If there is any connecting theme in the continuous run of current scandals (Turn our anger into action with a summer of solidarity, 24 April), it is the breakdown of the old pre-Thatcher mixed economy, where there was a bipartisan focus on maintaining full employment. Now there is, instead, an obsession with maintaining high land and house prices – what some land economists call homeownerism – which has created a vicious class system, whereby at one end of a Midland village you have young couples paying £800 a month in house rent, and at the other older people profiteering from the rents of six such houses.
No movement concerned with social justice can ignore this scam. It is corrupt because people are bribed by continuously rising untaxed capital gains into voting for rightwing parties. It deprives the young of spending power forgone in rents and high mortgages which, as Henry George showed, prevented people from moving where there was new work and affording any more than the basics.
• You report (24 April) that Finland’s experiment with a universal basic income is coming to an end. The headline to an earlier article (10 December 2015) when the trial started asked whether it was too good to be true. It appears that it was.
Unfortunately, the concept of “money for nothing” is hard to sell – and hard to sustain. This is why the progressive left especially should now consider the idea of the job guarantee. On Thursday 26 April at 6.30pm, Fadhel Kaboub – of Denison University, Ohio and the Binzagr Institute – will be speaking at City University of London on a proposal for a job guarantee scheme for the UK. Because it is not “money for nothing”, it should appeal to the right and centre, while still being acceptable to the left, since it is not the same as “workfare”.
• Philip Hammond implies that public finances are already in good shape, but economists are right to question “the strength of the UK economy” (Drop in deficit by £3.5bn could herald public spending rise, 25 April). What matters is not the budget but the trade deficit, which, at its largest since 2010, widened to 2.2% of GDP in 2016, when the current account deficit, at 5.9% of GDP, was widest in the G7 and the largest on record. Such deficits are feared because they have to be financed by external borrowing, so Hammond’s low-borrowing boast may be short-lived.
Additionally, in May 2015 the UK slipped into deflation for the first time in over 50 years, a state it has barely escaped from. Globally the threat of debt-deflation prompted U-turns in 2016 by the IMF and OECD, and governments were urged to use “public investment to support growth” – advice not substantially heeded then by Hammond.
Economist Ann Pettifor’s concern is that deflation inflates the value of debt and interest rates which, together with a Bank of England rate rise to its “target” 4%, would, author and economist Steve Keen worries, “cause the economy to tank”. Spending that £112m current budget surplus could be too little too late.
• What Stefan Collini (Education, 24 April) omits is the complicity of academics in the demise of academic freedom. I can only write of a subject with which I am familiar: economics. There was a purging in the 1980s of the alternative voices to the dominant free-market economics. I was informed by one former economist that to teach Keynesian or an economics contrary to the mainstream was academic suicide. Not only would such lecturers be denied preferment, but they would be unable to have their “alternative views” published in any respected academic journal. In a time of performance management, when the number of published articles counted towards a satisfactory assessment of one’s performance, such alternative economics rapidly disappeared from the curriculum. Modern languages seem to have followed a similar path, where “value for money” criteria demanded the closure of many modern language courses. Since the quality needed by university chancellors and their senior management is the ability to adapt quickly to the ever-changing dictates of central government policies, it is not surprising that these people are poor defenders of academic freedom.
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