'FREEDOM CONVOY' TRIAL
Closing arguments wrap up at Pat King convoy protest trial
CBC
Fri, July 26, 2024 


Pat King, one of the leaders of what became known as the Freedom Convoy protests, arrives for his trial in May. Closing arguments wrapped up on Friday, and the judge is expected to deliver his decision in October. (Spencer Colby/The Canadian Press - image credit)

Closing arguments have wrapped up in the criminal trial for one of the leaders of what became known as the Freedom Convoy, and a decision is now expected in October.

Pat King has pleaded not guilty to charges of mischief, intimidation, counselling and other charges for his role in the 2022 protests, which led to large swaths of the city's core being gridlocked by trucks and other vehicles for nearly three weeks.

Throughout his trial in Ottawa, the Crown used evidence from social media, police and residents to show King played a key role in bringing protesters to the city and then encouraged them to stay after authorities ordered them to leave in February 2022.


Prosecutors say the Freedom Convoy as a whole was a "group mischief" and argue King played an active role in it, significantly impacting citizens' lawful use and enjoyment of property.

"This case is about Mr. King's conduct and how he chose to express his views — which he's entitled to have — about the COVID-19 mandates, and how that manner of expression consisted of intimidation and mischief," said Crown prosecutor Emma Loignon-Giroux during closing submissions.

King's defence counsel, Natasha Calvinho, has argued the Crown's case lacked context, that the trial was not about the protests themselves and that King can't be held liable for the actions of others.

Freedom Convoy Demonstration in Ottawa.before police moved in on 20 Feb 2022. See truck and protest signs in front of Parliament buildings.

In February 2022, the provincial government declared a state of emergency due to the protest. Shortly after, Prime Minister Justin Trudeau invoked the Emergencies Act. Police arrested protesters and cleared city streets. (CBC/Radio-Canada)

She pointed to instances where King followed police directions and encouraged viewers of his popular social media feed to stay peaceful, while minimizing the overall role he had in the protests.

Calvinho said the protests were a "failure" of all levels of government and suggested any guilt on King's part would only be the result of him getting "erroneous advice" from officials, whom she accused of "barricading" protesters in the city and preventing them from leaving.

Superior Court Justice Charles Hackland will now weigh the nuances of the overall circumstances in Ottawa during the protests against King's own actions to decide whether the law was broken.

Role of King's leadership a central question

Central questions at the trial included what role King played during the three-week protests to what extent he could be considered a "leader."

The court never saw evidence of King honking a horn himself or driving a truck. Prosecutors said they didn't need that, because King's other behaviour showed he was actively taking part in mischief and other crimes.

On his social media, King posted videos that prosecutors used as evidence. They showed him directing supporters to honk horns after a court injunction banned the act, leading a "slow roll" of trucks by the Ottawa International Airport and talking about sneaking trucks downtown.

Other videos, including some made after the federal government invoked the Emergencies Act, showed King helping trucks block Wellington Street near Parliament Hill and encouraging supporters to "sit on the ground" if police begin enforcement.

Police enforce an injunction against protesters, some who have been camped in their trucks near Parliament Hill for weeks, on Feb. 19, 2022.

Police enforce an injunction against protesters, some of whom were camped in their trucks near Parliament Hill for weeks, on Feb. 19, 2022. Several police officers were called to testify at King's trial. (Evan Mitsui/CBC)

Officers who testified said efforts to contact King were made because he was considered a "leader" or "person of influence."

One protester from western Canada told court how King was the "guide" for truckers coming from Alberta and was "there to make sure everybody was safe."

Another said he felt rebellion was his "duty" and King was a "prominent figure" in that rebellion.

King was also listed as a contact on the website of one of the main groups organizing the protests.

King points to others, blames authorities

Other protest participants said they had no idea who King was until they got to the city or until the protest was over.

Calvinho also pointed to other people, some who were never charged, who played key roles. She suggested King was targeted only because he was a "valuable personality" as he had some 354,000 online followers at the time of the protests.

She questioned the role authorities played when it came to mitigating the risk of having so many people and vehicles in the downtown core.

"Knowing that, and the volume of persons, [authorities] not only invited them, they told them where to park, where to stage, where to set up, where to remain, where to overflow," Calvinho said.

Dozens testified, hours of video evidence entered

The trial started in May and endured starts and stops before both parties finished calling evidence Friday and made closing arguments.

Hours of video evidence, much of it sourced from King's own social media, were entered into evidence by both sides. Other evidence included decibel maps that showed noise levels, as well as descriptions of how services like transit routes were disrupted.

During closing arguments, King appeared on a video screen from Red Deer, Alta., where he lives.

King's trial was highly anticipated by supporters and followers of the 2022 protests. He is one of the key convoy figures going through Ottawa courts.

If found guilty, any potential jail time for King is a moving target — but prosecutors have made clear he could face up to ten years in prison.

Hackland is planning to deliver his decision on Oct. 4, 2024, and has ordered King to be there in person.

Scientists find rare species in survey of Chignecto Isthmus

CBC
Sat, July 27, 2024 

The Canada jay is one of the rare birds spotted by scientists on the Chignecto Isthmus. (Submitted by Sean Blaney - image credit)

For wildlife that can't fly or swim, the only path between New Brunswick and Nova Scotia is across the Chignecto Isthmus.

That's why it's important "to maintain the genetic integrity of populations of species that need it," says Sean Blaney, executive director and senior scientist at the Atlantic Canada Conservation Data Centre.

The Chignecto Isthmus connects Nova Scotia with the rest of Canada.

The Chignecto Isthmus connects Nova Scotia with the rest of Canada. (CBC News)


This isthmus, a narrow strip of land that connects the two provinces, is the focus of a research project led by the Nature Conservancy of Canada.

As part of that project, Blaney and a group of scientists at the centre recently surveyed the strip of land, documenting over 58 species of birds. They also identified 360 species of plants, 270 of which were native species and 90 exotic.

"Larger patches of that nature are becoming rarer all the time in our region," said Blaney.

The scientists work beforehand to find "critical zones," or areas that haven't been affected by people that wildlife is likely using to traverse the area.

There are no trails and the terrain is rugged and swampy, said Blaney.

The area that he covered was north of Scoudouc, between Shediac and Moncton.

"I was surprised in a good way by the extent of higher quality forest," he said.

"It can be a struggle to find more mature forest in larger patches in this region because it has a really long history of human occupation and quite intensive use for forestry and for other land uses that have converted the forest entirely."

The Isthmus is a narrow, 24 kilometre strip of land that joins mainland Nova Scotia to New Brunswick and the rest of the continent.

The isthmus is a narrow 24-kilometre strip of land that joins mainland Nova Scotia to New Brunswick. (Submitted by Sean Blaney)

He spotted rare bird species such as the eastern kingbird and Canada jays, and even an orchid listed in New Brunswick as endangered: the southern twayblade.

He said these patches of intact habitat on the isthmus are essential for animals.

"It's quite important as one of the last quite intact zones within a real priority habitat corridor," he said.

Blaney will hand over his data to the Nature Conservancy, which will use it as part of the organization's conservation efforts, including working with local landowners to maintain natural areas.

Work to protect Chignecto Isthmus going too slowly, say local politicians

CBC
Wed, July 24, 2024 


The Chignecto Isthmus is the strip of land that connects New Brunswick and mainland Nova Scotia. It's an integral trade corridor and is vulnerable to flooding from the effects of climate change. (Craig Paisley/CBC - image credit)


Officials elected by the people living on and near the Chignecto Isthmus say work to protect the low-lying strip of land that connects mainland Nova Scotia to New Brunswick is going too slowly.

Local MLAs, mayors and other stakeholders attended a meeting this week at Amherst Town Hall, where they discussed pending upgrades to the centuries-old dike system that protects the isthmus from the battering tides of the Bay of Fundy and Northumberland Strait.

Amherst Mayor David Kogon said it's time for the provincial governments and Ottawa to stop fighting over who will pay for the project and get to work.


Scientists have estimated that extreme weather and rising sea levels caused by climate change threaten to flood the Chignecto Isthmus by the year 2100, which would have devastating effects for Amherst.

Kogon said he worries that timeline is accelerating, and there's little his town can do to protect itself.

"All we can do is advocate and push the higher levels of government because that's where the money is," he told reporters following the meeting.

Two years ago, a study commissioned by Nova Scotia and New Brunswick yielded a report that said the dikes need major repairs.

No construction has started, but a spokesperson for the Nova Scotia Department of Public Works said there is other work underway. They said staff are studying the impact of water movement in the area, hiring a project manager and engaging with governments, academics and others.

David Kogon is the mayor of Amherst.

David Kogon is the mayor of Amherst. (Town of Amherst)

Work stalled over funding questions

Kogon said he has "full confidence" in the work getting done, eventually, but he thinks it's stalled.

"Unfortunately they can only plan to a certain point. They can't go beyond a very beginning nature in the planning until the financial agreements are in place on how it will be paid for."

The study from 2022 pegged the cost of raising and strengthening the dikes around $300 million, but the cost estimate has since ballooned to $650 million.

Ottawa wants to share the cost with the provinces, but the provinces want the federal government to cover the whole bill.

New Brunswick Green MLA Megan Mitton and Nova Scotia Independent MLA Elizabeth Smith-McCrossin represent districts on the Chignecto Isthmus.

New Brunswick Green MLA Megan Mitton and Nova Scotia Independent MLA Elizabeth Smith-McCrossin represent districts on the Chignecto Isthmus. (Pat Callaghan/CBC)

Nova Scotia and New Brunswick reluctantly applied for a cost-share agreement through the federal Disaster Mitigation and Adaptation Fund, but they're also in the midst of a court case pushing for Ottawa to pay more.

New Brunswick Green MLA Megan Mitton and Nova Scotia Independent MLA Elizabeth Smith-McCrossin were both at the meeting in Amherst this week, and said their constituents are tired of waiting.

"It's frustrating because we've lost precious time," said Mitton.

"People want shovels in the ground," said Smith-McCrossin.

Bill passed in Senate

New Brunswick Sen. Jim Quinn thinks a bill he introduced could help move things along.

"We simply need to do this more quickly," Quinn told reporters in Amherst.

Bill S-273 passed through the Senate this spring. Quinn said Conservative MP Stephen Ellis, who represents the Nova Scotia riding of Cumberland-Colchester, will sponsor the bill in the House of Commons this fall.

New Brunswick Senator Jim Quinn, pictured in Amherst Town Hall on July 23, 2024.

New Brunswick Sen. Jim Quinn, pictured in Amherst Town Hall on July 23, 2024. (Taryn Grant/CBC)

The bill declares improvements to the dikes on the Chignecto Isthmus "to be for the general advantage of Canada." It does not explicitly call for Ottawa to pay for the whole project, but Quinn said it could lead to the federal government paying for more than the 50 per cent that's currently on the table.

He said it could also result in the federal government taking the lead on other aspects of the project such as consulting with Indigenous communities and assessing environmental impacts.

Quinn said he thinks his bill also highlights the need for regional equity, pointing to Ottawa's decision to spend $1 billion over 25 years to repair and maintain a Quebec bridge, while resisting the call to pay for the Chignecto Isthmus work.

"We need to be treated fairly and equally as others in the federation," said Quinn.

Autocracy, Inc review – fears for liberalism and democracy

Lloyd Green
Sat, 27 July 2024 

Putin and Xi Jinping in Beijing in May.Photograph: Anadolu/Getty Images


“There is no liberal world order any more, and the aspiration to create one no longer seems real,” Anne Applebaum writes in her new book, Autocracy, Inc: The Dictators Who Want to Run the World.

In the eyes of many, US failure in Iraq coupled with the great recession discredited rules-based democracy. Parents of privilege shielded their children from war and economic downturn. The rest were not so lucky. The world’s current crop of rising strongmen are not operating on a blank slate.

Russian belligerence and the rise of China play out against this roiling landscape, so too the challenges of Iran and North Korea. The emergence of a reinvigorated Brics bloc is another reminder of western unsteadiness. Indeed the west itself – from Hungary to Paris to Washington – is far from immune to the trend.


“Nowadays, autocracies are run not by one bad guy but by sophisticated networks relying upon kleptocratic financial structures,” Applebaum argues. She is a Pulitzer-winning historian, a staff writer at the Atlantic and married to Poland’s foreign minister.

Looking back, Applebaum got it wrong on the Iraq war (she had advocated regime change), nailed it on Vladimir Putin (“personal survival is more important than the well-being of their people”) and came close to the mark on Ukraine (“Russia must acknowledge Ukraine as an independent country with the right to exist”).

The strength of Autocracy, Inc lies in its description of how autocrats bend and distort opinion, and find allies across national boundaries.

In retrospect, the west was too eager to treat China as just another trading partner, not as a rival. The Tiananmen Square massacre signaled what might come next. Xi Jinping is a product of a system.

In such systems, Applebaum writes, elites operate “not like a bloc but like an agglomeration of companies, bound not by ideology but rather by a ruthless, single-minded determination to preserve their personal wealth and power”.

No single caricature-like figure calls the plays alone. Rather, ad hoc collectives are driven by cash and power.

“The members of these networks are connected not only one to another within a given autocracy but also to networks in other autocratic countries, and sometimes in democracies too.”

Such elites have lawyers in New York and London, bank accounts and holdings strewn across the world. Applebaum notes that Marc Kasowitz, who counseled Donald Trump during the Mueller investigation of Russian interference in the 2016 election, also represented alleged US conduits for a Ukrainian oligarch. As it happens, David Friedman, Kasowitz’s former law partner, was Trump’s ambassador to Israel.

As Applebaum writes, “the globalization of finance, the plethora of hiding places, and the benign tolerance that democracies have shown for foreign graft now give autocrats opportunities that few could have imagined a couple of decades ago.”

Putin is estimated to be worth between $70bn and $200bn, wealth to rival that of Elon Musk. Xi and his family clock-in north of $1bn.

Applebaum examines gas pipeline deals between the then Soviet Union and what was West Germany. The US was rightly concerned.

Richard Nixon saw the danger that such transactions would “detach Germany from Nato”. Jimmy Carter imposed sanctions on the sale of US pipeline technology, on account of Soviet human rights violations. Decades later, the Nord Stream pipeline emerged as a battleground between Moscow, Kyiv, Berlin and Washington.

Applebaum turns her gaze to Gerhard Schröder, German chancellor between 1998 and 2005. Since then, he has worked for Nord Stream, Rosneft and Gazprom – all Russian. Now 80, he has chaired the shareholder committee of Nord Stream, reportedly earning around $270,000 a year. He also led the supervisory board of Nord Stream 2, now shuttered.

He is unapologetic. In February 2022, after Russia invaded Ukraine, he told the New York Times: “I don’t do mea culpa, it’s not my thing.”

Applebaum also discusses so-called “hybrid states”, which she characterizes as countries that are a “legitimate part of the international financial system” and possess many of the trappings of democracy but that are “also willing to launder or accept criminal or stolen wealth or to assist people and companies that have been sanctioned”.

She points to the United Arab Emirates and Turkey. “Russian property purchases in the Emirates rose 100% after the invasion of Ukraine,” she writes.

Not surprisingly, Applebaum lauds patriotism but fears nationalism and isolationism. By such metrics, Brexit was a bust.

“Did the removal of Britain from the European Union give the British more power to shape the world?” Applebaum asks.

The answer is self-evident.

“Did it prevent foreign money from shaping UK politics?”

Want a hint? Evgeny Lebedev, son of Alexander Lebedev, a Russian oligarch and ex-KGB agent, is now Lord Lebedev of Hampton and Siberia, neatly ensconced in parliament.

“Did it stop refugees from moving from the war zones of the Middle East to Britain? It did not.”

Nigel Farage’s dream has left the UK worse for wear. Farage’s admiration for Putin is a feature, not a bug.

“I said I disliked him as a person,” Farage recently said of the Russian president, while campaigning for election as an MP. “But I admired him as a political operator because he’s managed to take control of running Russia.”

Applebaum hopes liberalism and democracy are sustainable but is uncertain of their fate.

“Nobody’s democracy is safe,” she writes. Still, “there are liberal societies, open and free countries that offer a better chance for people to live useful lives than closed dictatorships do.”

For autocrats, liberty and autonomy are inconveniences. Conformity is king. There is little surprise that Putin portrays himself as the defender of faith and traditional values.

American democrats – as well as Democrats – have reason to be concerned. During the 2016 election, Paul LePage, then governor of Maine, thought Trump needed to show some “authoritarian power”. A lot has happened since then. Come November, LePage just may get his wish.

Autocracy, Inc: The Dictators Who Want to Run the World is published in the US by Penguin Random House

REFUSNIKS

‘I can’t justify this military operation any more’: the IDF reservists refusing to return to Gaza

Ruth Michaelson, and Quique Kierszenbaum
Sat, 27 July 2024 

Israeli army reservists Yuval Green, Tal Vardi and Michael Ofer Ziv have revealed their reasons for not returning to military service in Gaza.

Photograph: Quique Kierszenbaum/The Observer

For Israeli military paramedic Yuval Green, it was the command to burn down a house that made him decide to end his reserve duty.

Green had spent 50 days in the southern Gaza city of Khan Younis earlier this year with his paratrooper unit, sleeping in a home lit only by battery-powered fairy lights among the rubble and devastation.

He had begun to have doubts about the unit’s purpose there months earlier when he heard about Israel’s refusal to agree to Hamas’s demands to end the war, along with freeing hostages.

Green is one of three Israeli reservists who told the Observer they will not return if called for military service in Gaza. All three previously undertook compulsory military service in the Israel Defense Forces (IDF), which forms the backbone of society.

They returned after the 7 October attacks by Hamas militants, when almost 1,200 people were killed in towns and kibbutzim around Gaza and about 250 taken hostage.

But the destructive behaviour Green says he witnessed from other soldiers only fuelled the misgivings that he carried into Gaza, despairing at what he describes as a cycle of violence. He said he had stayed out of a sense of duty to care for those in his unit, who he knew from his years of compulsory military service. They were angry after seeing the devastation wreaked by Hamas’s attacks on Israeli towns, he added.

“I saw soldiers graffiting houses or stealing all the time. They would go into a house for a military reason, looking for weapons, but it was more fun to look for souvenirs – they had a thing for necklaces with Arabic writing that they collected.”

Then, early this year, he said: “We were given an order. We were inside a house and our commander ordered us to burn it down.”

When he raised the issue with the head of his company, he added: “The answers he gave me were not good enough. I said: ‘If we’re doing all of this for no reason, I’m not going to participate.’ I left the next day.”

The IDF’s response to the 7 October attacks has become Israel’s longest war since 1948 and one that has now killed more than 39,000 people in Gaza. Thousands more are believed buried beneath the rubble, with at least 90,000 wounded and the overwhelming majority of its 2.3 million population displaced. Meanwhile, observers fear the fighting risks spilling over into Lebanon.

Two of the reservists said they could feel compelled to return to service if the near daily exchange of drone attacks, airstrikes and artillery fire between Israel and Hezbollah in Lebanon becomes a fully fledged war.

All three cite different motivations for their decision not to serve in Gaza again, from how the Israeli military is conducting the war to the government’s reluctance to agree to a hostage deal, which offers an end to the fighting.

The three reserve soldiers speaking publicly about their unwillingness to return to service represent a minority, in part because military refusal in Israel is normally considered illegal.

Last month, 41 reserve soldiers signed an open letter declaring that they would no longer continue to serve in the IDF assault on Gaza’s southern city of Rafah.

“The half year in which we took part in the war effort has proven to us that military action alone will not bring the hostages home. Every day that passes endangers the lives of the hostages and the soldiers still in Gaza, and does not restore security to those living on the Gaza and northern borders,” they wrote.

An IDF spokesperson disagreed. “The IDF’s military pressure on Hamas has brought many hostages back home, as it has yesterday when five bodies were recovered by the IDF’s 98th Division,” they said last Thursday.

Related: ‘Like judgment day’: evacuees tell of fleeing Israel’s assault on Khan Younis

“The IDF operates according to the law regarding serving in the IDF and the assignment of troops to their duties. Each case of refusal to comply with the duty is assessed considering the relevant circumstances.”

Israel’s prime minister, Benjamin Netanyahu, has pledged to achieve “total victory” in Gaza, arguing that only military pressure will force Hamas to agree to a hostage deal.

“Any reasonable person can see that the military presence is not helping to bring the hostages back,” said civics teacher Tal Vardi, who trained reserve tank operators in northern Israel during his recent time back in the military.

“So if we’re not bringing back the hostages, all this is doing is causing more death on our side or the Palestinian side … I can’t justify this military operation any more. I’m unwilling to be part of a military that’s doing this,” he said.

“If anything, some of these operations have endangered the hostages, and the army has also killed some by mistake,” he said, pointing to an incident last December, when Israeli forces shot dead three hostages in Gaza who approached them waving white flags, in what the IDF said was a case of mistaken identity.

“It was bound to happen,” said reservist Michael Ofer Ziv, who said the incident provoked in him a powerful sense that once he finished his military service on the Gaza border, he would not return. The incident for him symbolised an overall lack of care and he was concerned by a system where mistakes such as this could occur.

Ziv returned to the IDF days after the October attacks to serve as an operations officer, requiring him to spend long hours staring at screens showing a live drone feed of footage from a small section of the enclave. This meant days at a time observing daily Palestinian life, watching as stray dogs or cars crossed bombed-out streets.

“Suddenly, you see a building go up, or a car you’ve been following for an hour suddenly disappear into a cloud of smoke. It feels unreal,” he said. “Some were happy to see this, as it meant seeing us destroy Gaza.”

When ground troops from his unit entered the enclave, his role was to track their movements and activities for support, as well as requesting targets for airstrikes.

“We almost always got approval to shoot,” he said. The approval process with the air forces, he added, “was mainly bureaucracy”.

He was also dismayed at what he described as a lack of clarity for soldiers regarding the rules of engagement, which he said were far more explicit during his compulsory military service, and felt the rules during this war were far looser than anything he previously experienced.

“After they shot the three hostages last December, I tried to remember if I ever saw a document like this – I was supposed to,” he said. “I was sure there was a briefing to the soldiers, but without having any documents to lean on, it’s unclear what people understood.”

An IDF spokesperson denied allegations relating to lax rules of engagement. “The IDF provides extensive training to its soldiers on them and how to act accordingly,” they said. “Additionally, before each military operation, soldiers receive a detailed briefing on the rules. Any accusation regarding the lack of written rules of engagement is completely false.”

Ziv recalled crying in the bathroom after his unit lost track of an injured Palestinian child at a checkpoint. Such things, he said, made him question his own role in the war and the overall purpose of the fighting.

The decision to invade Rafah rather than seal a hostage deal, he said, confirmed for him that he would not return to the military. When recently called upon to do so, he said, he told his commanding officer he could not come back.

“I came after 7 October as I felt like maybe they will rise to the occasion and use us in a way that could be of benefit. But I’m not willing to participate in this, as I don’t trust the government and what they’re trying to do.”

He added: “If something happens in the north, there’s a chance I’d go, but on other hand, I know what it might be like. I know what we did in Gaza – there’s no reason to believe we’d act any differently in Lebanon.”

How Elon Musk could benefit from a second Trump presidency

Jacob Shamsian
Fri, 26 July 2024 



Elon Musk has championed Donald Trump's presidential campaign.


Musk's companies — including Tesla, SpaceX, and X — are being sued or probed by federal agencies.


Trump could change or choose not to enforce regulations that affect Musk's companies.

With a few pen strokes, Donald Trump could make many of Elon Musk's problems go away.

Shortly after a gunman shot at Trump's head two weeks ago, injuring his ear, Musk made his preference for the 2024 presidential election known.

After being openly hostile to President Joe Biden on X, he endorsed Trump. When Trump chose as his running mate JD Vance — the US Senator from Ohio with deep links to Silicon Valley power brokers — Musk ramped up the promotion. This week, he said on X he had formed a political action committee "supporting a meritocracy & individual freedom," which he said he now associates with Republicans.

If Trump were to become president again, he could repay the favor. Musk has a lot to gain.

Trump's plans to lower corporate and personal taxes are certainly a plus. But Musk also stands to gain with a new administration controlling federal regulations.

"You can think of Musk's contribution as an investment," Michael Gerhardt, an expert in administrative law at the University of North Carolina, told Business Insider. "To eliminate any governmental interference with his businesses."

Musk owns six companies, all of which are subject to regulations from different agencies controlled by the executive branch.

The conservative-controlled Supreme Court's recent SEC v. Jarkesy decision, along with its Loper Bright decision striking down much of the Chevron doctrine, made it harder for federal agencies to enforce laws and regulations against companies. But with Trump as president, Musk wouldn't even need to dismantle the so-called "administrative state" to get federal agencies out of his way.

As the head of the executive branch, the president can simply sign executive orders and make hiring decisions to change the direction of federal agencies.

Tesla, SpaceX, and X (formerly Twitter) are all the subjects of ongoing federal investigations and lawsuits, and Musk's brain chip company, Neuralink, is highly regulated. A president has the power to change regulations, end those investigations, and free those companies from future regulatory action. Trump could also direct agencies to simply drop investigations or withdraw lawsuits, like the Justice Department's civil rights lawsuit against SpaceX for Musk's refusal to hire refugees for certain positions, or the agency's investigation into Tesla's self-driving claims.

As president, Trump could direct the Justice Department and other executive agencies to drop any actions against Trump and his friends' businesses, Gernhardt told BI.

Elon Musk.Apu Gomes via Getty Images

Musk's plans to build factories and towns for his employees in Texas have caused environmental problems. Recent Supreme Court decisions have watered down the Environmental Protection Agency's ability to protect environments due to construction, according to Jillian Blanchard, an environmental lawyer at Lawyers for Good Government. But a president could make it even easier for companies to challenge regulations, she said.

"Federal environmental rules like NEPA require you to do all sorts of environmental analysis before you build out a big manufacturing plant, for example," she said, referring to the National Environmental Policy Act.

"And that's a federal rule, so it comes across the whole country no matter where he decides to move his plants," she added.

Existing federal laws from the EPA and Department of Interior could be relaxed, Blanchard said.

"If Trump were in the White House, he would control the EPA, the head of the EPA, and they could also amend those regulations to make the permitting for Clean Water Act requirements easier," she said. "Same is true for the Endangered Species Act right now."

Musk didn't respond to a request for comment for this story.

Some agencies — called independent agencies — have statutory independence from the executive branch. The Securities and Exchange Commission, which has overseen numerous investigations into Musk and his companies over the years, is one of them. The president can't fire any of the five commissioners who oversee the FEC, and no more than three of them may belong to the same political party.

However, the conservative legal movement has waged a long war against the laws granting these agencies independence. And if Trump is president and Republicans control Congress, they could pass laws that give the president more authority over these agencies. The SEC's ongoing investigation into Musk's purchase of Twitter — now X — could go under Trump's control if Republicans get their way, Gerhardt said,

"The probe is tied up with the independence of the agency," Gerhardt said. "And one thing that I think is clear is that Trump wants to lead a pushback against independent agencies."

Even if a federal agency chooses not to enforce laws and regulations on the books, ordinary people can still bring the government and companies to court to force them to follow the law. Blanchard brought cases against the first Trump administration as the director of Lawyers For Good Government's climate change program to keep the EPA and Interior Department on notice.

But that still effectively transfers enforcement power from taxpayer-funded government to less-resourced private citizens.

"It's going to be up to the individuals to be able to bring those private rights of action if the federal agencies won't enforce their existing laws," Blanchard said.

Elon Musk is still being graded on a curve
Nora Naughton
Sat, 27 July 2024 

Wall Street was tough on auto stocks after second-quarter earnings.


For years, Tesla has managed to garner valuations more akin to tech than automotive stocks.


Musk knows how much weight his promises hold.

It's a tough time to be a car company on Wall Street — unless, of course, you are Elon Musk.

Several major automakers reported second-quarter and first-half financial results this week, and regardless of the results, investors were hard on everyone.

General Motors posted a significant beat Tuesday, only for its stock price to close down more than 6% that same day. Ford's financial results were dinged significantly by higher-than-normal warranty costs, and a significant earnings miss sent its stock price down 13% immediately following those results.

Tesla, meanwhile, reported a mixed quarter. Musk's electric car company missed analyst expectations on earnings-per-share but beat on revenue, sending the stock price down around 7% that evening.

While all three companies were experiencing a stock bounce back Friday afternoon, the difference comes down to one thing: valuation.

On a per-share basis, GM made $3.06 in profit, and Ford $0.47. Those stocks were trading at $44.12 and $11.24, respectively, Friday afternoon.
Tesla, on the other hand, made a similar $0.52 per share yet maintains its lofty $220 stock price as it has for years, thanks to grand promises and industry-leading tech.
Why valuations matter, and how Musk uses Tesla's to his advantage

Legacy automotive executives and some industry experts have long bemoaned the imbalance in their valuations versus Musk's, particularly in the days before Tesla started turning a consistent profit.

It makes for an uneven playing ground between massive global car companies. With less money from investors, legacy car companies struggle to raise enough capital to invest in the futuristic technology and software innovations that these same investors are clamoring for.

While Tesla has a few unique advantages over its competitors, looking at the hard numbers can leave one wondering: how long can Musk keep investors on the hook?

You can see the difference in valuations in how each of these companies talked about their future technology on earnings calls this quarter.

While Tesla focused on non-autos revenue streams in the second quarter, Ford spent much of its earnings call reassuring investors about the future value of its EV business despite big losses — $2.5 billion in the first six months of the year — even as its EV sales soared.

Barclay's Adam Jonas, a longtime Tesla bull who also has an overweight rating on the Blue Oval, accused CEO Jim Farley of being overly optimistic about future EV profitability.

"Tesla struggles to make a positive profit in EVs. Why does Ford think it can?" Jonas wrote in a Thursday note to clients.

Tesla also continues to dangle a future robotaxi business and the value of its AI technology. In contrast, GM continued its pull-back on investments in its own Cruise robotaxi business, canceling production of the Cruise Origin autonomous vehicle to focus on the existing Chevrolet Bolt-based robotaxis.

GM blamed the decision on a complex regulatory environment, which Musk disputed on Tesla's quarterly earnings call.

"GM can't make it work," Musk said. "Waymo is doing just fine in those markets, so it's just that their technology is not far."

Musk's promises on robotaxis and AI technology have largely reversed a stock slide that hit the company earlier this year following poor sales results and a pushed-out timeline for its long-awaited affordable vehicle.

Despite any real timeline for this technology, as is typical for Musk, the promise alone is enough for his most ardent supporters.

Following Tesla's Tuesday earnings call, longtime Tesla bull Dan Ives of Webush wrote in a note to clients that Tesla's rescheduled robotaxi day in October "will unleash the beginning of the AI story at Tesla which we value at $1 trillion alone over the next few years."

Elon Musk's X (Twitter) is now training its Grok AI using your data - here's how to stop it

Rob Waugh
·Contributor
Updated Fri, 26 July 2024 

Elon Musk's X network is to start training AI on user data (Photo by Marc Piasecki/Getty Images)


Elon Musk’s X, formerly known as Twitter, has added a setting which allows the network to use users’ information to train its Grok AI.

The new setting appears to be "on" by default for most users and allows the network to gather their information to train Grok - not just from posts, but from other interactions with the site.

The new setting says: "To continuously improve your experience, we may utilize your X posts as well as your user interactions, inputs and results with Grok for training and fine-tuning purposes.

"This also means that your interactions, inputs, and results may also be shared with our service provider xAI for these purposes."

The company made the change with little fanfare so it will have doubtless gone unnoticed by many users, although Musk did announce that his the company had begun training Grok this week in a post on X, promising "the world’s most powerful AI by every metric by December this year."
What is Grok?

Grok is a chatbot similar to ChatGPT only accessible to X subscribers (Getty Images)

Grok is a chatbot (similar to ChatGPT and Anthropic’s Claude) that is accessible via X, but only to subscribers.

Once known as TruthGPT, Musk initially billed Grok as "a maximum truth-seeking AI that tries to understand the nature of the universe". Musk has promised that Grok will be ‘anti-woke’ and offers a ‘Fun Mode’ as well as an ‘Unhinged Fun Mode’.
Why is the new setting controversial?

Similar changes at Meta (owner of Facebook and Instagram) have triggered complaints from data rights groups. Meta emailed Facebook and Instagram users in May to warn of a change, aiming to use user data to develop AI.

Privacy campaigners Open Rights Group (ORG) said: "With the latest update of their privacy policy, Meta has stated their intention to feed all the data they hold (about you) on their Facebook and Instagram platforms for the purposes of training 'AI technology'.

"While Meta also stated that they would only use 'public posts', their privacy policy contradicts this by including any personal data collected through these platforms, with the sole exclusion of private chats."

ORG has raised a complaint with regulators over the issue.

Veronika Pozdniakova, a privacy expert at privacy-focused phone company Murena, said, "As is often the case with online services, the new terms and conditions lack transparency, and this change directly impacts user privacy because the AI will be trained using users' personal information, which they may not be aware of or fully comprehend.

Users should regularly review and manage data shared on such platforms, including posts, interactions, and direct messages. Users also can opt out by abandoning a platform whose terms and conditions they don't agree with."
How can you stop your data being used like this?

You can’t change this setting in the mobile app, but you can withdraw consent to your data being used in the desktop version of X on Mac or PC.

To do so, just go to your profile, then Settings > Privacy and Safety > Data Sharing and Personalization.

Select Grok, and then switch the slider to ‘Off.’


Elon Musk Is Now Using Your Tweets to Train His Weird AI. Here's How to Turn It Off.

Noor Al-Sibai
Fri, 26 July 2024 


Sharing Is Caring

At some point, X-formerly-Twitter auto-opted its users into sharing their data with Grok, owner Elon Musk's unfunny "anti-woke" chatbot — without bothering to tell users about the change.

Flagged by Rolling Stone's Noah Shachtman, it remains unclear when X introduced this so-called "data sharing" change that authorizes the social network to use your tweets to train Musk's shoddy ChatGPT competitor.

As Shachtman notes, opting out of having your data included in Grok's training pool is as simple as de-selecting the allowance in your settings.

Nevertheless, it's super sketchy that everyone was automatically opted in without being informed, and that nobody knows how long this has been going on.

Forgiveness, Not Permission

Beyond not informing users that it's using their data, X also appears to not have told regulators about the change, either.

In a statement to TechCrunch, a spokesperson for the Irish Data Protection Commission (DPC), which acts as X's European watchdog, said the agency was taken by surprise when it learned that the social network had automatically opted users into allowing their tweets to be used as AI training data.

"The DPC has been engaging with X on this matter for a number of months, with our latest interaction occurring as recently as yesterday," Graham Doyle, the DPC's deputy commissioner, told the site. "Therefore we are surprised by today’s developments."

As TechCrunch notes, European Union law requires companies to have a valid legal reason to process data — and per the brief explanation provided under the "data sharing" tab in X user settings, such reasoning is unclear.

The watchdog said it had followed up with X about the change and that it's waiting for "further engagement" on the matter.

With this brewing debacle, X has become the latest in a string of companies to scrape data without asking. It's also not the first to automatically opt users into data sharing as a means of ass-covering — and unfortunately, it probably won't be the last.

More on AI training: When AI Is Trained With AI-Generated Data, It Starts Spouting Gibberish

Here's how to disable X (Twitter) from using your data to train its Grok AI

Aisha Malik
Fri, 26 July 2024 

X, formerly known as Twitter, has automatically activated a setting that allows the company to train its Grok AI on users’ posts. X enabled the new setting by default. The good news is that you can switch it off and also delete your conversation history with the AI.

If the setting is turned on, X can “utilize your X posts as well as your user interactions, inputs and results with Grok for training and fine-tuning purposes,” according to the platform’s settings page. X goes on to note that “this also means that your interactions, inputs, and results may also be shared with our service provider xAI for these purposes.”

Although it’s not possible to disable the setting via X’s mobile app, you can do so on the desktop version of the social network.
How to switch off X's data sharing settings:

Open up the Settings page on X on your desktop.


Select the “Privacy and safety” button.


Select “Grok.”


Uncheck the box.

A screenshot showing how to switch off the Data Sharing settings in X's desktop mode. Image Credits: TechCrunch

After you have switched off the setting, you can delete your conversation history (if any) with the AI by clicking on the “Delete conversation history” button.

Earlier this week, X owner Elon Musk said xAI had started training its Grok large language model using "the most powerful AI training cluster in the world." Musk said that the AI model would become "the world's most powerful AI by every metric by December [2024]." Now, it’s clear that Musk and X were hoping to use more than the powerful training cluster to train its AI by also using users' past tweets and posts.

X isn't the only social network that has utilized user data to train its AI, as Meta notified EU and U.K. users last month of an upcoming change that would allow it to use public content on Facebook and Instagram to train its AI. The company eventually bowed to regulatory pressure and paused its plans.

UK

LEEDS RIOTS

‘A minority inside a minority’: fear and conspiracy theories in the Leeds Roma community

Robyn Vinter North of England correspondent

THE GUARDIAN
Sat, 2 July 2024 

Mounted police on a street in Harehills on the morning after the disturbance. Photograph: Christopher Furlong/Getty Images


“A child died at the weekend,” a Roma woman in Harehills, Leeds, said on Monday. “Police came to take him and he jumped out of an upstairs window and died. The authorities have covered it up.”

Where has she heard this? “TikTok.”

Some said it was a baby and he fell accidentally. Some said it happened on Friday, others said it was the weekend. Some said it happened in Bradford and that it was several weeks earlier.


But no version of the story is true.

West Yorkshire police said there was no such incident in Leeds or Bradford, and the local ambulance service has no record of it either. There is no photo or video and no first-hand accounts. It is simply a conspiracy theory that has taken particular hold in marginalised groups.

A week on from the unrest in which a police car was flipped on its side, riot police pelted with missiles and a doubledecker bus reduced to a burnt-out wreck, concerns about the trustworthiness of the authorities are still rife among marginalised communities.

The disorder, triggered by police helping social services remove children from a Roma family into care, may have been short-lived – it seems nobody in Harehills is keen to repeat it – but the issues that sparked it have not gone away.

Related: Council to review child protection case that triggered Leeds unrest

Simona Lazar, the chief executive of the advocacy group Union Romani Voice, said the story was easy to believe when it was met by silence from the local authorities – and it had led to a lot of genuine distress. “The local community is so upset,” she said. “If it’s false information, the authorities need to come out and say, ‘Look, this is not true.’”

She said one of the issues among Roma people is that they come from countries where police are more heavy-handed and authorities more corrupt and discriminatory, and so they carry this mistrust with them to the UK.

Language and cultural barriers are another issue, organisations said – it is harder for non-English speakers to get reliable news and official information – but greater than that is a feeling of discrimination.

Steffie Banu, the chief executive of another Roma advocacy group, Roconect, said: “The Romanians in the UK are already a minority here, but then you have this Roma minority in the Romanian community. So basically they are a minority inside a minority in this country.”

On Tuesday, the family at the centre of the row that sparked the unrest were present in court at a hearing to determine whether it was possible to place the four children in the care of extended family.

The parents in the case were joined in support by many other family members, something that is unusual in family court, where there is very little space for supporters to wait.

Anyone who did not have a role in the proceedings was asked to leave the building, something an advocate complained amounted to discrimination, which he would be submitting a formal complaint about. He said: “In Roma families, decisions are made with the involvement of everyone. That’s what they don’t understand.”

Related: The Guardian view on unrest in Leeds: fodder for far-right disinformation | Editorial

Banu said it could be jarring for people who value community so strongly to live in a more individualistic society.

She said: “Family is the most important to the Roma people, not the career, not making money, not position in society, but family. It is their greatest treasure and focus in life.”

Roma groups said there were plenty of examples of discrimination by social services and police. Roma children make up a disproportionate number of those in care and Roma women are overrepresented in prison, which critics would say is a direct result of this. In the case of the Harehills family, complaints were made about their social worker, who was later removed from the case.

Lazar said more training was needed for police and social services, but more also needed to be done to help Roma families integrate into communities and feel welcomed and respected.

“Some of them don’t behave to UK standards, but they need support,” she added. “They’re lovely when they receive support, but if someone is saying to them ‘You’re the worst,’ they will behave like they are the worst.”

Green economy could generate 3.3m jobs across Africa by 2030 – report

Caroline Kimeu in Nairobi

THE GUARDIAN
Fri, 26 July 2024 

The renewable energy sector is expected to generate about 70% of the projected jobs, with 1.7m of those in solar power.Photograph: UN /RES4Africa


A greener economy could bring millions of jobs to some of the largest countries in Africa, according to a new report.

Research by the development agency FSD Africa and the impact advisory firm Shortlist predicts that 3.3 million jobs could be generated across the continent by 2030.

Forecasting Green Jobs in Africa predicts that 60% of the roles, mainly in the renewable energy sector, will be skilled or white collar positions that can “spur the growth of the middle class in countries with high-growth sectors” such as renewable energy, e-mobility, construction and manufacturing.


The report was based on forecasts from five countries – the Democratic Republic of the Congo, Ethiopia, Kenya, Nigeria and South Africa – that the study says will see more than a fifth of the jobs expected from the green transition over the next six years.

About 10% of the jobs created will demand university degrees, 30% will be “specialised” work that requires certification or vocational training, and 20% administrative. Unskilled labour will be more stable, with opportunities for upward mobility, the study predicts.

“This is the first public report that takes seriously the notion that human capital and talent is important as an input to green economic growth, and as a positive outcome – in the form of millions of new, direct jobs,” says Paul Breloff, CEO of Shortlist.

The renewable energy sector will generate about 70% of jobs, and roughly 1.7m will be in solar power. DRC and Ethiopia, with Africa’s largest and second largest hydropower potential – will see jobs in that sector. Agriculture should employ hundreds of thousands, with more than half of those jobs in climate-smart technology.

The researchers call on policymakers, funders and educational institutions to invest in training a workforce in green industries, saying it could “contribute to the formalisation of African economies, and the inclusion of whole populations in stable systems of remuneration, social security and taxation”.

“Policymakers and funders and workforce developers need to step up to meet this near-term demand with effective training, apprenticeships, and job/skill matching, in hopes of achieving Africa’s green promise,” said Breloff.

With its young workforce and vast renewable energy resources, Africa can “leapfrog” into renewables, skipping over the carbon-intensive pathways taken by industrialised countries, but, the report’s authors argue, it will require “supportive policies, infrastructure, and significant financial investments, estimated at over $100bn annually”.

African countries have struggled to attract renewable energy investments due to investor perceptions of risk and concerns over commercial viability. The continent receives only 3% of global clean energy funding. To meet climate and energy access development goals, investments need to more than double to over £155bn a year by 2030, according to the International Energy Agency (IEA) and the African Development Bank.

“You need a base level of good skills in the country to get investors comfortable putting their money into green investments – those jobs de-risk investments, investments flow into or within the country. If finance flows, then projects get to be realised, and will create even more new jobs,” said Kevin Munjal, director of development impact at FSD Africa.

Related: From Silicon Valley to Silicon Savannah: climate expert Patrick Verkooijen on why this is Africa’s century

Some countries, especially those with oil and gas reserves, continue to push back on calls for Africa, which accounts for less than 4% of global carbon emissions, to elevate carbon reduction goals over domestic priorities, such as fossil fuels for economic growth or domestic energy, when 600 million Africans do not have access to electricity.

Munjal says that, while “there is need to think about a just transition”, green growth provides critical potential for jobs and economic growth.

“There is a significant opportunity here to address what is quickly turning into a demographic crisis,” said Munjal. “Africa has the youngest, fastest-growing workforce but … the youth need jobs.”

UK

Did The Tories Really Leave Labour A 'Shocking' Inheritance?

OF COURSE THEY DID 

TAX CUTS =  DEFICITS

Kate Nicholson
Fri, 26 July 2024 

PM Keir Starmer has regularly slammed the legacy of Rishi Sunak's government in the last three weeks since he got into office. via Associated Press

Labour have wasted no time in pinning all of the countries’ problems on the Tories.

It’s not exactly a new political tactic – see the Conservatives’ ongoing claim Labour told them there was “no money left” when they took over in 2010 – but it is one they seem to be laying on rather thick so far.

Since getting the keys to No.10, the government has, almost without fail, blamed every major issue on the Tories.


In fact, Keir Starmer said on Thursday the last government “left us the worst inheritance since the Second World War”.

He added: “Every day we are finding more mess they’ve left for us to clear up.”

The prime minister also tried to buy his government some time, saying: “We’ve started the rebuilding but the problems that have been left to fester for years, cannot be fixed overnight.”

His health secretary, Wes Streeting, said their legacy was “shocking”.

Obviously the Conservatives have not taken to this lying down.

Tory leadership hopeful, Mel Stride, on Friday dismissed any such claims against his party, saying: “This is all pitch rolling, smoke and mirrors, to suggest that they’ve come in and it’s far, far worse than they ever could possibly have imagined. ”

So, just how bad is it? Let’s take a step-back from the political spin and a look at some of the cold, hard facts around some of Labour’s most eye-catching claims from recent weeks.
NHS

Streeting ordered an independent investigation into the state of the NHS a week after getting office.

On Friday, he revealed some of the early findings, all of which were pretty damning.

It found the Care Quality Commission, which is responsible for inspecting NHS hospitals, GP surgeries and care homes in England, is not fit for purpose.

Inspectors were found to be lacking experience, with some having never been in a hospital before or met a person with dementia.

Its inspections backlog is so large that a fifth of services had never been given a rating – and one NHS hospital has not had an inspection for a decade.

Meanwhile, the independent public spending watchdog, the National Audit Office (NAO) found the “scale of challenge facing the NHS today and foreseeable in the years ahead is unprecedented”.

It found a growing number of NHS bodies “have been unable to break even” with the amount of funding they’ve received, and the “pace of change” has been slow.

The authors of the NAO report said: “We are concerned that the NHS may be working at the limits of a system which might break before it is again able to provide patients with care that meets standards for timeliness and accessibility.”

It suggested policymakers must explain the potential mismatch between demand and funding, adding the NHS would need a larger budget or service levels would “deteriorate further”.

via Associated Press
Economy

The full extent of the economic inheritance will be revealed in full by chancellor Rachel Reeves on Monday.

She is expected to reveal a “black hole” in the government finances worth tens of billions of pounds – possibly exceeding £20bn per year.

She already told the BBC last weekend: “I don’t think anyone realised quite how bad things were.”

While we wait for her report, the think tank, the Institute for Fiscal Studies, looked into the Tories’ economic legacy – and found it rather wanting.

It said the last 14 years have been “extraordinary” – with earnings growing at their slowest rate in more than 200 years, and interest rates at a historic low.

“The period from 2010 to 2019 saw the biggest and most sustained cuts to public spending since World War 2,” the report said, adding that this all benefited the older generations.

The last five years have been a particularly lethal combination, due to the uncertainty of Brexit, the Covid pandemic and borrowing “on a scale even greater than seen during the financial crisis”, all of which meant taxes rose by more during the last five years than in any parliament since at least 1945.

“The legacy for the next government will be a difficult one,” the IFS said. “Expected economic growth is slow.

“The fiscal policy responses to the three shocks of the financial crisis, Covid-19 and the cost of living crisis mean that public sector debt is high, and a combination of high interest rates and low growth means that even running a primary surplus will not be enough to get it on a downward trajectory.”

It also called out the repeatedly failed promises to raise fuel duties in line with inflation, which is “another unwanted legacy” for Labour.

It predicted that the future “looks harder” for the British economy compared to its other developed countries’ economies with low productivity and high inflation.

The IFS also noted that Labour’s note to the Tories from 2010 that “there is no money left” can be applied to the current government as it “remains true today”.



The biggest and most sustained cuts to public spending since World War 2Institute for Fiscal Studies
Prisons

The new justice secretary Shabana Mahmood said last week that the UK is facing “the imminent collapse of the criminal justice system”, which sounded liek “some dystopian film”.

She said: “This is the legacy of the last Conservative government. This is the legacy of the guilty men.”

And figures released by the Ministry of Justice on Thursday showed how deep the overcrowding prison crisis is.

There were 73,804 recorded self-harm incidents in the last year, and 28,292 violent assaults in prisons over the last 12 months.

Overcrowding in prisons increased for a third year in a row, meaning 23.6% of jails now have too many inmates.

Meanwhile, the performance of four in 10 prisons are either of concern or serious concern.

Prisons have been at 99% capacity since the start of 2023, meaning prisoners have struggled to get out of their cells much.

This is all increasing reoffending rates – and worsening the risk to the public.

Interestingly, even the former Tory justice secretary Alex Chalk has backed Mahmood’s plan to reduce some offenders′ sentences to ease the overcrowding.

Lord Chancellor and justice secretary Shabana Mahmood via Associated Press
HS2

The high speed rail project was partially cancelled by Rishi Sunak, who said it had become too expensive and promised to redirect its funding.

The NAO’s latest report found that the Tories spent £592m buying land and property along parts of the route which are no longer going ahead.

Construction costs have soared by £16.1bn just since 2020, too.

It will take three more years to cancel parts of the route at an additional cost of around £100m.

The trains, which will still run between Birmingham and Manchester, will also have less space than current services – a decline of up to 17%, NAO said.

According to the NAO, the government may need to decrease demand by “incentivising people to travel at different times or to not travel by rail”, although the spending watchdog warned that this this may constrain economic growth and increase environmental costs.

Alternatively, the government was advised to try “improving or adding infrastructure” – but that may be expensive and disruptive, too.

With the economy, the NHS, HS2 and the prison system all struggling, it seems Labour may have a point – they really did inherit quite the legacy.

But now they’re in power, they can only blame the Conservatives for so long until the public get bored. The real question now is, how will they fix it?
Related...




Eight charts that lay bare Labour’s spending inheritance from Tories

Richard Partington and Phillip Inman
Fri, 26 July 2024 

Rachel Reeves and her predecessor Jeremy Hunt at the state opening of parliament. On Monday she will unveil the audit to MPs.Photograph: Ian Vogler/Reuters


Rachel Reeves is preparing to announce Treasury analysis of Labour’s spending inheritance from the Conservatives in parliament on Monday to highlight why she will need to make “tough decisions” in her autumn budget.

The chancellor’s audit is expected to show £20bn in commitments left unaccounted for by the previous government, building on a narrative that the Tories have left Labour with the “worst set of circumstances since the second world war”.

After more than a decade of stalling economic growth, and with public services stretched thin, there is plenty of evidence to back up Reeves’s argument. However, there are also signs that some progress was being made before Keir Starmer’s landslide victory this month. Here are eight charts that lay out the economic legacy the new administration faces.
Soaring national debt

Reeves will be painfully aware of the damage George Osborne inflicted on Labour the last time her party left office, epitomised by the way David Cameron’s chancellor seized on the infamous Treasury note left by Liam Byrne, joking that “there is no money left”.Interactive

Without such a powerful device this time, Labour will be keen to highlight official figures showing a tougher picture than in 2010.

The national debt has risen from 64.7% of GDP in 2010 to 99.5%, the highest level since the 1960s, after successive annual budget deficits and the damage of the Covid pandemic. Debt interest costs reached a postwar high of 4.4% of GDP in 2022-23, although are now falling back as inflation cools.

UK government bond yields – a proxy for borrowing costs – have also been on a rollercoaster, soaring after Liz Truss’s mini-budget in September 2022, falling back after Rishi Sunak took over but rising again in 2023. They have eased in recent weeks but remain higher than in 2010, amid predictions that rock-bottom rates seen after the 2008 financial crisis are unlikely to return.
Falling living standards

If one chart illustrates how the UK’s situation over the last five years can be likened to the period after the second world war, it is a look back at the ups and downs of disposable incomes in each parliament.Interactive

There was a fall of 0.1% in the period from 2019 to 2024 in household incomes when taking inflation into account. To find another five-year period when real household incomes fell means going back to the Labour government of 1945-50 headed by Clement Attlee.

Then, like now, the government was also increasing defence, health, education and infrastructure spending while trying to bring down borrowing from historically high, although not unprecedented, levels.
Recovering economic growth

Since the 2008 financial crisis, growth in UK GDP has slowed. Treasury analysis requested by Reeves shows that, had the British economy grown at the Organisation for Economic Co-operation and Development average over the past 13 years, it would have been more than £140bn larger.Interactive

However, in recent months there have been more encouraging signs. The UK exited last year’s brief recession in the first quarter at a faster pace than many forecasters predicted. Gross domestic product (GDP) rose by 0.7%, more than double the rate in the eurozone and above the G7 average.

Business surveys show robust growth has been maintained, in contrast to France and Germany, where political uncertainty and global trade headwinds are weighing on activity. The pound has gained on the international money markets and the FTSE 100 is close to a record high.
Cooling inflation

After reaching the highest level since the early 1980s, 11.1% in October 2022 after the Russian invasion of Ukraine, inflation has fallen in recent months to the 2% government target.Interactive

However, prices are significantly higher than three years ago and still rising. Labour also argues that insufficient action to decarbonise Britain’s energy supply and insulate homes left households more exposed to the cost of living crisis.

Still, cooling inflation is expected to lead the Bank of England to cut interest rates, possibly as soon as Thursday next week, easing the pressure on households and businesses after 14 consecutive increases, from 0.1% in December 2021 to the current level of 5.25%.
Tax constraints

Reeves has criticised the Tories for leaving office with “working people facing the highest tax burden in 70 years”. Tax as a share of GDP is forecast to rise from 36% of GDP to 37.1% by 2028-29. That would be four points higher than pre-pandemic and the highest level since 1948.Interactive

Despite these high tax levels, public services are struggling, and could face cuts should the chancellor stick with self-imposed fiscal rules requiring the national debt to be falling as a share of GDP in the fifth year of forecasts.

Labour’s manifesto pledged not to raise income tax, national insurance or VAT, which account for the bulk of overall taxation, hemming in the new government. Reeves could, though, tweak the fiscal rules, or raise more from taxation – most likely by targeting capital gains and inheritance taxes.
Employment challenge

The proportion of people in employment across the UK has declined over the past five years, mainly in response to an acceleration in the number of people opting for early retirement and a rise in the number too sick to work.Interactive

It is a trend that other G7 countries have managed to buck. In France there has been a significant rise since the coronavirus pandemic in the number of people in employment as a proportion of all working-age people, albeit from a lower level than the UK.
Investment challenge

Investment in the UK has trailed other G7 countries for decades, hindering productivity growth and leaving key infrastructure increasingly inadequate for a modern advanced economy.Interactive

Public investment has jumped in recent times from an average of 1.8% of national income to 2.4% since 2021, but the last Tory chancellor, Jeremy Hunt, paid for his pre-election cuts to national insurance with a dramatic reduction over the next five years that Labour is struggling to reinstate.

The level of investment by businesses has also been low for decades. Huge injections of foreign direct investment mostly went into buying UK companies rather than building new factories. Brexit added a layer of uncertainty, deterring foreign companies from basing themselves in the UK and discouraging businesses from investing to spur exports.
Councils in crisis

More English councils have declared effective bankruptcy in the past three years than the preceding 30, with casualties including Birmingham, Nottingham, Thurrock and Woking.Interactive

Sky-high inflation and rising demand on services have played a role, as have missteps at some authorities. However, local government bore the brunt of the Tories’ 2010s austerity drive, with central government grants cut by 40% in real terms in the decade up to 2020. The Institute for Government estimates that local authority budgets would need to increase by £7.1bn to bring funding back to the level in 2010.

Among the biggest challenges include a £5bn debt crisis in funding for special educational needs, which has been kept off municipal balance sheets by a special “override” arrangement with central government.