Tag Archives: UK

Figuring Out Which Companies are Naughty or Nice

Quebec City    Even as the Brexit landslide seemed to be building in the formerly United Kingdom, the European Union leadership was piecing together an ambitious plan to achieve climate goals by 2050.  Their plan was to reach net-zero in carbon emissions at that point in a sweeping economic transition.  Some countries like Poland that still depends on coal for 80% of its electricity production were balking at embracing the process, but leaders of the EU seem willing to put billions of euros where their mouths are and help financially grease the changeover.

The new head of the European Central Bank, Christine Lagarde, is also arguing for policy initiatives that would use monetary and banking policies under their supervision to push forward on climate change as well.  She’s not alone.  The Bank of England also is saying something similar.  In the United States, the arguments are still raging with the latest shot being President Trump twitter bashing the child campaigner, Greta Thunberg, and telling her to “chill,” of all things, in a spit fight over climate warming.

All of them want to figure out which companies are cleaner or dirtier than others, but that’s not easy.  The so-called ESG scores for companies, which stands for environmental, social, and governmental factors, are still a long way from an exact science.  A good example is the fact that ESG investment funds reportedly have the fifth largest set of investments in Saudi Arabian firms, who are pretty much the opposite of climate change crusaders.  One of the commissioners on the US Security Exchange Commission was quoted calling the current state of ESG ratings little more than “Labelling based on incomplete information, public shaming, and shunning wrapped in moral rhetoric,” which hardly counts as an enthusiastic endorsement.

Don’t get me wrong.  I would love to see a unified score that allowed all of us to follow benchmarks for corporate performance on all of these issues involving responsible behavior.  The full page, glossy ads in national magazines, the endowed chairs at big universities, and droning claims of good deeds on public radio from oil, chemical, drug, and other companies trying to convince us that they are so-called “good” corporate citizens could be thrown in the garbage can, if we had a good, independent set of measurements where there was common agreement on which companies had been naughty or nice.

Sadly, we seem to have none of that.  We have different rating companies competing for what is estimated to be a $3 trillion dollar set of investments tracking ESG and from what I read here and there, all of them are using different standards and categories.  Since many of the companies aren’t exactly enthusiastic about being tracked closely, they aren’t helping provide accurate and timely data either, so we end up with a crapshoot pretending to be science.

Most of us aren’t investors of course, but a real rating system would eventually trickle down to us as consumers where those of us at the bottom could join in putting the squeeze on the bad companies and just maybe, miracles never cease, get some help from the big investors joining us at the top.

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Increase Austerity, and Welfare Becomes More Popular!

New Orleans   Something very surprising, and I think very important, is happening about attitudes about welfare.  Finally!  Unfortunately, it’s happening in the United Kingdom, rather than in the United States, but let’s take the wins where we find them, because there are lessons there that politicians and policy makers need to heed about the limits to the abuse of lower income families.

The biggest takeaway seems simple.  If the government proposes and implements draconian austerity programs that scale back benefits, and worse, attack the benefit recipients, there will come a point when the public reacts and pushes back to support more generous benefits and to oppose further cutbacks.

In the USA, in recent weeks in the middle of the a 10-year economic cycle of success for corporations and the rich, we see current rule proposals that would take four million off of food stamps who are automatically certified since they are on TANF or welfare benefits.  Similarly, it would knock a half-million children off of automatic certification for free or reduced school lunches.  This is just the latest attack in a decades’ long erosion of protections for the poor that was only momentarily relieved in the worst days of the recession under President Obama.

In the UK, there’s a big, fat backfire, as reported in The Economist.  After the conservatives promised $18 billion in cuts to welfare benefits, they rode that to election victory in 2015.  But what they accurately call “the political pinata” isn’t working now.  Polling in Britain indicates that where more than 50% once thought benefits were “too generous,” and now that number has fallen to only a bit above 40% in just two years.  More importantly, 56% now believe that cuts “would damage too many people’s lives.  That’s huge!

Furthermore, the Ronald Reagan lies about “welfare Cadillacs” and other scurrilous attacks on recipients aren’t working in the public square either.  A study of news’ mentions of welfare fraud and abuse in the UK, finds that they have gone from almost 700 annually in 2010 down to less than 200 in 2018.  It’s not working to use the poor as a kickball there, so they’ve had to dial it back and tone it down.  Praise, lord!

It’s not all cheery in old England of course.  The numbers have also dropped because immigration from the European Union has been reduced, and part of the opposition had been to so-called freeloaders from abroad.  The Economist refers to a report by Professor Ben Baumberg Geiger at the University of Kent arguing that these changes are not systemic as much as they are “thermostatic…Once policies become harsher or softer than the level preferred by the public, voters send a signal and the government adjusts the policy ‘temperature’ accordingly.”  They cite the current government slightly increasing the working-age benefit as an example of climate change on this issue.

Sounds like magic, doesn’t it?  Not sure when this wand will wave over the United States or whether or not we have hit the bottom of the thermometer that would move politicians to release their death grip on the necks of poor families, but let’s hope we’re close to point where benefits must rise, so families can survive.

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Please enjoy “Can I Go On” by Sleater-Kinney. Thanks to KABF.

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