Greatest Economic Crime In UK History? – OpEd
So it’s official, then. On Wednesday, on her first full day in office — just before the death of the Queen froze all public-facing political activity for at least a week and a half — Liz Truss addressed the UK’s devastating energy bill crisis, which threatens to hurl two-thirds of the country into fuel poverty, and to bankrupt all small- to medium-sized businesses, as well as public sector organisations like the NHS, schools, universities and charities, by capping domestic energy bills at £2,500 a year until 2024, stemming the rise to £3,549 that was to take place on October 1, and which was forecast to rise to an almost unimaginable £5,400 a year in January.
This will still be a nightmare for poorer families — who, lest we forget, make up at least half the population — because last winter average bills were £1,277 a year, and even now people are struggling with the cap set at £1,971 a year, but what makes the announcement so poisonous, whilst appearing to be the act of a saviour, is that it will be funded not through a windfall tax on the estimated £176 billion in obscene and completely unearned profits of the oil and gas companies who have benefitted from the eleven-fold increase in gas prices since 2019, but by transferring the cost onto taxpayers.
Do you see how disgusting and disgraceful this policy is? Truss is refusing to tax the grotesque profits of the oil and gas companies, and is instead proposing to borrow at least £100 billion — and maybe more — to compensate them for their losses through the cap that is necessary to prevent the total collapse of the British economy, and then making us pay it back in increased bills over the next ten to 20 years, — in other words, increased bills every month into the 2030s or even the 2040s — simply to preserve the energy companies’ monstrous windfall profits.
The shameful unfairness of this ought to spark an instant revolution, but my fear is that the British public, punch-drunk after decades of being told that any criticism of corporate profiteering is morally wrong, will put up with it, grateful that unthinkable disaster has been avoided.
The ongoing nightmare for businesses and the public sector
Even if this reverse Robin Hood-style borrowing can somehow be sold to the British public, Wednesday’s news still leaves Britain’s small- and medium-sized businesses, who don’t even have the protection of any kind of existing cap on prices (not even Ofgem’s broken model of spiralling costs for domestic customers), as worried as they were two days ago, especially with the sudden suspension of any meaningful political activity for the foreseeable future because of the Queen’s death.
For businesses, Truss merely promised what the Guardian described as “a six-month scheme”, which “will offer what was termed ‘equivalent support’ to that for households, with a review in three months about how it could be better targeted.”
This will provide little or no reassurance to the numerous businesses who have been pointing out, with increasingdesperation over recent weeks, that they are being quoted such colossal increases in their energy costs (often five-fold increases from a year ago) that they are all likely to be put out of business unless significant help is provided.
The government’s catastrophic enthusiasm for new oil and gas extraction
In addition, on Wednesday, Truss announced plans to ensure the UK’s energy supply in future not by immediately investing in renewable energy sources (offshore wind power, onshore wind power, solar and wave power), but by lifting the moratorium on the filthy business of fracking, and giving the green light to new oil and gas extraction, and to new nuclear power.
Anyone paying attention to Truss’s Cabinet appointments — and her inner circle of advisers in 10 Downing Street— wouldn’t have been surprised by this, as she appointed the climate change denier Jacob Rees-Mogg as energy minister (who has just announced that new fossil fuel extraction is the government’s official policy), and has been thoroughly marinaded in the crazed ideology of the small state, pro-Brexit, climate change-denying far right ‘libertarian’ think-tanks based in Tufton Street, just a stone’s throw from Parliament, but it doesn’t make it any less shocking when it’s spelled out as official government policy, even if it is slightly reassuring that her chancellor (and friend) Kwasi Kwarteng is on record as opposing the resumption of fracking.
These new fossil fuel proposals are environmentally suicidal, and almost certainly in breach of our legal obligation to reduce our carbon emissions to net zero by 2050, and, crucially, they also involve such a long time-scale that they cannot hope to address our needs for years — or decades, in the case of nuclear power — when we clearly need urgent solutions to wean ourselves off our gas dependency right now.
As experts — rather than Parliamentary puppets of the fossil fuel industry— are pointing out, with an eloquence and persuasiveness that the dim-witted Truss and her Cabinet can only aspire to, the only practical solution to the energy crisis — beyond the necessary windfall tax — is immediate investment in the renewable energy sources that can be delivered in the short-term, as well as a country-wide investment in insulating our leaky and energy-inefficient homes. Ironically, this was underway under David Cameron until he denounced it as “green crap” and discontinued it, but on Wednesday, predictably, Liz Truss failed to mentioned it at all.
On energy, however, Truss and her government are completely out of touch with the British people. In a poll by Survation published on Wednesday, 81% of respondents supported new solar power, 76% supported offshore wind, 74% supported onshore wind and 72% supported tidal and wave energy. Just 34% supported fracking, with 49% supporting nuclear power, and 56% supporting new gas extraction from the North Sea.
Shamefully, the expansion of solar and wind power in the countryside is opposed by NIMBYists (and also opposed by Truss and her team, including the new environment secretary Ranil Jayawardena, who has talked about “protecting our countryside from solar farms”), but as Jonah Fisher, the BBC’s Environment Correspondent, explained, “The cold, hard capitalist truth is that new renewables are currently a much cheaper source of new power generation than any of the fossil fuel or nuclear alternatives. So shifting towards wind and solar makes not just environmental, but economic sense, while at the same time giving us more energy security.” He added, “Britain is a world leader in offshore wind and in the next few years the building of ever larger wind-farms — mainly in the North Sea — looks set to continue. Huge projects are already under way and will come on stream in the next couple of years.”
There are, of course, many more problems with the country’s energy supply that also need addressing — for example, the fundamental injustice that the energy cap, which sets prices, is pegged to the most expensive supplies — of gas — obscuring the fact that renewables are much cheaper.
For now, however, there needs to be concerted resistance to the Truss Tax, the most monstrous proposal in British history — to tax everyone, every day for up to 20 years, to preserve the unforgivably huge profits that the oil and gas companies have secured, and are still securing, through no effort or investment on their part.
Liz Truss has just proposed robbing us blind for decades to guarantee the bloated, unearned profits of companies that are at the forefront of making our planet uninhabitable long before we’ve even finished paying off the loan to support their current bonanza. Quite simply, we must not allow that to happen.