Why can’t our leaders learn from 30 years of failure in health and education? | John Quiggin

We’ve known since the 1980s that the profit motive doesn’t work in health and education. And the reasons why are no puzzle at all

The inadequacy of competition and the profit motive in the provision human services like education and health has been established by harsh experience with consistent failures like PFI hospitals, for-profit schools and private prisons. This failure presents a puzzle: how is it that (assuming we have an adequate income) we can rely on for-profit corporations to put food on our tables and clothes on our backs, but not to educate our children or preserve our health.

In the hands of many advocates of privatisation, this puzzle is turned into a knock-down refutation: if the profit motive works well in providing something as vital as food, it must work well everywhere. The latest instance of this naive faith in the market is the Australian Productivity Commission’s call to privatise public health and housing.

Related: Our hospitals are being privatised. Is anybody paying attention? | Amy Corderoy

Related: Face the facts: competition and profit don’t work in health, education or prisons |

Continue reading…

Plenty of reasons for a second EU referendum | Letters

Rafael Behr (Opinion, 21 September) and senior Liberal Democrats who question the wisdom of Tim Farron’s commitment to a second referendum once the terms of Brexit are settled, assume present attitudes will persist. They ignore the likelihood that negotiations will end in “a hard Brexit”.

Continued membership of the single market and of the EU customs union is the least likely outcome. Outside both, the prospect of an easy conclusion of favourable new free trade agreements (FTAs) with the rest of the world is a pipe dream. We would not only need a new FTA with the EU, likely to be a protracted negotiation as it has to be agreed by all 27 members, but also with some 50 countries with which the EU now has FTAs, as well as those with which it is now negotiating, principally China and the US. We would also have to re-enter the World Trade Organisation, which involves making a number of commitments that have to be approved by all 164 WTO members.

Continue reading…

Carney backs green finance to cut emissions and boost growth

Bank of England governor says more investment in green technologies could help escape low-inflation low-growth trap

The Bank of England governor, Mark Carney, has thrown his weight behind the fledgling market in green investments to help cut carbon emissions and boost global economic growth. Carney used a speech in Berlin on Thursday to highlight green finance as an opportunity to boost financial stability while also tackling climate change.

He said more of the $100 tn (£76tn) held by big global investment firms could be channelled into green bonds to help finance initiatives such as water or renewable power projects aimed at reducing carbon emissions. Last year, $42bn of green bonds were sold worldwide.

Continue reading…

Corporation tax is on a downward trend, says OECD report

As eight industrialised nations cut their rates, policy is seen as aggressive attempt to chase GDP growth after banking crisis

Eight of the world’s top industrialised nations lowered their corporation tax rates last year or announced plans to do so, according to a leading thinktank.

In the Organisation for Economic Cooperation and Development’s annual report on tax changes around the world, published on Thursday, the thinktank said Japan, Spain, Israel, Norway and Estonia had all lowered their tax rates for corporate profits in 2015. Meanwhile, future reductions had been announced by Italy, France and the UK, while Japan planned further cuts.

Related: What’s next for Apple’s €13bn tax battle?

Continue reading…

Helicopter money is back in the air

Money can be given to consumers or spent on infrastructure. Such ‘drops’ would not inflate national debt – governments would ‘owe’ money only to its own banker

Fiscal policy is edging back into fashion, after years, if not decades, in purdah. The reason is simple: the incomplete recovery from the global crash of 2008.

Europe is the worst off in this regard: its GDP has hardly grown in the last four years, and GDP per capita is still less than it was in 2007. Moreover, growth forecasts are gloomy. In July, the European Central Bank published a report suggesting that the negative output gap in the eurozone was 6%, four percentage points higher than previously thought. “A possible implication of this finding,” the ECB concluded, “is that policies aimed at stimulating aggregate demand (including fiscal and monetary policies) should play an even more important role in the economic policy mix.” Strong words from a central bank.

Related: Helicopter money is closer than you think

Continue reading…

UK economy can weather Brexit storm without rate cuts, says MPC member

Bank of England’s Kristin Forbes says there is no need to further reduce rates from 0.25%

The Bank of England’s interest rate cut to 0.25% in August should be enough to prevent the economy from slipping into a recession, according to the most hawkish member of the central bank’s interest rate-setting committee.

Kristin Forbes said Britain had avoided the predicted economic shock following the vote to leave the European Union and should recover without the need for a cut in rates to nearer 0%.

Continue reading…

UK manufacturing output rises and order books are solid, says CBI

Monthly survey echoes other upbeat indicators suggesting activity has picked up after initial post-Brexit vote slump

British manufacturers have enjoyed rising output and a steady flow of new orders over the past three months, according to a survey that will buoy hopes that the Brexit vote did not deliver an immediate blow to businesses.

The CBI’s monthly check on the factory sectoralso found that manufacturers’ expectations for the next three months had picked up sharply despite a dip in export orders.

Continue reading…

UK economy faces challenging period after Brexit vote, says Bank

Financial policy committee warns withdrawal from the EU poses risks but will not be used to reduce regulation of banks

The vote for Brexit has created a “challenging period of uncertainty and adjustment” Bank of England policymakers have said.

In a quarterly update on the health of the financial system on Thursday, the Bank’s policy makers also said the UK’s withdrawal from the European Union would not be used as a way to reduce regulation on the banking sector.

Related: Shares rally and pound jumps after divided Fed leaves US interest rates on hold – business live

Continue reading…