UNISONActive is an unofficial blog produced by UNISON activists for UNISON activists. Bringing news, briefings and events from a progressive left perspective.

Thursday, 11 March 2010

The human cost of the economic crisis‏

'The Great British Economy Disaster’ is the title of a superb article by John Lanchester in the current edition of the London Review of Books, in which he outlines the human impact of the economic crisis:

- 511 000 people lost jobs in Britain in 2009 – a rate of 1400 per day

- A British property is repossessed every 11 minutes

According to Lanchester ‘the historic pattern, unfortunately, is that as many people will lose their jobs in the initial recovery as lost them in the downturn’.

In coming years, the level of spending cuts could reach an unthinkable 18 – 24% if a future Government honours cross party pledges to ring-fence spending on health, education and overseas development are honoured. The effect of even a 2 year freeze in NHS spending would lead to the sharpest contraction in 60 years!

Lanchester castigates the executives at Goldman Sachs who awarded themselves a bonus pool this year of $16.2 billion – more than twice Haiti’s GDP of $7 billion.

He concludes his analysis of the banking crisis by making the case for the Tobin Tax – a levy on financial transactions:

‘A proposal which might help is the Tobin tax, a global levy on all financial transactions, named after its inventor, the Nobel laureate James Tobin, who began touting the scheme in 1972. The analogy would be with email spam: if it cost some minute amount, say a penny, to send an email, it would have no effect on the righteous, but would immediately destroy spam as a business, because spam depends on sending tens of millions of free emails daily. Similarly, a tiny levy on every financial transaction would introduce just enough grit in the system to slow down the operation of the global casino, most of whose activity consists in zero-sum betting: gambling in which the banks bet against each other, and one wins what the other loses, to zero public benefit.’