business | ukwatch.net

Madness of the market

tim — Sat, 13 Sep 2008 15:51:18 +0000

Once again, capitalism has shown its cuddly, people-friendly face with the collapse of holiday giant XL Leisure Group.

Around 85,000 people stranded abroad, several hundred thousand advance bookings dishonoured, staff finding out that they didn’t have a job in mid-flight, over 1,700 jobs potentially vanishing and the Unite union not even being informed by the company that it was in trouble with its refinancing arrangements after a major bank pulled out on August 14.

And yet, in the full knowledge that it was, indeed, in trouble and desperately trying to arrange a bail-out, the companies in the group continued to take people’s cash and make bookings that there was precious little chance that they could honour.

Not that this implies any dishonesty or deliberately dodgy dealing by the companies. Far from it – at least in the terms of the market economy.

The logic of capitalism meant that they had to continue trying to trade their way out of trouble and that same market-oriented logic said that they could not allow any hint of trouble to become public knowledge because people would obviously then cease to book with the companies, thereby sealing their fate.

Indeed, as late as August 31, a company spokesman was saying that “the XL Leisure Group is experiencing strong trading, with bookings for 2009 already outperforming last year.”

But, as for the long-suffering passengers, they inevitably get the sticky end of the deal and, the less well off that they are, the stickier it becomes.

Granted, customers well off enough to book full package deals through travel agencies are covered by the CAA air travel organisers’ licensing scheme and will be offered repatriation flights or their money back if they have an advance booking.

And, if they booked by credit card, their card insurance should cover them.

But people not having credit cards to book with, or booking a flight only, because they could not afford the full package, will face an extra fee to get home.

And it’s not only the passengers. The staff have an even worse situation to deal with.

No jobs and an industry that is contracting by the day, with airlines such as Alitalia and Zoom either collapsing or in terminal decline and a resulting glut of unemployed staff on the jobs market.

So, who is to blame for this situation?

In 2004, the Times reported that a major British bank “is poised to become the largest oil trader in the City of London as banks rush to profit from the soaring oil price and booming oil speculation market.”

In 2008, that same bank pulled the rug out from under XL because of financing associated with fuel. In other words, a major oil speculator shuts XL because the company can’t pay the price for fuel that the speculators have driven up.

And the bank’s partner in financing XL – a major Icelandic bank – acquired the still-profitable French and German XL subsidiaries on Friday morning after the rug-pulling exercise, in what can only be described as a perfect example of asset-stripping, although it would probably claim that it was saving what could be rescued from the stricken company.

But the fact remains that, if the company was stricken, it was the banks that did the striking.

Talk about having your cake and eating it.

It is difficult to imagine a better example of the amoral chaos of market capitalism or, for that matter, a better reason for social ownership of banks and big businesses generally.

Unusual suspects

Alex Doherty — Thu, 11 Sep 2008 17:48:21 +0000

White collar crime, which includes fraud and crimes committed by corporations, businesses and professional groups, is generally excluded from the zero tolerance approaches and calls for tough punishment attracted by what is popularly represented as ‘crime’. Yet the high toll of death, disease, injury, economic loss and damage to the environment which these crimes cause has consistently been argued to exceed that of other crimes. This article will firstly explore the significance, in the Scottish context, of these offences, before turning to consider how more innovative approaches could be adopted in an effort to control them.

The economic impact of these crimes is considerable. Fraud has recently been said to be increasing and to cost every person in Scotland £330 each year (Scottish Government Press Release 12/5/08), and that, says Her Majesty’s Inspectorate of Constabulary for Scotland in its 2008 report, excludes the cost of tax evasion. This, along with many other forms of fraud, is extremely difficult to estimate, and the report accepts that the real extent of fraud is impossible to assess. What is certain is that Governments have far fewer resources at their disposal as a result of the many and varied tax evasion schemes of wealthy individuals and corporations for whom avoiding taxes is good business practice. The Scottish economy, like any other, is also vulnerable to global trends and spectacular company frauds, like that of Enron, have a rippling effect and reduce the legitimacy of business and finance. It is also notable that United States agencies are investigating the criminal aspects of the current ‘credit crunch’ (Herald 25/06/08). Other major losers from fraud include the National Health Service, which loses at least 1 per cent of its annual budget to fraud – a situation prompting the Scottish Government to proclaim a policy of zero tolerance. While fraud in this area is often associated with ‘scroungers’ and patients falsely claiming free prescriptions, professional groups are also involved. Examples reported include dentists claiming to have used precious instead of non-precious metals in fillings and falsifying claims for NHS work; opticians claiming for more expensive lenses than have either been needed or supplied; pharmacists claiming for expensive brand name drugs when cheaper alternatives have actually been dispensed, and GPs, who have prescribed these drugs and been found to have had ‘inappropriate’ relationships with representatives of pharmaceutical companies (Sunday Herald 26/01/08).

Corporate activities have also been associated with deaths, injuries and diseases, documented in a recent book by criminologists Steve Tombs and Dave Whyte (Tombs and Whyte 2007, Safety Crime, Willan Publishing). Deaths alone easily exceed those attributed to homicide. Scottish examples are all too well known. They include the deaths of 21 old age pensioners in Wishaw in 1997 following the failure, on the part of the butcher, John Barr to follow routine food preparation procedures; the death, in 1999, of the Findlay family in Wishaw in a gas explosion caused by the failure of TRANSCO to maintain supply pipes, and the death of six workers in the Stockline explosion in May 2004, again caused by a failure to check gas safety. 2008 saw the twentieth anniversary of the 167 deaths aboard the rig Piper Alpha, amidst reports that despite many subsequent changes, there is still much to be done to make oil rigs safe, a grim reminder of which was the death of two workers at the North Sea Brent Bravo platform in September 2003. To this high toll must be added the individual deaths which far less often receive headline publicity, and countless injuries, stress and occupationally caused diseases in the workplace. Consumers can also be injured and made ill as a result of contaminated food, dangerous toys, about which warnings abound at Christmas, inadequately regulated chemicals in household cleaners, toiletries and cosmetics, and the as yet unknown long term consequences of additives in food.

Environmental crime is also a major problem, and its impact includes the death of wildlife from illegal emissions of chemicals and farm slurry, the contamination of drinking water, sea water and beaches and its effects on the volume of damaging emissions. Scottish Water has been described as Scotland’s ‘most frequently prosecuted environmental criminal’ having amassed 16 prosecutions in just over three years. And these, argue Friends of the Earth, are merely the ‘tip of the iceberg’ (Sunday Herald 9/02/08). In addition the Scottish Government itself faces legal proceedings from the EU in respect of this and other matters including conservation, the quality of beaches and failures to meet pollution targets (Observer 4/05/08).

In addition, a whole host of questionable corporate activities affect us daily including bargain offers which aren’t bargains, meat and food which contain higher than permitted amounts of water and additives, and misleading advertisements. These very often lie on a fine line between honesty and dishonesty, legality and illegality. Phrases such as ‘healthy’, ‘traditional’, ‘low fat’ or ‘organic’ are often abused and pictorial images of foods often give a false impression of the size of portions or the origins of the food. Power companies have been notorious for ‘aggressive marketing’ on the part of sales representatives on the doorstep, persuading consumers to change their supplier on the promise, later unfulfilled, of large savings. The unsolicited phone calls which many companies now make, again promising savings, can be seen as intrusive and as examples of what could well be called anti-social business behaviour.

Many of these activities, including the most serious, are not, of course, widely or popularly represented as ‘crime’. Incidents which cause single or mass deaths are routinely presented as ‘accidents’, a description which, by implying inevitability and the operation of chance, all too often conceal a long history and indeed a culture of neglecting regulations. Phrases such as ‘misselling’ or ‘wrongdoing’ are often used to describe what are, in effect, fraudulent or corrupt practices. Victims may not be in a position to detect offences and, even when harm is done, very often do not report them as crime. A large number of offences, therefore, are not fully investigated, not prosecuted and, as will be seen below, leniently sentenced. Many are not the province of the police but a host of enforcement agencies such as the Health and Safety Executive, Environmental or Trading Standards Officers, who suffer from declining resources and very often prefer to issue warnings or advice rather than recommend prosecution. The Piper Alpha case was never prosecuted despite evidence of breaches of regulations.

Fines are the most widely used sentence but are often seen as far too small. Most recently, two companies responsible for the death of a baker in Maryhill who was hit by a faulty tail-lift were fined £33, 500 (BBC News Scotland 5/11/07), and a consultation paper for a proposed Bill on equity fines cites the average fine for offences related to injuries or deaths of employees between 2001 and 2005 in Scotland as £17,482 ( www.scottish.parliament.uk/s3/bills/MembersBills/pdfs/CriminalSentencing… ). This follows considerable criticism of, for example, the total fine of £200,000 fine given to Stockline in 2007, widely reported as amounting to a mere £44,000 per life (Scotsman 29/08/07). Even the £15 million fine given to TRANSCO, while hailed as a ‘record’ UK fine, could be criticised as amounting to a mere four per cent of the company’s profit. In these cases, victims and their relatives often complain about a lack of justice.

In part this reflects the use of regulatory legislation such as the Health and Safety at Work Act, widely associated with lower fines. For cases resulting in death, an alternative avenue is to prosecute for corporate homicide or corporate killing, which, however, is notoriously difficult to do, due to the legal requirement that a company can only be prosecuted if an individual director can also be identified as culpable – a test which is increasingly irrelevant given the size and complexity of corporate decisions. Many jurisdictions, including Scotland, have recently reviewed this legislation, and an expert group made several recommendations ( www.scotland.gov.uk/Publications/2005/11/14133559/35592 ). In the event however, the then Scottish Executive decided, controversially, that this was a reserved matter and the new Corporate Manslaughter and Homicide Act 2007 covers the whole of the UK. This Act, while containing some improvements, did not go so far as the expert group had recommended in moving away from the doctrine of identification, does not include provisions for the prosecution of individual managers and did not at the time consider sanctions. These, amongst other issues, have been the subject of calls, by the STUC and other groups, for new legislation for Scotland, and indeed, Cathy Jamieson, Minister of Justice at the time of the rejection of Scottish legislation is now said to support it (Herald 21/08/08). At the same time, members of the current government, who supported legislation while in opposition, appear reluctant to re-open the issue.

The issue of sentences continues to be debated. Monetary penalties are generally regarded as too small and other jurisdictions have introduced a wider range of innovative measures. These include, for example, requirements to name and shame companies, provisions for corporate probation and corporate community service, under which the resources and knowledge of corporations can be used to the advantage of victims and the community, thus providing elements of restorative justice. These, also recommended by the Expert Group, have attracted widespread support and it is not yet clear if the (albeit limited) range of penalties envisaged for England and Wales will be introduced in Scotland. These include proposals to increase monetary penalties by relating fines to a company’s turnover, and the recent consultation paper, referred to above, proposes the introduction, in Scotland, of equity fines, related to the overall value of the company. In addition, this paper, which ensures that the issue of sentences remains on the political agenda, also proposes to introduce company background inquiry reports, necessary for courts to establish accurate information about the company’s finances and their history of compliance. These proposals are limited, however, to monetary penalties and relate only to serious offences. For other offences, The Regulatory Enforcement and Sanctions Act of 2008, which encompasses a very wide range of regulatory areas, does include the possibility of equivalents to probation or community service orders, but so far these are only seen as civil, not criminal, sanctions.

This reflects the trend, across many areas, to secure ‘better regulation’ by reducing the amount of ‘burdensome’ regulations. Indeed the proposals in the Regulatory Enforcement and Sanctions Act are based on the assumption that the criminal law is over, rather than under-used against businesses. Despite this however, it can be argued that there is considerable scope for the Scottish Government to consider new and innovative proposals for both legislation and sentencing which might go some way towards meeting victims’ complaints and recognising the significance and harm associated with white collar and corporate crime.

Hazel Croall is Professor of Criminology at Glasgow Caledonian University and served as a member of the Scottish Executive Expert Group on Corporate Homicide.

SATs fiasco- Labour’s failure

tim — Mon, 25 Aug 2008 11:50:33 +0000

On August 15, the British Labour government’s regulatory body, the Qualifications and Curriculum Authority (QCA), terminated the contract of the company responsible for marking Standard Assessment Tasks (SATs) school test papers (which are mandatory for all school children in England aged 11 and 14 years.)

The QCA had only signed the £156 million, five-year contract with ETS Europe (a branch of the US-based Educational Testing Service Global BV) in February 2007. However, a series of major problems with the administration and marking of the tests this year caused almost a month’s delay in publishing the majority of results for key stage two (11-year-olds) and three (14-year-olds). Key stage three results were not released until August 12, although some were still incomplete.

Not only was the deadline missed, but the accuracy of marking was severely compromised, with many schools reporting that inexplicable results in some cases suggested that the markers either did not understand the questions themselves or that there was not adequate time to check.

When ETS was awarded the contract to administer the SATs, it had boasted of a new method to ensure marking accuracy. Markers would have to sit online tests every time they had assessed 80 exam papers, supposedly to ensure they were marking to the given criteria. In practice, however, the markers were given no feedback other than a pass or fail and could not adjust their marking accordingly.

Not only was the marker training inferior to previous years, but markers did not receive papers in sufficient time, as they were sent from schools to a central depot and then on. This meant the papers had to be marked under tremendous pressure during school term time, further undermining accuracy. Papers/scripts that were near the borderline of grades were not double-checked, as was the case in previous years. On top of this, some markers received no papers at all, while others received papers for the wrong subject. Unlike in previous years, pupil registers had to be checked online and marks for every single question submitted online—an extremely time-consuming if not futile exercise, exacerbated by crashed websites and helplines that went unanswered.

Following the virtual collapse of the test paper marking system, the QCA and ETS Europe agreed to dissolve the contract with immediate effect. Under the agreement, ETS Europe is expected to pay back £24.1 million of the nearly £40 million it received to run this year’s testing process and is to be stripped of the five-year deal. Government agencies will now oversee the delivery of the last 30,000 results and the appeal process. ETS has been banned from contacting schools directly.

ETS Europe had hoped to prove itself in the English school system so as to expand elsewhere in Europe. It won the SATs contract despite a catalogue of past failures to deliver on its commitments. In 2002, software errors by ETS led to serious failures, including giving the wrong marks, in the graduate management admission test (GMAT) in the US. According to the New York Times, in 2004, mismanagement by ETS led to more than 40,000 teachers taking a flawed exam and ETS paying out millions of dollars in compensation.

From the very start of its contract in England, there had been problems with the delivery and collection of test papers from schools, the electronic registration and moderating system crashed, and markers and schools could not log on. The helpline was constantly engaged. Thousands of teachers dropped out of the marking scheme, and many other markers resigned. A backlog grew, forcing ETS to set up 24-hour emergency marking centres. According to the Guardian newspaper, at one point, the National Assessment Agency went in and found 10,000 unopened emails from increasingly desperate schools.

Now, the exams regulator, Ofqual, has asked Lord Sutherland to head an inquiry into the delays. Ofqual head Kathleen Tattersall said that if there is a significant rise in schools appealing over results, then all 1 million SATs results should be annulled. The general secretary of the National Association of Head Teachers, Mick Brookes, said that such appeals “are set to rocket.” He has urged the schools inspection body Ofsted to disregard SATs results when making a judgement on a school. Results that Ofsted deems poor could contribute to a school being placed in the failing category of “special measures,” in some cases resulting in heads and teachers losing their jobs.

State education given over to the market

While no parent, teacher or child in England will shed a tear on the departure of such a clearly incompetent company from schools across the country, the more fundamental issue exposed by this latest crisis is not the marking but the actual tests themselves. But rather than replace the testing system, as most teachers, educationalists and parents have been arguing—well before the latest marking fiasco—the government intends to replace one company with another in order to continue with the whole flawed testing enterprise.

Teacher unions have already cast doubt on whether a new contract could be awarded in time to deliver next year’s SATs and called on ministers to overhaul the system. Schools secretary Ed Balls said he was “open to reform long-term.” He floated “lower-intensity” testing but flatly ruled out suspending SATs for 2009.

The government has hinted that the data-handling firm Capita may be contracted to run next year’s SATs. Ken Boston, chief executive of the QCA, said it would launch an urgent tendering process and that he expected organisations that previously expressed an interest to bid again. ETS was one of five companies short-listed two years ago. According to the Guardian, two of the three other major exam boards have already ruled themselves out of the contract, on the basis that they did not believe there was a strong enough educational rationale for the SATs tests. Greg Watson, head of the OCR exam board, said it did not bid because the tests were used to measure schools against one another, rather than qualifying a child at a certain level and diagnosing skills. A second exam board, AQA, also said it had not bid because of concerns about the purpose of the tests.

One unnamed senior examiner said that the process was so educationally “vacuous” that it would actually be more suited to a company such as Capita, which is used to dealing with large-scale public sector data projects rather than educational examinations. So indefensible have the SATs now become that a former aide of Tony Blair admitted recently that they risked turning schools into “drab, joyless assessment factories” where preparation for tests crowds out real learning.

The disparity between the overblown election promises the Labour government made on education policy and the subsequent mess that it has made in the school system has been widely acknowledged. But the government and the media are seeking to conceal how and why this has happened.

The cash-starved and moribund education system that emerged after 18 years of Conservative-rule was the one of the most glaring examples of the socially regressive policies of the Thatcher and Major administrations.

In the absence of a mass socialist alternative to address this, the right-wing “new” Labour Party under Blair successfully capitalised on popular support for a radical break with the pro-market policies of the past and for a reduction in the levels of social inequality that rocketed following the speculative boom of the 1980s.

On taking office in 1997, Blair and then-chancellor Gordon Brown kept rigorously to Tory spending limits while introducing cosmetic changes in education—such as more classroom assistants and the introduction of learning mentors. Most significantly, however, the Labour government sought to introduce the most pro-business agenda in education for a generation. Virtually every area of education was opened up to corporate profit making; from the building of school infrastructure, the development of business-friendly “specialist schools,” the increase of “faith schools” and to the setting up of private “academies.”

State schools have become testing grounds for ever-more uninspired ways to narrow the already prescriptive national curriculum and force children through a selective testing system. The effects of teaching to the tests—as in the present SATs—on especially young children is to squeeze out the joy of learning that should be inherent in an imaginative, widely scoped, generously resourced syllabus. This contributes significantly to the growing levels of disaffection amongst pupils that has been confirmed by international reports on the levels of unhappiness amongst children in the UK.

Furthermore, teachers have been demoralised as they are turned into part-time administrators of prescribed curriculum, while being scapegoated and even publicly hounded by the government for its own policy failures. Many well-meaning teachers have found themselves grubbing for each test paper point instead of being free to open young minds to the exploration and discovery of the world around them. Crowning it all, each school faces the constant threat of government inspection whereby they are monitored, praised or punished on the basis of fulfilling increasingly arbitrary targets. Schools are encouraged to compete against one another—via league tables—in a desperate bid for decreasing resources. At the end of this process, parents are thrown into a scramble to get a place at the “best” school for their children.

The end result of the corporate-inspired curriculum and the assessment system—the implementation of which has been the mainstay of the Labour government’s education policy since taking office in 1997—is the straitjacketing of the intellectual and imaginative capacities of children in order to provide for the demands of big-business and industry.

The government’s education policies have long since alienated millions of parents, but such is the damage it has caused, the very corporate interests that it sought to serve have signalled their dismay at the results of the school system. After complaining about the low literacy and numeracy levels of school levers, the Confederation of British Industry (CBI) announced recently that it was withdrawing its support for the government’s new diplomas, which were intended to replace the current A-Levels (taken at 18 years of age). Whatever new schemes Labour devises in response to such criticisms, its continued drive to redistribute wealth away from working people to big business and the super-rich, further fuelling social inequality, means it is incapable of arriving at a “better,” or more just education policy.

FOI: Scotland to explore extending its reach

tim — Fri, 04 Jul 2008 17:28:04 +0000

The Scottish Government has raised the prospect of extending the Freedom of Information (Scotland) Act to cover more organisations carrying out certain public functions.

Parliamentary Business Minister Bruce Crawford said the Government is committed to fully exploring the issues around coverage but stressed that a final decision on extending coverage would be taken only after consultation with interested parties and those organisations potentially affected.

As a first step, Mr Crawford will have discussions with interested parties about bringing within the scope of the Act the following organisations:

> Registered social landlords
> Contractors who provide public services that are a function of a public authority (for example, contractors providing prison services)
> Local authority trusts or bodies set up by local authorities (for example, bodies set up by local authorities as limited companies to run leisure facilities)

At the start of a week when the Minister will be in London and Cardiff to discuss FOI policy in the UK Government and the Welsh Assembly, Mr Crawford said:

“The Scottish Government is committed to the principles that underpin Freedom of Information legislation. Principles of openness and transparency, essential parts of open democratic government and responsive public services.

“We’ve taken steps within the Government to publish more of our material proactively. For example, we recently revised our Publication Scheme which describes the vast range of Government information we routinely publish. The First Minister also recently announced a pilot scheme within an area of the Scottish Government, which will see an increase in the amount of information made public.

“And we are committed to continually assessing whether the scope of the Act can be improved. I believe it has served the people of Scotland well but it is still a relatively new piece of legislation and many people and organisations are still getting used to both its real and potential impact.

“The organisations we are looking at in terms of coverage have not been chosen at random. They are bodies about whom concerns over a lack of coverage have consistently been raised with us. The concerns may have arisen because of changes in the way public services are delivered – for example the contracting out of services traditionally provided directly by a public authority.

“Discussions will take place before any decision is taken to formally consult. But formal consultation is not a rubber-stamping exercise. Any extension of coverage needs to be measured and appropriate.

“For example, we will look closely at the issue of the proportional impact on smaller organisations particularly in the voluntary sector.

“I am aware there are differing arguments and there is a need to balance those. But I believe it is only right to give serious thought to extending FOI coverage in Scotland.

“Later this week I will discuss FOI with the relevant UK and Welsh Ministers and share our experiences. I am keen to ensure that Scotland continues to build a reputation for greater transparency and accountability”.

The Freedom of Information (Scotland) Act 2002 (the Act) provides significant and important rights allowing access to recorded information.

The Act came into force on January 1, 2005 and provides a statutory right of access to information held by Scottish public authorities. These include, for example, the Scottish Government, the Scottish Parliament, local authorities, schools, colleges, NHS Scotland and the police. The Act also requires the proactive publication of certain information. Compliance with the Act is promoted and enforced by the Scottish Information Commissioner.

Somalia - Hidden Catastrophe, Hidden Agenda

Ellie Keen — Wed, 14 May 2008 19:21:40 +0000

On May 1, the BBC website reported an attack on Somalia with the words:

“Air raid kills Somali militants.”

One might think the BBC’s headline would identify the agency responsible for the bombing, but the first few sentences also shed no light:

“The leader of the military wing of an Islamist insurgent organisation in Somalia has been killed in an overnight air strike.

“Aden Hashi Ayro, al-Shabab’s military commander, died when his home in the central town of Dusamareb was bombed.

“Ten other people, including a senior militant, are also reported dead.” (http://news.bbc.co.uk/1/hi/world/africa/7376760.stm)

Only in the fourth sentence, was responsibility ascribed:

“A US military spokesman told the BBC that it had attacked what he called a known al-Qaeda target in Somalia.”

English teachers often illustrate use of the passive form with the sentence: ‘A man has been arrested.’ The passive is preferable, students are told, because the active form, ‘The police have arrested a man,’ contains a redundancy – the agent is already indicated by the action. There’s no need to actually mention ‘the police’.

Likewise, the BBC takes for granted that the US is the world’s policeman; no need to mention it by name. The action of bombing an impoverished Third World country already indicates the agent. This also helps explain why no mention was made of the illegality of this act of aggression.

On the rare occasions when the media mention the conflict in Somalia at all, the focus tends to fall on US attempts to hunt down al Qaeda, or on the West’s alleged humanitarian motives. Other priorities were indicated in 1992 when the US political weekly The Nation referred to Somalia as "one of the most strategically sensitive spots in the world today: astride the Horn of Africa, where oil, Islamic fundamentalism and Israeli, Iranian and Arab ambitions and arms are apt to crash and collide." (December 21, 1992)

In December 2006, the US backed the invasion of Somalia by its close Ethiopian ally to overthrow the Islamist government, the Islamic Courts Union (ICU). Christian Ethiopia is a historic enemy of Somalia, which is made up entirely of Sunni Muslims.

On December 4 of that year, General John Abizaid, the commander of US forces from the Middle East through Afghanistan, travelled to Addis Ababa to meet the Ethiopian prime minister, Meles Zenawi. Three weeks later, Ethiopian forces crossed into Somalia and Washington launched a series of supportive air strikes. The Guardian quoted a former intelligence officer familiar with the region:

"The meeting was just the final handshake.” (Xan Rice and Suzanne Goldenberg, ‘The American connection: How US forged an alliance with Ethiopia over invasion,’ The Guardian, January 13, 2007)

Political analyst James Petras commented:

“Somalia… was invaded by mercenaries by Ethiopia, trained, financed, armed and directed by US military advisers.” (Petras, ‘The Imperial System: Hierarchy, Networks and Clients – The Case of Somalia,’ Dissident Voice, February 18, 2007; http://www.dissidentvoice.org/Feb07/Petras18.htm)

USA Today reported in January 2007 that the US had “quietly poured weapons and military advisers into Ethiopia,” which had received nearly $20 million in US military aid since late 2002. The report added:

“The [Somalia] intervention is controversial in Ethiopia, where the Meles government has become increasingly repressive, said Chris Albin-Lackey, an African researcher at Human Rights Watch.

“The Meles government has limited the power of the opposition in parliament and arrested thousands. A government inquiry concluded that security forces fatally shot, beat or strangled 193 people who protested election fraud in 2005.” (http://www.usatoday.com/news/ world/2007-01-07-ethiopia_x.htm)

Petras noted that, having driven the last of the warlords from Mogadishu and most of the countryside, the ICU had established a government which was welcomed by the great majority of Somalis and covered over 90% of the population:

“The ICU was a relatively honest administration, which ended warlord corruption and extortion. Personal safety and property were protected, ending arbitrary seizures and kidnappings by warlords and their armed thugs. The ICU is a broad multi-tendency movement that includes moderates and radical Islamists, civilian politicians and armed fighters, liberals and populists, electoralists and authoritarians. Most important, the Courts succeeded in unifying the country and creating some semblance of nationhood, overcoming clan fragmentation.” (Petras, op. cit)

Martin Fletcher wrote in the Times of the ICU:

“I am no apologist for the courts. Their leadership included extremists with dangerous intentions and connections. But for six months they achieved the near-impossible feat of restoring order to a country that appeared ungovernable…

"The courts were less repressive than our Saudi Arabian friends. They publicly executed two murderers (a fraction of the 24 executions in Texas last year), and discouraged Western dancing, music and films, but at least people could walk the streets without being robbed or killed. That trumps most other considerations. Ask any Iraqi.

“The Islamists have now been replaced – with Washington’s connivance – by a weak, fragile Government that was created long before the courts won power, that includes the very warlords they defeated and relies for survival on Somalia’s worst enemy.” (Fletcher, ‘The Islamists were the one hope for Somalia,’ The Times, January 8, 2007)

It was clear to many commentators that the Ethiopian invasion would prove disastrous. Three months later, the Daily Telegraph reported:

“A new humanitarian crisis is rapidly taking shape in the Horn of Africa where eight days of heavy fighting in Mogadishu, the capital of Somalia, has forced about 350,000 people to flee.

“Artillery fire has devastated large areas of the city, forcing about one third of its population to leave. Yesterday Mogadishu’s main hospital was shelled.

“The plains around Mogadishu are filled with refugees enduring desperate conditions with little food or shelter. The fighting began when Somalia’s internationally recognised government, supported by Ethiopian troops, launched an offensive against insurgents.” (Mike Pflanz, ‘Fighting brings fresh misery to Somalia,’ Telegraph, April 26, 2007)

The Telegraph cited a British aid worker: "They are bombing anything that moves.”

Catherine Weibel, from the United Nations High Commission for Refugees was also quoted:

"Everyone we are talking to says this is the worst situation they have seen in 16 years since the last government fell.”

The War On Terror… And The Real Concern

The preferred media framework for making sense of US actions closely parallels cold war mythology. We are to believe the US is passionately, even blindly, battling ideological enemies in an effort to protect itself and the West. Guardian columnist Jonathan Freedland could be relied upon to paint this picture of events:

“A fortnight ago the Ethiopians entered Somalia to topple the Islamist forces who had just taken Mogadishu. Americans dislike that Islamist movement, fearing it has the makings of an African Taliban, so they backed the Ethiopians to take it out. According to Patrick Smith, the editor of Africa Confidential, the war on terror is fast becoming a cold war for the 21st century, with the US finding proxy allies to fight proxy enemies in faraway places.” (Freedland, ‘Like a deluded compulsive gambler, Bush is fuelling a new cold war,’ The Guardian, January 10, 2007)

If this sounds curiously simplistic, even childish, it is. In fact, the cold war, like the “war on terror”, was far less ideological, far more prosaic, than journalists like Freedland claim. Historian Howard Zinn has, for example, commented on the Vietnam war, which the BBC would have us believe “was America’s attempt to stop Communists from toppling one country after another in South East Asia” (http://www.bbc.co.uk/worldservice/ documentaries/2008/04/080327_mylai_partone.shtml):

“When I read the hundreds of pages of the Pentagon Papers entrusted to me by [military analyst] Daniel Ellsberg, what jumped out at me were the secret memos from the National Security Council. Explaining the U.S. interest in Southeast Asia, they spoke bluntly of the country’s motives as a quest for ‘tin, rubber, oil.’” (http://www.zcommunications.org/znet/viewArticle/17049)

Ethiopia’s invasion coincided with the Pentagon’s goal of creating a new ‘Africa Command’ to deal with what the Christian Science Monitor described as: “Strife, oil, and Al Qaeda.” Richard Whittle wrote:

“The creation of the new command will be more than an exercise in shuffling bureaucratic boxes, experts say. The US government’s motives include countering Al Qaeda’s known presence in Africa, safeguarding future oil supplies, and competing with China, which has been courting African governments in its own quest for petroleum, they suggest.” (Richard Whittle, ‘Pentagon to train a sharper eye on Africa,’ January 5, 2007; http://www.csmonitor.com /2007/0105/p02s01-usmi.html)

As Andy Rowell and James Marriott have noted, the key fact is that “some 30 per cent of America’s oil will come from Africa in the next ten years". (Rowell and Marriott, A Game as Old as Empire – The Secret World of Economic Hit Men and the Web of Global Corruption, edited by Steven Hiatt, Berrett-Koehler, 2007, p.118)

The US has plans for nearly two-thirds of Somalia’s oil fields to be allocated to the US oil companies Conoco, Amoco, Chevron and Phillips. The US hopes Somalia will line up as an ally alongside Ethiopia and Djibouti, where the US has a military base. This alliance would give America powerful leverage close to the major energy-producing regions.

Chatham House, a British think tank of the independent Royal Institute of International Affairs, commented on US and Ethiopian intervention last year:

"In an uncomfortably familiar pattern, genuine multilateral concern to support the reconstruction and rehabilitation of Somalia has been hijacked by unilateral actions of other international actors – especially Ethiopia and the United States – following their own foreign policy agendas.” (http://www.zmag.org/znet/viewArticle/15545)

Catastrophic Crisis

This ‘hijacking’ has had truly appalling consequences. More than one million people have been made internal refugees, and the UN food security unit warned last week that 3.5 million people, half of Somalia’s population, are facing famine. Fighting has turned Mogadishu into a ghost town. About 700,000 people have fled – out of a population of up to 1.5 million. The International Committee of the Red Cross describes Somalia’s crisis as “catastrophic.” (http://www.democracynow.org/2008/5 /5/thousands_of_somalis_protest_deadly_us)

Soaring food prices have driven thousands of protestors onto the streets of the capital, Mogadishu. On May 5, Professor Abdi Samatar, a professor of geography and global studies at the University of Minnesota, told the US website Democracy Now:

“Well, what you see in Mogadishu over the last year and a half or so, since the Ethiopian invasion, which was sanctioned by the US government, has destroyed virtually all the life-sustaining economic systems which the population have built without the government for the last fifteen, sixteen years.” (http://www.democracynow.org/2008/5/ 5/thousands_of_somalis_protest_deadly_us)

A kilo of rice, which previously sold at around seventy US cents, now costs as much as $2.50. The average day’s income for anyone fortunate enough to have a job is less than a dollar a day. The gap between incomes and the cost of food primarily imported from overseas means that millions of people cannot afford to eat.

Last week, Amnesty International reported that it had obtained scores of accounts of killings by Ethiopian troops that Somalis have described as "slaughtering [Somalis] like goats." In one case, "a young child’s throat was slit by Ethiopian soldiers in front of the child’s mother.” (http://www.amnesty.org/en/library/asset/AFR52/006/2008/en/1162a792-186e-11dd-92b4-6b0c2ef9d02f/afr520062008eng.pdf)

Amnesty reported that during sweeps through neighbourhoods, Ethiopian forces placed snipers on roofs, and civilians were unable to move about for fear of being shot:

“While some sniper fire appeared to be directed at suspected members of anti-TFG [Transitional Federal Government] armed groups, reports indicate that civilians were also frequently caught in indiscriminate fire. In many cases families were forced to carry their wounded to medical care in wheelbarrows and on donkeys because ambulance drivers would not operate their vehicles due to general insecurity, including sniper fire. As a result, it has become very difficult for civilians to access medical care.”

The British government has consistently downplayed both the gravity of the crisis and the murderous behaviour of Ethiopian forces. In the Foreign Office’s latest annual human rights assessment of Somalia there was no mention of Ethiopia, let alone the conduct of its troops. No surprise – Ethiopia is one of the largest recipients of UK aid in Africa and, as discussed, is an important regional ally.

The Media Follow The Government Lead

Predictably, the government’s strategic silence is reflected in press reporting. In the last year, the words ‘Somalia’ and ‘famine’ have appeared in a grand total of seven British broadsheet newspaper articles discussing the topic. Of the few references to the latest US attack in the British press over the last week, only the Independent and the Sunday Times made briefs references to Somalia’s humanitarian crisis. The Independent noted that life for Somalia’s nine million residents has become “unbearable”. The Guardian merely quoted Reuters:

“Western security services have long seen Somalia as a haven for militants. Warlords overthrew dictator Siad Barre in 1991, casting the country into chaos.” (Reuters, ‘US airstrike kills head of al-Qaida in Somalia,’ Guardian International, May 2, 2008)

The Amnesty report was mentioned in three broadsheet newspapers. Of these, the Guardian failed to mention the US role at all. Ian Black commented:

“Ethiopia sent in troops in December 2006 and ejected them. Since then, Mogadishu has been caught up in a guerrilla war between the government and its Ethiopian allies and the Islamist insurgents. Up to 1 million Somalians are internally displaced.” (Ian Black, ‘Somali refugees speak of horrific war crimes,’ The Guardian, May 7, 2008)

By contrast, a short Independent piece led with the US role:

“Amnesty International has called for the role of the United States in Somalia to be investigated, following publication of a report accusing its allies of committing war crimes.” (http://www.independent.co.uk/news /world/politics/call-for-inquiry-into-us -role-in-somalia-822166.html)

Amnesty’s Dave Copeman was cited:

"There are major countries that have significant influence. The US, EU and European countries need to exert that influence to stop these attacks."

This is the sole reference to Copeman’s comments in the entire national UK press.

Professor Samatar commented on the latest US attack:

“[I]t’s quite befuddling to Somalis and many other peace-loving people around the world as to why the United States has chosen to bomb people who are desperate for assistance and food, and who have been dislocated and traumatised by an Ethiopian invasion, a country that has its own people under tyranny in itself.”

The Truth Of ‘Our Leaders‘

With our shared responsibility for the catastrophe in Somalia buried out of sight, the Telegraph reported this week:

“Gordon Brown urged the Burmese authorities to give ‘unfettered access’ to humanitarian agencies. ‘We now estimate that two million people face famine or disease as a result of the lack of co-operation of the Burmese authorities. This is completely unacceptable,’ he said.” (Alan Brown, ‘Burmese officials “are seizing emergency aid and selling it for profit”,’ Daily Telegraph, May 13, 2008)

The great lie is that we are represented by people like Gordon Brown, described as ‘our leaders’. Because they represent us and we are not monsters, we are to believe that ‘our leaders’ are seeking to resolve problems afflicting humanity in general, while working more specifically to protect us from terrorism and other threats. In other words, we are to believe that ‘our leaders’, like us, are rational, compassionate and well-intentioned.

The truth is very different. In fact we are free to chose from parties and leaders who all represent the same interests of concentrated state-corporate power – the tiny fraction of the population that owns much of the country and runs its business.

Crucially, ’our leaders’ front a political system that has an overwhelming advantage in high-tech military power. They are all too willing to use this power to convulse countries with bloodshed when doing so supports their lucrative version of economic ’order’. Iraq is the obvious example – Somalia is another.

’Our leaders’ rule in the name of democracy, but they act in the interests of a narrow, extremely violent kleptocracy.

SUGGESTED ACTION

The goal of Media Lens is to promote rationality, compassion and respect for others. If you do write to journalists, we strongly urge you to maintain a polite, non-aggressive and non-abusive tone.

Ask the following journalists why they are not doing more to expose Western responsibility for the catastrophe in Somalia.

Write to Ian Black
Email: ian.black@guardian.co.uk

Write to Simon Kelner, editor of the Independent
Email: s.kelner@independent.co.uk

Write to Alan Rusbridger, editor of the Guardian
Email: alan.rusbridger@guardian.co.uk

Please send a copy of your emails to us
Email: editor@medialens.org

F.A.C.K. YOU

Ellie Keen — Sun, 13 Apr 2008 22:29:06 +0000

WORKPLACE DEATHS CONTINUE, TEN YEARS AFTER THE MURDER OF SIMON JONES

“FACK grew out of the campaigning around Simon Jones’ death which had a magnificent effect, especially the direct action. It woke people up to the fact that we could take on the companies that kill people and do something about it. There’s over 20 families of people killed at work involved with FACK, campaigning against unfettered and unregulated greed of business. People build struggles on past stuggles, it’s important to learn lessons from past campaigns – it’s how we get stronger”

Hilda Palmer of Families Against Corporate Killers (FACK)

Ten years ago, on 24th April 1998, Simon Jones was killed at a Shoreham dock on his first day at work unloading a ship. His death sparked a campaign of direct action against the corporate killers. Ten years on and despite lip service from Neo-Labour, businesses still get away with the murder of employees and families are forced to fight for justice. Families against Corporate Killing (FACK) were formed as an umbrella group to help people who lose loved ones to workplace accidents.

Eventually bowing to the pressure from both campaigns and large scale corporate safety failures like the (ironically named) Herald of Free Enterprise ferry disaster and the Hatfield train crash, an offence of corporate killing has finally made it on to the books – just last week in fact, following a government consultation paper published way back in 2000.

The long-standing promise to punish directors who allow their companies to kill people resulted in nothing of the sort. The Corporate Manslaughter and Corporate Homicide Act has just become law to universal condemnation from safety activists and unions. The building industry union Ucatt’s general secretary Alan Ritchie said, “This Act will not save the life of a single construction worker. Only by creating the possibility that directors will go to jail will there be a change of culture in the construction industry.” He should know – last year 77 workers died in the building industry.

But despite all the tragedies, how does the workplace safety record shape up now?

In fact, the Health and Safety Executive (HSE) is worse than ever. Between 2006 and 2007, UK deaths at work went up from 217 to 241, an increase of 11%. In the same period HSE inspections of workplaces decreased by 24%, to the point where a workplace could expect the man from the HSE to call once every 14.5 years. Since 2002, the HSE has lost over 1,000 posts as a result of cuts. Go get them cowboys!

In Britain, a worker between 16 and 24 years old suffers a reported workplace injury requiring more than 3 days off work every 12 minutes of every working day. A young worker is seriously injured at work every 40 minutes. Workplace fatalities in this age range occur at a rate of more than one a month. And year on year, the number of accidents rises.

So the ability to more easily extract a few fines from those companies able to be unequivocally proven guilty won’t come as any consolation to the family of Simon Jones – or Steven Burke, a 17-year-old scaffolder who fell to his death from inadequately constructed ‘birdcage’ scaffold inside a giant sewage reclamation tank in 2005. His case was finally dealt with in February this year. Despite a damning verdict that showed the scaffold he was assigned to was a staggering 2,500 tubes short, his employers 3D Scaffolding Ltd were fined a mere £80,000 (and given 18 months to pay). His family stated, “No amount of money would bring Steven back or hurt the defendants whose actions and inactions led to his death, but the family feel fines should be much greater to bring home the full seriousness of what they have done.”

For more see Families Against Corporate Killers www.fack.org.uk

Corporate Power and the SNP Government

Ellie Keen — Sun, 06 Apr 2008 18:03:03 +0000

The SNP government has played a bit of a blinder in its first ten months, consistently wrong footing Labour and the rest of the unionist opposition. It is still too early to come to a definitive judgement on the SNP record in relation to business, although some early lines of development are pretty clear. These can be divided into two main areas. First is the area of economic policy and the general orientation towards business interests. For the most part this is business as usual, little different from the policies pursued by the neo-liberal labour/Lib Dem administration. Second is the area of social policy where the SNP has almost appeared to be a social democratic government. Among the announcements was Nicola Sturgeon’s commitment that ‘We reject the very idea that markets in health care are the route to improvement’.1 Other statements include ‘positive commitments’ as the STUC’s Grahame Smith put it, on prescription charges, prison estate, more free school meals and nursery places.2 Democrats will applaud the sentiments and make sure they examine the details.

The other area to watch is the much vaunted bonfire of the quangos. There seems to be very little action here yet. This is not one of those dull media feeding frenzies on broken manifesto commitments but a serious question about re-democratising the public sector. Yes, this means resisting contracting out, shared services and all the other means for the corporations to get their hands on free money and attack terms and conditions. But the other pressing issue is the fact that legions of political appointees gum up the possibility of serious opening up and accountability. Many of these people would need to be removed in a bonfire of the quango-crats. Two examples will suffice. Sir Ken Collins at SEPA is a former Labour MEP. To be fair his long experience as chair of the Environmental committee at the European Parliament was a significant qualification for the job. But SEPA has not been able to play the role of a proper watchdog on environmental issues because it has been too close to the Executive and too willing to be influenced by big business. Collins himself is still politically active. As well as being a public servant he acts as an advisor to the European Public Affairs Consultants Association – the EU lobbyists lobby group – which is determined to resist openness and transparency. This is the kind of conflict of interest of which any public servant should beware since advocating for corporate interests by definition undermines the public interest. Such conflicts pale, however, beside the extraordinary fact of the appointment of Sir Ian Byatt and a whole crew of neo-liberal ideologues to run the Water Industry Commission for Scotland. Their ostensible role is to make sure that the Scottish Water is run efficiently within the public sector. But from the beginning they have been more interested in pushing it towards privatisation. This suits their friends and allies in the think tanks and private water companies well. In fact it suits pro market consultancies such as Frontier Economics, too. Frontier is retained as a consultant to the Byatt led WICS and – would you believe it? – Frontier in turn employs Byatt as a ‘senior associate’. The continuation of such appointments is an affront to the most basic principles of public life.

After gutting the quangos of pro market place people, the SNP might then be tempted to fill the resulting places with its own stooges. This would be an historical mistake as it would lead inexorably to the reinstatement of the institutionally corrupt layer currently in post when the government changes. For Scotland to function at anything approaching a democratic polity changing the people needs to be accompanied by changing the structures. The quango-cracy is in it self anti democratic and more or less insulated from popular pressures. So, fundamental reform and direct democratic input is required. This might mean the wholesale abolition of many of these organisations.

In fact though the whole machinery of government needs overhauled. The senior management at the old Scottish Executive ceased some time ago to be the impartial civil service of old. They have made clear statements on their own behalf indicating they are almost to a person signed up to the neo-liberal reform agenda. All the rhetoric about bringing business ideas and expertise to the public sector is itself a betrayal of their responsibility as public servants. No sign so far of any movement here. At a more visible level the direct role of business in government seems not to have abated. Scottish Financial Enterprise (a business lobby group, despite the name suggesting it is part of the public sector) is still able to shape policy on financial services by having 7 out of 12 seats on the Financial Service Strategy Group and ten of seventeen on the Financial Services Advisory Board, both of which combine to run Scottish government policy on financial services. This composition and the fact of one union rep on both organisations is the same as under Labour. The Scottish Executive Management Group has been renamed the Scottish Government Strategy Board and has lost one of its ‘non-executive directors’, the corporate lobbyist and networker Shonaig Macpherson. The other two (Bill Bound formerly of PricewaterhouseCoopers and David Fisher of HBoS) remain. No changes there.

Meanwhile in the Parliament the one area where Scotland could said to be ahead of Westminster was on openness and transparency particularly in relation to lobbying, where the Standards Committee declared for regulation of lobbyists in 2003. Since then the European commission has launched the European Transparency Initiative and even the Westminster parliament is holding an inquiry on lobbying. At the Scottish Parliament the issue appears dead. The amazing antics of the Scottish Parliament Business Exchange show how much contempt the Parliamentary bosses have for democracy and transparency. The exchange is alleged to be an educational venture to teach MSPs about business and vice versa. It claims to have ‘no connection with lobbying in any form’ and at ‘all times operates in an open and transparent manner’. Neither of these statements appears to be true. The interim director until January 2008 was Devin Scobie, himself a lobbyist who ran Caledonia Consulting, a own lobbying consultancy while at the SPBE. There is no public information about whether any of his clients are also SPBE members. However, we do know that former Pfizer lobbyist and head of the SPBE on the business side, Lynda Gauld, also works at Caledonia. As if that is not enough, other connections between the two organisations include the former member of the SPBE and former MSP, David Davidson, who now also works at Caledonia. The new ‘Chief Executive’ of the SPBE from January 2008 is Arthur McIvor. McIvor is a former marketing man from Royal Mail who recently set up his own consultancy – Art McIvor Consultants – which seems to offer high end lobbying and hospitality services. The SPBE is in other words a virtual gateway for lobbyists into the Scottish Parliament. No sign so far that this will change under the SNP or that the issue of lobbying regulation will come back on the agenda, despite the recent launch of the civil society coalition the Alliance for Lobbying Transparency.3

On economic policy the SNP are, as used to be said by the Labour Party, the Tartan Tories. Used to be said, before, that is, the former people’s party emulated the neo-liberal, pro-privatisation policies of the Thatcher government. The deeper cut in business rates made to bring the Tories on board for the budget is a key indication.

But there are some areas where SNP policy departs from manifesto commitments or their own social democratic rhetoric. In much the same way that the phrase ‘military precision’ is now widely understood as referring to mass civilian casualties, the phrase ‘Private Sector efficiency’ is now widely recognised as meaning inefficient, more expensive and unjust.

Two key areas to watch where there may be some potential for democratic outcomes are the Scottish Futures Trust and the mooted mutualisation of Scottish Water. The Futures Trust is heralded as an alternative to the widely loathed extortion that is PFI/PPP. Although the detail on this is yet to be worked out it is already clear that the Futures Trust would transfer public assets out of the public sector and insulate them from public accountability, much as has happened with the transfer of museums and leisure facilities from Glasgow City Council to ‘Culture and Sport Glasgow’

The issue of mutualisation of water was kicked into the long grass before the last election with Labour, the SNP and the Greens declaring their opposition to mutualisation – a back door means to bring in the banks and effectively privatise Scottish Water. But in February amidst a morning fanfare the issue of mutualisation was back on the agenda as the SNP announced a review of the water industry. Briefings from the First Minister spin doctors suggested a policy change.4 Yet by the afternoon it was clear that the relevant minister and the rest of the party were not signed up for this and the matter was downplayed. Not a lot of sign for social-democratic optimism there as the vultures which have been circling the Scottish water industry for some years, circle closer. These are both fudges which will allow the private sector in by the back door. They are not ‘public sector’ solutions and will end up defrauding the public and putting public services beyond direct accountability.

All in all then, there are some signs of social democratic reform, but for the most part it is business as usual with a few frills attached.

1. BBC Online Plans to end private cash for NHS Last Updated: Thursday, 21 June 2007, 15:21 GMT 16:21 UK
2. STUC Response to Scottish Government Budget 14th November 2007 http://www.stuc.org.uk/press-releases/441/stuc-response-to-scottish-gove…
3. http://www.lobbyingtransparency.org . Spinwatch.org is a founding member.
4. Steven Vass ‘Ofwat backs cross-border competition ‘, Sunday Herald, 1 March 2008

Labour makes Massive Cuts in Higher Education

Ellie Keen — Sat, 29 Mar 2008 17:35:00 +0000

The Labour government of Prime Minster Gordon Brown is implementing significant cuts in higher education.

Last September the government announced that it planned to remove £100 million of funding from students studying for a second degree. These students are known as Equivalent or Lower level Qualification students (ELQs). The measure was announced in a letter from the Universities Secretary, John Denham, to the Higher Education Funding Council for England (HEFCE), instructing it to remove £100 million a year from the funding of ELQ students.

It is estimated that the policy will affect an initial 170,000 mostly part-time students. The changes will be introduced in the next academic term of 2008-09. Since the measures were announced, more than 18,000 people have signed an online petition to the prime minister. The petition supports a call from the Open University for the decision to be delayed.

The government has attempted to justify the cuts on the basis that the lost funding would instead be redirected to students taking their first degrees. The reality is that the proposals are a vital part of the government’s strategy to deregulate and privatise higher education, in order to make it the preserve of more affluent layers.

The £100 million represents a tiny fraction (0.1 percent) of the government’s higher education budget, but its removal sets a precedent. The government intends to incorporate the private sector directly into the provision and funding of higher education. As part of its proposals, the government is calling on private sector corporations to pay towards the costs of ELQ students. The letter stated, “In many cases, it may be appropriate for the employer to pay at least a proportion of the costs of such re-training.”

The hardest hit higher education institutions will be the Open University and Birkbeck College, London. The Open University is the largest academic institution in the UK by student number, with more than 180,000 students enrolled, including more than 25,000 students studying overseas. According to research carried out by the Universities College Union (UCU), the withdrawal of its ELQ funding will leave 29,000 OU students without funding and will cost it £31.6 million in teaching funding by 2014.

David Vincent, the Pro Vice Chancellor of the University said, “The Open University is threatened with a loss of more than £30 million of its teaching income. It will have a real impact on those who have a degree but want to continue with their education, to develop their skills, to improve their employment chances or further their careers. For the OU and other institutions in the part-time sector, this is the biggest cut in funded numbers the English higher education system has witnessed for a generation.”

Nine out of ten of the higher education institutions facing the largest ELQ cuts in percentage terms are located in London. An estimated 54 percent of students affected by the loss of funding study in the capital. At Birkbeck College, a third of its students have ELQ status. The university is set to lose £7.8 million in teaching funding by 2014.

Birkbeck issued a statement opposing the cuts and revealed the devastating impact they will cause: “Many Birkbeck students embark on the major step of studying for a second qualification later in life in order to become more employable or to change career direction. Across the sector, ELQ students are mostly part-time and clustered at institutions like Birkbeck and the Open University, so these highly targeted cuts will have a disproportionate effect on the part-time sector.

“If urgent action is not taken to support Birkbeck and other part-time institutions, these cuts will have an immediate and detrimental effect on all part-time students and the government’s skills agenda. Classes will be vulnerable to closure, choice will be reduced and the student experience will be impoverished.”

A further 24 institutions will lose over £2 million each in teacher funding.

The financial cost to students themselves as a result is set to immediately escalate. Universities have warned that the cuts will mean that fees for such students will be forced up above £7,000 per year. Many of the OU’s students are part-time, on low incomes or benefits and rely entirely on government funding in order to study. Some 13 percent of OU ELQ students live in areas of severe multiple deprivations (within the bottom 25 percent of areas scored against the Index of Multiple Deprivation). OU statistics show that 3,500 ELQ students have special needs and 600 are unable to work owing to illness. OU Vice Chancellor Professor Brenda Gourley said the university was already seriously looking at charging higher fees: “Our core mission is to bring in more students at the lower end of the scale, and we will continue with this aim. But we’ll have to carry out market surveys to see what people will pay. While the government thinks employers are willing to fund their staff’s education, that hasn’t been our experience.”

Despite almost universal opposition, a January 9 vote in Parliament supported the cuts by a majority of 53 votes. As part of a phony “consultation” exercise, the government asked for submissions from individuals and organisations prior to a House of Commons’ select committee which took evidence on the ELQ issue in mid January. The government had no intention of changing its course even though the vast majority of the 478 submissions—470—stated they opposed the policy.

On January 17, in an attempt to deflect the widespread criticism to its plans, Higher Education Minister Bill Rammell announced that an extra £10 million would be directed towards funding part-time degrees. This would increase funding for students on part-time courses from £20 million to £30 million. The move was described in various quarters including by the opposition Conservative Party as a “retreat.” It was nothing of the sort. The £100 million cut remains in place.

The University and College Union, which represents 117,000 members in higher education, stated that the cuts were part of an overall slashing of the budget of the Department for Innovation, Universities and Skills (DIUS). The government previously announced that it plans to implement “efficiency savings” rising to £1.5 billion a year by 2010-11. However, the UCU also made clear that it is not opposed to cuts in principle but wanted to be consulted.

Businesses being primed to run higher education

On February 25, in an article entitled, “Blueprint for bosses to shape degrees,” the Financial Times reported that “Employers would gain significant new powers to shape higher education degrees under a confidential blueprint circulating inside Whitehall.”

The article cited a document, produced by the Department for Innovation, Universities and Skills, under the title “Higher Level Skills Strategy.” According to the FT, it “sets out the case for devoting the bulk of extra university funding over the next three years to degrees jointly designed and funded by employers” and states that universities should offer a range of reforms “that an employer and employee will want.”

The document continues, “We expect the great majority of this growth to be in provision that is developed with employer input—either foundation degrees [two-year vocational degrees co-designed by employers] or employer co-funded places.” The report warns that such growth will be “initially concentrated in those institutions which have shown they are able and willing to commit to working closely with employers.”

On March 6 an article in the Guardian on the governments annual higher education budget revealed that cuts were being made to the number of students allowed access to leading universities such as Oxford, Cambridge, Bristol, University College London and the University of Manchester. From next term the government’s budget for “widening participation” will increase by £15 million to £364 million but according to the Guardian’s research 50 out of the 90 English universities are facing cuts in their “widening participation” budgets. Cambridge will lose 44 percent of its funding and Oxford will lose nearly 37 percent. University College London, Bristol and Manchester University will have budget cuts of between 6 and 22 percent.

Universities students face massive debt crisis

The cuts to higher education are being carried out at a time when universities have borrowed millions of pounds in order to finance construction of much needed new buildings and the upgrading of existing buildings. Steve Egan, deputy chief executive of Hefce, told the Guardian, “The level of borrowings, as compared to the level of total income, is the highest since 1997. In actual terms (that is, the amount rather than a percentage), the level of borrowings in 2005-06 was higher than ever before.”

Many universities already rely on the income from international undergraduate students, who currently account for eight percent of total university income.

The debt crisis has resulted in significant job losses. Britain’s largest university, the University of Manchester, has an operating deficit of £12.4 million. It is planning to shed 650 mostly administrative jobs through “natural wastage.” Up to 20 percent of these will be academic staff. At Sunderland University’s the deficit has increased from £1 million in 2005/06 to £4.2 million in 2006-07. As a critical part of managing the debt, universities have been forced to sell of large parts of the estate they own. The University of Manchester recently sold off the 3,600 acre Tabley House Estate in Knutsford, Cheshire, for £35 million, without which its debt levels would be far, far higher.

At the University of Sussex, management has published restructuring plans that will mean cuts in established areas of study in favour of more lucrative areas such as business and management and international security. Increasingly universities are seeking direct contracts with big business in order to finance their operations. Last September the University of Manchester announced that it was establishing a £50 million venture capital fund with a commercial partner to invest in “intellectual property” in order to facilitate bringing academic research to sell in the market place.

Tuition fees introduced by Labour are currently £3,145 for this academic year, but it is expected that a government review will recommend a further increase in the fees for 2008/09. But this is only a part of the prohibitive financial scenario facing students. Research by the Student Union found that when living costs such as rent, textbooks, utility bills and travel are added, the average cost of a three-year university degree comes to more than £45,000 in London and £39,000 outside the capital. Students are forced to take out “Student Loans,” which are to be paid back after graduation when they enter employment, leaving them saddled with tens of thousands of pounds of debt. In addition, the credit reference agency Equifax found that 83 percent of parents are footing their children’s education bill.

London Mayoral Elections (Part One)

Ellie Keen — Fri, 14 Mar 2008 21:03:36 +0000

Labour’s neo-cons and the left apologists for Ken Livingstone

With less than two months to go to the May 1 elections to the Mayor of London and the London Assembly, the contest is becoming ever more super-charged.

The last weeks have seen a barrage of allegations of misconduct against Mayor Ken Livingstone, Labour’s official candidate who is running for his third term in office, and his leading aides. These range from the “wasteful” use of funds, to excessive drinking. The allegations claimed their first scalp last week, when Lee Jasper—who had been the focus of many of the unproven allegations of financial impropriety—resigned his post as Senior Policy Advisor on Equalities when sexually explicit emails he sent to a female friend in a body that receives funding from the Assembly were leaked.

The accusations, spearheaded by the right-wing Evening Standard newspaper, have led to counter-charges of a smear campaign designed to further the political prospects of Conservative candidate Boris Johnson. In turn, a so-called “progressive alliance” has been launched to back Livingstone’s re-election, which is deemed essential in order to safeguard democracy and the rights of ordinary Londoners.

The degree of rancour directed against Livingstone seems extraordinary. Having been forced to run as an independent for the first Mayoral contest in 2000 after he was blocked by the party hierarchy (and then expelled from the party), Livingstone successfully exploited anti-Labour sentiment to defeat the party’s official candidate.

Livingstone’s former reputation as “Red Ken,” built up during his leadership of the Greater London Council (GLC) in the 1980s, and his preparedness to defy the leadership when it conflicted with his own self-advancement, had convinced Tony Blair that he was too much of a maverick to be trusted with administering the capital’s newly created regional assembly. Having won election, however, Livingstone was at pains to prove his fidelity to Labour and its backers in the City of London. So much so, that the party—at Blair’s behest—bent its own rules in order to smooth Livingstone’s readmittance to membership in early 2004, just in time for him to run successfully as its official candidate.

Livingstone continues to enjoy the support of the Labour leadership and many of the city’s financiers based on his record in building up London as a magnet for global capital. Bloomberg reported that “Growth in London’s financial district, known as the City, has fuelled the UK capital’s biggest economic expansion since World War II, and the Labour Party’s Livingstone, 62, has helped make it happen.” The Mayor “has earned the admiration of many of London’s business people and bankers,” it continued, citing Harvey McGrath, former chief executive officer of the hedge fund Man Group Plc. Livingstone, “works quite hard to get closer” to the needs of financiers, McGrath stated. “He’s done a better job and is more business-friendly than people would have thought.”

“He’s been a very pro-business mayor,” said Nigel Bourne, director of the London office of the Confederation of British Industry.

The evidence bears out such claims. London is the world’s largest international banking centre, with the sixth largest city economy on the globe, generating an estimated 30 percent of the UK’s Gross Domestic Product. Home to 49 billionaires—the greatest concentration in Europe—it is the most expensive city in the world for prime real estate (another reason why the business elite were so enthusiastic about Livingstone’s role in the campaign for the capital to host the 2012 Olympic Games—a significant portion of the costs of which will be born by working people through higher council taxes).

If anything, Livingstone has proven himself even more attuned to the interests of big business than his allies in the Labour leadership. Only last month he denounced the government for its now aborted attempt to tax wealthy “non-doms” (officially not resident in Britain for tax purposes), claiming it would drive investment away from London. Otherwise he has marched in lockstep with the government under both Blair and Gordon Brown—attacking striking London Underground workers as “selfish” and defending Metropolitan Police Commissioner Paul Condon and the police shooting of Brazilian worker Jean Charles de Menezes.

Only in April 2007 Livingstone stated, “I used to believe in a centralised state economy, but now I accept that there’s no rival to the market in terms of production and distribution” and dismissed any talk of “great ideological conflict.” It is no surprise then that the Economist magazine described Livingstone only last month as a “formidable politician.”

But the Mayor has also sought to buttress his neo-liberal economic policies with radical gestures—such as last year’s oil deal with Venezuelan President Hugo Chavez to provide lower-cost fuel for London’s buses—and the assiduous cultivation of relations with the various leaders and groups representing ethnic and religious minorities in the capital.

Such policies have been generally tolerated by the powers that be. There has been a recognition that such an apparently “inclusive” agenda is necessary if Livingstone is to be able to pass himself off as someone sitting “squat on the centre of the political spectrum”—his own description—and not firmly on the right. This is especially true in a city where one-third of the population were born outside the UK and more than 300 languages are spoken. Moreover, Livingstone has been careful to ensure that his populist posturing only applies on international matters and where it does not conflict with the fundamental interests of the City of London.

At any rate, neither the Mayoral post nor the London Assembly are exercises in genuine popular control. Conceived as part of Labour’s regional development initiatives aimed at encouraging international investment into the UK, they function as a means of coordinating and administering the strategic interests of the major corporations. The London Assembly is comprised of just 25 members, 14 from each of the London constituencies (for a city of some 10 million people) and a further 11 from party lists. Its powers are largely confined to “scrutinising” the power of the Mayor, whose own remit concerns budgeting and planning for transport, the police and emergency services, economic development and “cultural strategy.”

Labour’s “liberal” imperialists

The undemocratic character of this set-up, however, combined with the absence of any significant base of support for any of the official parties represented, makes it a focal point for the backdoor political intrigues and vendettas of small numbers of rich and influential people.

In March 2006 the unelected Adjudication Panel—which oversees the Assembly—agreed to suspend Livingstone for four weeks over a private exchange he had with Oliver Finegold, an Evening Standard reporter. The exchange, in which Livingstone referred to Finegold’s journalistic technique as similar to that of a Nazi concentration camp guard, followed a long-standing campaign by the Standard and right-wing Zionists against the Mayor for his condemnation of Israeli violence against the Palestinians and his relations with various Muslim organisations and individuals, such as the Egyptian-born Muslim cleric Dr. Yusuf al-Qaradawi.

The Standard is again prominent in the current allegations against Livingstone. Apparently convinced that the Conservatives may finally have a credible opponent to run against Livingstone in the Mayoral race in Boris Johnson, the newspaper has run almost daily stories charging that taxpayers money has been wasted on funding defunct black organisations, with links to Livingstone’s key ally Jasper. Standard reporter Andrew Gilligan, who was at the centre of the political scandal over the outing of whistleblower and leading nuclear expert Dr. David Kelly, alleged that “at least £2.5 million of public money has been given to a shadowy network of businesses and NGOs directly linked to Mr. Jasper and his close friends and associates, many of them supposedly operating out of the same small room in Kennington.”

Although the police ruled out any criminal investigation, the Standard has kept up its stream of accusations including the claims of Atma Singh, a former high-level adviser to Livingstone, that members of Socialist Action (SA) —a tiny group of former radicals that long ago buried themselves in the Labour Party—had infiltrated city hall and were working to fashion the capital as a “beacon for socialism.”

Far from having uncovered a long-kept secret, both Jasper and the Socialist Action Caucus are known political quantities with nothing to do with socialist politics. Jasper, a long-time ally of Livingstone dating back to the days of the GLC, is a longstanding Labour Party member and black nationalist who has utilised racial policies to cultivate relations with the police and business groups. Socialist Action, which supports the largely defunct Socialist Campaign Group of Labour MPs, has also worked with Livingstone for years. And—as befits an organisation that has remained true to Labour regardless of the Iraq invasion and its big business agenda—neither SA leader John Ross’s former position as economic adviser to Livingstone, nor Redmond O’Neill’s post as deputy chief of staff, have contradicted the right-wing political trajectory of either Livingstone or the party generally.

It is doubtful that any of the Standard’s latest “revelations” would have been seen as anything other than a continuation of its long-running vendetta—even the staunchly Conservative Telegraph noted that “one need only scan the Labour benches at Westminster—and the Cabinet table—to find numerous former revolutionaries”—were it not for the addition of a new political factor in the anti-Livingstone campaign, concentrated around the pro-Labour New Statesman magazine.

It was New Statesman editor Martin Bright who presented the Channel 4 “Dispatches” television programme, charging the mayor with “financial profligacy, cronyism and links to a Trotskyite faction conspiring to transform London into a ‘socialist city state,’” in the words of the Guardian.

Writing in the Standard last month under the headline “I now believe Ken is a disgrace to his office,” Bright said he felt it was his “duty to warn the London electorate that a vote for Livingstone is a vote for a bully and a coward who is not worthy to lead this great city of ours.”

Bright says that he arrived at this insight in the course of his investigative research for Channel 4 Television. Until then, he had believed “Ken Livingstone was a flawed but charismatic leader of the capital. We had fallen out over his support for radical Islamists, but I thought much of what he had done was refreshingly bold.” Faced with evidence to contrary, “the scales finally dropped from my eyes. I am only ashamed it took me so long.”

Bright is not the objective bystander he makes out. Over the last months, he has emerged as a strident critic of what is described as Labour’s “appeasement” of Islamic “extremists.” He has authored numerous reports pointing to the Labour government’s inconsistency in its prosecution of a “war on terror” while maintaining political relations with groups associated with Egypt’s Muslim Brotherhood. Bright complains that the government’s policy towards Muslim groups in Britain is driven “by the Foreign Office’s determination to engage with Islamist radicals.”

Several of these articles have been compiled as a pamphlet by Policy Exchange. The think tank, which is described as the most influential “on the right,” was itself embroiled in controversy only recently over allegations that documents it circulated to prove the influence of Islamic extremists in Britain’s mosques were fakes.

Policy Exchange is headed by Charles Moore, former editor of the Thatcherite Spectator magazine—a position also held previously by Boris Johnson. Another leading light is Anthony Browne, again a contributor to the Spectator, who has claimed that Labour’s immigration policies will mean whites becoming a minority in the UK by 2100; evidence Browne claims of a government “whose intellectual faculties are [so] crippled by political correctness.”

The think tank’s research director is Dean Godson, who worked as Special Assistant to John Lehman, a signatory to the neo-conservative Project for a New American Century, from 1987 to 1989. It is alleged that when Godson was sacked by the Daily Telegraph, Editor Martin Newland explained, “It’s OK to be pro-Israel, but not to be unbelievably pro-Likud Israel, it’s OK to be pro-American but not look as if you’re taking instructions from Washington.”

Writing in the Times in 2006, Godson had attacked the government along lines similar to those employed by Bright. Labour’s failure to ban the radical Islamist Hizb-ut-Tahir had exposed “Whitehall’s greatest weakness—the war of ideas,” he wrote, calling for a revival of the type of political propaganda employed during the “Cold War, [when] organisations such as the Information Research Department of the Foreign Office would assert the superiority of the West over its totalitarian rivals. And magazines such as Encounter did hand-to-hand combat with Soviet fellow travellers.”

To be continued

Behind Flat Earth News

Ellie Keen — Thu, 21 Feb 2008 14:50:05 +0000

On 1 February, MediaWise, one of The Campaign for Press and Broadcasting Freedom’s associated groups, released online the Cardiff University research report that underpins Nick Davies’ devastating critique of British journalism, Flat Earth News, previewed in the current issue of Private Eye and this week’s edition of Press Gazette. The report can be downloaded here

The quality and independence of British journalism has been severely damaged since the Wapping Dispute in 1986, when Rupert Murdoch challenged the power of the print unions. Over the last 20 years, the research shows, profits have doubled and pagination has trebled, across the industry, while the number of jobs is about the same and productivity, in terms of the number of stories produced by journalists, has trebled.

Many journalists now have to feed a 24-hour news operation, producing copy for a variety of media – print, online, television and radio. Increasingly deskbound, they have no time to go out and find or properly research stories. Our report suggests that less than 1 in 5 stories is now independently sourced. As a result the public relations industry exerts an unduly powerful influence over the news agenda. And with each medium feeding off the content of its rivals, the public has no way of knowing which news items may have originated in an unchallenged press release.

Profits may be up but there has been no corresponding investment in the actual business of journalism. This is one of the complaints of striking journalists at the Milton Keynes Citizen, who have queried their management’s commitment to quality journalism. Johnston Press, now has 18 daily newspapers, 291 weekly newspapers and 317 local websites, acquired and developed over recent years.

Take-overs, merged titles and shared newsrooms and overheads have improved balance sheets across the industry to the detriment of journalistic integrity. Yet few members of the public can be expected to appreciate the complex mesh of media ownership that controls the flow of information they receive, and may indeed influence news content.

They may be familiar with News Corporation and Rupert Murdoch’s massive global interests in media production, but what about Newsquest, the UK end of the US publishing giant Gannett? It owns 17 regional dailies, some 300 local weeklies and 180 local websites. The Daily Mail General Trust includes 50 companies with more than 100 local newspapers, 28 local websites, as well as radio, TV, teletext outlets and its national titles. Their influence over public discourse is immense, so it is not surprising that Daily Mail executives were among the first to try and rubbish Nick Davies’ book and the Cardiff research.

Funded by the Joseph Rowntree Charitable Trust, our report is a major contribution to the debate MediaWise initiated in 2004 on Journalism and Public Trust. We were pleased to assist Nick Davies, since those who object to criticism of journalism standards constantly demand hard evidence. Cardiff’s research contains evidence in abundance. Its closing section, ‘The View from the Newsroom’, offers perhaps the most dispiriting evidence – a collapse in confidence among even then most experienced of journalists.

Only last weekend (26 Jan 08) former Independent on Sunday Editor Peter Wilby reflected this mood, when he told the Campaign for Press and Broadcasting Freedom conference on ‘New Threats to Media Freedom’ that marketing managers are now taken more seriously than Editors.

“Is it any wonder that public trust in journalists is declining?” responded Jeremy Dear, General Secretary of the National Union of Journalists. The situation is not peculiar to the UK. A poll in the US has revealed that fewer than one in five Americans is willing to trust the accuracy of news reporting, and four out of five are convinced that the media seek to manipulate public opinion. One third of Americans believe the media is biased and unfair, according to research by Sacred Heart University in Connecticut.

The House of Lords Communications Committee members need to read the Cardiff research and Nick Davies’ book before they complete their current deliberations on Media Ownership and the News. We shall also be submitting it to the Secretary of State for Culture, Media & Sport, and renewing our call for a Fourth Royal Commission into the state of the UK media.

For more information or interviews, contact 07968 031 531

Flat Earth News by Nick Davies (Chatto & Windus) was published on 7 February 2008 – for more information visit www.flatearthnews.net

The Democracy of Political Funding

Ellie Keen — Mon, 11 Feb 2008 02:11:27 +0000

Labour’s traditional form of fund-raising was an example of democracy in action. It depended overwhelmingly on very modest contributions from millions of supporters, the great majority of whom were working people and pensioners.

In the constituencies, money was and still is raised from members by subscriptions, donations, raffles and functions organised by voluntary supporters. Among the affiliated organisations the individual contributions are also at a very modest level but there are millions of contributors. Much of the money is collected through trade union political funds. Opponents of Labour often speak of this money as though it gives Labour some kind of unfair and undemocratic advantage.

How wrong these critics are! The right of working men and women, members of trade unions, to collect and distribute money to influence political and economic policies affecting their welfare, their employment prospects, their pension arrangements, education, health provision and the need for international action against war has a long and worthy history. It is part of our democratic heritage.

From the earliest days of the industrial system workers sought to protect themselves and their children against cruel exploitation. One obvious way was to seek legal protection. Hence the very early agitation for control of working hours of women and children in textile factories and for safety in mines and all industrial workplaces.

This struggle for minimum legal standards in employment continues to this day. Much has still to be done, for example, to achieve equal pay for work of equal value, an issue of special concern to women. Similarly, hundreds of thousands of workers have been adversely affected in recent years by changes or threatened changes in occupational pension arrangements.

Trade unionism in the workplace coupled with political action are the keys to progress. This is why millions of trade unionists voluntarily recognise the need to contribute to the political funds of trade unions.

An important stage in the evolution of trade union political funds was centred on the struggle in the early 20th century for the payment of Members of Parliament. This demand was in the Charter in the 1840s when the early working class were seeking the right of parliamentary representation. How could working people stand for parliament and, if elected, live as an MP without financial support? Trade unions raised money to sustain MPs who were seeking to promote legislation for the protection of labour.

In 1913 a Trade Union Act was passed, following sustained agitation against restrictions imposed by legal decision, which established the right of unions to pursue certain political objects. The law has been changed from time to time and the relevant legislation now dates from 1992.

Under the law as it now stands a union must, if it wishes to ‘further political objects’ as set out in the Act, get the approval of the membership in a ballot vote. If, and only if, a majority is secured, can it then establish a political fund. This fund must be separate from the normal union funds. Any member who objects to contributing to this separate fund has the right to ‘contract out’. They must not in any way be excluded from any other right of union membership. The existing law defines what is meant by ‘the furtherance of political objects’. Any expenditure of money for these political objects must be taken from the separate political fund and not from the general funds of the union.

It will thus be seen that the law on the political funds of trade unions is not an example of privilege. It is indeed restrictive, but it imposes restrictions which the unions have accepted and surmounted by their democratic endeavour. Thus even before a political fund can come into existence in a union, there is in real life a debate about it. If the policy-making body of the union decides in favour of taking a ballot the issue is then submitted to a legally controlled ballot vote of the entire membership. If, and only if, a majority is secured can a political fund be established. If and when the fund is established any member who objects to contributing has a right to ‘contract-out’. They must not suffer any loss of rights in the union.

Trade union political contributions are an example of democratic action. They are not to be confused with or placed in the same category as big donations from wealthy aristocrats or businessmen, irrespective of the political party they favour.