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Swedish welfare reform – unemployment benefit which benefits everyone.

Nov 26

Posted by Dom in Economy, International | 1 Comment

Sweden is on the cusp of pushing through a cross-party welfare reform which will both guarantee a minimum level of unemployment benefit and allow higher earners to insure against the risk of unemployment. This week a parliamentary commission came to agreement on reforming the unemployment benefits system in a way which will accommodate the twin requirements of maintaining a reasonable standard of state benefit and accommodating well established union-linked unemployment insurance funds.

One of the big lessons in the UK of the financial crisis and subsequent recession has been that, rather than unemployment benefit being the preserve of all those fabled tracksuit-wearing benefit scroungers, a large number of middle income people with families to feed and mortgages to pay found themselves having to survive on Jobseeker’s Allowance and what savings they may have had. The cruel irony of wealth is that the more people accrue in terms of financial obligations (and there are very few who are lucky enough to be able to buy houses, cars and much else outright), the larger the fall when their income stream is taken away from them.

A signature visual trope of the global financial crisis has been Americans bedding down for the night in tents and cars after losing their homes – the product of a society where there is no real apparatus for helping people cope with a sudden inability to meet their financial obligations when unemployed, and very little consumer protection to stop banks doing as they please.

Now the bottom-most rung in Scotland were poor before the recession, are poor during and will most likely be poor afterward if we continue with the current financial and welfare model. What is more concerning is when people who are, in statistical terms, safe and middle class find themselves spiralling downward.  Even if downsizing is an inevitability, many do not even have the time to take stock of their assets before the wolf comes knocking. This underlines one of the biggest problems with contemporary society – the constant fear experienced by those without significant liquid assets that their life might vanish in an instant.

Jobs for life are now a thing of the past. People pursue multiple careers and during that time they will often spend months between jobs – months in which bills need to be paid, mortgages serviced and essentials bought.

It is of course unworkable that, without taxing everybody at eighty per cent, we should expect state unemployment support to replace the income of somebody earning upwards of 40,000 pounds a year. It is however morally and economically necessary to provide a basic level of income support which allows people to survive unemployment with their dignity and will to work intact.

The Swedish reform is designed to unify the roles of state unemployment benefit and the so-called ‘A-Kassa’, or unemployment fund. This is in effect a form of insurance against unemployment which, like a pension fund, is paid into and grows from private contributions, but is protected by the state. In the event of unemployment it then pays out at a rate relative to earnings which will function as a cushion above and beyond the basic level of unemployment benefit.

It is very difficult to make a moral case for taxpayers’ money being used to defend the accumulated assets of individuals above the basic standard of living which everyone in our society should enjoy, but it IS in the public interest that those on medium incomes should be given a framework of protection which will prevent them from entering a downward spiral. One of the most absurd things about the UK government’s current welfare reforms is the insistence that the system should be completely devoid of any cushioning elements whatsoever. As we all know, the stress and fear of losing everything you have ever worked for is the best possible motivation for finding a new job as quickly as possible. Why else would the men with the most embrace a welfare system which takes this as one of its core beliefs?

Imagine, for example, that you are a self-employed shop-owner or a freelance consultant of some form. In a good year you might hope to take 50,000 pounds or so, but come a recession, or a decision by your landlord to hire your premises to someone else, your work may dry up. As there is no severance package, you are essentially on your own. You might, in theory, have some assets which you could turn into liquid capital by remortgaging your house, or raiding your pension, but neither of these are particularly sensible long term options. Neither is it a question of lifestyle. You might possibly try and save energy, buy cheaper food and go out less, but these things will never vanish completely. Moreover, not having a miserable life and staying positive when unemployed is actually quite important, so eating Lidl value pasta seven days a week and leaving people to the joys of daytime television for lack of opportunity to do anything is not the kind of lifestyle we should be forcing people into.

Now, the beauty of the A-kassa system is that it makes a direct link between work and the amount of money you get back. It is in the interests of benefit claimants to seek work (combined with measures such as the living wage where working is actually a means by which people can take control of their own lives instead of servicing somebody else’s), and once you start paying in you can expect the fund to pay out. This is all in addition to your basic state unemployment benefit. Before anybody accuses me of wishing to burden people with more tax to pay for the unemployed, I should point out that this is a proportional tax which benefits the people who pay it.  Like National Insurance, it builds upon the idea that not everybody will become ill at the same time, but that in the event of illness the cost burden has already been dealt with or will be dealt with through future payments. We can try to build a society where fewer people become ill in the first place, just as we can try and remove the scourge of unemployment through more sustainable economics and foresight, but neither illness nor unemployment will ever vanish completely.

Becoming unemployed is actually a fairly natural event which will likely happen to many of us at some point, and it is time that we had a welfare system which recognised that unemployment is not the preserve of only the poorest. Green policy already envisages a basic level of income via the citizen’s wage, a simple and basic unit of government benefit essentially payable to all, but in the majority of cases recouped via higher tax receipts. The A-kassa system is designed as protection above and beyond this, meaning that unemployment need not result in the spectre of home repossession, rental eviction or severe financial hardship, and that working pays even when unemployment rears its head – a particular help to people working in changeable, short contract jobs. It also has the benefit of allowing people to feel that they are investing instead of throwing tax money at something which is of no benefit to them,

Not everything from Sweden is great, but breaking down the work/benefits dichotomy and helping people to recover from unemployment is something which can only ever be a public good.

Steve Bell just loves puppet imagery

Nov 16

Posted by James in International, Media | 5 Comments

Today there’s been a veritable faeces-storm over Steve Bell’s latest cartoon, which depicts Bibi Netanyahu using laughable “peace envoy” Tony Blair and Foreign Secretary William Hague as puppets, with missiles unleashed behind him. One Times hack went so far as to call Bell a Nazi, although that appears to have been a misunderstanding. Bell defends himself thus.

But anyone who is even vaguely familiar with Bell’s work (and I am a fan) knows he loves this kind of imagery. All sorts of people are depicted, largely legitimately, as puppets in his work. All these works are copyright Bell or the Guardian or both – I couldn’t always find them on the Guardian’s site, but if anyone from the Guardian wants me to take them down, just let me know..

Racist about Egyptians?

Racist about Russians?

Racist about Americans and Iraqis?

Racist about Afghans?

It’s a thing Bell likes. It fits with a certain left understanding of the world, especially international relations. So-and-so is really controlling what’s-his-name. Sure, some people who are antisemitic use it too, so should that make it off-limits as a metaphor? How would you illustrate that idea?

And yes, having a menorah on the podium might seem off. But you know, it’s just how the actual podium Netanyahu uses looks. That same pic has the same furled Israeli flags that Bell drew for today, too. Again, it’s just how a Netanyahu press conference looks. I’m as anti-antisemitic as anyone, but criticising Israeli politicians for bombing civilians, and criticising those who support them in doing so, that has to be allowed. This just looks like another attempt to shout down critics by disingenuously conflating their legitimate criticisms with racism.

Scotland in Europe reconsidered

Nov 8

Posted by Guest Blog in Europe, Holyrood, International | 23 Comments

If the First Minister won’t take legal advice on EU accession, Better Nation will get some on his behalf – in this case advice contrary to one of the editors’ perspectives on the issue.  

Stuart MacLennan teaches European Union Law at Trinity College, Dublin, where he’s a doctoral researcher. He is a former advisor to Labour on Europe and External Affairs in the Scottish Parliament.

The debate surrounding the question of a newly-independent Scotland’s membership, or otherwise, of the European Union is, to many, a confusing one. This is likely due, in part, to the fact that two parallel debates appear to be taking place. The question as to whether or not a newly-independent Scotland would be a member of the European Union is often confused with the question of whether or not such membership would be automatic. It is the opinion of this author that while a newly-independent Scotland would almost certainly be a member of the EU, it would certainly not be “automatic”.

It is worth noting that there is five recognized means by which a state can be created:

  • Secession;
  • Dissolution;
  • Merger;
  • Absorption;
  • Decolonisation.

It is important, in the context of the current discourse, to correctly categorize Scotland, as each category tends to attract different treatment under International Law. Some have argued, quite incorrectly, that Scottish Independence would be a dissolution of the United Kingdom. This would have significant consequences for the remainder of the United Kingdom, as it would have to seek recognition as a “successor state” rather than simply being a continuing state.

There is no precedent, nor any unique grounds, to suggest that the forthcoming referendum could result in the dissolution of the United Kingdom through the repeal of the Act of Union. First, Irish independence did not result in any change in status for the United Kingdom, despite being merged by a similar Act of Union in 1800. Secondly, the s30 Order agreed by the Scottish and UK Governments only “unreserves” the holding of a referendum on “The Constitution” under the general reservations contained within Schedule V of the Scotland Act 1998, leaving the Schedule IV specific protection for the Act of Union reserved. A semantic point, but nonetheless significant in that it appears to be a recognition by the SNP that Scottish Independence would be a secession on the part of Scotland, rather than a dissolution of the United Kingdom. It is the opinion of the author that that Scottish independence would certainly be a secession.

Heavy reliance has been placed upon the Vienna Convention on Succession of States in respect of Treaties, in particular by the SNP. It is worth, at this point, making a few cautionary notes about the Vienna Convention however. First, the Convention is principally concerned with decolonization – with “successor states” being colonial powers and “newly independent states” former colonies. The International Law Commission wanted to insert a category of “quasi-newly independent states” to deal with secessions in the non-colonial context, which would apply more specifically to cases like Scotland, however France and Switzerland objected, not wanting to encourage separatist movements within their own territories.

Secondly, the European Union has shown scant regard for the principles of International Law in the past (it began with Van Gend en Loos v. The Netherlands, and just spiralled from there).

Finally, a mere 22 states have ratified the Vienna Convention, only six of which (Cyprus, Czech Republic, Estonia, Poland, Slovakia, & Slovenia) are presently in the EU. However as the SNP’s arguments are firmly rooted in the application of the convention, it is therefore necessary to give it further consideration.

The case on which the proponents of automatic EU membership relied hinges on Article 34(1) of the Convention, which states:

When a part or parts of the territory of a State separate to form one or more States, whether or not the predecessor State continues to exist:

(a) any treaty in force at the date of the succession of States in respect of the entire territory of the predecessor State continues in force in respect of each successor State so formed;

On that basis alone Scotland would surely accede to all of the United Kingdom’s treaties upon independence. However international practice would suggest otherwise. Following the dissolution of the Soviet Union, only Russia was deemed to succeed to most international instruments. Furthermore when Pakistan separated from India, the United Nations (hardly a difficult club to gain membership of) admitted Pakistan as a new member and recognized India as a continuing member – a practice which has been followed in every subsequent case of secession.

International practice was recognized by the International Law Commission in its commentary on the Vienna convention:

In many organizations, membership, other than original membership, is subject to a formal process of admission. Where this is so, practice appears now to have established the principle that a new State is not entitled automatically to become a party to the constituent treaty and a member of the organization as a successor State, simply by reason of the fact that at the date of the succession its territory was subject to the treaty and within the ambit of the organization.

This practice was therefore recognized in Article 4 of the convention, which states that:

The present Convention applies to the effects of a succession of States in respect of: (a) any treaty which is the constituent instrument of an international organization without prejudice to the rules concerning acquisition of membership and without prejudice to any other relevant rules of the organization;

(emphasis added)

It is clear, therefore, that both customary norms of international law, as well as positive international law, would not see an independent Scotland as a continuing member of the European Union.

However, it has also been suggested that EU Law is different from all other instruments of international law, because it purports to be directly effective. In particular, it has been suggested that the “EU citizenship” rights enjoyed by Scots would continue by virtue of the doctrine of direct effect. This is quite incorrect. The concept of “EU Citizenship” is often confused with citizenship of Member States of the European Union. While it is the case that the Treaty of Maastricht establishes the concept of citizenship of the European Union, it is by no means clear that such citizenship exists independently of citizenship of the Member State. One cannot, therefore, rely upon EU citizenship rights as somehow creating or continuing EU membership – they are the product of a state being a member of the EU, not the cause.

EU Law is, of itself, only directly effective by virtue of EU membership. It is not a super-sovereign authority that is effective without the consent of the governed (Member States). EU Law is only effective because the authorities of the Member State give effect to it (through the courts, administration, police, etc.) even if the legislation itself originates from Brussels. Without its own means of enforcement, the purported “supremacy” of EU Law over a territory is dependent upon continuing membership and acquiescence of Member States. Membership, therefore, marks both the beginning and the end of the direct effect of EU Law. It is, therefore, a fallacy to suggest that the direct effect of EU Law over the territory of Scotland exists in perpetuity.

Of course, the foregoing discourse is merely one of European and International Law – perhaps the sort of discourse that might be contained in legal advice from the Lord Advocate to the First Minister. Given the body of evidence that suggests that Scotland would not be a continuing member of the European Union, it is perhaps hardly surprising that the Scottish Government has not sought formal legal advice on the matter.

That is not to say that just because Scotland would not automatically be a member of the European Union, that it would not be a member at all. International law is inherently intertwined with international relations. It is the opinion of the author that – while not a continuing member of the European Union – Scotland would find itself in the position of a candidate state that satisfies all of the accession criteria. In that circumstance, it is entirely possible that immediate accession could be achieved through negotiation. However such matters of European politics are beyond the scope of this discussion.

What if the Americans got themselves an actual NHS?

Sep 28

Posted by James in Health, International | 3 Comments

While scanning this piece about the unpopularity of the Romney-Ryan plans for healthcare, one figure jumped out at me. The total Medicare bill: $549bn, roughly £338.5bn. This programme covers 48m Americans – 40m of whom are over 65, and 8m are people with disabilities. That’s a cost per capita of roughly $11,400 or £7,000. Compare that to the NHS. For ease of comparison, these are the England-only numbers. The whole population of 51.8m was covered in 2010 for a total of £105bn, just over £2,000 per capita.

Now, clearly Medicaid covers a section of the US population that is much more expensive to care for, but we have some information about the NHS costs specifically for treating people of retirement age. This Parliamentary research paper says that in 2007-8 the value of NHS treatment to retired households was about 85% higher than the value to non-retired households, and, from that same paper, the retired are about a sixth of the population. A spot of simple maths gives us a rough NHS cost for the non-retired of £1749 a year and £3236 for the retired (again on a crude assumption that the average household size of each group is the same). Note: I’ve not factored out the higher costs for caring for people with disabilities, either, so the comparisons above will also be inaccurate to the extent that those costs diverge from the costs of care for the over-65s.

So let’s say the Americans had a rush of socialist blood to the head and set up a NHS along pre-Coalition lines. What might the budgetary implications be, aside from the setup costs?

Let’s assume treating those on Medicare would cost the UK retired figure, and treating the 260m Americans who aren’t eligible for Medicare would cost the UK non-retired figure. The Medicare crowd would then be covered for about £123bn ($200bn) – a saving of $349bn, Republicans please note – and everyone else would be covered for £455bn ($738bn). At a total cost £578bn (or $938bn) all 260m Americans would have healthcare free at the point of use, just 70% more than the current cost of caring for fewer than a fifth of them.

But Medicare isn’t the only government health programme LBJ left our American friends. Medicaid was established as a medical safety net for those on low incomes, and in 2008 it cost about $338bn, roughly £208bn, to cover a further 60m Americans, albeit with plenty of costs for those poorer citizens still to bear. No doubt the 2010 figure was higher, but even assuming not, that takes total federal expenditure to $887bn, or £547bn.

So, to conclude: America – you’re spending $887bn to provide healthcare to 108m people, little more than a third of the population, but you could spend less than 6% more, just a further $50bn, and cover the whole country. In fact, your total costs are already almost three times more than that when you factor in private expenditure, from companies and individuals – a whopping $2,600bn. Sure, some of that wouldn’t be covered by your shiny new National Health Service, but the savings would be truly enormous.

No-one would pay a penny when they got sick except a small flat charge per prescription that the Medicaid and Medicare crowd would be exempt from entirely (this is a comparison with England: in Scotland, Wales and Northern Ireland you wouldn’t even pay that). No more fear of losing insurance. Hell, no more insurance.

Cut wasteful spending. Save the average family $20,000. Put money in the pockets of the middle class and the working class alike. Economic benefits, not least because people might dare to start more businesses rather than clinging to an employer’s health insurance. This is nothing less than a fiscal conservative’s dream. Even Obama’s baby step in this direction isn’t unpopular anymore. Just don’t mention Bevan, Attlee and Beveridge.

Scotland’s Dirty Water

Aug 6

Posted by Guest Blog in International | 10 Comments

Water apartheid is a daily reality in the Occupied Palestinian Territories. But Scotland is not free from complicity in this. As the Scottish Green Party raises a motion in Parliament urging the Government to withdraw subsidies to Eden Springs UK, Tariq Al-Bazz charts the link between this Scottish water company and its Israeli parent company which sources its water on illegally occupied territory on the West Bank.

In Scotland we have it pretty good as far as water is concerned. There’s loads of it, and we can even afford to sell some to our poor neighbours down south. But what if those neighbours chose to bomb our cities, invade our country and proceed to surround all our population centres with settlements guarded by heavily armed troops?  What if they poured lots of money into these settlements, gave settlers loads of privileges, and commandeered our water for themselves? “It couldn’t happen here”, you might say. Everyone has an equal right to water – even if we do have to pay for it. That’s what the people of Palestine thought before they were hounded out of their land and occupied by the state of Israel. Water apartheid is now a daily reality for Palestinians living in Gaza and the West Bank.

The facts speak for themselves. Israelis use three times as much water as Palestinians. Palestinian water usage barely reaches the minimum daily standard of 100 litres per person per day as defined by the World Health Organisation. Israel exerts strict control over water availability, and ensures that its own population is plentifully supplied with water, whilst restricting that provided to Palestinians.

Water is legally defined as (Israeli) public property. As such a permit is required to drill new wells or fix existing ones. Permits go through eighteen stages of approval in various administrative departments. Furthermore, quotas limit the drawing of water from each well. In many cases, Palestinians are deprived of access to water resources by being deprived of access to their land in general. Israeli land grabs are frequently carried out by establishing military areas on natural reserves, especially in the Jordan Valley.

Israel also makes no effort to maintain the water system. Neglect of infra-structure is a deliberate Israeli policy which also goes well beyond the water sector. The amount of public expenditure in the Territories in all fields is less than the fiscal revenues that Israel collects from the Palestinian population.

In addition to not authorizing construction of new water networks and repeatedly rejecting requests to be connected to existing networks, the Israeli Civil Administration often destroys or confiscates the modest structures that Palestinians build to collect water.  Through settlements and Mekerot, (the state water company), Israel damages existing Palestinian access to water by drilling deeper, more advanced wells in close proximity to Palestinian wells or streams, causing a reduction in the yield of Palestinian water sources.

The extreme water crisis felt by Palestinians is only magnified by the blatant overuse of water in nearby Israeli settlements. As mentioned above, the average Israeli consumes up to 350 litres of water each day, Israeli settlers typically consume even more, despite living among a majority Palestinian population denied proper access to water.

In the Jordan Valley, for example, there are 56,000 Palestinians and 9,400 settlers. Settlers use six times more water than Palestinians. This discrepancy in water allocation is particularly brutal in the hot summer months when Israeli settlements are provided with an uninterrupted flow of water while Palestinians are often cut off from the pumps.

All this colonial domination by Israel flies in the face of international law and human rights.

According to the Israeli human rights organisation, B’Tselem “Article 55 of the Hague Regulations limits the right of occupying states to utilize the water sources of occupied territory. The use is limited to military needs and may not exceed past use. Use of groundwater of the Occupied Territories in the settlements does not meet these criteria and therefore breaches article 55.”

But what relevance does all this have to us in Scotland?  Well, it seems that the Scottish Government has been complicit in supporting water apartheid in Israel. In October last year the Government announced the award of a £156,000 grant to Eden Springs UK.  Eden Springs is the largest provider of water coolers to workplaces and offices in Scotland. It supplies drinking water to most Scottish Health Boards, to a large number of Scottish Councils, Universities, Colleges, and office complexes. The Scottish Enterprise Grant followed a meeting in January 2010, between John Swinney, then Cabinet Secretary for Finance & Sustainable Growth, and the UK Managing Director of Eden Springs.

Eden Springs UK is a subsidiary of Eden Springs Ltd of Israel. This company extracts water from the Salukia spring in the Golan Heights, where it also has a bottling plant. The Golan Heights is part of Israel’s colonialist expansion in the Middle East. It is Syrian Territory illegally occupied by Israel since June 1967. The UN condemns Israel’s actions in illegally occupying the West Bank, Gaza and the Golan Heights and in Security Council resolution 242 emphasised “the inadmissibility of the acquisition of territory by war” and affirmed that a just and lasting peace can only be established when there is a “withdrawal of Israel armed forces from territories occupied”. In effect, Eden Springs is stealing water from the Golan Heights.

Of course Eden Springs UK does not itself source its water from the Golan. Its main depot is in Blantyre, although it has other sites in Inverness, Aberdeen, & Dundee. However, this is part of an international company whose complicity with water apartheid in Palestine is well established. Alex Salmond has said in the past “you can’t have normal relationships if you believe another country has been involved in what Israel has been involved in”. I agree with him and ask therefore that his administration withdraws its support from an organisation that is complicit in Israeli apartheid. It is time that the Scottish Government acted on its principles and withdrew its grant to Eden Springs.