Economic Policy

The current economic system is broken. The Utopian economic policy seeks to fix that. We cannot list all of the policies and changes needed to do this, so instead, we will point out some of the things that are broken or which need changing. All these changes fit into the wider Manifesto, where other changes in other areas are needed to support these changes, so they cannot be taken in isolation alone. But by seeing the things that need to change, you will see the type of economic policy that will be applied.

New Economic Bargain

The overall aim is to re-set the economic bargain between the British people and the Government.

That bargain will be:

Your children can expect, on average, to better off than you were.
The country will remain a highly attractive place for foreign investment.
We will be ultra business friendly and will provide the environment for the best local and global businesses to thrive and terms which is the best for the future.
Fairness to all groups will be at the heart of everything we do.
The system will not be perfect and will need to be re-balanced at times. Economics is an Art, not a science.
The ultra rich and international corporates have nothing to fear from these changes and over time will see that this approach benefits them more than the current approach in ways other than radically increasing their wealth for no reason at all.
We will not demonise immigrants and people on benefits to distract from other economic problems.

GDP

GDP as a measure of economics is broken. GDP measures total economic output based on spending and/or production. This is an appalling measure of value. Just because I go out and purchase something pointless off Amazon, doesn't mean the country is getting better in any way at all. I don't spend any money sending my kids to school, or letting my parents look after them while I work, but both of these things have more value than Chinese plastic shite bought from Amazon. So we need to change it. At the least we will measure:

The physical and mental health of the individuals within the country.
The protection and environmental preservation of a business.
The gap between the richest and poorest in the country.
The growth in overall wealth of everyone in the country, apportioned to flatten wealth inequality.
The socially useful purpose of any business activity.

In line with our overall strategy, this may need changing as we learn new things, or find that its not quite right but we will measure these things and aim to improve them because we believe they are more important and relevant to people than GDP.

Greed is Good, Generosity is Better

Greed is Good has become the mantra of the version of neoliberal capitalism that we are living with today. Profit at any cost. This is fine if we could replace the planets resources tomorrow, but not when the planet is finite. For the wealthy elites today, nothing is too precious or sacred to stand in the way of making a profit, not even the existence of mankind into the future.

Aside from the planet, this is also seen in the treatment of people. In the UK, we have been sold a scam that free movement of people was for our own good, when in fact it has been used by wealthy elites to drive down wages and increase competition between domestic workers and people who can be brought in to work for less. The trouble is that the eventual end point of this is slavery, or a 21st Century version of slavery. There is nothing better for your profits that free expendable labour that you can treat as an input rather than a human. And that is the pathway we have been moving slowly down for the last 40 years with workers being nothing more than exploitable and replaceable. Look at how the lack of airport baggage handlers after covid has been. British workers won't do the job and be exploited, so airports have been demanding cheap foreign labour to exploit.

The elites wove into this myth of profit and shareholder returns being everything, that it comes from the Darwinian survival of the fittest mantra, even though Darwin himself never said this at the outset of publishing The Origin of the Species. Fittest in human evolutionary terms has been taken to mean the physically strongest. In economic terms, we're told its the one who makes the most profit. But in fact, the fittest in human terms isn't the strongest. The physically strongest and most dominant and dangerous male in any group would be too dangerous to live with and would kill or destroy his tribe or be expelled from his tribe for his violence, neither of which means his genes are passed on. The strongest in human and environmental terms means the one who cooperates the best with everything around him. And we can see that playing out today. The human species is the strongest it has ever been, but its not cooperating with the plants, animals and environment around it, and so we are living through a mass extinction that will end up killing us. This may manifest itself initially with minor disruptions such as the odd hot summer, the odd mild winter, some bad storms that kill a few people, some food shortages and increasing prices, nothing drastic, that thats just how the beginning of the end looks.

So the Utopian economic policy is not about the individual and winner takes all. Instead it takes the same approach as mother nature, which is, if we cooperate, we all win, and in the long run, our overall win is greater than it would have ever been under the current system.

Social Cooperative Companies

A new corporate governance framework will be put in place alongside new accounting standards that do not focus entirely on profit and shareholder return. Instead, companies will be judged and measured on factors that include environmental damage, how they treat and pay their workers, how they operate, and whether they are socially useful.

The following Utilities will be subject to compulsory purchase at a price which compensates existing shareholders but which reflects a charge for any long term investment they claim is needed:

Water
Sewerage
Electricity (networks, gas, coal, green, nuclear).
Internet connection (currently broadband)
Rail
Roads

These new SCCs will be 51% owned by the State, UK pension funds and UK residents who will be given free shares. This portion of shares cannot be sold but they will attract a dividend when the companies make a profit. However, in the short term, the companies focus will be on things other than profit, such as fixing water leaks, not putting sewage into the sea or rivers. These badly needed investments in future infrastructure may reduce initial profits, but will increase the value of the shares in the long run, when the investments are no longer needed and its just repairing a first class system, the dividends will become more valuable. As the asset cannot be sold by the owner its increase in value may not seem worthwhile, but people will be able to borrow against them subject to rules to avoid too much personal debt. Plus the dividends will be income. The asset can be passed to children or will be passed back to the state for those without children.

Banking Reform

As the current system is so beneficial to banks and the wealthy elites, any changes will be terrifying for them. Therefore they will be done slowly, until it becomes clear to these groups that these changes will actually be far better for them in the long run than the current status quo. However, some of these things are also designed to ensure that the UK can function without disruption should these institutions move against the countries interest.

Bank of England (BoE) Reform.
- The reformed BoE will be given an asset price target.
- The BoE will become accountable to wider group of stakeholders.
- It will have a target to prevent or minimise the impact of recession.
Retail and Investment banking will be split up.
Regulations will gradually increase the quality of assets held by bank to reduce systemic risks.
A National Investment Bank (NIB) will be created, controlled by a reformed and more accountable BoE.
There will be a state owned public retail banking system that will be given competitive advantages over private banking including lending being guaranteed by the state. Lending priorities would be set based on the economic cycle and with preference towards small business, domestically owned business, environmentally positive businesses and those with a social purpose.
The public banking system will be regionalised so that local investment decisions can be made.
The public banking system can take on citizens debt and force write offs on existing debt holders.
A Citizen Wealth Fund (CWF) taking income from the Crown estates, bonds, existing public assets and wealth taxation. It will pay out an annual dividend to all resident British citizens over 18. This may increase in good times, decrease in other times. This will be invested in socially useful, environmental, ethical investments as well as pushing democracy and accountability within the system.
Peoples Asset Manager will make investment decisions along side the NIB and own the CWF to maximise returns to the fund returns and take in the ownership of UK pension funds.

Working People

When workers have power life becomes difficult for large corporates and the wealthy elites. In the 1970s in the UK, perhaps the workers had too much power and perhaps things needed to be rebalanced towards capitalists. That pendulum has now swung way too far the other way. When workers have power they can ask for more pay and reduce the profits of capitalists. In the neoliberal system we have today, this is a huge no. Today workers need to be desperate. Workers need to know their job is unstable and that they won't get pay rises even when the company is doing well. There needs to be a baked in fear of speaking up in case you lost your job. That is where we are today. Thats with domestic workers. Imagine how good it is to replace them with immigrants, how much more fearful, desperate and grateful will they be to have that job. Thats the exploitative and extractive system we have today and no one is happy with it.

With that in mind, we will do the following worker focused policies:

The Government will pursue policies of full employment.
Universal Basic Income will be used to protect periods of unemployment.
Banning Zero Hour contracts.
Increases in Hourly Pay rates (4 day week implementation).
Mandatory works councils consisting of bosses and workers.
Support for small unions.
Pay or credit will be given for unpaid work such as childcare or careers.
Immigration would be used where it allows the country to punch up, not for employers to punch down, but further consideration would be given to those places where immigrants move from and their own need for Doctors or nurses etc.
Education reform, as written about in this blog would be part of this change.
Personal debt will be slowly reduced and eroded to a lower overall level within a generation.
Personal debt may be written off in some circumstances, as stated above.
Home ownership for working adults under the age of 25 will become affordable.

Whilst the 1970s UK was a time when perhaps worker, or union power was holding businesses back somewhat, its the workers movement throughout history that have led to the most radical and transformative changes in society, and ones which have led to the biggest increase in wealth for all, and this is what these changes proposed here will also lead to. Real life improvements for those in society with the lowest wealth, but equally, improvements for the wealthiest in terms of the society they live in.

Tax Reform

Taxation will be used by the Government to pursue the objectives that are in the interest of the whole country. Not any 1 specific constituent. We will take the following approach to taxation:

It needs to be simplified. The overcomplication of taxation has been done because it helps large corporations and the super rich avoid it. A simplified approach such as a sales tax on sales within the UK will be applied instead of complex avoidable corporation taxes.
The tax system will become more dynamic and immediate. The mantra from business that they need certainty is because it leads to a static and slow tax system. This keeps the tax system in the 17th Century and easily avoidable by companies with tax advisors. Instead it will become high tech, and use 21st Century methods such as surge pricing and feedback.
Tax Havens and hidden asset ownerships will be discouraged or phased out if at all possible.
Wealth taxes will be introduced, very lightly at first until it becomes clear that the super rich are not threatened by the new system.
Land taxes will be used.
Transaction taxes will be used to control capital movement into and out of the UK and promote economic stability.
Limited Liability Partnerships Partners will be taxed as Directors.
Non-domiciled rules, if retained, will be subject to different rules elsewhere, including not being allowed to own UK land, property, or business. Or the rules will change and individuals can be taxed on their worldwide income.
HM Revenue & Customs will be strengthened and re-focused away from people on under average incomes and onto large corporates and the ultra rich.

Public Sector Reform

The public sector will be strengthened and the consultancy, outsourcing giants, private finance, and hidden privatisations will be removed. The civil service will be built up so that it has the skills in project management and mobilsation so that excessive fees to large consultancies are no longer necessary and that public sector skills are the best in the market.

Public sector procurement rules will be more open and democratic and will never be allowed to go through unchecked as happened during the covid pandemic which merely results in a huge transfer of wealth from working people to large corporates and the wealthy.

Corporate Reform

Global monopolies hold too much power over nation states. Global monopolies will still be allowed to operate in the UK but will be subject to additional rules. For example, search engines will be required to pay for news sources so that journalism is prioritised over pointless content. Social media will only be allowed to display content from verified UK accounts and identify overseas accounts that are bots and will be penalised for socially negative content.

High executive pay in comparison to lowest will be penalised. This is in line with the changes to MPs pay discussed in this blog. Where markets appear to be working well in terms of the wider society, the environment, and businesses, regulation will be as light touch or non-existent as possible.

Property and Land Reform

This isn't economics, and I will write about these Manifesto changes elsewhere. However, as house prices is part of the old bargain that supported the middle classes, the new bargain will seek to reduce the affordability of houses back to levels of current income. Rent and mortgage payments for the same property will be broadly equal. The new BoE will be given an asset price inflation target that will reduce, over time, house price growth but allow house prices to grow over the lifetime of its ownership. House price growth will be at a level where people are encouraged to view the property as a home, not an asset but working and middle classes will be protected from inheritance tax so that property can be passed on.

Sales of property to non-domiciled individuals, foreign individuals, or any offshore entity or corporate will not be possible. Its primary purpose will be for living accommodation for UK residents and businesses. The power and wealth passing to the rentier class will be reduced.

Parliamentary and Local Government Reform

This isn't economics but is needed as part of these reforms. I will write about them separately in the Parliamentary Reform section of this Manifesto, but broadly they will include:

House of Lords Reform.
Change City of London into a Local Authority.
Abolish Devolved Governments and Reform Local Government.
Increased local decision making away from Westminster.
Voting reform will see the creation of an electronic profile that every British citizen will need. More will be explained about this in the other section.

In Summary

People are intrinsically selfish and self interested. Equally, people are kind, selfless and altruistic. These are competing forces within us which can lead to excess if unchecked. We live in an interconnected system. We will all be richer and safer if we develop a new form of humanist capitalism that acknowledges the imperfections of humans and of markets, and that the planet has finite resources.

Published 18/9/22

Utopia Manifesto