Monday, January 25, 2016

The Ridley Report – How the Tories plotted to smash the mining unions and destroy working class opposition

The destruction of the mining industry was a deliberately worked out plan.

It was an attempt to take on and smash the most militant determined and class conscious section of the organised labour movement. And this was seen as a critically important task by the ruling class and their chosen instrument, the Tory Party. 

It even had a name, the Ridley Report, named after its author. 

Ironically Nicholas Ridley MP, like David Cameron, was another well-heeled rich boy who was educated at Eton College along with the other rich boys of his generation. 

The Tories had been thrown out of office in 1974, during the big upturn in strike action which is best remembered for its miners’ strikes, with power cuts and the three day week. Ted Heath went to the polls asking the question: “who runs the country” and lost! 

The ‘70s were a period where wave after wave of industrial struggle forced the bourgeoisie to look to more extreme measures than ‘usual’, while at the same time the working class, the unions and the Labour Party began to move towards the left. 

Many workers began to draw revolutionary conclusions on the basis of their experience, while extreme Conservative politicans began to plot a military coup to overthrow that well known revolutionary, Labour Prime Minister Harold Wilson. 

In 1974 the Tories drew up a plan as to how they might take on and defeat a major trade union in the public sector or nationalised industries as they were known at the time! 

It was a blatant policy designed to declare civil war against the working class. The plan was quite thorough, as became obvious when it was leaked to the Economist in 1978: 

·         The government should, if possible, choose who and when to fight; 

·         The plan grouped industries together based on an assessment of how    easy they might be to beat; 

·         Coal stocks were to be built up at the power stations; 

·         Coal supplies should be arranged via non union foreign ports 

·         Non union lorry drivers should be recruited; 

·         Coal/oil dual fuel generators should be built at whatever cost;

·         The state must "cut off the money supply to the strikers and make the union finance them"; 

·         It was necessary to organise and equip a squad of mobile police, ready to use special riot tactics to defeat pickets. 

Ridley was merely the architect of the plan but it’s quite clear he wasn’t acting alone. The plan was agreed by the Selsdon Group of right wing Tory MPs, a group that included among its number both Norman Tebbitt and Margaret Thatcher who was elected Tory leader in 1975. 

Margaret Thatcher was eventually elected Prime Minister in 1979, by which time the right wing Labour government was utterly discredited and the leadership isolated within the active layers of the labour movement. 

Society was polarised, the Tories began to implement an economic strategy designed to make the economy ‘leaner and fitter’. In other words they sought to make the working class pay for the economic crisis that erupted between 1979 and1981. 

The Tories responded by slashing benefits to the old and the sick, cutting services and attempting to roll back the welfare state, under the banner of “self reliance”, “choice” and “the free market”. 

The Ridley Plan was central to this programme, the straightforward reason being that the organised Labour and trade union movement represented the biggest single obstacle to their plans. 10 million workers were organised in the TUC, potentially the most powerful force in British society, and the working class was moving to the left. 

The Tories had to risk a confrontation with the unions. The ruling class had no option, under conditions of capitalist crisis. In the minds of Thatcher and her cronies there was ‘no alternative’. 

It would be wrong however to look at the Ridley Plan in isolation. It was just one aspect of the Tories anti trade union onslaught. Even today, after almost 12 years of New Labour, the laws governing trade union activity in Britain remain the most repressive in any of the advanced capitalist countries. Restrictions on picketing, the huge bureaucratic process required to carry through strike ballots and the right of the government to “sequester” trade union assets were all imposed to try and cut across the potential for militant trade union struggle, which had been so much a feature of the 1970s. 

The ferocity of the struggle that the miners were forced to wage to defend their jobs and communities however, revealed the limits of the Ridley plan and the trade union laws. 

Despite the plans that the Tory government had prepared and despite all of the legal mechanisms and ploys that they used to undermine the strike, the battle of pit closures lasted for almost a year. The level of support within the working class for the miners meant that millions of pounds were raised on the streets and from the labour movement to support the miners and their families. The Tories were forced to move the legal goal posts on several occasions to try and shackle the National Union of Mineworkers.

The class struggle is a battle of living forces, involving real men and women. The strategy and tactics of the ruling class are an extremely important factor in the situation, but of even more importance is the role of the leadership of the working class.

The Ridley Plan was just part of a drift under Thatcher towards authoritarian rule in Britain, authoritarian rule now considered necessary by the ruling class. This was carried out through parliamentary means, a form of ‘parliamentary bonapartism.’ as the Marxists explained at the time.

This reflected the crisis of capitalism and the fact that the ruling class weren’t confident that they could rule through the ‘usual’ methods. Yet the strategy of the Labour Leaders was to adapt to the new conditions by appearing to be “reasonable and moderate”. Meanwhile the trade union leaders adopted a policy of ‘new realism’, essentially weakness and collaboration. Under these conditions the outcome was inevitable - more attacks on the working class and the poor, the weak and the old. At the same time however the ideas of Marxism began to gain ground and began to become a significant factor in British politics. 

The main lesson of the Ridley Plan for the labour movement and the politically active layers of the youth is that a Tory government would be forced to move against the working class, to deal with the crisis that the capitalist system clearly faces. In the dark corridors, and the city boardrooms similar plans will be being drawn up today. Our task has to be explain the threat that this poses and help arm the movement to fight and defeat the Tories.

Adapted from ‘Socialist Appeal’.

Sunday, January 24, 2016

Your children cannot buy a house in London because the criminal banks prefer Russian dirty money.

I have repeatedly warned that the cost of failing to interdict the obscene amount of  money laundering that goes through the City of London, will have huge consequences for ordinary people.

When any society fails to obstruct the flow of criminal money, the people who are moving the money become the de facto controllers of the banking system.

It is pointless hoping that our children will be able to stay in London in the future. 

Even if there were any jobs for them, they will not be able to afford the rents of even the smallest flat, never mind have any aspiration to own a house of their own.

Property prices have escalated way beyond the hopes and ambitions of ordinary men and women, and London has quickly become the stamping ground for an army of foreign criminals, tax evaders, pimps, whores and assorted slimeballs, all of whom have found London to be a very welcoming home of choice.

We have sold our once-proud sense of independence and our strong degree of self-reliance to a bunch of Russian and Asian crooks whose money will not pass muster, but as no-one in the British financial Establishment is looking too closely, City practitioners have merely become highly paid prostitutes, working in the financial bordello of EC3.

This dependency on Russian money is even distorting our foreign policy position. England’s political establishment has become crude and mercenary. A British civil servant was recently pictured arriving in Downing Street for a national security council meeting with an open document in his hand, dealing with a proposed UK response to the crisis in Crimea and the Ukraine. Despite the Russian aggression, it recommended that Britain should “not support, for now, any trade sanctions,” nor should it “close London’s financial centre to Russians.”

Mustn’t let principles get in the way of enriching the City of London.

The Government agrees, it doesn’t care as long as the money continues to flood in. Never mind the fact that we have strong laws designed to prevent and forestall the entree of this money, the laws and the regulations are widely ignored by George Osborne, Boris Johnson and David Cameron, in order to permit this cornucopia of foreign dirty money to seep into every nook and cranny of the financial establishment.

A recent article in the New York Times points out that the UK is deliberately breaking step with the Americans over this issue, and puts the matter this way.

“...The White House has imposed visa restrictions on some Russian officials, and President Obama has issued an executive order enabling further sanctions. But Britain has already undermined any unified action by putting profit first.

It boils down to this: Britain is ready to betray the United States to protect the City of London’s hold on dirty Russian money. And forget about Ukraine.

Britain, open for business, no longer has a “mission. Britain’s ruling class has decayed to the point where its first priority is protecting its cut of Russian money — even as Russian armoured personnel carriers rumble around the streets of Sevastopol. But the UK establishment understands that, in the 21st century, what matters are banks, not tanks...”

The Russians also understand this. They know, as many UK criminal investigators know, London is a centre of Russian corruption, that their loot enriches Britain’s empire of tax havens — from Gibraltar to Jersey, from the Cayman Islands to the British Virgin Islands — a financial empire on which the sun never sets.

You can now buy British residency, our much vaunted citizenship is up for sale. And it’s cheap for a Russian oligarch or crook.

“Investor visas” can be purchased, starting at £1 million ($1.6 million). London lawyers in the Commercial Court now get 60% of their work from Russian and Eastern European clients. 

More than 50 Russian-based companies swell the trade at London’s Stock Exchange. Planning regulations have been scrapped, and along the Thames, up go spires of steel and glass for the hedge-funding class.

Britain’s bright young professionals have now become the foreigners’ poodles, the oligarchs’ valets.

Vladimir V. Putin, understands the rules of the new game only too well. When you pay the piper, you own him, and you call the tune.  Putin was absolutely certain that Britain’s managers — shuttling through the revolving door between cabinet posts and financial boards — would never give up their fees and commissions from the oligarchs’ billions. He was right. Never underestimate the British taste for foreign funny money.

The direct impact is that property prices, already inflated by the free availability of this money are enjoying a knock-on effect elsewhere in London, as professional workers, accountants, lawyers, bankers et al spread wider and wider to afford houses, while the prices of ordinary 3 bedroom Victorian terrace houses, of which London possesses hundreds of thousands, spread across the Metropolis, spiral upwards exponentially.

Billions of pounds of corruptly gained money has been laundered by criminals and foreign officials buying upmarket London properties through anonymous offshore front companies – making the City of London the world capital of money laundering.

Transparency International, the respected anti-corruption organisation, reports that some 36,342 properties in London have been bought through hidden companies in offshore havens and vast numbers are thought to have been bought anonymously to hide stolen money. The flow of corrupt cash has driven up average prices with a “widespread ripple effect down the property price chain and beyond London”, according to property experts cited in the most comprehensive study ever carried out into the long-suspected money laundering route through central London real estate. by Transparency International.

Some sources claim it has skewed developers towards building high-priced flats and houses rather than ones ordinary people can afford. While corruption and tax evasion are likely to be the biggest sources of the illicit money, drug dealing, people trafficking and sanctions busting are also common, police say.-

TI’s research, which includes previously unreleased internal figures from the Metropolitan Police Proceeds of Corruption Unit, found that 75 per cent of properties owned by people under criminal investigation for corruption are held through secret offshore companies.

London has become a global magnet for corrupt funds, TI said, due to the high prices of property – enabling millions of pounds to be laundered at a time – and Britain’s notoriously lax rules on the disclosure of property ownership. Any anonymous company in a secret location, such as the British Virgin Islands, can buy and sell houses in the UK with no disclosure of who the actual purchaser is. Meanwhile, TI said, estate agents only have to carry out anti-money-laundering checks on the person selling the property, leaving the buyers bringing their money into the country facing little, if any scrutiny.

Anti-corruption experts have repeatedly expressed frustration that the UK does so little to stem the flow of money stolen from their countries. This author has repeatedly warned against the impact of permitting foreign-based criminal capital to be laundered through London.

Robert Barrington, executive director of TI, said: “This has a devastating effect on the countries from which the money has been stolen and it’s hard to see how welcoming the world’s corrupt elite is beneficial to communities in the UK.”

If you have any illusions of watching your grandchildren grow up in London, forget them, your children won’t be able to afford the housing.

Tuesday, January 12, 2016

Why we would be MAD to replace Trident

We are beginning to witness the first moves in a debate within the Labour Party which engages with the suitability of renewing our policy of maintaining nuclear weapons through the Trident programme.

Now that the Cold War is over and Russia herself is involved in far greater degrees of asymmetric warfare, as indeed are we, the need for us to maintain large numbers of nuclear weapons has frankly disappeared.

The original justification for their existence was as part of a Cold War philosophy of ‘Mutually Assured Destruction’ or MAD for short. The idea being that an attack by one weapons’ owning state on another would trigger a retaliatory attack before the first bombs arrived, so that both countries would ultimately be very badly damaged if not effectively destroyed.

However, there is no justification to undertake a first strike against an enemy, any enemy, and there is no debate on this, and it is abhorrent to suggest that there ever could be. So the question remains, under what legal justification could Britain possibly use its deterrent? 

Second strike capability is frankly a nonsense, as in these days, just a small percentage of the weaponry possessed by other nuclear powers, would be sufficient, if used first, to return the entire United Kingdom to a smoking, throbbing radioactive rubble. So all this talk about sealed letters aboard nuclear submarines signed by the Prime Minister is all a little academic.

Moreover, Britain is committed under the Nuclear Non-proliferation Treaty to move toward disarmament. By deciding to renew its deterrent, it may undermine the very treaty that it is so keen to hold Iran to account over. Why should it listen to another country that is saying nuclear weapons are dangerous and unnecessary when it refuses to disarm itself?

Finally, I would like to pose a question as to which nuclear power would the one most likely to bomb Western Europe pre-emptively?

When I was a uniformed police recruit undergoing my basic training at Hendon, we were lectured in the last few weeks of basic training, by two men from the Ministry of Defence, who advised us of our likely role as police officers in the event of a nuclear war.

It was all so surrealistic that I doubt if any of us took the scenario planning very seriously. I for one, considered that the likelihood of my surviving the nuclear winter they anticipated would be unleashed, was so small as to be beyond consideration.

However, the one thing I do recall with absolute clarity was their determination of the identity of the country dropping the first nuclear weapon to impact on the UK, and that was America.
I can still recall my shock at learning this likelihood, but they justified its use against us thus!

America had always been looking for ways of countering Russian aggression and strategic desires. The way their scenario played was that in the event of a nuclear posturing reaching such proportions that the likelihood was that weapons of Mass Destruction were about to be unleashed by the Russians, the Americans would first destroy Western Europe as a means of providing themselves with a nuclear infected barrier zone between themselves and the Soviets.

They argued that the Russians would first seek to gain a toe-hold in Western Europe so as to be able to face down America, and thus the first strike would be to deny the Russians such an opportunity, hence the bombs that would obliterate Western Europe, would be American.

Any readers who have seen the film or read the book ‘Dr Strangelove’ will have no difficulty in appreciating this scenario. That is also why British submarines are armed with US weaponry which cannot be used except with US authority, because we are nearer Russia than they are.

So, when you hear promoters of Trident talking about the need to have a weapon which can be used as a second strike capability against some country determined to annihilate us, remember they are talking about our retaliating against America!

The UK does not need to replace Trident. It is vastly expensive, and the days are long gone when we need to worry about our need to sit at the top table in diplomacy. Britain is not that important any more, and membership of the nuclear club no longer carries the threat it once did.

It is time we all grew up, aligned ourselves with our NATO and EU allies and put the money saved to better uses.

Saturday, January 09, 2016

Who is telling the truth over the dropping of the Culture review of the banks?

Yet again, we are facing the usual tsunami of disinformation coming from Government, the Treasury and the FCA as to whose decision was it to decide to drop the review of banking culture.

George Osborne says it wasn’t him, The Treasury denies having any part in this decision, and Tracey McDermott, fearless acting head of the FCA says that it was the FCA that made the decision, but it doesn’t mean they are going soft on the banks.

The City regulator, the Financial Conduct Authority, is "not going soft on the banks", its interim chief executive Tracey McDermott has said.

In December the FCA said it had shelved plans for an inquiry into the culture, pay and behaviour of staff in banking.

Such a review was crucial to a better understanding of why banks have come to resemble organised mafia crime families in recent years. We, the tax payers deserve the right to know why our money has been used to prop up an entirely rotten banking edifice, and empire of crime and wrong-doing, and we are entitled to know how this dysfunctional system has developed and evolved.

Critics of the decision to back off say the Treasury successfully put pressure on the FCA to be more "light touch" with financial firms.

Hang on, we’ve been there before, haven’t we? Wasn’t it ‘wee Gordie Broon’ who prevailed upon the regulators to adopt light touch regulation, prior to the banking collapse in 2008. 

Look what happened then. The bankers went on a spree of criminal activity that left the banking industry on the verge of collapse, and we, the tax payers had to have our pockets picked, to keep these gangsters afloat!

But Ms McDermott insisted the FCA was still taking tough action, including a £72m fine imposed on Barclays in December.

Speaking to the BBC she said: "We're not going soft on the banks, we're not being told what to do by the government. We have objectives which are set for us by parliament and statute, and we are determined to deliver on those." 

Fining Barclays millions of pounds for financial wrong-doing is pointless is not being tough on them. It merely becomes a deduction from their bottom line for tax purposes, it isn’t punishing them at all. The only people taking the hit are the shareholders, while the gang bosses on the 5th floor are laughing all the way to their next bonus.

Frankly, we would be better off in this country without Barclays Bank, and I suspect, other major banks as well.

Who says so, well I am indebted to Richard Murphy, a chartered accountant and a political economist. He has been described in the Guardian as an “anti-poverty campaigner and tax expert”. He is Professor of Practice in International Political Economy at City University, London. 

Quoting from his seminal work 

“...Barclays: the bank that just loves Luxembourg and Jersey, but not the UK...”

I have drawn on some of the following features, and particularly the way in which Barclays reports its profitability in the UK. Reviewing Barclays own reported figures provides us with some fascinating insights.

In examining Barclays own reported figures for 2014, he states:

What I wanted to see is whether or not it was likely that the claimed allocation of profits and losses by Barclays accords in any way with the likely allocation of profits by Barclays to the UK, in particular... 

Suddenly the UK does not make the loss, which Barclays admit they report in this country. Instead a profit of almost £1.1 billion is reported. And Luxembourg does not make a profit of £1.38 billion as is claimed in the original data, but ends up with just £71 million. Jersey also drops, in that case from £801 million of profit to £53 million.

It is complete nonsense for Barclays to claim they make a loss in the UK of significant amount (as seems likely) when in practice more than equal and opposite sums turn up, virtually untaxed, in Luxembourg and Jersey within their own accounts.

So, what is happening? I have a long list.

First, Barclays is, very politely laughing out loud at the UK and is failing to pay its way as a UK bank. So much for the contribution the City makes: this bank is not making it.

Providing employment? Barclays is employing people who would otherwise be employed elsewhere. 

As for the banking levy, that’s a tiny contribution to the cost of having effectively been bailed out by the UK taxpayer in 2008 – which all banks were as it was the system as a whole that failed. So let’s ignore claim that Barclays is contributing to the UK in these ways: it is not doing anything more than it should.

Barclays is a massive user and maybe abuser of tax havens, and especially Jersey and Luxembourg.

It is clear that transfer pricing of head office operations is not taking place effectively in the case of this company. HMRC must have the power to say that a company must reallocate costs to the group it manages from the UK or a mockery is made of our tax system. The need for reform in this area is obvious.

The question has to be asked as to why we are so keen to have companies headquarter in the UK when it is very clear that many other countries benefit more than us by not having Barclays’ head office in their domain. Barclays could bank here by all means, but candidly we would be better off without their head office.

We can ask in that case how the Barclays’s auditors (PWC) signed off these accounts as true and fair when that is the last thing they look to be.

This analysis suggests that Barclays is massively under-declaring profit in the UK at cost to all of us. The loss to the UK could easily exceed £150 million based on the above data. And in that case it is time for serious tax reform in this country.

Now, a fair and proper review of banking culture, and particularly with regard to the way they account for their profit and loss positions, would, I suggest, have had a seminal impact upon the attitude of ordinary British tax-payers, who would have rightly become very angry indeed at this wholesale exercise in tax fiddling.

If Barclays have been doing it, you may rest assured that the other big players will have been doing it in order to take advantage of the hyper-relaxed attitude that Government takes towards the criminal banks in the UK, and it is legitimate to ask what do these banks really contribute towards the common weal?

Back in the day, when the British public had seen the results and the findings of the Treasury Select Committee, and were asking genuine questions of concern about the probity and the legitimacy of our banking sector, the Government announced its intention to undertake a banking culture review. What follows restates its terms of reference.

“...The government is today announcing further steps to raise standards of conduct in the financial system with a joint review by the Treasury, the Bank of England and the Financial Conduct Authority (FCA) into the way wholesale financial markets operate. Strong and successful financial services that set the highest standards are an essential part of building a resilient economy.

The ‘Fair and Effective Markets Review’ will be led by Bank of England Deputy Governor for Markets and Banking, Minouche Shafik, with Martin Wheatley (Chief Executive Officer, FCA) and Charles Roxburgh (Director General, Financial Services, HM Treasury) as co-chairs.

Recent events have demonstrated the need for authorities and market participants to take action to ensure fair and effective markets. Forward-looking in nature, this Review reflects the government’s long term economic plan to ensure Britain remains a world leader in financial services, with successful institutions operating to the highest standards.

Drawing on the insights of public officials, market participants, end users of wholesale financial services, the Review is also intended to reinforce confidence in the fairness and effectiveness of UK wholesale financial market activity, and influence the international debate on trading practices.

Amidst recent serious allegations of misconduct in financial markets, the Review will focus on those wholesale markets where the bulk of concerns about misconduct have arisen - fixed income, currency and commodity markets - although it could have applicability across a wider range of wholesale markets.

It builds upon the tough action Britain has already taken to punish the wrongdoers and fix the financial system, including the work of the FCA to reform LIBOR and the Parliamentary Commission on Banking Standards which has led to a new legal regime for senior managers.

The Review will run for 12 months and is expected to make recommendations on:
  • principles to govern the operation of fair and effective financial markets;
  • reforms to ensure standards of behaviour are in accordance with those principles;
  • tools to strengthen the oversight of market conduct;
  • whether the regulatory perimeter for wholesale financial markets should be extended, and to what extent international action is required; and
  • additional reforms in relation to benchmarks, in order to strengthen market infrastructure.
So there you have it.

During this cultural review, the question of profit taxation would inevitably have arisen, and as we can now see, thanks to the insights of a highly qualified accountant, they would not have passed muster.

No wonder the bankers didn’t want any element of their banking culture to be examined or investigated. 

The taxation system however was only one small element of the rest of the long list of criminal actions, dishonest incentives; commissions which possess all the criminal qualities of bribes; dishonest actions by banking groups setting up clients to borrow vast sums of money and then deliberately bankrupting them and taking over their valuable assets; the institutionalised degree of false accounting in accounting standards; to say nothing of the vast level of criminal money laundering which these British banks are providing to their criminal foreign clients.

Any culture review would simply not have been able to deflect the realisation of what a bunch of criminal operators have been allowed to take over the control of the British wholesale banking industry, and such a recognition would, I am convinced, have predicated a scandal of such proportions that I truly believe it would have become an issue of political confidence.

I have no doubt whatsoever that the big players in the banks prevailed upon the Treasury and therefore George Osborne to soft-pedal on this culture review, realising that it was a road to perdition.

Well, the genie may be back in the bottle for the time being, but I wonder how long the FCA can keep it there. These things have a tendency to explode at just the wrong time!