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Thursday, 29 June 2017

Has deregulation gone too far?

Nobody likes 'red tape' 
- and many have seen leaving the EU as an opportunity to get rid of much of it:
Futures Forum: Brexit: and a bonfire of EU red tape

As the OECD suggests:
Red tape is damaging Britain's growth, says OECD - Telegraph

However, lack of regulation can mean 'shoddy' buildings:
Futures Forum: "The laissez-faire, speculative attitude helps to create a shoddy culture in which the mindsets of estate agents take priority over the resourcing of local authority departments that are supposed to plan and regulate construction."

Polly Toynbee doesn't mince her words:
Brexiteers call it useless red tape, but without it people die | Polly Toynbee | Opinion | The Guardian

And so more questions are being asked about the drive to deregulate:
Futures Forum: Questioning the neoliberal agenda of deregulation and austerity

Especially about the timing of decisions to degregulate:
Government-backed 'red tape' group looked at EU fire safety rules on morning of Grenfell fire | UK news | The Guardian

In fact, we might see more regulation following Brexit:
Goodbye to red tape? It’s not going to happen | Business | The Times & The Sunday Times

Indeed, to what extent was a Labour government responsible for 'the wrong sort of deregulation'?
Grenfell Tower fire: was Tory austerity to blame or do problems date back to Blair? | UK news | The Guardian

Now there is a 'backlash' seemingly underway:
Regulation, red tape, sometimes necessary as Grenfell and BHS prove in different ways | The Independent
Grenfell tower: The beginning of the end for the Tory austerity regime | The Independent

Yesterday's New York Times asks:

After Grenfell Tower Fire, U.K. Asks: Has Deregulation Gone Too Far?


LONDON — The terrifying fire at the Grenfell Tower apartment block, with its final toll of victims still hidden in the ashes, has intensified a political debate, with many Britons believing that privatization has gone too far and that the state has shrunk too much.
It is a partisan debate, wrapping in the bitterly fought election this month, the recent terrorist attacks in Manchester and London, the anger about rising inequality, and years of budget cutting that is generally known as austerity.
With cladding on each of the 120 high rises tested so far having failed combustibility tests, and hundreds of fire doors missing from buildings, the language of politics has now itself become incendiary. A Labour lawmaker, David Lammy, who grew up poor and had friends who died in the fire, said: “This is the richest borough in our country treating its citizens in this way, and we should call it what it is. It is corporate manslaughter.”
The Conservatives have been fond of promoting what they called a “bonfire of regulations” in every aspect of government, to bolster private and individual responsibility and promote economic growth and productivity. It was an argument made with particular force in the debate over Britain’s withdrawal from the European Union, or Brexit, which advocates said would free the country from annoying European “red tape.” But as Jonathan Freedland, a Guardian columnist, said acidly: “They got their bonfire.”
Continue reading the main story
What the Conservatives call red tape, argued George Monbiot, “often consists of essential public protections that defend our lives.” And the freedom promoted by deregulators, he said, often “means the freedom of the rich to exploit the poor, of corporations to exploit their workers, landlords to exploit their tenants and industry of all kinds to use the planet as its dustbin.”
Tom Tugendhat, a Conservative member of Parliament first elected in 2015, described Britain as, without question, “definitely more divided on the issue.”
“It’s the state as provider and the state as guarantor,” he said. “And while stepping away from the state as provider, we’ve moved too far away from state as guarantor.”
Simon Tilford, an economist and deputy director of the Center for European Reform in London, said: “We’re seeing the biggest challenge to this 40-year drive to marginalize or discredit the state and its role in the economy and society. Grenfell Tower had such impact because it symbolizes for many in Britain the retreat of the state, visible in badly maintained social housing and the failure to build more social housing.”
Britain is having another chapter in the central debate of the capitalist era: What are the proper roles of the state, the market and the individual? A generation ago, neoliberalism had seemingly won, and the theorist Francis Fukuyama declared “The End of History.” But a British backlash against the small state, free trade and globalization, seemingly a remote possibility as late as last year, now seems to have arrived.
The debate is an important one. Britain has been a laboratory of sorts for deregulation and the shrinking of the state since Margaret Thatcher became prime minister in 1979. The concepts were embraced by the Conservatives and then by New Labour, and helped rescue the country from the gloom and strikes of the 1970s and early 1980s. The “big bang” of deregulation of the financial industry gave rise to the London boom, turning it into a global city.
But Grenfell Tower has come to symbolize the growing pushback against seven years of moderate budget restraint brought on by the 2008 financial crisis. As services have been reduced, wages have stagnated for many in the public sector, and inequality has risen. Voters “are finally growing weary of austerity, of the rationing, outsourcing and penny-pinching,” wrote James Ely in The Financial Times. “Seven years of spending restraint is starting to manifest itself in the quality of some public services.” 
The issues encapsulate the renewed ideological battle between the wounded but governing Conservative Party and the revived opposition Labour Party under Jeremy Corbyn. A man of the harder left, Mr. Corbyn has brought back the arguments used against Mrs. Thatcher in the 1980s, calling for a reversal of the policies she championed — privatization, deregulation, corporate tax cuts, and a shrinking of the Labour-built, semi-socialist state.
During the campaign, Mr. Corbyn and Labour called for renationalizing the railways, the water supply and some utilities, spending much more on social services like the National Health Service and social benefits and ending tuition fees at universities. After the terrorist attacks in Manchester and London, Mr. Corbyn, long an opponent of surveillance and enhanced police powers, called for more beat police officers, complaining about austerity and arguing that “you can’t protect the public on the cheap.”
His left-wing populism (marked by a longstanding contempt for American foreign policy) was a sharp break with the neoliberal consensus of the past 30 years or so, which included Labour’s last prime ministers, Tony Blair and Gordon Brown. But the Grenfell Tower fire, Mr. Freedland said, “appeared to make the Corbyn argument for him.”
In an indication of the shift, Britain’s annual Social Attitudes Survey, published on Wednesday, showed a broader rejection of austerity, with more people saying that taxes should rise to finance higher public spending. Only 29 percent of Britons favored further cuts in public spending, down from 35 percent 10 years ago, and 48 percent said taxes should rise, compared with 32 percent a decade ago. People were not asked if they were personally prepared to pay higher taxes, however.
While preparing a platform for the June election, Prime Minister Theresa May sensed the mood turning against austerity, loosening debt targets, trying to reach out to disaffected working-class voters and penalizing, though mildly, the better-off. But her campaign ended in tears, and “Mayism” has had a shorter life than the Edsel.
Mrs. Thatcher is often held up as the icon of the Conservative Party’s move to shrink what she called “the nanny state,” which she felt promoted dependency instead of initiative. 
The welfare state built by the postwar Labour Party, had huge accomplishments, like the National Health Service and the spread throughout the country of public housing, known as council housing here. The ideal championed by the postwar Labour health minister, AneurinBevan, was of a place “where the doctor, the grocer, the butcher and farm laborer all lived on the same street,” and according to Pilgrim Tucker, a housing campaigner, in 1979, 20 percent of the richest 10 percent of Britain’s population lived in social housing.
Mrs. Thatcher introduced the “right to buy” social housing to its tenants in 1980, in an effort to promote homeownership and responsibility. Over time, the nature of social housing changed, as some apartments simply became private rental properties — including an unknown number in Grenfell Tower itself — though their maintenance was controlled by the local council through a nonprofit management agency. And local councils did not build housing fast enough to keep up with demand, especially in big cities.
Under Conservative efforts since 2010 to reduce the national budget and the national debt, state funding was reduced or frozen for many parts of the government, including local councils. Deregulation also meant outsourcing responsibility for fire inspections to owners and builders, instead of civil servants. Private companies were required to use “authorized inspectors” for fire safety, but, as Mr. Freedland pointed out, they worked for builders and developers, and “there was a classic conflict of interest.”
Here the two trends of saving money and deregulation come together: The council had recently spent some $11 million on Grenfell Tower to insulate apartments and cut energy costs, using cladding that was approved under existing building regulations. And those regulations, however inadequate they have proved, are the same for all buildings, not just those of the poor.
The cladding aside, there were other fire-safety issues that were not dealt with by anyone, including the questionable installation of new gas pipes, inadequate fire proofing, and the lack of a central fire alarm or a sprinkler system, though neither was required for a structure built in 1974.

Still, as Mr. Lammy, the Labour lawmaker, said: “You can’t contract out everything to the private sector. The private sector can do some wonderful things, but they have for-profit motives, they cut corners. We’ve all been up to those tower blocks — they exist right across the country. Where are the fire extinguishers on every corridor? Where are the hoses? Are the fire doors really working? Where are the sprinklers?”
The questions are the right ones. But the fight over who is responsible, and over the causes and solutions, will continue, and will continue to mark British politics, divided more now than at any time since the election of Mrs. Thatcher.

After Grenfell Tower Fire, U.K. Asks: Has Deregulation Gone Too Far? - The New York Times
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