast majority of cases have won huge concessions or outright victories. On the other hand, in some conditions, strikes in the face of closures can sometimes allow the employers to just walk away, leaving whole communities wrecked. And in stark contrast to both, appeals to the employers’ good nature to ‘change their minds’ about closures are a pitifully weak response to the boardroom boot-boys, who will only ever ‘change their minds’ when they know the alternative is carnage for their reputation and profit levels.
Many workers will increasingly see they have nothing to lose in the teeth of mass redundancies, and a lot to win by taking up the cudgels. As Visteon’s UNITE convener Kevin Nolan recently told Labour Research magazine, “We just thought: ‘What do we have to lose?’ So we just went for it. If anyone else is in the same position I’d say weigh everything up and if you think there’s a chance of winning something back or improving your situation by occupying the place, then go for it.”
By seizing control of the company assets, including valuable machinery, plus halting production, whilst using the workplace as a huge campaign headquarters, occupations provide workers with an unprecedented platform to take on the bosses who want to heap the crisis they have created on the shoulders of working people.
We have a duty to concretely assist every group of workers who take such action; every victory won is a boost to the generalized struggle to save jobs, not profits, to reverse the tide of closures and cut-backs endured for far too long.