Category Archives: Economic policy

Brexit opponents raise alarm over bleak impact analysis reports

Previously leaked document finds poor economic growth in all models for future UK-EU relationship

Anti-Brexit campaigners have seized on a bleak Whitehall assessment of the economic impact of leaving the European Union, published following a battle over government secrecy.

MPs voted in January for the document to be released in full, but its publication was resisted by the Brexit secretary, David Davis.

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Source: gad

Government to review law before self-driving cars arrive on UK roads

Three-year review will consider responsibility in self-driving vehicles and their role in public transport

The government is to review the law before the arrival of self-driving cars on UK roads, considering issues such as whether this type of transport requires new criminal offences.

The development of autonomous vehicles is at the heart of the government’s industrial strategy and the three-year law review is considered necessary if it is to stick to the timetable announced in November last year when the chancellor, Philip Hammond, promised driverless cars on the road by 2021.

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Source: gadt

Liam Fox’s shiny new trade deals won’t compensate for hard Brexit | Sam Lowe

If Britain leaves the single market and customs union, the idea that future trade agreements will make up for the losses is for the birds

Liam Fox, the secretary of state for international trade, is right about one thing: a UK-EU customs union would leave the UK “in a worse position that it is now”.

Economically speaking, compared to being a full EU member, a EU-UK customs union would leave us worse off. However, there is little evidence to back his assertion that it would leave us worse off than if we were to follow his plan, and free ourselves to trade with the world.

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Source: gad

Is the British establishment finally finished?

Aeron Davis has spent 20 years researching Britain’s elite, interviewing more than 350 leaders in business and politics. His conclusion? Their failings are not only damaging society, but undermining the foundations of the establishment itself

In his 2014 book The Establishment, Owen Jones explained how and why Britain’s unequal, class-ridden system would always prevail. It was written at a time when the elite seemed to be thriving, despite having recently helped to trash the global economy. After a few lean years for “Davos man”, bank debt had effectively been nationalised. No one in power had gone to jail, while most of them seemed to be getting richer and richer. As Jones explained, the establishment was as dominant as ever.

Developments since then have sorely tested that view. After the vote for Brexit, David Cameron and George Osborne were suddenly cast adrift, while the Bank of England and captains of industry found themselves wondering who to support. The Conservative party – their political party, the only one they had ever supported – was following a course of action they thought would wreck the economy. Sterling and the FTSE 100 index plummeted. Shareholders began revolting and bankers relocating.

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Source: gad

The Guardian view on Capita’s woes: another warning of a system in crisis | Editorial

The current outsourcing pattern is commercially unsustainable. It is time for a wider rebalancing of public and private provision of essential services

When the chief executive of a business declares its operations to be “far too complex”, investors are naturally alarmed and customers concerned. In the case of Capita, the ultimate customer is the taxpayer, since the group specialises in services outsourced from Whitehall, devolved administrations, local government, the NHS and other public sector bodies. Wednesday’s profit warning by Jonathan Lewis, Capita’s CEO, is all the more alarming since it comes so soon after the collapse of Carillion, whose over-complex business also relied heavily on public sector contracts. But Capita is not, yet, the new Carillion. Its share price has tanked, but it is still able to raise money. Mr Lewis is airing dirty financial laundry now because, being new to the job, he can signal change and blame troubles on the old management.

So business as usual? Not quite. Given the scale of public sector vulnerability, the Carillion case takes business as usual off the menu. This is a political matter more than a commercial one. Businesses operate under the conditions that are set for them by governments and, where outsourcing is concerned, the market only exists by virtue of public procurement. That brings special responsibilities and unique consequences for failure. Most voters do not dwell on ownership structures behind public services – until they go wrong. There is higher awareness of the private sector’s role in the NHS, providing buildings as well as clerical and clinical tasks. That is because the health service is a symbol of universal care bought with general taxation. Fear of its cannibalisation for profit animates great political passions.

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Source: gad

Automation to take 1 in 3 jobs in UK's northern centres, report finds

Workers in Wakefield and Mansfield worst affected as tech advances risk widening north-south divide

Workers in Mansfield, Sunderland and Wakefield are at the highest risk of having their jobs taken by machines, according to a report warning that automation stands to further widen the north-south divide.

Outside of the south of England, one in four jobs are at risk of being replaced by advances in technology – much higher than the 18% average for wealthier locations closer to London. Struggling towns and cities in the north and the Midlands are most exposed. A total of 3.6m UK jobs could be replaced by machines.

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Source: gadt

Democracies will fail if they don’t deal with the fallout of globalisation | Editorial

Democracies will fall under the spell of populists like Donald Trump if they fail to deal with the fallout of globalisation

The rich, as F Scott Fitzgerald noted, “are different from you and me”. Their wealth, he wrote, makes them “cynical where we are trustful” and their affluence makes them think they are “better than we are”. These words ring truest among the billionaires and corporate executives flocking to the Swiss ski resort of Davos this week. The highs recorded by stockmarkets, the tremendous monopoly power of tech titans and spikes in commodity prices reassure the rich cosmocratic class that they have weathered the storm of the financial crisis. The moguls can talk safely about inequality and poverty. But they will do little about it because they do not think their best interests are aligned with citizens. This is a mistake of historic proportions.

Since 2015, Oxfam calculates, the richest 1% have owned more wealth than the rest of the planet. The very wealthy think they no longer share a common fate with the poor. Whatever the warm words at Davos, no company bosses will put their hands up to the fact they play one country against another in order to avoid taxes; no firm will be honest about their attempts to stymie trade unions or about how they lobby against government regulation on labour, environment or privacy that tilts the balance of power away from them and towards the public. The largest western corporations and banks now roam the globe freely. As memories of the financial crisis recede, they are going back to the myth that they are no longer dependent on national publics or governments. Lobbyists for the corporate world claim that markets are on autopilot, that government is a nuisance best avoided.

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Source: gad

Carillion lenders consider appeal to save firm from collapse

Despite late rescue bid, administrators prepare to take action, prompting fears for 43,000 jobs, major projects and crucial public services

Construction firm Carillion is hoping for an eleventh-hour rescue to save it from the brink of collapse, amid fears for the future of a host of major government projects and day-to-day services, from schools to hospitals, prisons and the army.

The Cabinet Office hosted emergency talks on Sunday aimed at mapping out a future for a company that employs 43,000 people – including nearly 20,000 in the UK – but the meeting broke up without a rescue deal being announced.

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Source: gad

Catch the East Coast line – a fast track to Tory incompetence and scandal | Aditya Chakrabortty

Though we’ve seen the awful cost of government ideology, this bailout may be its biggest outrage yet

In 1787, a splendid metaphor was born. Catherine the Great of Russia set out on a cruise along the River Dnieper to survey a new colony. To wow the empress, her lover, Prince Gregory Potemkin, organised fake villages along the bank and tricked out his men as honest serfs. As Catherine’s boat floated by, the serfs stood and cheered – then stripped off, dismantled their settlements and ran downstream to do it all over again. And so the world was gifted the Potemkin village – a byword for ruling-class deceit and disinformation. While the Kremlin has cornered the market in Potemkinism, dictators everywhere like to indulge.

Related: Rail privatisation: legalised larceny | Aditya Chakrabortty

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Source: gad