We must tax profits now, freeze energy prices – and if necessary bring suppliers into the public sector

Without urgent action, families are seeing nothing more than pain now and pain later. There is a way through writes former PM and Chancellor Gordon Brown in The Guardian

The energy cap has to be suspended before 26 August, the date on which an approximately 80% increase in our energy bills is expected to be announced. Photograph: Peter Byrne/PA


Time and tide wait for no one. Neither do crises. They don’t take holidays, and don’t politely hang fire – certainly not to suit the convenience of a departing PM and the whims of two potential successors and the Conservative party membership. But with the country already in the eye of a cost of living storm, decisions cannot be put on hold until a changeover on 5 September, leaving impoverished families twisting in the wind.

The energy cap has to be suspended before 26 August, the date on which an approximately 80% increase in our energy bills is expected to be announced. The Department for Work and Pensions computers, which adjust universal credit and legacy benefits, have to be reprogrammed in the next few days if help is to be given to all who need it when prices rise on 1 October. Voluntary cuts in energy usage – good for our green agenda – should, as has happened in Germany and France, be agreed upon now when the weather is good if we are to prevent rationing later when the weather turns bad. And windfall profits and bonuses have to be properly taxed now before the money flees the country.


There were two great lessons I learned right at the start of the last great economic crisis in 2008: never to be behind the curve but be ahead of events; and to get to the root of the problem. And it is not tax cuts or, as yet, a wage-price inflation spiral that are the most urgent priorities for action, but dealing with the soaring costs of fuel and food: the cause of half of our current inflation.

So it is indeed urgent that the candidates to be prime minister – and the current prime minister and chancellor – meet to make not just one or two but several urgently needed decisions: to suspend and fundamentally reform the energy price cap; to agree October payments for those who will not be able to afford to turn up their heating; to home in on alternative supplies abroad and open up appropriate storage facilities at home; to agree voluntary energy reductions; and to help pay for these measures with a watertight windfall tax on energy companies and a tax on the high levels of City bonus payments. For if we could remove the opportunity to avoid or opt out, as we did when imposing the windfall tax on privatised utilities in 1997 and the banker bonus levy of 2009, we could raise not just £5bn but as much as £15bn. This would be enough, for example, to give nearly 8 million low-income families just under £2,000 each.

All these measures should be based on a clear set of principles: that the right to a warm home is a human right; that we should do most for those who have least; and that no energy retailer should be allowed to additionally profit from the crisis.

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What’s more, British ministers – and no one has yet grasped this – should also be leading the way, as we did in 2009, in demanding coordinated international action with an emergency G20 early in September to address the fuel, food, inflation and debt emergencies. These are global problems that can only be fully addressed by globally coordinated solutions.

Tuesday’s forecast from Cornwall Insight of a £4,266 average annual energy price by January is remarkable. It means, as an immediate analysis carried out by Jonathan Bradshaw and Antonia Keung shows, that more than half of British households, 54%, will be in fuel poverty by October and two-thirds, 66%, by January. Six million households, an astonishing number, will be forced to pay an unprecedented 25% of their income in fuel costs and 4.4 million will be subject to a virtually unaffordable 30%.

So instead of allowing Ofgem to announce an increase on a scale that will send shock waves through every household, the government should pause any further increase in the cap; assess the actual costs of the energy supplies being sold to consumers by the major companies; and, after reviewing the profit margins, and examining how to make standing charges and social tariffs more progressive, negotiate separate company agreements to keep prices down. They should work with businesses to cut consumption, as is happening in France and Spain, which have imposed their own cap on energy prices, dictated more by what people can afford than the current wholesale gas price in the marketplace.

And if the companies cannot meet these new requirements, we should consider all the options we used with the banks in 2009: guaranteed loans, equity financing and, if this fails, as a last resort, operate their essential services from the public sector until the crisis is over.

With one of our main suppliers, Norway, seeking to retain its own gas for domestic use and France running into problems with its nuclear reactors, we are already running out of time to negotiate new deals with other international suppliers. And we are already missing out of additional capacity from Qatar, which has gone to mainland Europe. Over time, we can and must increase domestic production, and agree on a home insulation programme with the same urgency as our vaccination programme.

It’s true that Britain’s decade-long low growth, caused by low investment, has made us vulnerable to skill shortages and supply-side bottlenecks and thus higher inflation than our competitors. But most of the current rise in inflation has been generated from energy and food prices caused by the war in Ukraine and so removing the Bank of England’s independence is merely an exercise in blame shifting, as is direct criticism of the Treasury which, in my view, will take its lead from ministers.

It is the government that sets the inflation target and appoints the Bank’s main decision-makers. And it is the duty of government in a crisis to send the Bank an open letter telling it to set out a clear pathway over the coming years to return to stable prices. On the basis of an agreed inflation trajectory back to 2%, we should consider agreeing year-on-year wage settlements – starting with a flat rate of between £2-3,000 this year – so that hardworking families, especially those on the lowest incomes, can afford their energy bills without being plunged into poverty.

The truth is that without a plan the government is lurching from one crisis to another, failing to address the anxieties of families who see nothing more than pain now and pain later. But there is a way through from pain today to gain tomorrow, not just through the immediate relief I propose but in a clear strategy to move us from the 1.4% annual growth that the Conservatives have achieved back to a 2.5% trend growth rate. This is the one way to permanently end the cost of living crisis that British families have had to endure through an austerity decade.

No one can be secure when millions feel insecure and no one can be content when there is so much discontent. Churchill once said that those who build the present in the image of the past will utterly fail to meet the challenges of the future. Only bold and decisive action starting this week will rescue people from hardship and reunite our fractured country.

Going Beyond Har Ghar Tiranga

 

War or peace, truth suffers

Jawed Naqvi in The Dawn

UKRAINE has published a list of some 620 academics, journalists, military veterans and politicians who it says are Russian propagandists. Three such worthies in the list are Indian, and they seem baffled by the accusation.

As ‘agents’ go, there’s probably nobody to beat Pakistan, followed by India in sheer turnover. Someone praising an Indian batsman in Pakistan could fall into the category of an Indian agent as is known to have happened with cricket enthusiasts in India cheering for a Pakistani bowler. An Indian or Pakistani critical of authoritarian rule in their countries could be portrayed as enemy agents.

Rahul Gandhi has made the grade more frequently than many others. Opponents of nuclear weapons on both sides are easily saddled with the opprobrium of helping the enemy. Occasionally, campaigners for peace between the two become targets of slander. Others run the risk of annoying both sides.

The Pakistani establishment deemed Faiz Ahmed Faiz as too close to India. And now his daughters have run into trouble with the Indian visa regime.

Let’s suppose Russia were to publish a list of Ukrainian ‘agents’ in India. Quite a few, surely, including top-ranking former diplomats, would be running for cover having declared the imminent fall of Vladimir Putin either by assassination or a bloody coup.

The maxim that truth becomes a casualty in war is thus only half true. Peacetime is no longer a safe sanctuary for the ill-fated truth against being exchanged for something more expedient. Countries are creepily spying on their own unlike the old days when foreign agents were planted abroad to pry on each other.

A very determined American lover of democracy exposed the subversion of the constitution in his country whereby ordinary citizens were spied on in a Big Brotherly way. He is now parked in a Moscow hotel, some distance from those seeking to hunt him down as an enemy of the state. Such heroes are not uncommon across the world. Julian Assange and Mordechai Vanunu belong to this club.

Ukraine’s unusual move has an Indian parallel. It reminds one of framed pictures of intellectuals critical of the ultra right-wing government in Uttar Pradesh hung in public squares in Lucknow. The high court ordered the photos removed to protect the life and limb of those framed, as also their privacy.

Ukraine’s countermeasures have a history. During the war with Nazi Germany, Britain, currently advising Kyiv, had a department of propaganda, which was called that. It toggled also as the information department in its other avatars.

The ministries of information in our patch have remained a euphemism for the state’s propaganda overdrive targeting its own people mainly, come peace or war. In Ukraine, the Centre for Countering Disinformation was established in 2021 under Volodymyr Zelensky and headed by former lawyer Polina Lysenko.

According to UnHerd — the journal that carried absorbing responses from some of the alleged Russian propagandists — the disinformation department sits within the National Security and Defence Council of Ukraine. Its stated aim is to detect and counter “propaganda” and “destructive disinformation” and to prevent the “manipulation of public opinion”.

The July 14 list on its website names those “promoting Russian propaganda”. Several high-profile Western intellectuals and politicians were listed. Republican Senator Rand Paul, former Democrat Congresswoman Tulsi Gabbard, military and geopolitical analyst Edward N. Luttwak, political scientist John Mearsheimer and renowned journalist Glenn Greenwald were named. “The list does not explain what the consequences are for anyone mentioned,” the UnHerd story notes.

Next to each name the report lists the “pro-Russian” opinions the individual promotes. For example, “Luttwak’s breach was to suggest that ‘referendums should be held in the Donetsk and Luhansk regions’”; Mearsheimer’s folly was to say that “Nato has been in Ukraine since 2014” and that “Nato provoked Putin”. UnHerd contacted and published the comments by Luttwak, Mearsheimer and Greenwald.

From Feb 24, the very start of the war, said Luttwak, he had “relentlessly argued that not just the US, UK, Norway and others should send weapons to Ukraine, but also the reluctant trio of France, Germany and Italy”.

“What happened is this. I said that there is a victory party and the victory party is not realistic … Their idea is if Russia can be squarely defeated then Putin will fall. But this is also the moment when nuclear escalation becomes a feasibility. It is a fantasy to believe Russia can be squarely defeated. In Kyiv they have interpreted this stance as meaning I am pro-Russia.”

Mearsheimer was equally annoyed at being labelled a Russian plant. “When I was a young boy, my mother taught me that when others can’t beat your arguments with facts and logic, they smear you. That is what is going on here.

“I argue that it is clear from the available evidence that Russia invaded Ukraine because the United States and its European allies were determined to make Ukraine a Western bulwark on Russia’s border, which Moscow saw as an existential threat. Ukrainians of all persuasions reject my argument and instead blame Vladimir Putin, who is said to have been bent on conquering Ukraine and making it part of a greater Russia,” he told UnHerd.

“But there is no evidence in the public record to support that claim, which creates real problems for both Kyiv and the West. So how do they deal with me? The answer of course is to label me a Russian propagandist, which I am not.”

Greenwald saw a clear glimpse of McCarthyism in the Ukrainian list.

“War proponents in the West and other functionaries of Western security state agencies have used the same tactics for decades to demonise anyone questioning the foreign policy of the US and Nato. Chief among them, going back to the start of the Cold War, is accusing every dissident of spreading ‘Russian propaganda’ or otherwise serving the Kremlin. That’s all this is from the Ukrainians: just standard McCarthyite idiocy.”

Bhakt Bannerjee vs Asadudin Owaisi

 

Bharat Mata ki Jai

 

The people about to choose Britain’s next prime minister

Despite rumours to the contrary, the Tory faithful are exactly what you might imagine writes The Economist

It might be a queue for Marylebone Cricket Club, or perhaps an upmarket prostate clinic. There is ample linen. There are panama hats and pink cheeks and pink trousers; there is white hair and bald heads and a lurking suspicion that someone in the vicinity might bear the title “Major”. There are few women. There is almost no one, except the staff, who is not white.

The identity of the Tory party membership is a matter of national importance. The contest between Rishi Sunak, a former chancellor of the exchequer, and Liz Truss, the foreign secretary, to become the leader of the Conservative Party will also decide Britain’s next prime minister. The franchise for this choice belongs to members of the Tory party, at least 160,000-odd of them. Probably. For no one can or will say how many Tory party members there actually are.

What is clear is that they are gathering. In Exeter and Eastbourne, in Cardiff and Cheltenham, Tories are mobilising to attend the hustings for their new leader. Go to these hustings and you can see them queuing, punctually, outside. Some say that the Tory faithful are not what you might think. The queues put paid to that idea: the Tories are precisely what you might think.



According to research from academics at Queen Mary University and Sussex University, 68% of Tory members are over 50; 96% are white; 21% belong to the National Trust or English Heritage; 66% are male (see chart). They are not quite as aristocratic as the panamas and perceptions might suggest: policemen and teachers are among those queuing to get into the hustings. Women are manifestly in the minority. Many are unwilling to speak to a journalist, scattering like startled fish when approached and proffering their husbands as spokesperson instead. The term “Tory wife” appears to be less misogyny than justifiable taxonomy.

Tories may be mockable. That does not mean that they are malignant (or that unusual for members of political parties; Labour’s are 93% white). It is a trope that deviancy lurks behind the upstanding Tory exterior. George Orwell wrote that for a murder to make a truly entertaining news story it should have been perpetrated by a pious Christian preacher or a “chairman of the local Conservative Party branch”. Edward Heath, a former Tory prime minister, felt his party consisted of “shits, bloody shits and fucking shits”.

But the mood at the hustings is benevolent. Mike Trevor, working at the Exeter event as a security guard (and one of the few non-white people there), considers the Tories a “very easy crowd”. Mr Trevor usually does arena concerts. Tories, he says, are “very nice” to deal with. Another guard pulls a face: some members had become stroppy when she took away their water bottles. In the queue, Tories—polite, if prone to the odd harrumph—shuffle forwards.

The hustings do reveal two misconceptions about the Tory party race. The first is the idea that it is about Mr Sunak and Ms Truss. There are, as it were, three of us in these hustings. Many members are there less to elect a new leader than to mourn their old one—and to berate his killer. As one Tory, a fan of Mr Sunak, regretfully observes, in the assassination of Boris Johnson Mr Sunak has been cast as Brutus. On this reading Mr Johnson’s fall was not caused by his own incompetence and duplicity; it was caused by Mr Sunak. It is notable that the largest cheer of the evening in Exeter comes when, during a montage film of past Tory highlights, Mr Johnson pops up celebrating his 2019 election victory. Banquo’s ghost rarely made a better entrance.

The other misconception involves a confusion over conjunctions. Ms Truss is currently well ahead of Mr Sunak—the favourite among mps and the public—in polling of Tory members. A recent YouGov poll put her support at 58%, and his at just 29%. Surveying such a small, opaque electorate is hard but commentators still wonder how, “despite” jibes that she is “bonkers” and a “human hand grenade”, this lead apparently yawns. Speak to Tories at the hustings and it is clear that with Ms Truss—as with Mr Johnson before her—the correct conjunction is not “despite” but “because”. Ms Truss may be “bonkers”, says Colin Trudgeon, a Tory member, but “I love a bit of bonkers. Boris…was nutty as a fruitcake.”

Inside the venues, preconceptions about the candidates are generally confirmed. Ms Truss is, as a now-famous clip in which she discussed British cheese made clear, a friend of the full stop. She peppers her speeches with them. Often even stopping. Midway through a sentence. For effect. She discusses emotive issues: Vladimir Putin, fishermen and proper crops. In our fields.

Mr Sunak, meanwhile, is a man who speaks in subclauses. Sentences and ideas accumulate; complexity is embraced; nuance noted. He discusses corporation tax with enthusiasm. Neither fully wows the audience. Afterwards, Tory members who speak to your correspondent consider that Mr Sunak was more “statesmanlike”. But inside it was Ms Truss’s pauses for which they whooped more.

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