Saturday, April 06, 2024

GAZA

“No amount of medical care could ever compensate for the damage being inflicted here”

APRIL 4, 2024

LABOUR HUB

Mark Pearlmutter and Feroze Sidhwa give an eyewitness account from Gaza.

On March 25 the two of us, an orthopaedic surgeon and a trauma surgeon, travelled to the Gaza Strip to work at Gaza European Hospital. We were immediately overwhelmed by the overflowing sewage and the distinct smell of gunpowder in the air. We made the short journey from the Rafah crossing to Khan Younis, where Gaza European Hospital stands as one of the last remaining semi-functional hospitals for the 2.5 million human beings – half of them children – in the Gaza Strip. As humanitarian surgeons we thought we had seen all manner of cruelty in the world, but neither one of us has ever experienced anything like what we found when we arrived in Gaza.

We exited the van into a sea of children, all shorter and thinner than they ought to have been. Even over their screams of joy at meeting new foreigners, the snowmobile-like hum of Israeli drones could be heard overhead. That background noise is a constant reminder that violence and death can rain down on anyone at any time in this besieged and ransacked territory.

Our limited sleep is constantly interrupted by explosions that shake the hospital’s walls and pop our ears, even well after the United Nations Security Council declared a ceasefire must be implemented. When warplanes scream overhead everyone braces for a particularly loud and powerful explosion. The timing of these explosions always coincides with iftar, when families in this overwhelmingly Muslim county break the daily fast of Ramadan and are most vulnerable.

We walked through the wards and immediately found evidence of horrifying violence deliberately directed at civilians and even children. A three-year-old boy shot in the head, a 12-year-old girl shot through the chest, an ICU nurse shot through the abdomen, all by some of the best-trained marksmen in the world. Every square inch of the hospital’s floor is taken up with makeshift tents where displaced families live. They are the lucky several hundred who get to live indoors, unlike the tens of thousands sheltering outside on the hospital’s grounds.

As we got to work we were shocked by the violence inflicted on people. Incredibly powerful explosives ripped apart rock, floors, and walls and threw them through human bodies, penetrating skin with waves of dirt and debris. With the environment literally embedded in our patients’ bodies we have found infection control to be impossible. No amount of medical care could ever compensate for the damage being inflicted here.

As humanitarian trauma surgeons we have both seen incredible suffering. Collectively we were present at Ground Zero on 9/11, Hurricane Katrina, and the 2010 earthquake in Haiti on the first day of these disasters. We have worked in the deprivation of southern Zimbabwe and the horrors of both the war in Ukraine and attended primary trauma services to those injured in the Boston Marathon. Together we have worked on more than 40 surgical missions in developing countries on three continents in our combined 57 years of volunteering. This long experience taught us that there was no greater pain as a humanitarian surgeon than being unable to provide needed care to a patient.

But that was before coming to Gaza. Now we know the pain of being unable to properly treat a child who will slowly die, but also alone, because she is the only surviving member of an entire extended family. We have not had the heart to tell these children how their families died: burnt until they resembled blistered hotdogs more than human beings, shredded to pieces such that they can only be buried in mass graves, or simply entombed in their former apartment buildings to die slowly of asphyxia and sepsis.

The United States has heavily funded and overwhelmingly armed what is called “the occupation” of Palestine, but the term is misleading. Israel’s first president, Chaim Weizmann, declared that the existence of the Palestinians was simply “a matter of no consequence.” Thirty years later, Israeli defence minister Moshe Dayan told the Israeli cabinet that the Palestinians “would continue to live like dogs… and we will see where this process leads.”

Now we know: this is where it leads. It leads to Gaza European Hospital, and to two trauma surgeons realizing that the blood on the floor of the trauma bay and the operating room is dripping from our own hands, as we provide the crucial funding, weapons, and diplomatic support for a genocidal assault on a helpless population.

The two of us continue to hope against hope that American politicians, and especially President Biden, will abandon their support for Israel’s war on the Palestinians. If they do not, then we have learned nothing from the history of the past hundred years. Voltaire quipped that “no snowflake feels responsible for the avalanche”, but we as Americans must acknowledge that we are responsible for this crime against humanity that is unfolding in front of the entire world.

Israel has dropped so much American ordinance on Gaza that it now exceeds the explosive force of the atomic bomb that destroyed Hiroshima. More children have been killed in Gaza than were killed in all war zones in the entire world in the past four years. No conflict of any size in history has ever been this deadly to journalists, healthcare workers, or paramedics. Indeed, we and our entire team live in constant fear that Israel will attack this hospital directly, as it has with so many others.

We came to Gaza as two individual snowflakes trying to stop this avalanche of death and horror, and yet we also feel responsible for it. We urge anyone who reads this to publicly oppose sending weapons to Israel as long as this genocide continues, until the Israeli siege of Gaza is lifted, and until an end to the occupation can be negotiated.

Mark Pearlmutter, MD, FACS is an orthopaedics hand surgery specialist. Feroze Sidhwa, MD, MPH, FACS is a trauma, acute care, general surgeon, neurocritical care intensivist.

Image: Damage following an Israeli airstrike on the El-Remal aera in Gaza City on October 9, 2023. Source; Correspondence with Wiki Palestine (Q117834684). Author: Wafa (Q2915969) in contract with a local company (APAimages), licensed under the Creative Commons Attribution-Share Alike 3.0 Unported license.

Over 50 Labour MPs call for Israel arms sales suspension as pressure grows on Sunak and Starmer

APRIL 5, 2024

LABOUR HUB
LABOUR HUB EDITORS

Over 50 Labour MPs – more than a quarter of the parliamentary Labour Party and over half of the Party’s backbenchers – are now calling for an immediate suspension of arms sales to Israel.

The news comes as London Mayor Sadiq Khan also backed an immediate suspension of arms sales. The Lib Dems and SNP have also issued the same demand.

Today, Scottish Labour leader Anas Sarwar also called for an end to UK arms sales to Israel. But so far, the UK leadership refuses to budge.

In a separate development, civil servants are threatening to stop work over arms sales to Israel. Officials in the Department for Business and Trade have requested to “cease work immediately” over fears they could be complicit in war crimes in Gaza.

Former Shadow Chancellor John McDonnell MP tweeted: “Full support for these courageous civil servants. The Rome Statute covering war crimes is clear that following a superior’s instructions is not a defence when it comes to charges of war crimes. The government must come clean on the legal advice it has.”

Former Shadow Justice Secretary Richard Burgon MP also backed the civil servants, tweeting: “I fully support these workers.” Former Shadow Secretary of State for Communities and Local Government Grahame Morris MP also expressed “full support and solidarity with these PCS union members’ courageous actions.” Former leader Jeremy Corbyn MP also expressed his solidarity.

At the same time, the University and College Union announced: “We have today written to the university employer body UUK calling on them to review their UK-Israel research partnership scheme – in line with legal and ethical obligations to avoid any complicity in the ongoing genocide in Gaza.”

Momentum has launched a petition calling on Labour to back a suspension of arms sales to Israel. Currently, the Labour leadership is asking only that the government reveal what legal advice it has received on the issue – although Rishi Sunak clearly has no intention of doing so.

Meanwhile, 600 leading lawyers including three former Supreme Court justices are also demanding a suspension of arms sales to Israel, accusing the government of breaching international law by continuing to issue licenses.

Opinion polls, even before this week’s bombing of an aid convoy by Israel, showed public support for a suspension of arms sales. 71% of Labour voters back the demand, with just 9% opposed. 59% of voters say Israel is breaching people’s human rights in Gaza.

Kate Dove, Momentum Co-Chair said: “Israel’s murder of aid workers in Gaza represents one more war crime in a long list of atrocities. It is no wonder, then, that a majority of voters find it unconscionable that the UK continues to send weapons to Israel, a state on trial for genocide, or that 600 leading lawyers find it illegal. Yet while the SNP and Lib Dems have called for a suspension of arms sales, the Labour leadership has not. We must exert maximum pressure on Sunak and Cameron to finally do the right thing – that means Keir Starmer and David Lammy speaking up for an immediate suspension of arms sales to Israel.”

Tell Labour: Stand Against Arms Sales to Israel! Sign the petition and spread the word.

Image: London march for ceasefire, January 13th, c/o Labour Hub.

Common sense – or pie in the sky?

Luke Hildyard introduces some themes from his new book Enough: Why It’s Time to Abolish the Super-Rich, published by Pluto.

APRIL 6, 2024LABOUR HUB EDITORS

Running the Government is no picnic, but listening to the Conservative administration over the past 14 years, one could be forgiven for thinking that it literally is.

Throughout their terms of office, Tory Ministers, MPs and Advisers have repeatedly struggled to talk about the UK economy without digressing into ruminative metaphors involving pie and cake and jam.

Former Prime Minister Liz Truss is the figure most associated with the ‘economy as pie’ analogy with her frequent assertions that we must ‘grow the pie’, although it was widely observed at the time, her plans to galvanise the UK economy were of commensurate plausibility with the notion of an expanding pie.

But long before Truss arrived on the scene, Grant Shapps was warning in 2014 that Ed Miliband and Labour only wanted to divide the cake and never grow it. In the early months of the Coalition Government, no lesser figure than Rupert Murdoch, giving the inaugural Margaret Thatcher lecture to Tory thinkers at the Centre for Policy Studies think tank (to whom this presumably made some kind of sense), noted that “baking a bigger cake requires us to look beyond these borders.”

More recent examples of this tendency, include another ex-Prime Minister, Boris Johnson declaring his levelling up agenda would not be a ‘jam-spreading exercise.’ Business and Trade Secretary Kemi Badenoch has lamented that “for too long we have focused on how to divide the pie” rather than how to grow it. And backbench MP Ranil Jayawardene delivered a thundering Daily Express column last year setting out how Labour would take “someone’s slice of the pie and give it to someone else.”

It’s difficult to know how to read all this. The idea that confiscating your pie and giving it to someone else is such a mortifying prospect for voters reflects an endearing but slightly patronising view of the British public. If the constant references to pies and cakes are an unconscious expression of their innermost desires, then given the various scandals that dogged the end of John Major’s Tory Government, it’s possibly a good thing by comparison. On the other hand, if they’re sitting round the Cabinet table trying to sort out the pensions system or whatever and everyone is daydreaming about custard then perhaps not.

The serious point is what this shows about the world view of the Conservative Party, and whether or not it is shared by Labour. The point of the analogy is of course to argue that economic growth, rather than the distribution of resources, is the key factor determining living standards. The aggregate size of the pie is more important than how evenly it’s sliced up.

In reality, both aggregate wealth levels and how they are shared matter. The Resolution Foundation’s recent report ‘Ending Stagnation’ pinpoints both the lack of economic growth and the high levels of inequality as sources of the UK’s economic malaise. A fascinating data analysis by the Financial Times recently showed how, compared to counterparts in ostensibly similar economies across Europe, rich people in the UK are generally richer, but middle and low income households are much poorer. Because the UK is more unequal and those at the top take a bigger slice of the pie or cake, there’s less left over for those in the middle and at the bottom.

Though less bafflingly obsessed with finger foods, Labour seems to essentially accept the argument that distribution doesn’t matter that much. Rachel Reeves said in a Times interview last year that she wanted to solve inequality by raising people at the bottom up rather than bringing those at the top down. Her recent ‘Mais lecture’ to the City of London also emphasised that the economy is not ‘a zero sum game.’ Labour has ruled out multiple redistributive taxes including a wealth tax, an increase in capital gains tax or a higher top rate of income tax.

This is quite at odds with the way that living standards have improved throughout much of history. Mechanisms to ensure that wealth doesn’t overwhelmingly flow to the people with all the economic and political power have always been necessary to ensure that economic growth benefits everybody. Examples might include the rise of trade unions ensuring more of the wealth generated during the industrial revolution flowed to the workers who powered it. Or the creation of the NHS and the welfare state funded by progressive taxation. Or the introduction of the minimum wage, ultimately paid out of business income that would otherwise benefit the business owners.

In the UK, the richest 1% of the population have steadily increased their share of total incomes and wealth over the past few decades to the point that they capture up to 17% of total incomes, depending on which estimate you read – up from around 6% when Margaret Thatcher was elected – and nearly a quarter of all household wealth – up from about 18% over the same period. Taking a 17% share of total income down to 7% (still a disproportionately large amount) and re-distributing the remainder across the wider UK population would be equivalent to another £2,500 per person per year, assuming existing levels of income. The richest 1% by wealth could hypothetically give every household in Britain around £60,000 and still be left sitting on an average fortune of nearly £3 million each.

My new book Enough: Why it’s Time to Abolish the Super Rich argues that taxing the 1% more effectively and getting them to pay a bit more to the workers at the companies they run and invest in is the most pragmatic, obvious and effective way that policymakers could immediately raise general living standards for the UK population.

The economic risks associated with this approach are wildly exaggerated. There’s increasing evidence that a braver approach to extreme concentrations of income and wealth would actually release money and assets for use in the productive economy and help to make aggregate riches greater, as well as more equally divided. The argument that the super-rich would all leave is flawed on multiple levels – they wouldn’t, there are measures that could stop them or mitigate the effects and it wouldn’t matter that much if they did.

Taxes and/or curbs on top pay applied to the private sector bureaucrats that run Britain’s biggest companies or the heirs and heiresses, speculators and Russian oligarchs that populate our rich list aren’t going to penalise irreplaceable innovation or productivity, they’d merely ensure that people’s level of material affluence reflects how hard they work on their contribution to society a little bit more accurately.

This really ought to be the most moderate, mainstream, common sense. There’s a huge resource, in the form of the incomes and wealth of the super-rich, that could be used to raise living standards for people whose living standard needs to be raised, rather than to make people who are already obscenely rich even richer. Surely anyone who considers themselves a political pragmatist ought to be at least curious about enabling some kind of re-balancing of the distribution. Instead, those who think like this are treated as extremists or utopians. Meanwhile, talk of growing pies and ending inequality by making all the poor people as rich as the rich ones is considered a hallmark of sensible, sober policymaking.

Rather than getting annoyed about this, progressives should see it as a challenge to get out there and make action to address extreme concentrations of income and wealth politically opportune. Trade union rights, universal health care and the minimum wage were all seen as implausible heresies at one point, but are now broadly if not universally accepted.

A potential change of Government creates the opportunity for an administration containing a number of progressive voices and at least a bit more interest in distributional issues than the current one. My book argues that a major and transformative programme to re-direct the income and wealth captured by the super-rich to the people who need it and create it now needs to become a unifying and priority mission for progressives. With a broad, sustained and popular movement behind the cause, it is far from pie in the sky.

Luke Hildyard’s new book Enough: Why It’s Time to Abolish the Super-Rich is published by Pluto.

Private equity is predatory capitalism with a long trail of destruction

Prem Sikka
5 April, 2024
LEFT FOOT FORWARD

There won’t be enough money to contain the tsunami caused by private equity collapse. Yet there is no move to shackle private equity.

Prem Sikka is an Emeritus Professor of Accounting at the University of Essex and the University of Sheffield, a Labour member of the House of Lords, and Contributing Editor at Left Foot Forward.

Private equity is part of predatory capitalism that is swallowing everything from accountancy firms and airports to supermarkets and more. Some see it as a saviour of distressed companies and jobs, but it has no long-term interest in companies. It only buys to sell, and has left a long trail destruction which the rest of society has to mop-up.

The UK economy is yet to fully recover from the 2007-08 banking crash, but the path to the next crash is being laid by private equity which is unregulated. It controls assets of £6.3 trillion and in 2022 invested around £47bn in UK companies.

Private equity is effectively a consortium in which sovereign-wealth funds, banks, pension funds, hedge funds, insurance companies, financial technology firms, mutual funds, clearing houses, money market funds, private credit funds, trusts and wealthy individuals pool resources to buy a variety of business entities and generate high returns by selling them, often by breaking them.

Private equity operates through complex corporate structures and key components are almost always located in low/no tax jurisdictions with little or no transparency. High leverage, low wages, low investment, asset-stripping, strategic bankruptcies, profits shifting, tax avoidance and financial engineering are key tools for extracting profits.

It loads the acquired entity with secured debt because interest payments qualify for tax relief, which lowers the cost of capital and helps to increase returns. The secured creditor status enables private equity to drastically reduce or eliminate the losses which might arise from bankruptcies because it has to be paid before all other creditors.

Some may refer to Benson for Beds and B&M as examples of the private equity success story, but overall its focus on the short-term is destructive. Private equity controlled businesses are 10 times more likely to go bankrupt than those who aren’t. More often than not, it is deliberate to increase returns. Its UK victims include Bernard Matthews, Byron Burger, Casual Dining Group, Cath Kidson, Comet, Debenhams, Flybe, Four Seasons Health Care, HMV, TM Lewin, Maplin, Monarch Airlines, Paperchase, Planet Organic, Poundworld, Southern Cross, Toys R Us and many more. Thousands of jobs have been lost and town centres have been turned into economic deserts. Tax bills are not paid. Too many SMEs in the supply-chain have been wiped out as they could not recover the amounts owed to them.

Bernard Matthews was a well-known poultry business and fell upon hard times after its founder’s death. It was sold to a private equity consortium which loaded it with secured debt. Within the next three years, its private equity owners sold-off parts of the business and then deliberately placed it into bankruptcy. They refused to sell the whole business because that would have required the new owner to buy liabilities and pension scheme deficit, in return for a lower price. Instead, they only sold the tangible assets because that maximised the profits for private equity. Unsecured creditors and pension scheme deficit was dumped. This pattern has been repeated across numerous collapses.

In 2021, Debenhams closed its doors after 242 years, with the loss of 12,000 jobs. It was destroyed by private equity which increased debt from £128m to £1.6bn, and paid itself dividends of £1.3bn. The company was strangled by debt which left no wiggle room for investment and collapsed owing £616m to its suppliers.

Private equity has its tentacles in England’s water companies. Thames, Yorkshire and Southern Water are all inflicted by private equity and have higher leverage than other water companies. Profits are made by dumping sewage in rivers, not plugging leaks and low investment. Since 2020, Thames Water is has dumped 72bn litres of sewage into rivers and has not built any new reservoirs since 1989. It is now struggling for survival and has hiked customer bills by 12.1%, well above the rate of inflation.

Private equity has moved bought GP surgeries, nursing homes, hospitals, opticians, dermatology, and ophthalmology providers. Accessing GPs is becoming harder and doctors are being replaced with less qualified staff. A 2023 research study concluded that private equity ownership was “most consistently associated with increases in costs to patients or payers” and “associated with mixed to harmful impacts on quality.” It could identify “no consistently beneficial impacts of PE ownership.”

Some 75% of children’s care homes are private, and eight of the 10 largest UK private providers are private equity owned homes. Local councils are charged more than £30,000 per week or £1m per year for placements for children with significant care needs. Some 30%-40% of all public money handed to private equity controlled care homes vanishes in profits. Profiteering and neglect is never far away.

Care home workers are some of the lowest paid, a key factor in high vacancies, high staff turnover and low quality of care. Executive pay has rocketed. Highly paid executives focused on profit extraction have not delivered high quality of service. Numerous private equity controlled care homes attract “inadequate” and “requires improvement” quality ratings from regulators but they still pay high dividends. For example, HC-One, the UK’s largest care home service provider for more than 14,000 residents in 321 homes pays dividends even when the company makes losses. Research studies have concluded that for-profit homes provide lower quality of service than not-for-profit homes, and “private equity financing and independent for-profit ownership are associated with lower quality”.

A House of Commons report noted that around 16% of the fees paid to care homes vanish in interest payments to service high levels of leverage. Companies dodge taxes through the use of “tax havens, complex related party transactions and other artificial arrangements. It further added that there is “no transparency over ownership”, “no rules to stop or discourage financially risky behaviour”, and “providers bear no responsibility for the continuity of care if they suddenly leave the market or change ownership”.

Private equity has moved into supermarkets. In 2021, Morrisons wasacquired by private equity for about £7bn, which was loaded on to the company as debt. With rising interest rates, it soon hit the buffers. Asset stripping began with the sale of 337 petrol forecourts for £2.5bn. It is raising finance through sale and leaseback of stores. It may sell its manufacturing arm, which includes abattoirs, vegetable packing houses and fish processing plants, to raise cash to repay debt. It is goodbye to the benefits of integrated business synergies. Worker’s pay has been cut and employer pension contributions reduced. Customers complain of less choice, higher prices, a less-rewarding loyalty scheme, fewer staff, increasingly tatty stores and more self-checkouts.

In 2021, Issa Brothers in collaboration with private equity consortium TDR Capital bought Asda, and loaded it with £6.8bn debt. Through a complex corporate structure, Asda is controlled by a company registered in the tax haven of Jersey. Issa Brothers deny that the offshore vehicle will facilitate tax avoidance, but there is little other use of it. Soon after the debt-laded acquisition, the company announced job losses and 5% pay cut for about 7,000 workers. In February 2024, it was reported that one of the Issa Brothers is considering selling part of his stake in Asda.

The Bank of England has expressed concerns about the debt pile of private equity and its vulnerability to higher interest rates. Any major collapse would infect the whole economy. After the 2007-8 banking crash the state provided £1,162bn of support (£133bn cash and £1,029bn of guarantees) to bailout ailing banks and £895bn of quantitative easing to support capital markets. There won’t be enough money to contain the tsunami caused by private equity collapse. Yet there is no move to shackle private equity.

For starters, tax relief on interest payments should be abolished. Whether an investment is funded with debt or equity makes no difference to the systemic risk but tax relief facilitates high returns for the dealmakers and encourages high leverage. That subsidy must end. All prudential rules applied to banks, such as capital adequacy; need to be applied to private equity. The Competition and Market Authority should not permit takeovers where the buyer has consistently abused its powers. The gains made by private equity dealmakers are their incomes and must to be taxed at the marginal rates between 20%-45% instead of capital gains currently taxed at rates between 10% and 28%. Insolvency law needs to be changed to prevent private equity masquerading as a secured creditor from walking away with almost all of the proceeds from the sale of business assets. At least 50% must be ring-fenced for the benefit of unsecured creditors, and enable innocent SMEs caught up in the private equity games to survive and flourish.

Image credit: Marc Barrot – Creative Commons

Unifor head Lana Payne says union talking with Ford following Oakville EV delay

Alina Zorina, BNN Bloomberg

In the wake of Ford Motor Co.’s decision to pump the brakes on plans to launch a Canadian-made electric SUV next year, the head of Canada’s biggest auto workers union says they’re going to leave no stone unturned in their quest to mitigate the impact on employees.

Lana Payne, the national president of Unifor, told BNN Bloomberg in an interview on Friday that she was informed of Ford’s plans to delay the launch on Tuesday this week, only a day before it became public, but admitted the news didn’t come as a complete surprise.

“There had been a lot of rumours on the shop floor,” she said. “Chatter that there could be some challenges here.”

Canadian impact

The vehicle was set to be manufactured at the company’s Oakville, Ont. assembly plant, so this week’s development has thrown the future of the 3,200 people who work at the plant, along with another 2,000 along the supply chain, into uncertainty.

“All of their futures now are up in the air,” Payne said.

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The union has already started discussions with Ford on mitigating and lessening the impact on members and autoworkers in Canada. Even though the solution won’t come overnight, Payne saw signals Ford was willing to work something out.

“Every rock needs to be [turned],” she said, adding that the union she leads is determined “to push and to press the company here in any way that we can.”

Future for EVs

Payne said she thinks demand for electric vehicles will continue to grow, but as with any transition as massive as the current one underway, “major bumps” are to be expected.

“The reality is this is going to be a big part of the auto industry of the future and Canada needs to be in the game,” she said.

Payne added she’s pleased with the tone of her discussions with the company on the subject so far, and says she sees signals that they are going to work with the union to mitigate the impact on workers as much as possible.

“This is not going to be figured out overnight,” she said.

Ford Motor Co. delays start of EV production at Oakville, Ont., plant until 2027

Ritika Dubey, The Canadian Press

Ford Motor Co. is delaying the start of electric vehicle production at its Oakville, Ont. plant by two years, at a time when growth in the EV market is falling short of the automobile industry's ambitions.

The U.S. automaker had planned to start production at the Canadian plant, which employs 2,700 workers, in 2025. On Thursday it said it was pushing that back to 2027.

Ford announced plans last year to spend $1.8 billion to transform its Oakville assembly plant into a hub for electric vehicle manufacturing, including vehicle and battery pack assembly, as it transitions away from combustion engines.

Ford said in its release the delay will give the consumer market more time to develop and allow for further development of EV battery technology.

While the automaker's plan to overhaul the plant and equip it with tools to produce EVs beginning this quarter will continue as planned, the production of the new family-sized electric vehicles at the factory won't start until 2027. That means production workers will be out of a job for significantly longer than expected.

Sam Fiorani, vice-president of global vehicle forecasting and AutoForecast Solutions LLC, says Ford has realized where the market is at the moment.

"Acceptance of EVs is not there to the level that they had planned," said Fiorani in an interview. "They've pushed some investments of EVs back a bit so that they can be prepared when the demand shows up."

Fiorani said Ford is not the first to pause or delay the production of EVs and won't be the last.

"Everybody should have seen it coming," he said. "The initial adopters for EVs are tech-savvy people or green buyers and they're willing to pay a little extra to have an EV to be first on their block."

Most other drivers need a little more convincing to move away from combustion engines, he said, adding that all their questions about places to charge, adequate range and relevant technology need to be answered before they buy.

"It will take time for everyday drivers to warm up to an EV," Fiorani said.

Sales for battery-powered electric vehicles in Canada have seen a consistent uptick since 2017 — outpacing overall vehicle sales growth — but the rate of adoption has fluctuated, according to Statistics Canada.

Some employees will remain on site during the plant transformation but there will be layoffs, Ford spokesman Said Deep said.

He noted that employees are eligible for income security benefits for a period that varies with seniority levels.

The company said it will work with Unifor, which represents 3,200 workers at the plant, to mitigate the impact the delay will have on its workforce.

Unifor said it wants Ford to consider all possible options to lessen the negative effects on workers from the "substantial delay" in the EV production launch at the Oakville plant.

The union's national president, Lana Payne, said she was extremely disappointed by the decision.

Payne said in an interview that she understands the electric vehicle transition is not easy, "but none of that changes the reality of what thousands of workers are facing today and that is a lot of uncertainty and a delayed production to electric vehicles by a number of years."

She added the union is doing everything it can to "push the company to live up to its promises to our members and to the commitments that have been made to have a robust vehicle production facility at Oakville that includes the building of electric vehicles."

In its most recent contract agreement from 2023, Unifor secured an up to 70 per cent income security benefit rate for Oakville plant workers during the planned eight-month retooling.

The union is now looking to extend that financial support.

"The second demand will be: Are there other possible opportunities here to be able to lessen the impact of this decision on our members and their families?" Payne said. "We cannot leave any stone unturned."

Ford president and CEO Jim Farley said the delay would be a benefit in the long run.

"We value our Canadian teammates and appreciate that this delay will have an impact on this excellent team," Ford president and CEO Jim Farley said in a statement.

"We are fully committed to manufacturing in Canada and believe this decision will help us build a profitably growing business for the long term."

Ford has said the planned changes at the site include a new battery plant where workers will assemble parts produced at its U.S. operations into battery packs that will then be installed in vehicles assembled on-site.

The company's spending plans were first announced in 2020 as part of negotiations with Unifor, during which time workers wanted to secure long-term production commitments. The Detroit Three automakers eventually agreed to invest in their Canadian operations, in concert with spending agreements with the Ontario and federal governments.

The two governments agreed to provide $295 million each in funding to secure the Ford investment.

Ontario Premier Doug Ford called the delay "disappointing" at a news conference in northern Ontario.

He added, "I understand that Ford is going to take care of the Unifor members. That's No. 1. It's an absolute priority."

The company needs to try and retool "as quickly as possible," said the premier.

Asked what the automaker's delay meant for his government's plan to draw manufacturing capacity to Canada, Prime Minister Justin Trudeau said during a press conference in Winnipeg that companies make decisions that make sense to them.

He noted that his government is seeing a continued adoption of EVs by Canadians and progress toward a manufacturing chain that runs from mines to battery assembly and auto assembly to after-market recycling efforts.

This report by The Canadian Press was first published April 4, 2024.

DOE releases community guide on coal-to-nuclear conversion

SKIPPING NATURAL GAS CONVERSION

04 April 2024

The US Department of Energy (DOE) has released an information guide for communities considering replacing their retired or retiring coal power plants with nuclear power plants. The guide is based on a technical study that found transitioning from a coal plant to nuclear would bring local benefits including employment opportunities, increased revenues and economic activity.

The community guide features a rendering of TerraPower's Natrium project (Image: DOE)

Nearly 30% of the USA's coal plants are projected to retire by 2035, but pivoting away from carbon-emitting sources for electricity generation means economic uncertainty for the communities where those plants are situated, Coal-to-nuclear transitions: An information guide notes. But advanced small modular reactors are particularly well suited to replace coal plants, it says.

The report is based on an in-depth technical study prepared for the DOE, and builds on a 2022 DOE report highlighting the opportunities and challenges as coal communities consider converting to nuclear.

A nuclear power plant replacing a coal power plant would employ more people and create additional long-term jobs and increase total income in host communities, as well as increasing revenue for host communities, power plant operators, and local suppliers. In addition the study found that, with planning and support for training, most workers at an existing coal plant should be able to transition to work at a replacement nuclear plant.

The information guide "offers communities a high-level look at the economic impacts, workforce transition considerations, and policy and funding information relevant to a coal-to-nuclear transition", DOE said. It also provides utilities with a brief overview of considerations such as power requirements, project scope and timeline, and infrastructure reuse.

"As we work to transition to a net-zero economy, it's absolutely essential that we provide resources to energy communities and coal workers who have helped our nation's energy system for decades," said Assistant Secretary for Nuclear Energy Kathryn Huff.

The DOE's 2022 report identified 157 retired and 237 operating coal plants sites as potential candidates for a coal-to-nuclear - or C2N - transition, finding 80% of those potential sites to be suitable for hosting advanced nuclear power plants.

Advanced reactor developer TerraPower has already selected a location near a retiring coal plant for its first Natrium advanced reactor. It recently submitted an application to build the demonstration project at Kemmerer, Wyoming to the US Nuclear Regulatory Commission, and plans to begin non-nuclear construction work later this year. Utility PacifiCorp, which operates the retiring Naughton coal plant at Kemmerer, last year added two further Natrium units to its future plans.

Researched and written by World Nuclear News

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