[Marxism] U.K. Economy Needs Stronger Unions and Higher Taxes on Rich, Report Says

Louis Proyect lnp3 at panix.com
Wed Sep 5 08:23:36 MDT 2018


NY Times, Sept. 5, 2018
U.K. Economy Needs Stronger Unions and Higher Taxes on Rich, Report Says
By Stephen Castle

Britain needs sweeping changes to redress its economic failings, rising 
inequality and the corrosive legacy of the financial crisis, according 
to a report from a committee that included the Most Rev. Archbishop of 
Canterbury, Justin Welby.

The group outlined a 10-year plan for the sort of transformation 
experienced twice in Britain in the last century: once after the Second 
World War, when the state expanded its influence, and then in the 1980s, 
when Margaret Thatcher unleashed the free market to jolt the economy.

Commissioned by the Institute for Public Policy Research, a British 
public policy institute, the report, “Prosperity & Justice: A Plan for 
the New Economy,” landed just as Britain is grappling with its looming 
exit from the European Union, or Brexit, a move that has already slowed 
investment and dampened economic growth.

Instead of focusing on Brexit itself, the document tried to tackle some 
of the factors that prompted the 2016 referendum and the resulting 
decision to quit the European Union. That vote, the report said, “was a 
stark repudiation of the status quo and crystallized profound feelings 
of economic injustice.”

Several of the report’s conclusions are eye-catching, including calls 
for stronger trade unions and worker representation on company boards, 
for higher taxes on the wealthy and on large inheritances, and for 
greater regulation of giant social media companies.

“For decades the U.K. economy has not worked as it should, with millions 
of people and many parts of the country receiving less than their fair 
share,” said Archbishop Welby in a statement.

“The widening gulf between rich and poor, and fears about the future 
among young people and their parents, have damaged our nation’s sense of 
itself,” he said, adding that “achieving prosperity and justice together 
is not only a moral imperative — it is an economic one.”

The committee included academics, business executives and a trade union 
leader as well as Archbishop Welby. He has spoken publicly on policy 
issues before, but his comments may rankle those who feel the church 
should stay away from the political arena.

Over all, the report painted a bleak picture of the country’s economic 
performance, arguing that “it is impossible to escape a palpable feeling 
that the economy is not working for most people.”

The report found that “earnings that have been stagnant for a decade are 
combined with greater insecurity at work.”

It added: “Young people have been hit particularly hard — many unable to 
afford a home of their own and on course to be poorer than their 
parents. Whole communities feel left behind. Many people feel powerless 
and fatalistic.”

Many of the proposals are likely to be welcomed by the opposition Labour 
Party, led by Jeremy Corbyn, which is calling for an increase in 
government spending, greater investment in industry and the 
nationalization of the railways and some other utilities.

But Conservative Party politicians have also worried for years about low 
British productivity. When Prime Minister Theresa May came into power in 
2016, she said she wanted to help families who were “just about 
managing,” and to increase the representation of workers on company boards.

Much of that agenda faded, however, after Mrs. May lost her 
parliamentary majority in last year’s general election, and as she 
fights a bitter internal battle over her plans for Brexit.

The report also called for a rebalancing of economic power from 
corporations to trade unions, greater devolution of political power away 
from London, moves to create more affordable housing and to combat house 
price inflation, higher taxes on the very wealthy and efforts to 
incentivize long-term investment over short-term profit.

It urged greater use of robotics and automation alongside retraining for 
those whose jobs are lost.

Among more than 70 recommendations are an increase in the minimum wage, 
higher pay for those on employment contracts that do not guarantee work 
and the inclusion of workers on boards of companies with 250 or more 
employees.

Tax on corporations should be raised, and work and wealth should be 
taxed on an equal basis, the document suggested. It also proposed that 
the inheritance tax should be replaced with a lifetime gift tax, levied 
on recipients rather than estates.



More information about the Marxism mailing list