Author Archives: Calvin

LCH.Clearnet – who? what? why?

So, just to make sure I understand this straight: Italy’s current problems are the result of the hitherto-unknown (at least by me) LCH.Clearnet – essentially a clearing house for bond trading – deciding that traders in these things need to lodge more money up front with it to cover any prospective default, thus increasing the price of doing so and the rate of interest which the Italian government has to offer on such things to sell them.

This is despite the Italian economy being, generally speaking, in a healthy state, with low private debt, a level of public debt that is high but not unsustainably so, and a level of public expenditure which has been lower than taxation revenues in every year since 1992 (other than 2009).

A couple of questions, in the tradition of the simple laddie at the Emperor’s parade:

1. What exactly is LCH.Clearnet and to whom is it accountable?

2. How has it come to occupy such a central role in this whole business?

3. Are there, to coin a phrase, other clearing houses available for the trading of bonds, not just in Italian government bonds but those of other countries? If there are, is there any suggestion of a cartel?

4. And the evidently rhetorical – why do we give such organisations this sort of power over our economies? Or, perhaps more accurately, given the lessons of 2008, why do we continue to place such economic faith in the actions of financial institutions? To what extent does it make sense to give ‘markets’ (and here, we should be clear that this does not reflect an ‘invisible hand’ but the decisions of very powerful (but nevertheless completely invisible) individuals) this sort of role in the shaping of our economies? Not least when financial ‘markets’ (and individuals) are not exactly known for taking the long-term view which is critical in the circumstances in which we have been landed.

This really is the return of History (or, otherwise, perhaps the end of the End of History).

Unfairly dismissed? Well, speak to your union…

The Beecroft Report commissioned – and apparently supported – by the Head Bullingdon Boy himself, which was leaked originally on Tuesday to the Telegraph, continues to startle.

It is not just that the evidence base for the conclusion is so poor, as revealed by Channel 4’s FactCheck (did No. 10 really pay money for this? And, if so, who paid?). And neither is it the overt prejudice on the issue of workers’ rights from the shurely unlikely source of a venture capitalist who has strong links to the Tories, as revealed today in the Indy. This is, perhaps, the most shocking sign yet of the attack on working people which the Tories are mounting under cover of the state of the economy. Not an unprecedented attack, by any means, but which is startling from the perspective that it is a coalition government that is making it (although the junior partner has squeaked its opposition to the Report). And neither was there any mention of abolishing unfair dismissal laws in the Tory manifesto. No-one, indeed, voted for this.

Two observations, really:

(a) this is a sign of an increasingly confident, not to say arrogantly aggressive, government which feels it needs to pay no attention to protest. This might have been a bit of kite flying to assess public reaction to such a move, but I doubt it: such a piece of kite flying wouldn’t have been attempted by a government that knew it would not get away with it. Consequently, protest actions – like the one on November 30 on pensions in the civil service – need to be supported and the actions themselves need to be stronger if the attacks on working people are not to become even more direct.

(b) unfair dismissal laws were introduced – originally by a Conservative government, ironically enough, albeit in a rather different era of unions’ ability to mount a strikingly successful national campaign of civil disobedience to the law and its machinery – since it was thought by the 1965-1968 Donovan Commission that a law institutionalising unfair dismissal would prevent much of the unofficial strikes over dismissals which it regarded as a major factor in the UK’s low productivity. It is a sign of the times that we now have a new Tory-centred administration which is either ignorant of this or which feels it can simply ignore it on the assumption that strikes are now – and with some exceptions, this week not least – such an apparently invisible part of the industrial relations scene.

The ability of trade unions to take strike action over unfair dismissals, particularly unofficially, might be far removed from policy considerations these days, but the suggestion that things have gone so far that public policy can remove one of the employment rights safeguards whose original intention was actually to reduce the incidence of such action being taken is a novel one. Nevertheless, that’s a manual we will have to dust off again if we are to be able to deal convincingly with the increasing threats which this government is posing to workers’ rights. And, conversely to its aims, dusting off that manual is a move which could be good for us – if, of course, we can remember where we put it. Like the Charter earlier this year, this is something around which we could organise – but ideally locally, actively, rather than nationally.

Back to the future? Only under the Tories…

Labor’s top ten

In celebration of today’s Labor Day in the US and Canada, thenation. has come up with its own version – with videos – of the top ten songs commemorating workers’ struggle. As always with personal choices, there’s always room for debate about inclusions and omissions – but it’s good to see something from Phil Ochs in there. And the Dolly Parton is an inspired choice.

Having had my own bash at this a couple of years ago, I know how difficult it is to come up with much from the last couple of, well, decades. RATM/The Nightwatchman apart (from thenation‘s commentators – to which I might also add Diana Jones and indeed, Ry Cooder – thanks to @billybragg!), there’s just not a lot of people out there writing memorable modern songs about labour. A reflection of the – surely temporary – decline in collectivism no doubt, but, with work remaining central to the preoccupations of millions of us and with no shortage of issues to concern us, where indeed have all the good songs gone?

(thenation.com‘s list came to me courtesy of Labourstart – whose Labor Day solidarity campaign features the continuing struggle to get T-Mobile to allow workers in the US free choice of being represented by unions. Add your words to the e-mail deluge here.)

Back again

And what better way to kick things off again than with a fresh new look courtesy of the good people at wordpress.com, and an illustrative photograph?

This is Eshaness, in Shetland, on the most magical of days.

Blue skies; jade, emerald and turquoise seas; and an eloquent grandeur to the destructive power of the ocean. And that white speck on the clifftop grass is indeed a person.