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Thursday, October 06, 2022

Study finds expanding voting rights can reduce violence

vote — Credit: Pixabay/CC0 Public Domain

A new paper in the Journal of the European Economic Association, published by Oxford University Press, indicates that the extension of voting rights can reduce political violence. The researcher finds this by looking at the impact of the Voting Rights Act of 1965.

Political scientists have long debated the effect of enfranchisement on violence and political outcomes. In theory, the extension of voting rights to a historically disenfranchised group has great power to reduce the potential for violence, since voting offers a channel for those dissatisfied with the status quo to express disapproval and pick new officeholders. "Give us the ballot, and we will transform the salient misdeeds of bloodthirsty mobs into the calculated good deeds of orderly citizens," said Martin Luther King in his historic speech before the Lincoln Memorial in 1957. Malcolm X expressed a related sentiment in a speech he gave in Cleveland in 1964.

But the extension of voting rights also shifts political equilibria. Such changes may increase elites' incentives to compensate for their loss of power with political violence. People with new voting power may also turn to violence if they do not see the benefits they expected from enfranchisement.

President Lyndon B. Johnson signed the Voting Rights Act on August 6, 1965. This changed the political alignment of the United States dramatically, but its impact on political violence is debatable. Certainly, political violence in the country appeared quite salient throughout the 1960s, as Americans witnessed several assassinations and riots erupted throughout the decade, in cities including Birmingham, New York City, Los Angeles, Chicago, Cincinnati, and Atlanta. Riots occurred in more than 100 U.S. cities alone on the night King was assassinated.

The Voting Rights Act prohibited discrimination in voting, but all jurisdictions were not covered equally by changes due to the law. The act required covered jurisdictions to suspend any practices limiting registration and obtain federal pre-clearance before any change in voting practices, and in many cases, federal officials came to register new voters in their county.

But counties altered due to the changes imposed by the Voting Rights Act were often located adjacent to (otherwise similar) counties that could continue on as before. The researcher here compared data on political violence between covered counties and non-covered counties on either side of the border in the years following 1965.

The researcher found that the Voting Rights Act halved both the number of instances of actual political violence and the likelihood that new waves of political violence would break out. Additional results show that in counties covered by the Act, citizens voted to voice their political views, whereas in other counties citizens continued to use violence. This effect mainly appeared to result from a change in political strategies rather than changes in policies and in the economic situation of citizens.

"In the current context of increasing discontent with democracy, understanding the voting-violence nexus is of extreme relevance," said the paper's author, Jean Lacroix. "Multiple countries still discriminate access to voting. Ending such policies could incentivize all citizens to engage more with voting and to rely less on violence as political action."New research reveals impact of rioting at the ballot box

More information: Ballots instead of bullets? The effect of the Voting Rights Act on political violence, Journal of the European Economic Association (2022). DOI: 10.1093/jeea/jvac048

Provided by Oxford University Press

Party feuding leaves Truss and Britain battling for survival

The prime minister looks for a chance to govern one month into role

British Prime Minister Liz Truss with husband Hugh O'Leary following her keynote speech on the final day of the Conservative Party conference. Getty Images

Thomas Harding
Birmingham
Oct 05, 2022

One Conservative donor said it was the “worst” party conference he had been to in 50 years, a veteran journalist said it was the “most chaotic” in 50 that he had covered, “and that’s including Labour and the Lib Dems”.

At times it felt like the Tories had lapsed into the blood sports much loved by some, scenting prey and like hounds following it, regardless of the consequences.

That mindless chase towards impenetrable thickets was averted — temporarily at least — by Liz Truss’ conference speech, where she was emboldened by environmentalist protestors who attempted to steal her limelight.

In the end, she delivered a speech that grew in confidence, selling her vision of low tax and a booming British economy that appears to have bought her time.

Canada wipe-out

But that will not provide much solace for Conservative MPs terrified of losing their seats whenever the next general election occurs.

Some point to the wipe-out experienced by Canada’s Progressive Conservative party, whose popularity plummeted from 43 per cent to 16 per cent, losing all but two of their 156 seats previously held before the 1993 election.

Recent electoral surveys suggest MPs have good reason to be fearful, with steady polling showing the opposition Labour consistently at between 25 and 33 per cent ahead.

In the short term, at least, that favours Ms Truss, lending her the ability to exert party discipline with the threat of calling a general election in which most MPs would lose their jobs.

The risk of extinction might prove motivational and will probably tie MPs to Ms Truss’ vision for growth, no matter the consequences.

Cockpit addicts

The cause of the Conservative descent from being the self-styled “natural party of government” can be traced to the decision to call a referendum on exiting the European Union in 2016.

On the first day of Brexit they lost a sensible, centrist prime minister in David Cameron. Three prime ministers on and the party is plummeting earthwards in a spin.

“Since Brexit it’s been like a load of drug addicts are in the cockpit flying like crazy and we’re the passengers but it’s only the people in the cockpit who have ejector seats,” a respected Conservative figure told The National.

For now, it appears that Ms Truss has managed to land the plane but not exited the cockpit, surrounded by those who seem intent on self-immolation.

Snake and traitor

While the fledgling British prime minister ended the conference confident and, to a point, in command, that had not seemed possible when the man no Tory wants as an enemy, Michael Gove, fomented the first uprising of the Truss era on Sunday.

Well-intentioned headlines of fixing Britain’s economy were trounced when the former Cabinet minister, who was sacked by Boris Johnson as a final act of revenge the night before he resigned, lobbed a stun grenade

British Conservative MP Michael Gove arrives at the conference in Birmingham. Reuters

“I don’t think it’s right,” he said, responding to whether he would vote for the five per cent cut to the 45 per cent tax rate for highest earners announced in chancellor Kwasi Kwarteng’s contentious mini-budget.

Mr Gove, who has variously been called a “snake” and a “traitor” by his own, is clearly exercising influence now he’s back among backbenchers.

His reach was such that Mr Kwarteng missed the main course of his dinner with reporters from The Sun newspaper on Sunday night, as Ms Truss summoned him to commit a U-turn on the tax hike.

Cabinet freelancers

That came on Monday, the humiliation was complete for Mr Kwarteng as the reversal came hours before he made his keynote conference speech. Lacking any lustre, and indeed attracting only lukewarm support, its main effect was to trigger the starting gun for a Tuesday of high drama.

MPs felt emboldened to force further concessions with ministers — including Leader of the House Penny Mordaunt, calling for social benefits to rise in line with inflation, currently around 10 per cent.

Cabinet discipline went up in smoke mid-conference, with ministers openly floating their own policies against the government position.

Britain's Chancellor of the Exchequer Kwasi Kwarteng gives his keynote speech. EPA

Home Secretary Suella Braverman criticised the tax U-turn and accused Mr Gove and other critics of Ms Truss of staging a “coup” to force the climbdown.

Trade Secretary Kemi Badenoch publicly told Ms Braverman not to use such “inflammatory” language.

At one point it appeared Mr Kwarteng was blaming Queen Elizabeth II’s death for all the chaos, claiming his mini-budget had to be seen in the context of the “high pressure” period following her demise and funeral.

Grant Shapps, a former Cabinet minister renowned for his reading of the Tory mood, said MPs would not “sit on their hands” in ousting Ms Truss without improvement.

Whipping in

All eyes will be on the prime minister when MPs return to Westminster next week. MPs who vote against her tweaked financial package will probably find themselves without the whip, suspended from the party, Downing Street officials have hinted.

For now, it appears that Ms Truss’ conference speech has saved the situation. “People just need to give her a chance to deliver something and run the country,” one Conservative member told The National. “Because this is not about the party, it’s about the country.”

Battle for Britain

That hard won breathing space will not last for long. Challenging events loom for the government.

Next Wednesday, Ms Truss will come up against the official opposition, with Labour’s Sir Keir Starmer likely to be unrelenting in his criticism during Prime Minister’s Questions.

The Bank of England’s purchase of government debt, needed to restore order after the tax cutting triggered financial chaos, will end on Friday, October 14.

British Prime Minister Liz Truss speaks on stage at Britain's Conservative Party's annual conference in Birmingham. Reuters

Before or shortly after then, the government will probably publish the Office of Budget Responsibility report, which will set out how the tax cuts will be paid. This will probably be via big cuts in public services, leading to further cries of dismay in Tory ranks.

The coming days will be a time of reflection for Ms Truss, who has undoubtedly had the most challenging apprenticeship in becoming prime minister since Winston Churchill took office in May 1940 as France fell and British forces were thrown out of Europe.

Two months later, the Battle of Britain began, when the country’s very existence was at stake.
British Prime Minister Liz Truss - in pictures

TORIES CANNOT MANAGE CAPITALI$M

Pound falls again as agency downgrades outlook for UK's credit rating to 'negative'

Fitch takes aim at the apparent conflict between government policy and Bank of England action to fight inflation, warning that it is concerned by the levels of borrowing the chancellor is likely to need to fund the growth plan.

James Sillars
Business reporter @SkyNewsBiz
Thursday 6 October 2022

Chancellor Kwasi Kwarteng is due to meet bank bosses on Thursday

A measure of confidence in the UK's creditworthiness has been slashed by another major ratings agency in the wake of the mini-budget, piling further pressure on the under-fire pound.

Fitch revealed on Wednesday night that it had cut the outlook for its credit rating on UK government debt to "negative" from "stable".

It maintained its overall rating - with AAA being the ideal verdict - at AA-.

The shift reflected, it said, mounting concern over the level of borrowing required to fund the chancellor's tax and spending pledges made in the Commons last month.

Financial markets delivered a stinging verdict on the package, dubbed a growth plan by Kwasi Kwarteng, with sterling eventually plunging to an all-time low against the dollar.

Investors also demanded higher rates of return for holding UK government debt, with the Bank of England later intervening to buy long-dated bonds to prevent a crisis for pension funds.

A series of U-turns have since helped the pound and bond yields recover some poise.

Truss: ‘No shame’ over tax U-turn

The UK currency was, however, trading back towards $1.13 on Thursday morning though that partly reflected a rekindling of dollar strength after further oil market turbulence.

Fitch revealed its decision days after a similar move by rival Standard & Poor's.

It said of the chancellor's mini-budget: "The large and unfunded fiscal package announced as part of the new government's growth plan could lead to a significant increase in fiscal deficits over the medium term."

The agency hit out at the lack of independent budget forecasts from the Office for Budget Responsibility (OBR) in the statement and the policy clash that sees the government trying to grow the economy at a time when the Bank of England is trying to shrink demand in its fight against inflation.

It added: "Although the government reversed the elimination of the 45p top rate tax... the government's weakened political capital could further undermine the credibility of and support for the government's fiscal strategy."

Sky News revealed on Wednesday that Mr Kwarteng was due to meet bank bosses on Thursday amid concerns about the impact of the recent market turmoil on home loan provision.

It has emerged that the average mortgage interest rate has risen to above 6%, meaning households are paying the greatest portion of their income on mortgage payments since 1989 - exacerbating the wider cost of living crisis.

The politics of Britain’s ‘mini-budget’ crisis

By Andrew Curry,

originally published by thenextwave

October 5, 2022

Resilience
Building a world of resilient communities

To borrow Hemingway’s famous phrase, political and economic crises happen gradually, then suddenly. And when they do happen suddenly, there are lots of immediate reasons why. The current economic and political crisis in the UK is largely self-inflicted, which raises the question of ‘why?’, but can also be thought of as representing the endgame of a long political wave.

No, you can’t know when the actual moment will be. But over a long period of time, the options keep narrowing until there are no good choices left, at least for the party and politicians that have benefited from that wave. Every political party hits a zugzwang moment.

Forty year cycles

I think it was the politics academic David Runciman who observed that if you looked back over a century of British politics, you could see cycles that ran from economic crisis to economic crisis every forty years or so, with a political settlement coming around a decade later. I can’t find the source for that, though.

This is a heuristic, not a law, and the timings are approximate. But, indicatively, the long depression of the late 19th century ran to 1896 (with Baring’s Bank bailed out in 1890); the 1929 crash led to the depression of the 1930s; the oil crisis happened in 1973-74; and, then of course, there was the 2008 crash.

The political effects of these: the ‘Liberal landslide’ of 1906, the Labour win in 1945 (complicated by the experience of war), Thatcher’s win in 1979 and subsequent victories in 1983 and 1987. And the 2008 crisis is still playing out in our politics today.
Systems patterns

It happens that you see this two-generation pattern in other bits of the literature. Strauss and Howe’s idea of the ‘Fourth Turning’ basically proposes a four-generation model from crisis to crisis. Their four generation pattern more or less goes ‘build’/‘enjoy’/‘exploit’/‘unravel’, although that’s not the language they use. It follows a classic long-run systems pattern, even if some of their post-hoc timings are spuriously exact.

All the same, the mechanism is visible. A crisis leads to a system reset, designed to solve the problems that caused the crisis. For a generation you get a reinforcing loop as the system benefits from this new set of ideas. But all systems decay over time, and a balancing loop kicks in as the problems caused by those new ideas come to the fore.

The advocates of the previous set of reforms retire or die off, and a set of ideas that had some coherence to them either become incoherent, or simply no longer fit the changing political and economic landscape. As David Muir noted, Thatcher said this explicitly of the Labour Party back then:

He added:
Now applies to the Conservative Party.

Conservative decline

So the current British political and economic crisis can be seen as the last twitch of Thatcherism, and by two of its last remaining zealots. I’ll be coming back to the-budget-that-wasn’t-a-budget later in this piece, but there’s another important element here. This is about the long-term decline and de-composition of the Conservative party.

I know this is a strong thing to say. We’re talking about a party that has a majority of 80 seats in the British House of Commons, and one of the givens of modern British politics is that you should never bet against the Conservative party. Over the last century it has been the most successful ruling party in Europe.

But it has been unravelling since the 1980s. In the 1950s, and the era of ‘One Nation’ Conservatism, the Conservative Party was also a social institution, with 2.5 million members across Britain. (In Barnet, in north London, which had 70,000 voters, there were 12,000 Conservative party members. By the 2000s, its membership was less than a tenth of this, and ageing fast. Social values had moved away from the party as well. Economics, which have punished the younger generation, means that the party’s vote is now heavily skewed towards the over-60s and the party’s policies have followed.
Triangulation

David Cameron’s attempted solution to this was to triangulate: a pretence at ‘one nation’ social values to voters (gay marriage and ‘hug a hoodie’), with the party funds coming from an increasingly narrow base within the finance sector, and the core vote shored up with a message that drifted between patriotism and racism.

The first part of that was sheered off by UKIP and the Brexit, while the finance base got narrower (Johnson’s “fuck business” moment in Brussels was emblematic) but Johnson propped it up for a moment with the idea of ‘levelling up’, which appealed to enough voters beyond the traditional Conservative base to win an election. If you’re interested in the political sociology of all of this, the most persistent analyst is the sociologist Phil Burton-Cartledge at his ‘All That Is Solid’ blog—for example in these 2018 pieces—and in his book on the post-war history of the Conservative Party.

Levelling up was an interesting idea, or would have been had the Conservatives treated it as a strategy and not a slogan. At the least it could have been a programme that dealt with Britain’s real problem, which is captured sharply in a chart from the Financial Times a few weeks ago.

(Britain’s wage and productivity problem. Source: Financial Times)

Flat wage growth

The problem is this: wage growth, and associated productivity, in the UK have been flat since the financial crisis. The causes of this are either complicated, which is the version you get from economists, or they are post-crisis austerity, which killed off the initial post-crisis recovery, followed by Brexit, which had a calamitous effect first on business investment and then on trade.

These together have created the low wage, low investment economy that has characterised Britain recently, with a toxic combination of flat wages and low investment. Paul Mason explained how this worked in practice in a Guardian article a few years ago by using hand-washed car businesses as an example.

And one of the sharper observations on Twitter when inflation started picking up (you can never find a Tweet when you need one) was by James Meadway, who suggested that this low wage, low investment economy also needed low inflation and low interest rates to survive.

Doing something

But for a moment, let’s take the so-called ‘mini-Budget’ at face value. If the rise in inflation and interest rates has wrecked the UK’s low-wage, low-interest rate economy, then the government had to do something.

So, if you want to be generous to the budget-that-wasn’t-a-budget, you can say that it was, as claimed, an attempt to do something about productivity. I’ll pretend for a moment that Truss and Kwarteng were being honest when they said it was a ‘budget’ about growth.

But even this hits an immediate problem. In the 1980s, the idea of trickle-down economics and the Laffer Curve was contested, to say the least, but hadn’t been disproved. Similarly, ‘freeports’ and all of the other mechanisms of supply side economics had not yet been discredited. They represented then part of a suite of theories about how to solve the problems of the previous economic model. But everyone knows that’s no longer true. 40 years on, these are burnt out ideas that don’t work in the way their advocates thought they would.

Eric Beinhocker and Nick Hanauer spelt out some of the issues in an article in The Guardian:

As Truss put it last week: “Lower taxes lead to economic growth, there is no doubt in my mind about that.” There may be no doubt in the prime minister’s mind, but there’s a lot of doubt in the data. The US has had four decades experimenting with this kind of economics, and the evidence is clear: not only does it not work but it does enormous damage to the economy and society.
Understanding the government

So what’s going on with our new administration? I think there are four alternatives.

1. They are zealots who don’t realise that the ideas they have believed in for decades are no longer fit for purpose.

2. Or they are working a clever plan to create a crisis to force further cuts in the size of the state and of public spending.

3. Or they realise that they are only going to get one shot at this, and they have decided to help their friends and political supporters cash in before the house comes crashing down around their ears. (Corruption, in other words).

4. Or they aren’t very good at politics.

Measuring ‘zealotry’ is hard, even though you know it when you see it, and usually people just point to the libertarian economic manifesto, Britannia Unchained, that Truss, Kwarteng and others co-authored a decade ago. But while I was writing this piece, the Financial Times’ data journalist John Burn-Murdoch published a handy chart mapping economic policies by political party across a number of countries.1 The policies of the current Conservative administration are now right at the edge of the scale, having shifted from the centre-right mainstream to the right under Truss (‘jumped’ or ‘lurched are more accurate descriptions).

(Source: Financial Times)

Heady cocktail

Of course, some of the evidence fits several of these interpretations. Firing the head of the British Treasury department and then declaring that your Budget is a ‘mini-budget’, to avoid scrutiny, could be zealotry, or it could be cashing in, or it could be incompetence.

It’s probably doesn’t go with the ‘clever plan’ version, though, since the Treasury went along with years of Osborne’s austerity without kicking up a fuss despite the economic damage it was causing. (There are other views on the ‘clever plan’.)

My own view, briefly, is that it’s a heady cocktail of zealotry, corruption, and incompetence—that all three have interacted with each other to create the current crisis. You could even say that the current crisis is over-determined, because any two of these would have been enough.
Corruption

It is impossible to avoid the smell coming from the British government at the moment: the Chief of Staff who is of interest to the FBI, the Conservative billionaire hedge fund owner and Conservative donor Crispin Odey who used to employ the Chancellor who has made millions shorting the pound as a result of its collapse following the budget—with just a sniff of private information beforehand. Odey seems to have salvaged the fortunes of his hedge fund by doing this. Not to mention the Cabinet Minister and former (briefly) Chancellor of the Exchequer whose possible tax avoidance scheme continues to raise questions.

This list could go on, but it’s been a theme of the 2019 ‘Brexit’ government. The same corruption was seen throughout the pandemic procurement scandals.

As for competence, one of the signs of decline of a party is a shrinking pool of talent. The political talent pool has been shrunk more generally by the professionalisation of politics, but the Conservatives have accelerated this through expelling some MPs and by pushing through its pursuit of their ideological version of Brexit.
Running the country

In The Critic, Mike Jones brought these two ideas together when he noted a few months ago the shallowness of much of the Conservative leadership campaign:

For (leadership candidate Kemi) Badenoch, modern-day Conservatism is pretty much hollowed out, at least in terms of policy…“What’s missing”, she wrote, “is an intellectual grasp of what is required to run the country.” While Labour is cementing its image as the party of productivity and investment, the Tories, though unintentionally, spend much of its efforts in making the party as unattractive as possible.

But the deeper problem is that the party’s underlying ideas—legacies of that 40-year wave I discussed on Saturday—are about a smaller state with less public capacity. Hence Jacob Rees-Mogg’s persistent desire to shrink the civil service. A decade of austerity has stretched the capability of the state, of public services, and of local authorities to close to collapse.

State capacity

And one of the things we have learned, from the pandemic, from the climate crisis, and from the energy crisis, is that states need capacity if they are going to offer any kind of security to their citizens. Markets alone can not deliver this, even if they are well regulated. And they can no longer deliver growth either: we know, from the work of Mariana Mazzucato and others, that this requires all kinds of investment in public capacity.

Beinhocker and Hanauer described this as “middling out” economics, and it requires public investment:

a robust economy of thriving middle-income families is not a consequence of economic growth, it is its cause. So the policy priority is then to invest in the broad population of working people: education, healthcare, childcare, elderly care, worker training, affordable housing and good public infrastructure, from transport to broadband. It is also critical to support people with a living minimum wage and enough economic security that they aren’t economically trapped and can take risks, from starting a new business, to taking time out to reskill.

Johnson’s maverick style allowed him to nod in the direction of all of this, at least rhetorically, even if he had little intention of doing it. The political effect of Kwasi Kwarteng’s budget for the rich, along with Truss’ belated conversion to energy support, and the rolling crises that followed it, was to make voters realise viscerally—almost in a single day—how much they need the state to be on their side, to look after their security, in the 2020s.

A version of this article was published in two parts on my Just Two Things Newsletter.

Liz Truss wants 'growth, growth and growth'. Here's how Brexit has damaged her goal

By Alasdair Sandford • Updated: 05/10/2022

Britain's Prime Minister Liz Truss makes a speech at the Conservative Party conference at the ICC in Birmingham, England, Wednesday, Oct. 5, 2022. - Copyright AP Photo/Kirsty Wigglesworth

"I have three priorities for our economy: growth, growth and growth."

The concept formed the centrepiece of Liz Truss' speech to the Conservative Party conference, and the new British prime minister mentioned the word more than two dozen times.

"For too long, our economy has not grown as strongly as it should have done," Truss said. She underlined the importance of growth to the UK economy by linking it to the need to cut taxes — "putting up a sign that Britain is open for business" — slash regulation, boost investment, and improve public services.

Castigating "those who try to stop growth", she vowed she would "not allow the anti-growth coalition to hold us back".

And she painted Brexit in entirely positive terms, saying the government was "seizing the new-found freedoms outside the European Union", and "making the most of the huge opportunities Brexit offers".

Yet several reports say one significant factor to have impacted negatively on Britain's growth and economy — also creating a barrier to future performance — is Brexit itself.Liz Truss speech: Five key takeaways including Greenpeace, Brexit and 'facing down separatists'
Post-2016 period: After the UK voted to leave the EU

Some surveys have said the vote for Brexit in the June 2016 referendum had a damaging effect on the British economy, even before the UK actually left the EU and its economic structures.

"Voting for Brexit had large negative effects on the UK economy between 2016 and 2019, leading to higher import and consumer prices, lower investment, and slower real wage and GDP growth", wrote two economists from the London School of Economics (LSE) in a paper for the think-tank UK in a Changing Europe, published this year.

This happened even though at this stage "there was little or no trade diversion away from the EU", the report said.

Another report by the Centre for Economic Policy Research (CEPR) reached a similar conclusion. "Even before Brexit has actually taken place, the referendum shock of June 2016 has already had substantial economic costs," its study said in March 2020, updating its previous analysis from three years earlier.

"We estimate that the Brexit depreciation increased UK consumer prices by 2.9%. This represents an £870 per year increase in the cost of living for the average UK household," its four authors said.

An assessment by Investment Monitor in January 2022 found that UK growth trailed that of leading European counterparts in the years following the Brexit vote, even though it had been ahead at the start of 2015, and again at the time of the 2016 referendum.

"Based on figures from the OECD, UK GDP grew by 14.3% between Q2 2016 and Q3 2021. This is a smaller growth rate than four of the EU’s largest economies. During the same period, Germany had the highest indexed growth rate at 32.2%, followed by Spain (25.6%), France (23%) and Italy (16.3%)," it said.

"In the post-referendum and pre-TCA period, the economic effects of Brexit began to materialise. Products more exposed to the uncertainty of future trading relations with the EU experienced lower trade growth," said another report by LSE researchers for UK in a Changing Europe, published in April 2022.

It also concluded that increased UK-EU trade barriers had caused UK food prices to rise by six percent between the end of 2019 and September 2021 compared to the years before December 2019.

Brexit Timeline 2016–2020: key events in the UK’s path from referendum to EU exit
Post-2021: After Brexit took effect

This year has seen economists begin to separate the economic damage done by Brexit from that wrought by the COVID pandemic.

In June a report by John Springford of the Centre for European Reform (CER) estimated that in the final quarter of 2021, GDP (gross domestic product) was 5.2% smaller, investment 13.7% lower, and goods trade 13.6% lower than what they would have been had the UK remained in the EU.

He added that tax rises imposed by Boris Johnson's then government " would not have been needed if the UK had stayed in the EU (or in the single market and customs union)".

Two other reports cast a shadow over Liz Truss' desire to advertise Britain as "open for business".

The UK's Office for Budget Responsibility (OBR) reported in March that the UK had "missed out on much of the recovery in global trade," amid the recovery from the pandemic, noting that the UK "appears to have become a less trade intensive economy".

"The Big Brexit" published in June by the Resolution Foundation think-tank and the LSE found that a drop in British "trade openness" — measured as a share of GDP — showed a much higher fall than in countries with similar trade profiles, such as France.

In May a report by the Peterson Institute for Economics found that Brexit was "driving inflation in the UK higher than its European peers", despite suffering the same economic shocks from Russia's war on Ukraine and soaring energy prices. It blamed in particular labour shortages resulting from the end of the free movement of EU migrant workers to the UK, as well as new trade barriers.

In September City A.M. reported that the number of UK businesses exporting to the EU had fallen by a third in 2021 compared to 2020, due to the extra red tape they faced when trading with the bloc. It quoted figures from the UK's Revenue and Customs department HMRC.

An earlier study by the LSE, from April, found that Brexit caused "major disruption" to both EU-UK exports and imports, with many British firms stopping trade with the EU.

Eurostat data on EU trade with the UK published in March said goods imports from the UK to the EU in 2021 declined by nearly a quarter relative to 2019, while the value of services imports from the UK fell by nearly 7% over the same period.

The UK left the EU at the end of January 2020, and the new rules came into force when a transition period expired on December 31 that year. Its departure from the EU's single market and customs union, and the trade deal negotiated by then prime minister Boris Johnson, created significant barriers to trade with the bloc.Brexit damage: Is EU exit now hitting UK's economy harder than COVID?
Brexit agreement caused 'major disruption' to EU-UK trade, finds study
For both Conservatives and Labour, Brexit is done

Both the UK's ruling party and main opposition agree that there is no going back on Brexit.

"We are the party who got Brexit done," trumpted Liz Truss in her conference speech in Birmingham.

In a speech in July, Labour leader Sir Keir Starmer said he "couldn't disagree more" with those who wanted Brexit reversed — instead offering a new slogan of "Make Brexit Work".

There are understandable political imperatives behind such stances, and they may explain why Brexit often features little in debates over the UK's current economic plight.

But many critics of the government and opposition alike say the failure to face up to the reality of the UK's EU exit — and the barriers created with its closest trading partner — mean the complexities of the situation are not being properly understood.

GREEN CAPITALI$M
World's biggest sovereign wealth funds tackle climate crisis

Members of the One Planet Sovereign Wealth Funds Network will focus on the areas of private equity, clean hydrogen and renewables investment

This year, the Abu Dhabi Investment Authority and Mubadala are co-hosting the One Planet Sovereign Wealth Funds CEO Summit

Photo: ADX

Saeed Al Mansoori and Ahmed Al Calily

Oct 05, 2022

Five years ago, President Emmanuel Macron of France brought together a group of sovereign wealth funds to help act on the framework of the Paris Climate Accords.

Since then, the One Planet Sovereign Wealth Funds (Opswf) Network has grown to more than 45 of the world’s largest institutional investors — sovereign wealth funds, asset managers and private equity houses — that together manage or own more than $37 trillion worth of assets.

Today, the fifth annual Opswf CEO Summit, the largest yet, is taking place in Abu Dhabi.

It is the first time that the group is gathering outside of the Elysee Palace in Paris, France, making this a significant occasion for the emirate as the UAE prepares to host Cop28 next year.

Opswf Network members account for a substantial portion of the global economy, enabling it to play a key role in the transition to a low-carbon future.

This year, the Abu Dhabi Investment Authority (Adia) and Mubadala are co-hosting the summit and helping to drive greater engagement in mitigating climate change by advocating dialogue and collaboration across the network as it works to provide stewardship and guidance to the global investment community.

It is in Abu Dhabi that the global financial community is convening to marshal capital towards finding solutions to global problems.

Abu Dhabi well placed to lead UAE’s long-term sustainability charge

Abu Dhabi to develop hydrogen policy with new regulations and standards

Historically, the financial sector has supported industrial development and technological advancement, thereby playing an important role in achieving sustainable financial returns while working to deliver lasting change.

Adia and Mubadala recognise that lasting change can only be achieved by a combination of all our individual and incremental actions.

The world needs to innovate and develop alternative sources of energy, materials and consumables for a sustainable future. The energy transition and accelerating the development of renewables and clean hydrogen are vital challenges. It is a journey that requires systematic and responsible action and, for this to occur, collective endeavour is key.

Sovereign wealth funds are well suited to be change makers. Our multi-generational investment horizon matches the very long-term, sustained effort required to tackle big challenges such as climate change.

At the summit this week, Opswf Network members are focusing on three broad areas.

In the private equity space, where sovereign wealth funds as a group own about 16 per cent of global private equity assets under management, there is a significant opportunity to advance the quality and quantity of climate-related data. Members recognise that better data is critical to making well informed investment decisions that include considering the risks and opportunities associated with climate change.

Clean hydrogen is another important focus for the Opswf Network, as well as a priority for the UAE government. Hydrogen is widely recognised as a key component of the energy transition. It can be used as a zero-emission fuel, a versatile energy carrier or a flexible storage solution with numerous applications across the entire economy, complementing and amplifying electrification efforts in sectors such as transport and other net-zero emission technology.

Mubadala has entered into a partnership with Adnoc and ADQ to establish the Abu Dhabi Hydrogen Alliance, which aims to establish the UAE as a leader in hydrogen and build a substantial green hydrogen economy.

The third focus of the summit is on renewables investment in emerging and developing markets, where considerable opportunities exist to mitigate climate change while also growing economies.

Members of significant scale across the Opswf Network collectively have the ambition to increase their investments in renewables in those markets if the right policies and incentives are in place. Successfully addressing the priority enablers will not only open up further opportunities, but also increase flows of other private sector financing.

Collectively, Opswf members seek to make tangible change through collective, incremental actions.

The discussions in Abu Dhabi — among chief executives and leaders — will result in meaningful progress.

Adia and Mubadala are proud to be playing our role in convening the international financial community to find common ground to build a sustainable future.

Saeed Al Mansoori is deputy director at the Abu Dhabi Investment Authority and Ahmed Al Calily is chief strategy and risk officer at Mubadala Investment Company

Updated: October 05, 2022

Future cyber attacks 'could be deadlier than wars'

Shutting down utilities or taking over connected cars can cause more chaos than bombs and missiles, says chief of world's biggest private cyber security company

Hackers can potentially take over self-driving cars, causing them

to crash into each other, other objects and people, an expert has said. EPA

Alvin R Cabral
Oct 05, 2022

Future cyber attacks could be deadlier than actual wars if rogue elements in the digital underworld take aim at critical infrastructure and connected devices, the chief executive of the world's biggest private cyber security company, Forcepoint, has said.

Shutting down important entities such as utilities or taking over connected cars are among the possible scenarios cyber criminals can exploit, should they decide to engage in digital warfare in the future, Manny Rivelo told The National in an interview.

“As the world becomes much more connected, the vulnerabilities grow. A war in the future doesn’t have to be bombs or missiles; it could be shutting down [the] electrical power grid of a country in the middle of winter or shutting down the capabilities of having clean water,” he said.

“These are as severe, potentially, even more severe, you could argue, because they can completely shut down environments.”

The dangers of turning technology into a weapon have been flagged in the past, and these can potentially cause harm to humans or kill them by 2025, research firm Gartner said earlier this year.

“Cars are now more computer or chip-driven, and they are all connected to a network. Attackers could be misdirecting cars or autonomous vehicles to crash into each other,” Mr Rivelo said.

Organisations are investing up to a fifth of their budgets in cyber security, and most of them are those with highly sensitive data, including government agencies, he said.

Mr Rivelo suggested that these entities adopt a zero-trust approach, wherein it is always assumed that there is a threat and any access request needs to be verified.

“There are certain industries more susceptible to cyber attacks than others. A larger, high-risk firm will on the higher end of that because they are just a bigger target,” he said.

In a report released last week, Moody's Investors Service said about $22 trillion in collective rated debt associated with more than 70 global rating sectors had high or very high exposure to cyber risks in 2022, with critical infrastructure experiencing the highest risk.

Metaverse could be a playground for social engineering attacks

The growing sophistication of cyber attacks is undoubtedly expected in the metaverse, the emerging technology in which users interact using digital representations of themselves in a fully simulated environment.

One element that could exploit user vulnerabilities involves social engineering attacks, or the method of coercing users to divulge their private information.

Mr Rivelo, who has described his experience in the metaverse as “much more immersive” compared with other virtual environments, sees these attacks as “interesting” in that realm.

“We shouldn’t be afraid of the metaverse; it will unleash new ways of doing of commerce and interacting. But we should be cautious of how to protect ourselves,” he said.

It may be difficult to predict what threats will be prevalent in the metaverse. However, Mr Rivelo is confident that the cyber security industry will keep in step or even anticipate these to protect users, and the entire ecosystem as well.

“As we go down that path, those threats will begin to emerge, which will not be only social engineering but potentially technology threats. You will see solutions for that.”
Middle East in 'tier 2' for cyber security innovation

In terms of adopting cyber security innovation and adoption, Mr Rivelo ranks the Middle East as being in “tier 2", which is behind advanced economies in Europe and Asia, that have a big adoption rate.

A war in the future doesn’t have to be bombs or missiles; it could be shutting down [the] electrical power grid of a country in the middle of winter or shutting down the capabilities of having clean water
Manny Rivelo, chief executive of Forcepoint

The UAE and Saudi Arabia are in tier-2, while nations in Africa and Latin America are in tier 3, he said.

However, he acknowledged that there is a “long way to go” for Middle East countries to catch up, but the “desire” and need are there, given the growing use of data in the region, resulting in the need for more robust cyber security services.

“Dubai and the UAE are ahead of other parts of the Middle East but definitely not as far along, compared to North America,” Mr Rivelo said.

A silver lining for the Middle East and Africa is that these regions had the lowest number of ransomware attacks in 2021, according to a recent report by cyber security company Group-IB.

“It comes with time and experience. There is opportunity to move much quicker in the Middle East, because they can start on a clean state with best practices that are known,” Mr Rivelo said.

Cyber threats growing across sectors with $22tn in debt at risk, Moody's says

Middle East and Africa region least targeted by ransomware attacks in 2021, study says

Top cyber security predictions for 2022 and beyond

KILL A WORKER GO TO JAIL!

Director, company fined over death of worker who fell from platform after collision with crane

Investigations found that Ng Chin Sang knew that workers were

using the crane freely regardless of their level of training.

ST PHOTO: KELVIN CHNG

Samuel Devaraj

SINGAPORE - A construction worker was carrying out electrical work on a platform at a height of about 8m when a crane collided with it, causing it to topple. Mr Kaliyaperumal Manikandan, then 22, fell to his death.

Investigations found that Ng Chin Sang, the director of Fusion Builders - the company involved - knew that workers were using the crane freely regardless of their level of training.

Ng, a 72-year-old Singaporean, was fined $60,000 on Tuesday after he pleaded guilty to a charge under the Workplace Safety and Health Act.

His company was fined $250,000 for its role in the offence.

Ministry of Manpower (MOM) prosecutor Gregory Gan said in court documents that Fusion Builders was awarded a contract to erect a four-storey industrial factory block at 22 Tuas Avenue 6, as well as for additions and alterations to an existing workshop.

The firm engaged Long Way Electrical Contract to carry out electrical installation work. Mr Kaliyaperumal was employed by that firm as a construction worker.

On June 6, 2017, Mr Kaliyaperumal was working at a height of about 7.7m on a scissor lift - a mobile elevated work platform - carrying out electrical cabling work on the cable tray mounted on the third-floor wall.

At the same time, other workers were using a crane to transport rubbish bags to the first floor for disposal.

The crane collided with the scissor lift, causing the platform to topple towards the floor.

Mr Kaliyaperumal fell off the platform and landed on the ground floor of the building. Paramedics at the scene pronounced him dead at about 6.30pm.

The cause of death was subsequently ascertained to be from multiple injuries, consistent with a fall from height.

Prosecutor Gan said investigations revealed that while only one worker had been trained to operate the crane, others who were not trained were allowed to operate it, and that Ng was aware of this.

"He knew the workers used the (crane) freely regardless of their level of training and that the remote controls were passed around among workers," said the prosecutor.

Prosecutor Gan added that the company failed to prevent incompatible works involving the concurrent use of the crane and scissor lift from being carried out, and that it also failed to implement measures to warn workers on the scissor lift of the approach of the crane.

Mr Sebastian Tan, MOM's director of occupational safety and health inspectorate, said on Thursday: "This death was entirely preventable, if not for the negligence of Fusion and Ng. The company's multiple safety breaches show a lack of emphasis on workers' safety.

"Top management must take ownership of workplace safety and health, and take the lead to inculcate a strong safety culture at the workplace, so that workers can follow suit. All stakeholders must make workplace safety and health a priority."

Mr Kaliyaperumal's death was one of 42 workplace deaths that year. The annual workplace death rate dropped gradually between 2018 and 2020 before increasing in the last two years.

There have been 37 workplace deaths so far in 2022, the same as for the whole of 2021.

Following the spate of fatalities this year, a code of practice meant to improve workplace safety culture in Singapore was launched in September. It includes measures such as setting up internal reporting systems that assure workers of fair treatment.

The code will be gazetted in October, meaning that if a company commits an offence under the Workplace Safety and Health Act, the courts will be able to consider compliance with these measures in their judgment.