The Roots of Conflict 59

There is an excellent article by Simon Hughes on response to the looting. He has in many ways the same position as me in seeking radical solutions to the malaise of our hugely unequal society, while in no way sympathising with criminal looters.

The direction of all of Hughes’ proposals is correct, but his proposed action does not go far enough and is not specific enough. In both public and private organisations, the earnings differential between the highest and lowest paid should be limited by law to a factor of four, including the effect of all non-salary perks and benefits. Hughes does not give specifics on his desire to limit this gap, but Will Hutton has been promoting a factor of ten in the public sector – that is far too wide an equality gap.

Similarly Hughes’ pious wish to promote worker partnership and cooperatives needs to be given concrete form by legislation forcing all companies to give truly significant – I am thinking around forty per cent – shareholdings to employees.

If Simon really wants to roll back the excesses of the last thirty years, then natural monopolies like the utilities companies and the railways need to be returned fully to public ownership. PFI should be discontinued and all PFI assets nationalised without compensation.

Housing Association properties should be taken over by local authorities as traditional council housing, and massive new public funded mixed home building programmes should be begun that include the demolition of the ghastly huge sink estates of sub-standard housing. That would help boost the economy out of recession.

Hughes’ diagnosis is correct. But the reversal of the incredible and dangerous expansion of the gulf between rich and poor requires truly radical use of the power of the state with measures along the lines of those above. Anything else is just tinkering.

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59 thoughts on “The Roots of Conflict

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  • Anne O'Nimmus

    Excellent essay on the “Shopocalypse” here:
    As you read down, the sub-heads make you wonder if it’s a different article, but it’s not! And take a look at “The Society of the Spectacle” by Guy Debord. Prescient or what – first published in 1967:
    As noted above, the clawback on such as housing benefit and council tax rebate, or tax credits, as (a lucky?) one gets a pay rise, or more hours, is obscene – can amount to an effective “tax” of up to 85%. It needs to be restructured so that only people receiving the lowest level of top up benefits would be subject to that level of clawback. The fact that no govt has ever tried to effectively tackle the “benefit trap” makes me wonder if there’s some sinister reason for not doing so…
    And another thing! (Having just received notification of my gas – 19.4% up – & electric – 12.2% up) WHY are our utility companies able to charge us more (or discount us less?) according to method of payment? It’s not as if we’re buying it on HP! I’m not charged differently for how i pay for goods in a supermarket, I don’t think they’re even allowed to offer special discounts to people paying cash or card or any other way, so WHY these? It makes the pound in the pocket of the low-paid or benefit claimant worth less than that in the bank account of his better paid brethren. It’s structural financial discrimination that has crept into many areas of payment since Thatcher began selling off the silver and deregulating. It is indirect but relentless discrimination against millions of people, and needs to be examined to determine its extent, its ill effects, and challenged and stopped! (Rant over)

  • A. Prole


    Surely you realize that your program is far too left-wing for a Liberal Democrat.

    It is also far too left wing for New Labour.

    Perhaps you and Tony Benn should get together.

  • evgueni

    A cap on earnings differential is a sticking plaster. In other words, treating a symptom instead of the cause. And in any case very patronising – telling the people what is good for them. And if they do not agree, what then?
    Fundamentally, such “new new deal” would be precarious. What the hand of the political elite gives, it can take away again (what happened to the new deal?). Democratise the system instead and sensible earnings differentials will follow, as the people want it.

  • Clark

    Anne O’Nimmus, you’re right about utility bills. The ‘phone companies’ billing schemes amount to a lottery. You have to guess in advance how many ‘phone calls you’ll make at which times of day to which numbers, and choose your tariff accordingly. If you exceed your tariff’s limits you end up paying extra. Again, this disadvantages those who try to economize.
    It would be simple to change this. If your ‘phone usage exceeded the tariff you were on, you could be automatically billed according to whichever tariff proved most appropriate. No ‘phone company I know of offers such a scheme.

  • OldMark

    ‘natural monopolies like the utilities companies and the railways need to be returned fully to public ownership. PFI should be discontinued and all PFI assets nationalised without compensation.’

    It says something about the extent to which market fundamentalism has become the new ‘normal’ in the last 25 years that none of the main parties here will even consider these reasonable proposals, even as the ‘big 6’ utility companies demonstrate, with their synchronised price increases, how rigged the privatised ‘market’ is in practice.

    ‘It looks likely they will accept the banking review just accepted by Germany’s rich, making it ever easier to siphon off monies into swiss bank accounts, legally.’

    One side effect of the S&P downgrade on the US has been a sharp acceleration of ‘hot money’ into Swiss Franc denominated assets, thus raising the SFr to unsustainable levels. One mooted countermeasure to reverse this trend has been the imposition of a negative rate of interest on SFr deposits held by foreign depositors- a solution last used by the Swiss back in the mid 70s.

    Of course the supporters of ‘efficient markets’ & ‘globalisation’ would go apeshit if the Swiss actually did this- which is why the rest of us should say -‘bring it on!’.

  • Jaded.

    I could resist posting this folks and I won’t post any more of these. Some of the psycho Youtube shills are getting desperate. Look at a few of thse comments:
    Then you should ask yourself why you have such hatred toward people who have accomplished MORE than you, and been rewarded by the FREE MARKET with Money for it. Rich People, Banks, the federal reserve, and everybody you hate have all done more than you. Well, surprise surprise surprise.
    BULLSHIT. The Patriot Act simplifies and modernizes the equivalent American laws that have existed during every war with foreign savages. EMAIL provisions cover the same mail provisions that happened in WW2. YOU are on the internet, developed by DARPA, DUMBSHIT. Just like driving, you gave up
    your right to privacy when you jumped on the internet. It’s a shared resource DUMBASS, and owned by the Gubbamint. IF it was criminal, they would have knocked on your door by now.
    LIKE OSAMA BIN LADEN, your kind of criminal expects the US government to obey the rules while chasing them. The US doesn’t have to. We will oppose the various conspiracy groups just like external enemies, using the FBI just as designated since the 1930s. Don’t expect tolerance for your crimes. Al Capone
    didn’t get any, and the US won all those wars, with all those LAWs the US updated with the Patriot Act. LIBEL laws are being updated also.
    So, he asks why ‘they’ haven’t knocked on our doors yet, then says that they will! This guy needs an award for cohesive argument. LMAO.

  • Anne O'Nimmus

    Ooh, Clark, don’t get me going on sodding standing charges! The water bill has 3, count ’em, THREE before one gets to any usage, then they charge twice! Once to give it to you, then to take it away! My latest bill was two thirds charges! Why can’t they put in ONE unit charge to cover it all? Is it cos Mr X has to power wash his car, his patio, and copiously water his half acre gardens if we go two days without rain? Is that why the damn bill has to be front loaded this way? Cos it aint for the kiddy paddling pool ms y has in her postage stamp social housing garden for the tiddlers. And the power companies – most of them front load the bills, and also have the effrontery to charge MORE for the first quantity of gas units than the later – increasing that by enormous amounts over the winter! No wonder the old folks and the young families can’t keep their homes warm! Surely to goodness in this day and age it should be the other way around?! This imbalance, the inherent unfairness grinds people down, it is undoubtedly part of the disconnect from a society that so clearly does discriminate against the poorer of us. Even if it’s difficult to explain quite what it is, and that feeds from parents suffering from some degree of alienation into a greater degree among the adolescents, who, in inner cities have less access to a good education, who suffer ‘post-code discrimination’ from potential employers and therefore can see no hope for the future except more of the same that they once may have hoped to escape. What’s the point of keeping their noses clean if it gets them nowhere? Sure there are indifferent parents out there, but there are also indifferent teachers and an indifferent govenent. I blame you, you made me rant again. 😀

  • CheebaCow

    I just found out (thanks John K) that the UK minimum wage is £5.93. I’m truly shocked. That’s ridiculously low and it really surprises me. I thought with the relatively strong NHS system the min wage would also be decent. The Australian min wage is $15.51. However Australia also has similar benefits traps like Courtenay and Clark were referring to. I good friend of mine suffers from chronic health issues and is required to take huge amounts of medication. The government pays for nearly all of it (only a millionaire could afford it without assistance). However if my friend earns $1 too much in a given week, he has to pay for all his medicine for a month. It’s crazy, the system rewards inactivity and punishes those who actually want to do something.

    BTW I’m very jealous of everyone who gets to meet up at Edinburgh.

  • Suhayl Saadi

    Exactly, Old Mark and Anne O’Nimmus, they are ideologically opposed. The market is fixed – it is a cartel: De facto monopoly capitalism.

    CheebaCow, indeed, but you get the better weather!

  • ingo

    Good points A.Onimmus, Clark and mark. The planned energy price rise of 16% for gas and 11% to come in very soon will heap on the satrin, add to this Government plans for a petrol tax rise by 6% next year and you have an explosive mix.
    We will see a rise in hyperthermia death this winter, because people will have to eat. Inflation rise is being kept off the headlines, but its rising past 4%.

    They made abig thing of wage rises in the car industry this morning, 3.4%, followed by Duncan Smith with his usual aim at the working class and how he would like to cuts benefits to all unruly classes.

    Bratton for Met Chief? this must be the silly season! Surely inequality needs to be discussed in a tone that is pragmatic, not peppered with party political point scoring, nothing ever changes.

  • John K

    I think Oz has the highest minimum wage in the world.
    Comparing wage rates between countries is of course technically complicated as they are calculated on different bases – mimimum / maxium hours, part time workers, paid / unpaid overtime, tips, rates for young people, etc.
    The US federal mimimum is $7.25 an hour; Germany doesn’t have one at all.
    And mimimum wage has little correlation to a living wage, of course. Many put the living wage in London at £10 an hour, given high housing and commuting costs.

  • larry Levin

    This limiting of the earnings factor to 4 or some other figure will not work on a globalized world with free labour movement. Most excesses are in the financial services area. if you were to say to a trader you are limited to 300k/year he will move to a country were he can make £5mill/year he gains and the UK would lose. Hong Kong is an example of a truly free market, huge wealth is created and I would guess unemployment is never a problem. Free Markets will solve the problems of this unfair society.

  • dreoilin

    Speaking of hypothermia and energy costs and oil … but off topic:
    “Bomb blasts ripped through three Iraqi cities Monday morning, killing 38 people …
    “The violence struck from the northern city of Kirkuk to the southern cities of Najaf and Kut, and emphasized the persistent ability of insurgents to wreak havoc at a time when Iraqi officials are weighing whether they are able to protect the country without the assistance of American troops.”
    American troops are obviously going to have to stay. Those damned Iraqis! always messing things up for poor America.

  • larry Levin

    Energy prices rises are partially due to low interest rate on uk sterling. What has happened to energy prices in Switzerland or norway, any country were gangster capitalism has not destroyed the finances of the public purse.

  • larry Levin

    UK energy market deregulation was designed by Enron the corrupt US energy giant. When Californian governor gray davies was suing Enron to recover $9bill for the people of California, the powerful spent $10million on a recall motion and got arnold Schwarzenegger installed in gray davies’s place, and mysteriously the irritating $9 bill lawsuit disappeared. These same groups got UK energy market deregulated.


  • ingo

    I’m with you there Dreolin, could this have something to do with the sustainability,(modern speak, sic) of the arms trade/security forces as well as the US contingent?
    Or is it too hot in Norfolk, might get to 24C today.

  • anno

    Over this factor of 4, or £50,000 p.a. which should suffice any kind of lifestyle, income becomes capital, not earnings.
    What they do with this capital is a mystery to me, but the ordinary guy on the streets of London or Birmingham, can see that they can’t change the top level of society, but they can threaten the decent people who obey their extraordinarily difficult and expensive to obey laws and make themselves into something.
    It little profits that, an idle king,…
    I mete and dole unequal laws unto a savage race…

    The social divide consists, on the one side, of toffs, businessmen, political gravy-trainers, jihadi Muslims taking a holiday on benefits in the UK, Caribbean yardies i.e. spivs and drones, plus pitt-bull EDL hangers-on and voters for the Liberal Democrat and Conservative Party, with the rest of us ordinary citizens who try to obey the laws of our country/s and our religion/s and earn a living on the other.

    I for one have noticed that on this occasion the police appear to be on our side, that is, on the side of the common or garden ordinary Englishman/woman.

  • Paul

    Bit harsh on Housing Associations. They are mutuals – or could be made more transparently so. Better than most municiple housing departments, which in my experience are part of the housing problem.

  • mark_golding

    Ingo – the temperature is rising in Iraq, of course, the key phrase is, ‘there was no immediate claim of responsibility for Monday’s attacks’ – so who are these ‘insurgents’ planting bombs? History provides the answer – remember the SAS dressed as Arabs?
    agent Cameron has made a compassionate speech this morning at a youth centre, it was a well articulated dialogue, yet Cameron had to be prompted to let the young people he was addressing.. speak!
    In answer to Cameron’s ‘fight back’ strategy for problem families and parental failures, a teenager said, ‘what about our own problems?’ – Cameron sighted the social worker burdened with case loads of ‘at risk’ children being suddenly freed of this work-load to instruct parents how to bring up ‘good’ children.
    Cameron dismissed a question from the press on concerns for bringing Lord Wasserman man, Bratton into the ‘fix’ loop despite objections and vetoes from May and Johnson, as … ‘no need to worry’… what? Hmmmm check out the peerage again here and!
    I took on a young lad in our community. His name is Jason. He came from a dysfunctional family of six with many problems. The father was in jail and a young boyfriend of the mother could not cope with the kids. I had him for six years. He calls me ‘dad’ – I turned him away from crime and drug peddling and now at the age of 20 he is in employment as a roofer, has a home and a steady relationship. I have proved we can help ourselves and British society is NOT ‘sick’ not ‘broken’ as Cameron says – ‘gangs’ are groups of young people within their OWN family – the ‘gang’ IS their family.
    Trust in government cannot be much lower – we perceive politicians are out for themselves and serve a higher agenda – that of war, weapons, hegemony and the surviving status of the elite, the billionaires with the power and money to control.
    It is clear to me we need to look after ourselves – especially important if the economy collapses and the state turns to what I call capitalist dictatorship complete with TA enforcers and Taser wielding community officers – all very Orwell but not dismissable.
    The answers I believe lie within ourselves – NOT THE STATE’S DECEPTIVE NANNY SYSTEM.

  • david

    You want me to give 40% of my company to my employees ? Are you mad ? Its so easy to have a go at the owners of companies, calling them rich and implying that all business owners rip off their employees.
    What a load of tosh !
    I own a manufacturing business, I create 12 jobs, I invest my money in my business and if it goes wrong I lose everything. I really mean everything. I pay good wages, with some of the unskilled workers able to take home £30,000 per year with their over time and bonuses. I work 24 hours a day, even when Im not at work im usually thinking about it. My staff go home at 5pm they dont have to worry about anything to do with work. Ive been made ill with stress related problems, my employees havent. Ive sat up all night worrying…. my employees havent.
    Earnings are not just about the physical work you do. Reward has to take into account all factors, I built my company, with my knowledge my hard work and my skills. I put everything on the line to create this company, and you think I should just give 40% of it away ? On what basis exactly ?

    Typical response from people who have never had the balls to get off their arse and create jobs and create wealth. If anyone decides to make that law ill close the company on point of principle and go work for someone else.. risk free. Oh wait there wont be anyone else to work for because SME owners who have mostly all risked everything to create jobs wont stand for having 40% taken away from them. We pay 46% of turnover to the government already… what do you want blood ?

    The answer is not to punish those that create jobs, the answer is to punish those who dont want jobs, for the government to be more effective with the money that it raises and to use at least some of that to encourage and create more people willing to take that huge step and create their own companies out of nothing more than their money, their hard work and their talents.

  • johnstone

    I have been reading your blogs and comments since the riots and your view point does not seem to be all that consistent.

    The way I see it the people involved in the lootrioting are either just ALL thieving criminals, who have no underlying grievances, like discrimination, housing, jobs, student grant cuts, police stop and search methods and so on, OR they are not!

    The lootrioting occurred randomly in time and was unconnected to the shooting incident in Tottenham, thus not related to race discrimination and policing methods nor to the current political backdrop like, austerity measures, MPs expenses scandal, banker’s bonuses and unjust wasteful imperialistic wars etc., OR it did not!

    If you have not read this article already, then you should.

    Posted by another blogger Jonangus Mackay on 14th

  • mark_golding

    George Ciccariello-Maher makes some sense – the thrust of his argument is revealed by actually talking to the ‘rebels’ as he calls them, members of ‘the mob’ and from one we learn,
    “This is about youth not having a future… a lot of these people are unemployed, a lot of these people have their youth center closed down for years, and they’re basically seeing the normal things: the bankers getting away with what they’re getting away with… this is the youth actually saying to themselves, guess what? These people can get away with that, then how come we can’t tell people what we feel?”
    Did Cameron mention the ‘looting’ of expenses in his speech, No! or the British tax payers money used to bail out the banks, No! I heard no mention.
    Yet rioting and looting ‘gangs’ can work for astute protestors; clearly we know animal rights groups get noticed when they break into laboratories and free the animals, or ‘mobs, can be used as a smokescreen by governments to hide another more sinister agenda. A peaceful demonstration against the governments’s austerity measures went unnoticed in the main media; smashing windows, looting and lighting fires certainly bought attention as another young black youth reveals, “You wouldn’t be talking to me now if we didn’t riot, would you?… Two months ago we marched to Scotland Yard, more than 2,000 of us, all blacks, and it was peaceful and calm and you know what? Not a word in the press. Last night a bit of rioting and looting and look around you.”

  • OldMark

    ‘I just found out (thanks John K) that the UK minimum wage is £5.93. I’m truly shocked. That’s ridiculously low and it really surprises me. I thought with the relatively strong NHS system the min wage would also be decent. The Australian min wage is $15.51.’

    Cheeba- one reason the UK minimun wage appears to be so low is that those in receipt of it will also likely qualify for a partial indemnity on their rent payments via housing benefit/local housing allowance. Those in the UK drawing the dole, workless single parents, and pensioners with no private pensions also, in most cases, get their housing costs met in full- although the blank cheque that has existed hitherto in high rent areas like inner London is shortly about to change.

    Are there similarly generous reimbursement arrangements for housing costs in Oz ? If so, then your minimum wage must surely, in real terms, be about the highest in the world !

  • evgueni

    just because it seems fair to you that you should not have to share ownership of your company with your employees no matter how much they help you grow the business, it doesn’t mean it is true. The human mind is equipped with hypocrisy for evolutionary reasons and we ought to allow for that in our reasoning. I have a strong suspicion that were I in a position of a company owner, I would also find justifications for my disproportionate claims on other people’s labour. The key to this is that you are not asking your employees what they think is fair. Benevolently in your view, you create their jobs for them, on your terms or else!
    But I agree with you in opposing the 40% ownership giveaway, on the grounds that it is arbitrary, a yet another example of a solution from above without reference to what the employees actually want. Unintended consequences would surely follow, perhaps exactly as you describe..

  • John K

    A communist colleague of mine once described “profit” as the difference between what your staff earn and what you pay them.
    Unfair of course, for all the reasons David enunciates, but this thinking does have some logic to it – the concept of “surplus” is a very old one.
    Of course, in a socialist utopia business owners, if they existed, would leave the company to their employees, not their families who often had little to do with the creation of the business. But again, you can see the logic of the inheritance laws. We don’t want to become like France with hundreds of thousands of tiny land holdings.
    Ah well, nothing is as simple as the idealsts would have us believe.

  • Clark

    OldMark, Housing Benefit is generous to landlords rather than claimants, especially considering the ridiculous heights to which rents have risen. For claimants, the roll-off of HB at 66% for all earnings above “the (paltry) amount the law says you need to live on” creates a severe disincentive to work. Working incurs costs, such as transport, clothing, lunch, etc., and taking work can mean being no better of or even losing out.

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