Bank of England says UK must avoid protectionism in favour of international cooperationBrexit is an acid test of whether it is possible to reshape globalisation in a way that offers the benefits of trade while allaying public fears about the erosion of democracy, the governor of the Bank of England, Mark Carney, has said.Speaking in London, Carney said the ramifications of the UK’s departure from the EU would be felt around the world and would determine whether it was possible to shrug off rising protectionism in favour of a new era of international cooperation. Continue reading...

Forcing universities to compete with each other is a bad idea. What we need is a Teaching Happiness FrameworkIn The Methods of Ethics, a book read only by philosophers with an overdeveloped sense of duty, the late Victorian utilitarian moralist Henry Sidgwick argued that other philosophers of his day were wrong to believe that human beings act only for the sake of their own happiness or pleasure. There is a second spring of human action, he argues: the pursuit of excellence. A poet, a philosopher, or a sportsperson working obsessively may hope to be happy, but, more likely, what matters to them most is what they can achieve.Sidgwick’s work faded from fashion soon after his death in 1900. At Cambridge University, where he had been professor, he became a symbol of times past. The young Bertrand Russell and his fellows referred to him as Old Sidg. But his fortunes revived in the 1980s, and he is being read by undergraduates again. I don’t know if the current generation of university regulators ever studied him, but, if so, they have only remembered half of what he taught. We have the Research Excellence Framework, and the Teaching Excellence Framework. Where is the Research Happiness Framework, or the Teaching Happiness Framework? Continue reading...

Environmental and social problems could interact in global breakdown, report saysThe gathering storm of human-caused threats to climate, nature and economy pose a danger of systemic collapse comparable to the 2008 financial crisis, according to a new report that calls for urgent and radical reform to protect political and social systems.The study says the combination of global warming, soil infertility, pollinator loss, chemical leaching and ocean acidification is creating a “new domain of risk”, which is hugely underestimated by policymakers even though it may pose the greatest threat in human history.Related: Humanity faces an existential crisis – Labour must join the fightback | Owen Jones Continue reading...

Chancellor’s claim undermined as rapid slowdown in GDP growth is revealed

The public want the government to spend more, yet the Tories cannot grasp how this makes economic and political senseLast week it was revealed that a secret group of Whitehall officials were drawing up plans to rescue the economy if it were to tank after Brexit. However, the release of the latest GDP data shows that even before the UK leaves the European Union the economy looks as though it needs resuscitating. Philip Hammond thinks Brexit is a terrible idea. He also believes there is little wrong with the economy. As the man in charge of the nation’s finances, he would say that, wouldn’t he? The truth is that rather than presiding over a “fundamentally strong” economy, Mr Hammond and his Conservative predecessor George Osborne have been slowly asphyxiating the economy by depriving it of the oxygen of demand.The result has been that UK economic growth is as bad as it was in 2012, when Mr Osborne first softened ever so slightly his hardline policies but not his offensive rhetoric. It is important to say that we are some way off a recession, and it would be premature to suggest otherwise. However, the data shows that business investment is going backwards, unlike in other big European nations, and exports have stalled, which was perhaps foreseeable given the slowdown in near neighbours. The UK consumer, already in debt, is not willing to spend when Britain’s future direction, not least in respect to the EU, remains unsure. That leaves the government, which ought to be turning on the spending taps but is instead consumed by ideological rows over Brexit. What the Conservative party ought to realise is that the slow recovery from the 2008 crisis is about a deficiency of aggregate demand. The way out is more public spending. Remember the £350m on the side of the Brexit bus? Theresa May thinks she can get Mr Hammond to cough up that much and claim it as a Brexit dividend. In reality Brexit’s causes run deeper than that. Much more will be needed to repair the damage wrought by years of austerity politics. Continue reading...

Donald Trump may be a ham actor but he’s got the whole world on tenterhooks nowArt is supposed to hold a mirror up to society butfor Donald Trump the opposite is the case. Current events in the White House increasingly mirror the soap opera of the West Wing only with a rightwing nationalist rather than a social democratic globalist at the helm.As with the TV series, there are a number of interwoven plots. Is Trump involved in an attempt to smear the world’s richest man, Jeff Bezos? Will the probing by the special counsel Robert Mueller lead to the president’s impeachment? Will the president’s battle with Congress over a wall along the border with Mexico lead to a second shutdown of the government? Continue reading...

Chancellor blames Brexit uncertainty for a sharp slowdown at the end of 2018, but trade secretary points to China

GDP contracts by 0.4% in December in weakest year for growth since 2012The British economy plunged into reverse in December, with a broad-based slump in economic output completing the weakest year for growth since 2012.The Office for National Statistics said gross domestic product contracted by 0.4% from the previous month, fuelled by a fall in spending on the high street over the key festive shopping period.Related: Britain's Brexit slump will be quietly cheered in some quarters | Larry Elliott Continue reading...

A trip across England in 2016 revealed a nation broken by neoliberalism. For it to heal, this above all has to changeIn May 2016, a few weeks before the EU referendum, I walked 340 miles from Liverpool to London to see what was happening to my country. I was travelling in the footsteps of a 1981 march against unemployment that my late father had helped to organise. In that year, Tory policies had devastated industry and sent unemployment skyrocketing. In 2016, Tory austerity was putting the final nail in the coffin of those broken communities.Even so, on my walk I was shocked by the level of poverty, by the sheer number of homeless people in doorways and parks, and by the high streets of boarded-up shops and pubs, full of payday loan outlets and bookies. People in those former industrial towns spoke of their anger and betrayal, of having being forgotten by Westminster politicians, of their communities having been destroyed as the manufacturing that had sustained them either folded or moved to low-wage economies.Related: All Together Now? One Man’s Walk in Search of His Father and a Lost England – reviewIn Nuneaton (66% leave), I met a man who reeled off the names of closed-down factories like you might your football team’s greatest all-time XIRelated: What I found in Theresa May’s heartland: an England in miniature | Ian JackRelated: UK austerity has inflicted 'great misery' on citizens, UN says Continue reading...

Official figures likely to show Brexit anxieties weighing on consumers and businessUK growth slowed sharply in the final three months of 2018 as Brexit anxiety weighed on consumers and firms, official figures published on Monday are expected to show.City economists estimate that economic growth halved to just 0.3% in the fourth quarter of last year, compared with 0.6% growth in the third quarter. Continue reading...

Brexit is an opportunity, for remainers as well as leavers, to put the country on the right pathThis year marks a centenary of sorts. Back in 1919, with the first world war finally over, Britain woke up to a new reality. The days of being the world’s pre-eminent economic power were in the past.In truth, the writing had been on the wall before 1914. The US and Germany had caught up with Britain before the assassination at Sarajevo and were forging ahead in the new sectors that had sprung up around the turn of the 20th century. Even in industries where the UK had traditionally been strong, such as coal, rival countries were much faster to deploy new, productivity-raising technology. Continue reading...

Corbyn’s determination to free the UK from what he sees as the EU’s shackles would actually be damaging to the party’s causeThe spectre of Brexit haunted last weekend’s annual Venice seminar hosted by the Italian government, but we had to wait for the return home for comparisons with Dante’s Inferno.The president of the European Council has received a lot of flak for his outburst – which, in case you missed it, was: “I have been wondering what that special place in hell looks like for those who promoted Brexit without even a sketch of a plan to carry it out safely.”On the biggest issue facing this country Jeremy Corbyn has been letting people down Continue reading...

From the devaluation of sterling in 1967 to Brexit uncertainty, our economics commentator reflects on how Britain has diced with fiscal catastrophe

Treasury mandarins plan emergency measures designed to avert recessionTreasury mandarins have lined up emergency measures to protect the UK economy from a potential no-deal Brexit in fewer than 50 days’ time, with a series of growth-boosting measures designed to avert a recession.News emerged this week of cross-Whitehall plans codenamed Project After, drawn up after the 2016 Brexit vote. As the likelihood of a no-deal Brexit grows, some ministers and officials have returned to the work in search of emergency levers to pull in the event of a downturn, the Guardian has been told. These are the options that could be open to ministers: Continue reading...

Investors rattled after President Trump said there were no plans to meet President Xi Jinping before US tariffs on Chinese imports kick-in next month

Although there is a cloud over economy, the silver lining is central banks are more dovishAfter the synchronised global economic expansion of 2017 came the asynchronous growth of 2018, when most countries other than the US started to experience slowdowns. Worries about US inflation, the US Federal Reserve’s policy trajectory, trade wars, Italian budget and debt woes, China’s slowdown and emerging-market fragilities led to a sharp fall in global equity markets toward the end of the year.The good news at the start of 2019 is that the risk of an outright global recession is low. The bad news is that we are heading into a year of synchronised global deceleration; growth will fall toward – and, in some cases, below – potential in most regions.Related: The next financial crisis may come soon – are we all that safe? | Kenneth Rogoff Continue reading...

The Bank’s gloomy forecast sent the pound down but it rose again – despite the threat of recessionMark Carney could just as easily have shrugged his shoulders and declared that, like the rest of us, he hasn’t a clue how Brexit will work out. Instead, the Bank of England governor, obliged to riff on a theme when unveiling new economic forecasts, opted for “the fog of Brexit”, which amounted to much the same thing. Sadly, he couldn’t say when visibility will improve.Financial markets, too, seem baffled. The headline news that the Bank was making deep cuts to its GDP forecasts for this year and next sent the pound lower initially. The reaction seemed logical. The cut for 2019 was from 1.7% to 1.2%, which is severe. The new projections rely on a catch-up in the second half of the year just to achieve the slowest rate of annual growth since 2009. A recession this year is put at a one in four chance – and that assumes a no-deal, no-transition Brexit is avoided. Continue reading...

Goods dispatched in coming days may not arrive until after 29 March deadlineBritish exporters sending goods to far-flung destinations in the coming days risk being locked out of harbours around the world as a no-deal Brexit looms, business leaders have warned.Independent trade experts and the UK’s biggest business groups said exporters could be dispatching goods from UK ports imminently that would not arrive until after the 29 March deadline. This raised the prospect of goods being stuck in ports or facing hefty additional costs in the event of a disorderly Brexit.Related: A no-deal Brexit won’t result in a siege. The EU will be more clinical than that | Tom Kibasi Continue reading...

John Marzeillier, David Goudge and Ted Pawley respond to Caroline Flint’s Guardian article where she said she must honour her constituents’ decision to leave the EU. Plus letters from Tommy Gee, Roger Woodhouse, Julian Le Vay, Trevor Dean, Alice Appleton, Alison Harris, and Pauline ShelleyYet again we have a politician citing “the will of the people” as a justification for pursuing a Brexit deal however unsatisfactory it might be (Labour made a promise on Brexit, so let’s get a deal done, 6 February). Only this is not a Tory Brexiter but a Labour MP, Caroline Flint. She says: “I promised my voters that I would accept the referendum; I promised to work for the best deal for jobs for Doncaster, and pledged to oppose a second referendum.”We have a representative democracy; MPs are not mandated by their constituents to pursue a particular course, but to consider what is in their best interests. What if the best deal for jobs in Doncaster is achieved by remaining in the EU? What if, as is becoming clear, the 2016 referendum was corrupted, not just by the deliberate deceptions told by the leave campaign but by millions of pounds from shady sources? What if a second referendum asked voters specifically to choose between the deal Mrs May eventually comes up with, and remaining in the EU, a different question to the in/out choice of 2016? Continue reading...

Ian McCauley on the death of a friend let down by the system and Grahame Morris on Conservative culpability for austerityLinda Smith and Roger Pepworth (Letters, 4 February) are absolutely correct in linking the tragic deaths of so many homeless people to austerity. The national debate on this issue has been further constrained by political expediency and a blinkered approach to the evidence provided by good practice in this area. Congratulations to Andy Burnham for his initiative and imagination in his approach to homelessness (Off the streets: How Manchester bucked trend on homeless figures, 1 February).Just over a year ago you published my letter (11 December 2017) congratulating you on an article about Portugal’s approach to substance abuse and addiction. I referred to a young man who had been let down by an incoherent approach to his multiple addiction problems, mental health issues and homelessness. In particular I highlighted the inappropriate and inhumane response of the justice system to the minor offences connected with his addictions. I felt then that he was in mortal danger. He died a week ago. Continue reading...

Bank cuts growth forecast for 2019 as Brexit worries spread from companies to consumersThe Bank of England has warned the economy is on course for its weakest year since the global financial crisis, as evidence suggests Brexit jitters are spreading from companies to consumers.In its latest quarterly health check, the Bank cut its growth forecast for 2019 from 1.7% to 1.2%, blaming a slowing global economy as well as Brexit uncertainty for the sharp downward revision, and said there was a 25% chance of a recession this year.Related: Bank of England leaves interest rates on hold and cuts growth forecasts as Brexit looms - business live Continue reading...

UK must deal with plastic waste on its own soil, says group calling for export banA cross-party group of MPs is calling for a ban on the export of plastic waste over concerns the UK is passing the buck to the world’s poorest people to clean up its rubbish.MPs have tabled an early day motion to highlight growing concerns first raised by the National Audit Office that millions of tonnes of plastic waste sent abroad for recycling may be being dumped in landfill. Continue reading...

When Rutger Bregman and Winnie Byanyima spoke out about taxes at Davos they went viral. They talk with Winners Take All author Anand Giridharadas about why change is comingRutger: Winnie, why did the comments you and I made about billionaires and taxes at Davos go viral? Why do things seem to be changing right now?Winnie: Why did we go viral? I think we said things that people have wanted to hear, especially on a big stage where powerful politicians and companies are represented. And they are rarely said. People go there and speak in coded words and praise themselves and spin out the stats that suit them, but for once we spoke plainly about the challenges that people face.Davos is a Swiss ski resort now more famous for hosting the annual four-day conference for the World Economic Forum. For participants it is a festival of networking. Getting an invitation is a sign you have made it – and the elaborate system of badges reveals your place in the Davos hierarchy.

Since 2010, £400m has been stripped from these ‘non-essential’ services. It is a short-sighted, dehumanising tragedyAs it emerged Grantham Museum will soon look out on to a bronze statue of Margaret Thatcher, I found myself thinking about the last time I stepped foot in there.Related: A statue of Thatcher? No plinth will be too high for the vandals | Dawn Foster Continue reading...

Readers discuss the decline of high streets across the country and suggest what can be done to combat itJohn Harris offers a powerful lament on the decline of our high streets (Our towns have empty spaces where their souls used to be, Journal, 4 February), but the first big blow was not the crash of 2007-08 and the concurrent emergence of the internet as he suggests; out-of-town retail and the opening of the first malls like Brent Cross hastened the slow death of many high streets long before the crash or the rise of Amazon.Around 40 years ago, in the wake of Brixton’s “riots”, big retailers pledged to stay in our poorest areas. A year or so later Marks & Spencer pulled out of Harlesden in Brent, north-west London; Boots and BHS had already gone; Woolworths followed, as did four of our five banks and many of our pubs – the high street’s death came early to disadvantaged communities. Continue reading...

Rolling coverage of the latest economic and financial news, as Germany’s manufacturers struggle again

Blow to economy could be softened with planning from government and EU, claims the NIESRBritain could avoid slumping into a recession in the aftermath of a no-deal Brexit, according to one of Britain’s leading economics forecasters.The National Institute of Economic and Social Research (NIESR) said the blow to the economy from a disorderly departure from the EU could be softened by contingency plans being put in place by the government and by Brussels. Ministers could also reduce the impact with tax cuts and additional public spending, further limiting the damage. Continue reading...

Survey shows companies starting to cut staff in response to a decline in new businessBritain’s pivotal services sector has posted its weakest performance since the immediate aftermath of the EU referendum amid growing signs that Brexit uncertainty has slowed the economy to stall speed.The latest health check of a sector that accounts for almost 80% of UK output showed services companies starting to reduce staff numbers in response to a decline in new business. Continue reading...

UK service sector barely expanded last month, as political uncertainty wounds the economy

Toxic politics in the US and UK mean a competent response to a crash is far from certainA decade on from the 2008 global financial crisis, policymakers constantly assure us that the system is much safer today. The giant banks at the core of the meltdown have scaled back their risky bets, and everyone – investors, consumers, and central bankers – is still on high alert. Regulators have worked hard to ensure greater transparency and accountability in the banking industry. But are we really all that safe?Normally, one would say “yes”. The kind of full-blown systemic global financial crisis that erupted a decade ago is not like a typical septennial recession. The much lower frequency of systemic crises reflects two realities: policymakers respond with reforms to prevent their recurrence, and it normally takes investors, consumers, and politicians a long time to forget the last one.Related: UK economy slumps into stagnation as Brexit uncertainty hits demand - business live Continue reading...

Benefits from parts of economy that are performing strongly are not being felt by allBritish households have grown more pessimistic about the state of the economy and their own personal finances, according to official figures, amid rising debt levels and faster income growth for the richest in society.Pulling together an assessment of personal and economic wellbeing data for the first time, the Office for National Statistics said the benefits from parts of the British economy that were performing strongly were not being felt by all. Continue reading...

Shortfall in standards casts doubt on transparency of Britain’s aid spendingToo much of Britain’s aid budget is being spent poorly by Whitehall departments on projects that fail the test of reducing poverty in the world’s poorest countries, a campaign group has said.The One Campaign – an advocacy organisation set up by the U2 singer Bono – said the huge gulf in standards across government was undermining the battle to build public trust that taxpayers’ money was being well spent.Related: UK aid funding must not be privatised | Letter£1.5bn of aid was being spent with barely any transparency about where and how it was delivered.At least £475m of aid came with strings attached so that is has to be spent through UK institutions, contravening Britain’s system of untied aid.£115m of FCO aid was being spent to subsidise relatively affluent students going to university in the UK.Three of the five largest (in cash terms) programmes within the Newton Fund – which aims to develop science and innovation partnerships that promote the economic development and social welfare of partner countries – were based in China and were not focused on global poverty reduction.Related: UK Foreign Office ranks among world's worst on revealing how aid is spent Continue reading...

While the UK woos China’s telecoms giant, fears grow over the risks it poses to national securityIf, according to an ancient Chinese proverb, “a crisis is an opportunity riding the dangerous wind”, then Huawei is barrelling in on a storm force 12. Where the hurricane takes it, though, may be out of the telecoms giant’s control.A slew of bombshell allegations have raised troubling questions about the telecoms company’s probity and revived long-held concerns about its relationship with China’s intelligence services. The UK, in need of friends as Brexit looms, is struggling to negotiate the fallout. To ignore the mounting brouhaha risks alienating its closest ally, the United States, currently locked in a bitter trade war with China which has become synonymous with Huawei. But the UK needs Chinese technology to keep pace with the 21st century.Huawei’s cyber-security approach fell short but no hostile Chinese state activity was uncovered Continue reading...

Whether polar or recessionary, you can be sure they’re extremely unpleasantAh well, I suppose in these fractious times that we must take our comforts where we can find them – and so we must look to Italy and the prognostications of my favourite hyperbolic economic commentator, who never fails to cheer, with his dazzling and fresh lexicon of doom and chaos. Last week was no exception. As the country slides into recession, he thundered about a “recessionary vortex” that has “metastasised” over the past two months, while a former chief economist at the Italian treasury offers the terrifying warning that the country is “entering a self-defeating loop of negative growth”. (I’m not certain if a self-defeating loop is the same as a doom loop, but I’m pretty sure they must be related.) Further, “the downturn is tightening the noose on their non-performing loans”, while the pay-off - “Italy’s debt trajectory can quickly go parabolic” – conjures a suitably apocalyptic vision of a country deeper into the doo-doo than even this benighted isle.And so, almost inevitably, to the weather. While much of America suffers perishingly cold conditions thanks to the polar vortex (and if I were in charge, I would ban snow – filthy, worthless stuff), what do we get from the BBC forecasters but: “A quick heads up about the weather today.” Please, can we agree to proscribe the poxy phrase “heads up”, with all its ghastly PR/advertising/marketing overtones? And can we also chuck into the great big bin marked “redundant phrases” “spits and spots of rain” and “mist and murk”. I know we are obsessed with the weather, but these infantile phrases mean nothing. Continue reading...

Its populist leaders said they were on the cusp of an economic miracle to rival the 1960s, but debt and uncertainty intervenedSharing his predictions on the economy less than a month ago, Luigi Di Maio, the Italian deputy prime minister, believed the country was on the cusp of an economic miracle akin to the one enjoyed in the 1960s.“During that period we built highways, now we can build digital highways,” he enthused. His comments were met with derisive laughter. Continue reading...

German has flirted with recession, while growth is returning to Portugal and Spain

Hard Brexit is only the latest example where the British economy has taken second place to pride and party loyaltyA no-deal Brexit is just another cataclysmic event among many in Britain’s recent history. That’s why there is a good chance it’s going to happen.The economy, unfortunately, has usually taken second place over the last 60 years to pride, party loyalty or – and this must be the most significant driving force – a trusting sense that no matter how bad things look everything will turn out OK.Related: So just when, exactly, will the City press the no-deal panic button? | Nils Pratley Continue reading...

High employment rates gloss over a ‘much more complicated story’ of stagnant wages and vanishing mid-level jobsJanuary marked the 100th consecutive month of job creation in the United States – a record breaking streak of job creation that has left employers scrambling to find workers and dragged the long-term unemployed back into the market.Yet even now, 20m jobs later, there are some parts of the US economy that have yet to reflect the positive image projected by the continuous job growth and low unemployment rate.Related: US economy adds jobs for record 100th consecutive monthEmployers think they should be able to get whoever they want at those lower wages Continue reading...

They encourage us to think that anyone who is homeless deserves it. A radical cultural shift is needed on this subjectThe latest official figures for homelessness show that, in England outside cities, the number of people sleeping rough on any one night is down 2%. But this is where the good news ends. Rough sleeping has increased by 165% since 2010, with rises of as much as 60% in major cities, compared with last year. The homeless charity Crisis’s own research estimates that more than 8,000 people sleep rough on any given night. Meanwhile deaths of homeless people have more than doubled in the past five years.Most people agree that rough sleeping shouldn’t exist in a healthy society – especially not in the sixth richest economy in the world. But it doesn’t appear out of nowhere; it’s the product of political decisions. So why is it being allowed to continue?Related: Why are we still using a 19th-century law that criminalises homeless people? | Shaista Aziz Continue reading...

Heavy workloads, stress and anxiety are costing the economy. A shorter working week would help both business and workersOur current political moment is defined by a state of paralysis. By refusing to face the reality of a broken economic model, reactionary forces are driving us towards a future based on exclusion, continued deregulation and the scrapping of workers’ rights. Instead of conceding to this “inevitable” race to the bottom, progressive forces of all kinds need to meet the crises of the 21st century head-on by putting forward proposals that tangibly improve people’s lives.As Alexandria Ocasio-Cortez has demonstrated in the US with the green new deal, fresh proposals can change political and economic narratives so as to embrace collective opportunity, potentially avert catastrophe and move us towards sustainable futures. What will make up our “new deal” here in the UK? A new report by Autonomy – a thinktank of which I am co-director – argues that a shorter working week should be a central pillar of our economic future.Related: ‘Miserable staff don't make money’: the firms that have switched to a four-day weekRelated: Post-work: the radical idea of a world without jobs Continue reading...

The US jobs market shrugged off the government shutdown in January, with 304,000 jobs created last month

As Brexit barrels on, politicians must stop blustering about trade and work on policy priorities such as education and transportThis week’s report spelling out the calamitous impact of austerity on our major cities shows that much of the current debate over public policy is looking in the wrong place for answers.Thanks to Northamptonshire county council blowing up its own finances, Surrey using its muscle within the Conservative party to highlight the damage being done by cuts, and areas such as Somerset facing serious difficulties, an impression has been created that English shires are suffering the most pain under austerity.Related: Deprived northern regions worst hit by UK austerity, study findsRelated: Witless ministers have hammered councils like austerity punchbags | Richard VizeRelated: Sign up for Society Weekly: our newsletter for public service professionals Continue reading...

US president optimistic of reaching ‘the biggest deal ever’ as Beijing welcomes ‘constructive discussions’Donald Trump has said he will meet Chinese president Xi Jinping soon to try to seal a comprehensive trade deal as the US president while China’s trade delegation said the two sides had “clarified a timetable and roadmap” for the next negotiations.Trump, speaking at the White House on Thursday during a meeting with Chinese vice premier Liu He, said he was optimistic the world’s two largest economies could reach “the biggest deal ever made”.Related: Huawei indictments: sanctions busting, industrial espionage and a stolen robot Continue reading...

Inheritance tax loopholes and entrepreneurs’ relief mostly benefit the rich, critics sayInheritance tax loopholes and incentives for small business owners, most often benefiting the richest people in Britain, have cost taxpayers at least £4bn a year, according to official figures.Analysis of figures published by HM Revenue and Customs on Thursday revealed that the total cost of Britain’s system of tax relief had risen to a record £164bn annually – more than the entire NHS budget. Continue reading...

Labour values are at the heart of protecting our most vulnerable residents, says Jack Hopkins of Lambeth council, while Ted Watson says the Labour leadership of 1921 opposed the fight against austerityZoe Williams’ article (Red-on-red warfare won’t stop austerity, 29 January) contains some welcome recognition of the challenges that councils face under prolonged Tory austerity. But as she says, austerity has not gone away and for councils that have been dealing with it for nine years now things are more difficult than ever. Lambeth council has lost over £230m of government funding since 2010, with a further £38m to find over the next few years.Despite keeping 23 children’s centres open since 2010, at a time when Tory cuts have closed hundreds across the country, in 2018 the government cut the dedicated schools grant, which helps to fund our children’s centres, by £1.4m. As a council, we have protected children’s centres from that cut this year – but now we have no choice, with further cuts in all services imposed by the Tories, except to consult on plans that will keep 18 children’s centres in the borough. While that will see five centres shut, we’re working with them so they can still provide nursery places and other activities for children so the buildings aren’t lost to the community and are still open if we get a Labour government that will fund local services properly as Zoe Williams suggests. Continue reading...

TUC research finds London workers hit hardest with cumulative loss in real earnings of £20,000Wages are still worth a third less in some parts of the country than a decade ago, according to a report.Research by the Trades Union Congress (TUC) found that the average worker has lost £11,800 in real earnings since 2008. Continue reading...

The exit of Jim Yong Kim offers a chance to put the Bretton Woods institutions in the service of the many, not the fewThe president of the World Bank, Jim Yong Kim, will step down on 1 February – three and a half years before the end of his term – in search of greener pastures. His readiness to resign from the leadership of one the two most powerful international financial institutions is a worrying omen. But it is also an important wake-up call.The World Bank and the IMF are the last remaining columns of the Bretton Woods edifice under which capitalism experienced its golden age in the 1950s and 1960s. While that system, and the fixed exchange rate regime it relied upon, bit the dust in 1971, the two institutions continued to support global finance along purely Atlanticist lines: with Europe’s establishment choosing the IMF’s managing director and the United States selecting the head of the World Bank.Related: 'Ridiculous': report Ivanka Trump could lead World Bank meets scornIf we do not act quickly – demanding a radical change of direction – the World Bank will likely fade into irrelevanceJim Yong Kim’s departure makes one thing clear: the World Bank is on the brinkDavid Adler is a writer and a member of DiEM25’s Coordinating Collective. Yanis Varoufakis is the co-founder of DiEM25. He is also the former finance minister of Greece Continue reading...

Country’s economy shrinks by 0.2% amid weakening growth rates across the eurozoneItaly’s economy fell into recession in the final three months of 2018, in a blow to the country’s governing radical centre-right coalition, which pledged to boost the country’s persistently low GDP growth.The 0.2% drop in the eurozone’s third largest economy between October and December followed a 0.1% fall in the previous three months, the Italian statistics agency said. Declining GDP growth over two consecutive quarters put Italy in recession. It is the third time the country has fallen into recession in a decade. Continue reading...

Progressives were caught napping by the financial crisis. They cannot not be as ill-prepared next timeIt’s often said that real change takes place at a time of crisis, but that’s not the whole story. A crisis makes change possible, but only when new ideas are knocking about does it actually happen. Otherwise, it is soon business as usual. The US economist Milton Friedman understood that fact, which is why he toiled away in the political wilderness to plot the downfall of postwar social democracy and was fully prepared when trouble arrived in the mid-1970s.The left was so in thrall to market forces and globalised capital that it blew a golden opportunity in 2007Related: UK personal insolvencies hit seven-year high; US consumer confidence slumps - business liveRelated: Alexandria Ocasio-Cortez knows yesterday’s radicalism can become tomorrow’s common sense | Jeff Sparrow Continue reading...