So I got an email from 38 Degrees about their new energy campaign. I have been very happy to support a number of their campaigns in the past including those safeguarding the NHS and their work on the AV referendum.
The current campaign though just doesn’t sit with my sustainability sensibilities (try saying that quickly). The campaign is targeting the greed of energy companies in keeping prices high and making large profits, and aims to pressure them into reduce the cost of gas and electricity for the consumer. However, I don’t believe this approach will serve the greater good.
Energy is already too cheap. For the last century our economy and way of life has been subsidised by the availability of cheap fossil fuels. The cost of burning this incredible energy source is only just dawning on us decades later. Our addiction to cheap energy will soon cause energy shortages and price fluctuation which will leave whole nations unable to afford the fuel which they require to sustain their lifestyles. The rich nations will continue to be able to afford oil and gas for quite some time but as the cheap, easily extracted sources are exhausted the poorer nations will quite simply be priced out.
Another point here is the rebound effect. This is the argument that if everyone in the UK has more money in their pockets then they will go out and spend some of that money on consumer goods which require energy to manufacture, transport and use. So in an attempt to bring ‘fairer’ energy prices the result is an increase in energy use and CO2 emissions. (I cannot write that last paragraph without thinking that solving the current economic crisis requires an increase in consumer spending – this was not the motivation for the campaign though).
In the UK the vast majority of households can afford to pay more realistic prices for energy. Prices that consider the cost of climate change and the global instability that will result from resource depletion. This is will not be a popular opinion but energy has been too cheap for too long. I contacted the 38 Degrees team and suggested another approach which would curtail the greed of energy companies but would be sustainable and would not send a confusing message. I received a quick response which stated that they didn’t see a contradiction in fighting climate change and campaigning for cheaper energy bills. This is disappointing for the reasons I have already stated. The campaign was voted for by a majority of 38 Degree members which is no surprise, as in a quick internet vote with little information or thinking time the first response to the question ‘do you want to stop rip off gas and electricity bills?’ will be ‘yes’. No one wants to be ripped off and if this is suggested in the question the response is meaningless. But like myself given a bit more space I am sure many of those that voted for this campaign would see its flaws.
I, like most of the members of 38 Degrees, don’t like seeing energy companies making extortionate profits and not considering the wider implications of their actions. So what ideas might solve this problem? First, I’d like to see a change to the way that energy tariffs work. Currently the first bit of energy that you use is expensive up to a certain level of usage, at which point (and depending on your tariff), the cost is lowered. This is clearly regressive. In this system the per unit of energy price is higher for low energy users often from low income households than those that are using excessive amounts. It encourages high energy use. The tariff system should therefore be reversed. Energy should be cheap at first and the more you use then more expensive if should become.
Secondly, per unit cost of energy should be increased. This sounds shocking but energy needs a real price which considers the environmental damage and encourages individuals to use less and innovators to come up with better renewable and low energy solutions. This increase in price will not be for the energy companies to spend as they wish but the current obligations on them enforced by government should be extended.
These changes will then enable two things – Firstly households which cannot afford energy (and there will be more of them because of higher prices) will be heavily subsidised. This new system is therefore progressive and would be an equalising factor on a society which is currently becoming more and more unequal. Secondly more money will be available for making energy-efficient changes to homes and for investment into the development of renewable and low energy technologies.
So, the outcome would be to raise awareness of climate change and resource depletion, reduce fuel poverty and inequality and ensure long term investment in the technologies required to work towards a sustainable future.
I am sure that I am not alone in getting frustrated about the inconsistency of the messages that we get from Whitehall. The recent debate about whether the chief of RBS should accept his £1 million share bonus has got me thinking again about it all.
I am predominantly interested in sustainable development. This is really another way of saying that I am interested in anything that has an impact on the future of our society, the environment and economics – so everything then. For me this is one giant ball of string; it is all the same problem, although it does not have a single solution. It is, however, a huge problem which encompasses many global issues – climate change, energy security, peak oil, inequality… and can only really be tackled by governments that are willing to make choices to safeguard our future. If we are going to make these choices we have to be given clear and consistent messages.
So when a Cabinet minister like Iain Duncan Smith says that it would cause ‘chaos’ if the government overruled RBS and stopped the payment of the share bonus I feel uncomfortable. The government owns 82% of the bank so it seems only fair and right to hold them to account. The only reason that RBS is still open for business is that we spent billions of pounds bailing it out and continue subsidise it year on year (The Bank of England estimate subsidising of banks in the UK costs the tax payer £20 billion per year). So what is the message – the government is happy for banks to reward their managers even though their business model has failed and is failing. It is clearly not sustainable for any profit making company to be subsidised by the tax payer.
This is why I am a supporter of the Green New Deal. If we are going to provide a stable economy, a safe society and an inhabitable environment for our children we have to invest now in the things which we know will achieve this. Austerity is not working. We seem to be moving into another recession. Unemployment is rising. Let’s make some changes which will benefit generations to come.
The messages of the current government are sending – by propping up the banking system and asking the tax payer to pay the bill whilst making budget cuts to the services on which we rely – promotes risk taking and short term-ism for the benefit of the few, it says that banks can risk our livelihoods for their own personal gain with little or no government intervention on our behalf.
Let’s change the message. To a message which speaks of fairness and long term thinking. A message that says that every member in society is worth fighting for and a message that says that government is willing to lead our nation and not leave it to others. The green new deal promotes wise investment. It means spending to create jobs that will in turn strengthen our economy. Spending that will protect our environment and which will be a benefit to all in society. It promotes a consistent message that we can all believe in.
For more information regarding the green new deal follow this link: http://www.greennewdealgroup.org/
Searching Finance, 2011
In The Courageous State, Economist Richard Murphy presents a powerful and compelling critique of the existing neoliberal influence on democratic government in developed nations. His narrative depicts the State in a current crisis of confidence, neutered by the self-doubt of elected politicians who are taught to believe that the market knows best. This results in a weak government unable to perform its duties and uncertain of the State’s ability to work for the benefit of the citizens it represents. Yet in Murphy’s vision the State is not just the best but the only solution to the current financial turmoil, uniquely positioned to deliver a prosperous, sustainable, and equitable future for the greatest number.
It is a wide-ranging book, and while the mainly-economic points are plainly and vigorously made, the parts that reason via elements of psychology and sociology come across as less focused and precise, and at these stages the book loses a bit of the momentum built up in the earlier chapters. Nevertheless, the book as a whole is stronger for its broad approach. It is also uncompromisingly written; Murphy is nothing if not direct, yet I wonder whether such a forceful style, which comes across as almost arrogant at times, would deter some of the more timid members of the disgruntled majority whom the author would no doubt like to bring on board.
These are small concerns however, as what is most evident is that this is a book rammed full of good ideas. Not pie-in-the-sky but pragmatic, realistic solutions; not just to the economic crisis or the inherent unfairness in our society, but to the whole ideology which has led to the current class of wobbly politicians, whose lack of vision and conviction has allowed the dangerous status-quo to continue far longer than it should. It is these ideas, concentrated towards the end of the book, which elevate The Courageous State well above the yet-another-book-about-neoliberalism class of commentary. Murphy presents his solutions with great clarity, as well as clarity of purpose, which enables the reader to see the logical connections between them and for them all to sit together as a cohesive whole.
As a result, the most striking thing about Murphy’s vision, especially amongst the doom and gloom of the austerity agenda, is that it is one of hope; the best kind of hope based on specific, realistic objectives. You won’t find here any suggestions for revolution, simply a change of mind-set which will allow for the many small changes needed to alter the course of our troubled political and economic institutions; to enable them to be forces for the good of the majority rather than a wealthy few. With the current absence amongst national politicians of both hope and a cohesive vision, anyone looking to take up the leadership challenge on the left could do worse than read The Courageous State. If they were to pick it up they would find not just a book, but a fully-formed and fully-argued manifesto for a more stable and more equitable world.
I’m not exactly sure what I think yet about Scottish independence. Ultimately it should be, and looks like it will be, up to the people of Scotland to decide. However, I’m inclined to see it as a regressive move on the basis that the challenges facing the UK and the World in the next 20 or 30 years will be immense, and as Martin Wolf pointed out in an article in the FT on Sunday, it’s only by greater global cooperation that we can hope to make it through.
Breaking up the Union would be a step away from cooperation and collaboration towards an individualistic and ‘every man for himself’ approach. For all Alex Salmond’s socialist policies, this is a neo-liberal tendency and one that will serve both Scotland and the rest of the UK poorly in future, whether or not a full divorce is sanctioned by the Scottish electorate.
Finally just a quick note on the question itself. You don’t have to be Derren Brown to know that starting a question “Do you agree…?” is hugely suggestive for a yes vote. It’s therefore disingenuous at best for Alex Salmond to propose the question with the wording “Do you agree that Scotland should be an independent country?”. This kind of politicking is infuriating. ”Should Scotland be an independent country?” is a much simpler and fairer question, and took me all of 5 seconds to come up with.
Well this week we finally decided to put whyPolitics on Twitter. I’ll be tweeting from @MattJSisson, so please follow me if you’d like to stay up to date with all the latest whyPolitics info without having to check back regularly to the blog.
- “Perhaps the sentiments contained in the following pages, are not yet sufficiently fashionable to procure them general favour; a long habit of not thinking a thing wrong, gives it a superficial appearance of being right, and raises at first a formidable outcry in defence of custom. But the tumult soon subsides. Time makes more converts than reason”
- Thomas Payne, 'Common Sense'