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Arguments for socialism :: Northern Rock
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Northern Rock, the failed bank rescued by the previous Labour government, has been sold off on the cheap to Virgin Money by the Con-Dems.
The government will receive £747 million from the sale of Northern Rock despite £1.4 billion of public funds injected into it since 2007. In other words the government has lost up to £650 million in this deal.
Northern Rock was the first UK casualty of the global financial meltdown and was nationalised in February 2008 to prevent its collapse. However, instead of being run democratically in the interest of ordinary people, the bank was split between one with 'good assets' - now sold off to Virgin - and another part holding the 'toxic assets'. The latter still owes the Treasury up to £21 billion!
Tory chancellor George Osborne described the sale as "value for money".
During its 'reorganisation' the government owned Northern Rock shed 3,000 jobs. Virgin Money says that it won't compulsorily sack any more workers 'for three years' but did not rule out 'natural wastage' job cuts.
Despite legal threats from the City of London Corporation, the mood at Occupy London, outside St Paul's cathedral, remains defiant.
The direct response of occupiers to potentially lengthy legal proceedings and eviction has been to expand the occupation. Campaigners have taken over a huge abandoned office block owned by investment bank UBS. Renamed the 'Bank of Ideas', the building will be opened up to groups who have lost their community centres and youth clubs in the government's savage spending cuts.
This is only one of many empty properties in the City and raises the possibility of more widespread action as banks begin to repossess thousands of people's homes. Plus, many occupiers welcome the prospect of moving indoors if it starts to snow this winter!
The UBS building has also been opened up to unions on strike on 30 November. A conference and rally at the weekend brought together representatives of occupations across Britain and Ireland and fully backed the public sector strikes. Speakers from the trade union movement also pledged support to the occupation movement.
As the Socialist warned last week, the government has now decided to end the uprating of benefits in line with inflation (5.2% in September). Instead, ministers will use a lower inflation rate (4.5%), saving the Con-Dem government £1 billion.
As a result, millions of disabled and unemployed people and their dependents will now lose hundreds of pounds a year. This savage cut is on top of other reductions in benefits in the past 18 months, including those benefits relating to housing costs.
The move is a cynical exercise by the government to cancel the proposed 3p a litre rise in fuel duty expected in January by getting the poorest and most vulnerable to make up the shortfall in government revenues - a classic case of robbing Peter to pay Paul.
A letter released to the Stock Exchange last week from Wey Education plc, a company headed by Zenna Atkins, ex-chair of Ofsted, speaks volumes for the government's education privatisation agenda.
"Wey is responding to the English market opportunity brought about by the transfer of state-run schools to independent charitable entities and the deconstruction of the education function within local authorities.
Within the £53 billion English education system, the standards achieved by pupils and the rounded quality of the education they receive need to be significantly improved. Additionally the evidential efficiencies that can be made in the operation of schools combine to make a clear opportunity to make a substantial return to investors and improve education in the UK."
I have just received my winter fuel allowance which has been cut by £50! For the past three years the over 60s have been getting £250 and over 80s £400. I am now getting £200 and the over 80s will be getting £300 - a £100 cut! I can only afford to put my heating on in the evening and with prices going up all the time even that is becoming a luxury.
I live in Maesteg, an ex-mining town in South Wales and all my pensioner friends are in the same situation, freezing in their own homes because we can't afford to keep warm. Age Concern Cymru has estimated that 12 pensioners a day will die in Wales because of cold homes and yet this government still cuts our winter fuel allowance.
As a 74 year old member of the Socialist Party I still put some change aside in my money jar every week so I can help our party get rid of a system that in the 21st century is legally murdering old people every winter.
A year long inquiry into boardroom pay by the High Pay Commission think tank has revealed that the pay of top executives at a number of FTSE companies had risen by more than 4,000% on average in the last 30 years.
The report cites Barclays boss John Varley's pay of £4,365,636, which is 169 times more than the average worker in Britain today - a 4,899.4% increase since 1980.
This hike in fat cat salaries is in stark contrast to the shrinking pay packets of many workers, suffering a third year of pay freezes and soaring prices for heating, housing, transport and food.
While selling the Socialist I met a young homeless couple. Their dedication to one another was endearing but their desperate plight was heartbreaking.
The girl was Asian, estranged from her family for being in a mixed relationship. He had been brought up in care; they had no family. They said they couldn't save up enough money for a deposit to rent a flat (in London that's over £1,000). They said they couldn't get work because they didn't have an address and they had waited for days at the local housing office only to be turned away.
The boy pointed to the bag he was carrying: "Our whole lives are in this bag".
After talking to them I can imagine the symbolic tents of the 'occupy' movement to becoming actual tent cities if we don't stop these attacks.
The smashing of the public sector is the removal of the safety net for workers. 30 November represents crucial steps of the organised working class moving to defend it.
Unite union members were out in force in Greenwich on Saturday campaigning against the cuts.
One of the highlights of the day was when a local shop worker came out from a major department store and asked how long we would be outside the shop. Initially I thought that we were going to be asked to move on.
She in fact wanted application forms so that she and her friends could all join the union. She had heard, from her grandmother, about what a great union branch we have and wanted to get organised.
Arguments for socialism keywords:
Banking crisis (15)
Clause 4 (1)
Clause four (6)
Minimum wage (316)
Northern Rock (34)
Party funding (1)
Socialism 2007 (17)
Socialism 2008 (13)
Solidarity Scotland (1)
The Socialist (1221)
Them & Us (25)
Trade union organisation (7)
What we saw (38)
Workers press (1)
Working class (863)
Article dated 23 November 2011
The Socialist, weekly newspaper of the Socialist Party
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