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      Energy price cap: how high will bills rise and what government support is available?

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      Energy bills are about to jump significantly after regulators raised the price cap which sets the maximum suppliers can charge.But what does it mean for household budgets?How much will my gas and electricity bills increase?The energy price cap will increase by 54 per cent from 1 April for approximately 22 million customers. Ofgem calculates this means the average household will pay £1,971 for their gas and electricity for the year. That’s an increase of £693.An average pre-payment customer will see an increase of £708 from £1,309 to £2,017 a year.It won’t apply if you are on a fixed-term energy tariff, in which case your existing rate will continue to apply until the deal ends.The price cap sets the top rate suppliers can charge per unit of gas and electricity. It is not a cap on customers’ overall energy bills, which will still rise or fall depending on energy consumption. From 1 April, electricity costs are capped at 28p per kWh for electricity and 7p per kWh for gas. Businesses on commercial contracts are not protected by a cap. Unless wholesale energy prices fall, the cap will increase again in October, with experts forecasting it will hit £2,300.What financial support has the government announced?Rishi Sunak revealed that the government will give an upfront £200 discount to all domestic energy customers from October. It will be automatically taken off people’s bills, with the government loaning the money to suppliers to cover the costs. Pre-payment customers will receive £200 credit.That money will then be repaid in annual instalments of £40 added to customers’ bills over five years from 2023. It means the overall burden on bills will not be reduced but will be paid over a longer period.The government is banking on wholesale energy costs eventually coming down but markets indicate gas prices will remain elevated until at least the end of next year.Based on current prices, experts forecast that the price can will jump to around £2,300 in October when the £200 discount is to be applied, meaning it will cover less than one fifth of the £1,000 increase compared current prices.It is also universal, meaning that it will apply to all households, whatever their financial circumstances. A number of charities and think tanks had called for cash to be targeted at those most in need.Council tax rebatesAround 80 per cent of households will also get £150 off their council tax bill. A rebate will be applied in April to all residential properties in England rated A to D for council tax.Equivalent funding worth £56m in total will be supplied to devolved administrations in Wales, Scotland and Northern Ireland.You do not have to apply for the rebate. It will be applied automatically.While the move will be welcomed, critics have pointed out that it is poorly targeted. Council tax bands were calculated in 1991 and are a poor indicator of people’s incomes. Millions of the UK’s highest earners will pay less tax while many of those in lower income groups will be left out. Those that don’t pay Council Tax (such as students, some tenants and some benefit claimants) won’t get the full package of support either.Campaigners had called for money to be distributed through the universal credit system to ensure the poorest groups benefited most. The government rejected that approach and also declined to cut VAT on fuel bills from 5 per cent to zero, arguing that the measure would have benefitted wealthy households most.Discretionary fundThere is also a £144m discretionary fund which councils in England can allocate to people who are on low incomes but who do not automatically qualify for a rebate because they are not in a band A to D property, or because they don’t pay council tax at all.Speak to your local authority to see if you are eligible.Warm homes discountThe government will go ahead with planned expansion of the warm homes discount which it says will increase the number of people eligible by one third – around 780,000 families.The £140 per year payment for low-income families in England and Wales will increase to £150 next winter. If you are elligible you can apply for the discount through your energy supplier.The Resolution Foundation said the measures do not provide enough help for people on low incomes to deal with price rises.The think tank estimates that, as a result, the number of people struggling to pay for enough energy this year will double to five million this year. More

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      Levelling up efforts could fail the poorest, IFS warns

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      The government’s flagship levelling up policy risks failing Britain’s poorest by focusing on places, rather than poverty, a leading economic think tank has warned. Regional inequality is persistent and worsening the Institute for Fiscal Studies (IFS) said on Tuesday, in an analysis ahead of the government’s delayed policy white paper, expected this week. However, while places are at risk of losing out on economic growth and opportunities, some of the UK’s poorest people also live in the country’s wealthy regions. “It is really important to remember in all this that, while high paid jobs are unevenly spread, low paid jobs, and indeed poverty, are not,” said Paul Johnson, director of the IFS.“A higher fraction of London’s population is in poverty than in any other region. We need to worry about places, but we need to worry about people too”, he added. Wages for the lowest earners in the UK are similar irrespective of location, the IFS found. For those workers in the bottom 10 per cent, by earnings, wages are around £8-9 per hour in every region. In areas where other living costs, such as housing, are more expensive, such as London, that means that workers are more likely to be in poverty. The IFS found that 28 per cent of Londoners were in poverty from 2016-2019 compared to the national average of 22 per cent. Yet while low wages tend to be similarly low across the country, there’s a considerable gap between top earners in different regions – and that is a difference which has persisted for decades, according to the think tank. The top 10 per cent of earners in London were paid 80 per cent more per hour than the comparable group of workers in Scarborough. This effect is shown by comparing tax and population data too, the IFS said: while around one in seven of the UK population live in London, some one in three of the top 1 per cent of income taxpayers live in the city.Beyond wages, in areas such as educational outcomes, there are also stark divides. In Grimsby, in the north of England, fewer than one in five children go on to university, compared to one in three in London. Well trained graduates from other areas are also likely to move to cities where there are already lots of other highly skilled workers: one in two people with degrees in Grimsby move away by the age of 27, the IFS said. The think tank also found that cuts to public spending introduced from 2010 onward exacerbated regional inequalities. This suggests that some of the government’s efforts with levelling up will in part have to be aimed at repairing some of this impact. From 2009-10 to 2019-20, spending on services – not including education fell by an average of 31 per cent for councils in the 10 per cent most deprived areas. That is nearly double the drop of 16 per cent per resident in the 10 per cent least deprived locations, the IFS’ study found. More

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      in US Politics

      Dignity in a Digital Age review: a congressman takes big tech to task

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      Dignity in a Digital Age review: a congressman takes big tech to taskRo Khanna represents Silicon Valley and the best of Capitol Hill and wants to help. His aims are ambitious, his book necessary Just on the evidence of his new book, Ro Khanna is one of the broadest, brightest and best-educated legislators on Capitol Hill. A graduate of the University of Chicago and Yale Law School who represents Silicon Valley, he is by far the most tech-savvy member of Congress.Silicon Holler: Ro Khanna says big tech can help heal the US heartlandRead moreAt this very dark moment for American democracy, this remarkable son of Indian immigrants writes with the optimism and idealism of a first-generation American who still marvels at the opportunities he has had.Even more remarkable for a congressman whose district includes Apple, Google, Intel and Yahoo, Khanna is one of the few who refuses to take campaign money from political action committees.Once or twice in a “heated basketball game” in high school, he writes, someone may have shouted “go back to India!” But what Khanna mostly remembers about his childhood are neighbors in Pennsylvania’s Bucks county who taught him “to believe that dreams are worth pursuing in America, regardless of one’s name or heritage”.His book is bulging with ideas about how to transform big tech from a huge threat to liberty into a genuine engine of democracy. What he is asking for is almost impossibly ambitious, but he never sounds daunted.“Instead of passively allowing tech royalty and their legions to lead the digital revolution and serve narrow financial ends before all others,” he writes, “we need to put it in service of our broader democratic aspirations. We need to steer the ship [and] call the shots.”The story of tech is emblematic of our time of singular inequality, a handful of big winners on top and a vast population untouched by the riches of the silicon revolution. Khanna begins his book with a barrage of statistics. Ninety percent of “innovation job growth” in recent decades has been in five cities while 50% of digital service jobs are in just 10 major metro centers.Most Americans “are disconnected from the wealth generation of the digital economy”, he writes, “despite having their industries and … lives transformed by it”.A central thesis is that no person should be forced to leave their hometown to find a decent job. There is one big reason for optimism about this huge aspiration: the impact of Covid. Practically overnight, the pandemic “shattered” conventional wisdom “about tech concentration”. Suddenly it was obvious that high-speed broadband allowed “millions of jobs to be done anywhere in the nation”.The willingness of millions of Americans to leave big city life is confirmed by red-hot real estate markets in far flung towns and villages – and a Harris poll that showed nearly 40% of city dwellers were willing to live elsewhere.“The promise is of new jobs without sudden cultural displacement,” Khanna writes.He suggests a range of incentives to spread tech jobs into rural areas, including big federal investment to bring high-speed connections to the millions still without them. This is turn would make it possible to require federal contractors to have at least 10% of their workforces in rural communities.The congressman imagines nothing less than a “recentering” of “human values in a culture that prizes the pursuit of technological progress and market valuations”. A vital step in that direction would be a $5bn investment for laptops for 11 million students who don’t have them.The problems of inequality begin at the tech giants themselves. Almost 20% of computer science graduates are black or Latino but only 10% of employees of big tech companies are. Less than 3% of venture capital lands in the hands of Black or Latino entrepreneurs.If redistributing some of big tech’s gigantic wealth is one way to regain some dignity in the digital age, the other is to rein in some of the industry’s gigantic abuses. Data mining and the promotion of hate for profit are the two biggest problems. Khanna has drafted an Internet Bill of Rights to improve the situation.Throughout his book, he drops bits of evidence to suggest just how urgent it is to find a way to make the biggest companies behave better.“Algorithmic amplification” turns out to be one of the greatest evils of the modern age. After extracting huge amounts of data about users, Facebook and the other big platforms “push sensational and divisive content to susceptible users based on their profiles”.An internal discussion at Facebook revealed that “64% of all extremist group joins are due to our recommendations”. The explosion of the bizarre QAnon is one of Facebook’s most dubious accomplishments. In the three years before it finally banned it in 2020, “QAnon groups developed millions of followers as Facebook’s algorithm encouraged people to join based on their profiles. Twitter also recommended Qanon tweets”. The conspiracy theory was “actively recommended” on YouTube until 2019.And then there is the single greatest big tech crime against humanity. According to Muslim Advocates, a Washington-based civil rights group, the Buddhist junta in Myanmar used Facebook and WhatsApp to plan the mass murder of Rohingya Muslims. The United Nations found that Facebook played a “determining role” in events that led to the murder of at least 25,000 and the displacement of 700,000.The world would indeed be a much better place if it adopted Khanna’s recommendations. But the question Khanna is too optimistic to ask may also be the most important one.Have these companies already purchased too much control of the American government for any fundamental change to be possible?
      Dignity in a Digital Age: Making Tech Work For All Of Us is published in the US by Simon & Schuster
      TopicsBooksSilicon ValleyDemocratsUS politicsUS CongressHouse of RepresentativesUS domestic policyreviewsReuse this content More

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      Share the Profits! Why US business must return to rewarding workers properly | Robert Reich

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      Share the profits! Why US businesses must return to rewarding workers properlyRobert ReichThe economy is booming and corporate profits are huge, but American wages still stagnate. History provides the answer According to this week’s release from the commerce department, the US economy has been growing at its fastest pace in almost 40 years. Corporate profits are their highest in 70 years. And the stock market, although gyrating wildly of late, is still scoring record gains.Where egos dare: Manchin and Sinema show how Senate spotlight corrupts | Robert ReichRead moreSo why do most Americans remain gloomy about the economy? Mainly because their real (inflation-adjusted) wages continue to go nowhere.Steeply-rising profits, economic growth and stock market highs – coupled with near-stagnant wages – has been the story of the American economy for decades. Most economic gains have gone to the top.So why not share the profits?Profit-sharing was tried with great success in the early decades of the 20th century but is now all but forgotten. In 1916, Sears, Roebuck & Co, then one of America’s largest corporations with more than 30,000 employees, announced it would begin to share profits with its employees, giving workers shares of stock and thereby making them part-owners.The idea caught on. Other companies that joined the profit-sharing bandwagon included Procter & Gamble, Pillsbury, Kodak and US Steel.The Bureau of Labor Statistics suggested profit-sharing as a means of reducing “frequent and often violent disputes” between employers and workers. Profit-sharing gave workers an incentive to be more productive, since the success of the company meant higher profits would be shared. It also reduced the need for layoffs during recessions because payroll costs dropped as profits did.By the 1950s, Sears workers had accumulated enough stock that they owned a quarter of the company. And by 1968, the typical Sears salesperson could retire with a nest egg worth well over $1m, in today’s dollars.The downside was that when profits went down, workers’ paychecks would shrink. And if a company went bankrupt, workers would lose all their investments in it. The best profit-sharing plans took the form of cash bonuses that employees could invest however they wish, on top of predictable wages.But profit-sharing with regular employees all but disappeared in large US corporations. Ever since the early 1980s when corporate “raiders” (now private-equity managers) began demanding high returns, corporations stopped granting employees shares of stock, presumably because they didn’t want to dilute share prices. Sears phased out its profit-sharing plan in the 1970s.Yet, just as profit-sharing with regular employees disappeared, profit-sharing with top executives took off, as big Wall Street banks, hedge funds, private equity funds and high-tech companies began doling out huge wads of stock and stock options to their MVPs.The result? Share prices and chief executive pay (composed increasingly of shares of stock and options to buy stock) have gone into the stratosphere, while the wages of the typical worker have barely risen.Researchers have found that before the 1980s, almost all the increases in share prices on the US stock market could be accounted for by overall economic growth. But since then, a large portion of the increases have come out of what used to go into wages.Jeff Bezos, who now owns around 10% of Amazon’s shares, is worth $170.4bn. Other top Amazon executives hold hundreds of millions of dollars of shares. But most of Amazon’s employees, such as warehouse workers, haven’t shared in the bounty.Amazon used to give out stock to hundreds of thousands of its employees. But in 2018 it stopped the practice and instead raised its minimum hourly wage to $15. The wage raise got headlines and was good PR – Amazon is still touting it – but the decision to end stock awards was more significant. It hurt employees far more than the increased minimum helped them.Corporate sedition is more damaging to America than the Capitol attack | Robert ReichRead moreIf Amazon’s 1.2 million employees together owned the same proportion of Amazon’s stock as Sears workers did in the 1950s – a quarter of the company – each Amazon worker would now own shares worth an average of more than $350,000.America’s trend toward higher profits, higher share prices, mounting executive pay but near stagnant wages is unsustainable, economically and politically.Profit-sharing is one answer. But how can it be encouraged? Reduce corporate taxes on companies that share profits with all their workers, and increase taxes on those that do not.Sharing profits with all workers is a logical and necessary step to making the system work for the many, not the few.
      Robert Reich, a former US secretary of labor, is professor of public policy at the University of California at Berkeley and the author of Saving Capitalism: For the Many, Not the Few and The Common Good. His new book, The System: Who Rigged It, How We Fix It, is out now. He is a Guardian US columnist. His newsletter is at robertreich.substack.com
      TopicsUS economyOpinionEconomicsStock marketsUS domestic policyUS taxationUS politicsAmazoncommentReuse this content More

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      in US Politics

      Electric cars on show in Washington as Biden pushes for green revolution

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      Electric cars on show in Washington as Biden pushes for green revolution Auto show dedicates entire pavilion to electric vehicles but experts say more charging stations are needed for Biden’s goal to be realizedThe Washington DC Auto Show has been showcasing alternative fuel vehicles for 15 years, but this is the first year an entire pavilion was dedicated to electric vehicles, or EVs. In part, you can thank the current occupant of the nearby White House for that.If Joe Biden has his way with his ambitious $2.2tn Build Back Better plan there will be 50% zero-emission vehicles on the road by 2030. The Biden administration also has plans to convert an estimated 600,000 of its fleet to alternative fuels as part of a renewed commitment to combat climate change.There are major issues ahead – the plan is being blocked by Republicans and there are serious equity issues to be addressed as the US transitions away from fossil fuels. But big changes are already happening, and the car show, which ends this weekend, is on it.EVs have now been adopted on a global scale, said John O’Donnell, chief executive of the Washington DC Auto Show, and the show, which focuses on public policy and gives congressional members and auto industry leaders a space to review the latest technology, needed to reflect that.“We’ve had other technologies and declared them a pavilion, but I thought it was very important right now for us to make it larger and more high profile,” said O’Donnell. Not just because of the current debate over EVs in Washington but also to “dispel the myth the US car dealers do not want to sell electric vehicles”.An aggressive transition like the one Biden envisions will require an equally aggressive overhaul of infrastructure. In the bipartisan Infrastructure Investment and Jobs Act, $7.5bn is dedicated to EV-charging infrastructure and building charging stations along highway corridors. But the industry is concerned about how that money is spent.Matthew Nelson, director of government affairs at Electrify America, said the infrastructure that serves the public must be “future-proofed”. Ultra-fast charging at 350 kW of power, or the equivalent to 20 miles of range per minute, has been his paramount message to government stakeholders. “We think it’s really important that the chargers paid for today are able to charge faster than the vehicles on the market today,” Nelson said. “The vehicles are getting faster and faster every model year. If we design for today’s vehicles it will be outdated in five years.”Electrify America, a sponsor of the EV Pavilion at the car show, has the largest network of DC (direct current) charging stations in the US. Currently, the Electrify America network consists of 800 charging stations, mostly along highway corridors, and the company is planning an increase to 1,800 charging stations with 10,000 chargers by 2026.However, 500,000 charging stations are needed to meet Biden’s goals and Nelson said they should be reliable and non-proprietary. There are 31 different brands of auto manufacturers in the US that use the same non-proprietary standard for charging and Nelson said leveraging the consensus around that single standard is in the public’s interest.Right now, consumers’ biggest concern is their bottom line, and EVs are more cost-efficient than gas-powered cars. An e-gallon – the cost to drive a comparable vehicle the same distance you could go on a gallon of gasoline – currently averages $1.16, compared with gasoline’s $2.85. Because Electrify America offers public charging their prices are a little higher than at-home chargers, but are standard in every state.Recently, Congress amended the Public Utility Regulatory Act (Purpa) that requires each state to consider EV-specific utility rates, giving them the liberty to change rates not suited for EV adoption. These demand charges lead to “extremely high-priced” electricity being charged to the stations, making it difficult to maintain low prices. States such as Colorado, Massachusetts, California, Rhode Island and Connecticut have revised these rates, but Nelson said every state should be on board.And there’s an equity element to charging. Homeowners who charge their cars in their garage do not pay demand rates, but those who charge at commercial charging stations or who live in multifamily dwellings or apartments will pay the demand rate.Incentives to support EV charging infrastructure in multi-family dwellings and more community-based charging infrastructure are important tools to making EV adoption more equitable, said Kellen Schefter, director of transportation at Edison Electric Institute, which leads the National Electric Highway Coalition. He believes the biggest barrier to EV adoption is the lack of charging infrastructure that’s affordable, equitable and reliable.Making sure investments go into those communities that are not traditionally getting those allocations is a large part of the National Electric Highway Coalition’s agenda. “There is such a great need on the infrastructure front,” said Schefter.The right policies will be critical if Biden is to hit his EV goals. O’Donnell said a wider range of tax incentives are needed to persuade the American public to swap their fuel-dependent cars for EVs.“In Build Back Better, they are proposing $12,500 per vehicle purchased, but only if it is built by a United Auto Worker manufacturer. It doesn’t seem like mass-market adoption will be achieved using only union-made vehicles. We think all electric vehicles should qualify for the full $12,500 incentive,” O’Donnell said.But while tax incentives make a difference, chargers are more meaningful said Dilip Sundaram, chief international business officer at Acrimoto, an electric autocycle company. China – the biggest EV market – has about 800,000 chargers and Sundaram said 500,000 chargers in the United States, a car-dependent country, is not enough.“In China, the tax incentive is about $2,500,” Sundaram said. “Accessibility to chargers is what is driving mass adoption. If you remove range anxiety to make sure chargers are available everywhere you will suddenly see the EV adoption increase.”“Biden wants to put the United States in a leadership role instead of a passive role on the issue of climate change, but policies need to reflect the new challenge,” Sundaram said. “So that any new structure whether it be a mall or apartment complex, has chargers.”Despite a lower than usual attendance at this year’s show because of Covid, the line to ride in the new Arcimoto was long. As attendees watched the small autocycle whip around the EV pavilion, others buzzed about the displays for the latest EV models presented by Bentley, McLaren, Polestar, Hyundai and Nissan.The star of the show was the new all-electric Ford F-150, the latest iteration of the US’s best-selling vehicle. The impressive aluminum truck can pull 10,000lb, gets 300 miles on a standard charge, and can generate power for an entire house for three days. And it’s fast – going from 0-60mph in less than five seconds.As the demand for these new high-performing EVs grows, gasoline-powered cars look more and more like relics. But for now, all eyes are on Congress as to how soon the US can transition to mass adoption, and an equitable, EV market.TopicsAutomotive industryElectric, hybrid and low-emission carsUS politicsJoe BidenMotoringfeaturesReuse this content More

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      in US Politics

      Why is so little known about the 1930s coup attempt against FDR? | Sally Denton

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      Why is so little known about the 1930s coup attempt against FDR?Sally DentonBusiness leaders like JP Morgan and Irénée du Pont were accused by a retired major general of plotting to install a fascist dictator Donald Trump’s elaborate plot to overthrow the democratically elected president was neither impulsive nor uncoordinated, but straight out of the playbook of another American coup attempt – the 1933 “Wall Street putsch” against newly elected Franklin Delano Roosevelt.America had hit rock bottom, beginning with the stock market crash three years earlier. Unemployment was at 16 million and rising. Farm foreclosures exceeded half a million. More than five thousand banks had failed, and hundreds of thousands of families had lost their homes. Financial capitalists had bilked millions of customers and rigged the market. There were no government safety nets – no unemployment insurance, minimum wage, social security or Medicare.Many are disillusioned with American democracy. Can Joe Biden win them over? | Francine ProseRead moreEconomic despair gave rise to panic and unrest, and political firebrands and white supremacists eagerly fanned the paranoia of socialism, global conspiracies and threats from within the country. Populists Huey Long and Father Charles Coughlin attacked FDR, spewing vitriolic anti-Jewish, pro-fascist refrains and brandishing the “America first” slogan coined by media magnate William Randolph Hearst.On 4 March 1933, more than 100,000 people had gathered on the east side of the US Capitol for Roosevelt’s inauguration. The atmosphere was slate gray and ominous, the sky suggesting a calm before the storm. That morning, rioting was expected in cities throughout the nation, prompting predictions of a violent revolution. Army machine guns and sharpshooters were placed at strategic locations along the route. Not since the civil war had Washington been so fortified, with armed police guarding federal buildings.FDR thought government in a civilized society had an obligation to abolish poverty, reduce unemployment, and redistribute wealth. Roosevelt’s bold New Deal experiments inflamed the upper class, provoking a backlash from the nation’s most powerful bankers, industrialists and Wall Street brokers, who thought the policy was not only radical but revolutionary. Worried about losing their personal fortunes to runaway government spending, this fertile field of loathing led to the “traitor to his class” epithet for FDR. “What that fellow Roosevelt needs is a 38-caliber revolver right at the back of his head,” a respectable citizen said at a Washington dinner party.In a climate of conspiracies and intrigues, and against the backdrop of charismatic dictators in the world such as Hitler and Mussolini, the sparks of anti-Rooseveltism ignited into full-fledged hatred. Many American intellectuals and business leaders saw nazism and fascism as viable models for the US. The rise of Hitler and the explosion of the Nazi revolution, which frightened many European nations, struck a chord with prominent American elites and antisemites such as Charles Lindbergh and Henry Ford. Hitler’s elite Brownshirts – a mass body of party storm troopers separate from the 100,000-man German army – was a stark symbol to the powerless American masses. Mussolini’s Blackshirts – the military arm of his organization made up of 200,000 soldiers – were a potent image of strength to a nation that felt emasculated.A divided country and FDR’s emboldened powerful enemies made the plot to overthrow him seem plausible. With restless uncertainty, volatile protests and ominous threats, America’s right wing was inspired to form its own paramilitary organizations. Militias sprung up throughout the land, their self-described “patriots” chanting: “This is despotism! This is tyranny!”Today’s Proud Boys and Oath Keepers have nothing on their extremist forbears. In 1933, a diehard core of conservative veterans formed the Khaki Shirts in Philadelphia and recruited pro-Mussolini immigrants. The Silver Shirts was an apocalyptic Christian militia patterned on the notoriously racist Texas Rangers that operated in 46 states and stockpiled weapons.The Gray Shirts of New York organized to remove “Communist college professors” from the nation’s education system, and the Tennessee-based White Shirts wore a Crusader cross and agitated for the takeover of Washington. JP Morgan Jr, one of the nation’s richest men, had secured a $100m loan to Mussolini’s government. He defiantly refused to pay income tax and implored his peers to join him in undermining FDR.So, when retired US Marine Corps Maj Gen Smedley Darlington Butler claimed he was recruited by a group of Wall Street financiers to lead a fascist coup against FDR and the US government in the summer of 1933, Washington took him seriously. Butler, a Quaker, and first world war hero dubbed the Maverick Marine, was a soldier’s soldier who was idolized by veterans – which represented a huge and powerful voting bloc in America. Famous for his daring exploits in China and Central America, Butler’s reputation was impeccable. He got rousing ovations when he claimed that during his 33 years in the marines: “I spent most of my time being a high-class muscle man for big business, for Wall Street and for bankers. In short, I was a racketeer for capitalism.”Butler later testified before Congress that a bond-broker and American Legion member named Gerald MacGuire approached him with the plan. MacGuire told him the coup was backed by a group called the American Liberty League, a group of business leaders which formed in response to FDR’s victory, and whose mission it was to teach government “the necessity of respect for the rights of persons and property”. Members included JP Morgan, Jr, Irénée du Pont, Robert Sterling Clark of the Singer sewing machine fortune, and the chief executives of General Motors, Birds Eye and General Foods.The putsch called for him to lead a massive army of veterans – funded by $30m from Wall Street titans and with weapons supplied by Remington Arms – to march on Washington, oust Roosevelt and the entire line of succession, and establish a fascist dictatorship backed by a private army of 500,000 former soldiers.As MacGuire laid it out to Butler, the coup was instigated after FDR eliminated the gold standard in April 1933, which threatened the country’s wealthiest men who thought if American currency wasn’t backed by gold, rising inflation would diminish their fortunes. He claimed the coup was sponsored by a group who controlled $40bn in assets – about $800bn today – and who had $300m available to support the coup and pay the veterans. The plotters had men, guns and money – the three elements that make for successful wars and revolutions. Butler referred to them as “the royal family of financiers” that had controlled the American Legion since its formation in 1919. He felt the Legion was a militaristic political force, notorious for its antisemitism and reactionary policies against labor unions and civil rights, that manipulated veterans.The planned coup was thwarted when Butler reported it to J Edgar Hoover at the FBI, who reported it to FDR. How seriously the “Wall Street putsch” endangered the Roosevelt presidency remains unknown, with the national press at the time mocking it as a “gigantic hoax” and historians like Arthur M Schlesinger Jr surmising “the gap between contemplation and execution was considerable” and that democracy was not in real danger. Still, there is much evidence that the nation’s wealthiest men – Republicans and Democrats alike – were so threatened by FDR’s policies that they conspired with antigovernment paramilitarism to stage a coup.The final report by the congressional committee tasked with investigating the allegations, delivered in February 1935, concluded: “[The committee] received evidence showing that certain persons had made an attempt to establish a fascist organization in this country”, adding “There is no question that these attempts were discussed, were planned, and might have been placed in execution when and if the financial backers deemed it expedient.”As Congressman John McCormack who headed the congressional investigation put it: “If General Butler had not been the patriot he was, and if they had been able to maintain secrecy, the plot certainly might very well have succeeded … When times are desperate and people are frustrated, anything could happen.”There is still much that is not known about the coup attempt. Butler demanded to know why the names of the country’s richest men were removed from the final version of the committee’s report. “Like most committees, it has slaughtered the little and allowed the big to escape,” Butler said in a Philadelphia radio interview in 1935. “The big shots weren’t even called to testify. They were all mentioned in the testimony. Why was all mention of these names suppressed from this testimony?”While details of the conspiracy are still matters of historical debate, journalists and historians, including the BBC’s Mike Thomson and John Buchanan of the US, later concluded that FDR struck a deal with the plotters, allowing them to avoid treason charges – and possible execution – if Wall Street backed off its opposition to the New Deal. “Roosevelt should have pushed it all through and then welshed on his agreement and prosecuted them,” presidential biographer Sidney Blumenthal recently said.What might all of this portend for Americans today, as President Biden follows in FDR’s New Deal footsteps while democratic socialist Bernie Sanders also rises in popularity and influence? In 1933, rather than inflame a quavering nation, FDR calmly urged Americans to unite to overcome fear, banish apathy and restore their confidence in the country’s future. Now, 90 years later, a year on from Trump’s own coup attempt, Biden’s tone was more alarming, sounding a clarion call for Americans to save democracy itself, to make sure such an attack “never, never happens again”.If the plotters had been held accountable in the 1930s, the forces behind the 6 January coup attempt might never have flourished into the next century.
      Sally Denton is the author of The Plots Against the President: FDR, a Nation in Crisis, and the Rise of the American Right. Her forthcoming book is The Colony: Faith and Blood in a Promised Land
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      The US jobs report was a warning sign – even before the Omicron surge | Robert Reich

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      The US jobs report was a warning sign – even before the Omicron surgeRobert ReichThe Fed wants to raise interest rates and coronavirus support programs are ending. Millions of families stand to suffer Friday’s jobs report from the Department of Labor was a warning sign about the US economy. It should cause widespread concern about the Fed’s plans to raise interest rates to control inflation. And it should cause policymakers to rethink ending government supports such as extended unemployment insurance and the child tax credit. These will soon be needed to keep millions of families afloat.US workforce grows by just 199,000 in disappointing DecemberRead moreEmployers added only 199,000 jobs in December. That’s the fewest new jobs added in any month last year. In November, employers added 249,000. The average for 2021 was 537,000 jobs per month. Note also that the December survey was done in mid-December, before the latest surge in the Omicron variant of Covid caused millions of people to stay home.But the Fed is focused on the fact that average hourly wages climbed 4.7% over the year. Central bankers believe those wage increases have been pushing up prices. They also believe the US is nearing “full employment” – the maximum rate of employment possible without igniting even more inflation.As a result, the Fed is about to prescribe the wrong medicine. It’s going to raise interest rates to slow the economy – even though millions of former workers have yet to return to the job market and even though job growth is slowing sharply. Higher interest rates will cause more job losses. Slowing the economy will make it harder for workers to get real wage increases. And it will put millions of Americans at risk.The Fed has it backwards. Wage increases have not caused prices to rise. Price increases have caused real wages (what wages can actually purchase) to fall. Prices are increasing at the rate of 6.8% annually but wages are growing only between 3-4%.The most important cause of inflation is corporate power to raise prices.Yes, supply bottlenecks have caused the costs of some components and materials to rise. But large corporations have been using these rising costs to justify increasing their own prices when there’s no reason for them to do so.Corporate profits are at a record high. If corporations faced tough competition, they would not pass those wage increases on to customers in the form of higher prices. They’d absorb them and cut their profits.But they don’t have to do this because most industries are now oligopolies composed of a handful of major producers that coordinate price increases.Yes, employers have felt compelled to raise nominal wages to keep and attract workers. But that’s only because employers cannot find and keep workers at the lower nominal wages they’d been offering. They would have no problem finding and retaining workers if they raised wages in real terms – that is, over the rate of inflation they themselves are creating.Astonishingly, some lawmakers and economists continue to worry that the government is contributing to inflation by providing too much help to working people. A few, including some Democrats like Joe Manchin and Kyrsten Sinema, are unwilling to support Biden’s Build Back Better package because they fear additional government spending will fuel inflation.Joe Biden needs to stand up and fight Manchin like our lives depend on it | Daniel SherrellRead moreHere again, the reality is exactly the opposite. The economy is in imminent danger of slowing, as the December job numbers (collected before the Omicron surge) reveal.Many Americans will soon need additional help since they can no longer count on extra unemployment benefits, stimulus payments or additional child tax credits. This is hardly the time to put on the fiscal brakes.Policymakers at the Fed and in Congress continue to disregard the elephant in the room: the power of large corporations to raise prices. As a result, they’re on the way to hurting the people who have been taking it on the chin for decades – average working people.
      Robert Reich, a former US secretary of labor, is professor of public policy at the University of California at Berkeley and the author of Saving Capitalism: For the Many, Not the Few and The Common Good. His new book, The System: Who Rigged It, How We Fix It, is out now. He is a Guardian US columnist. His newsletter is at robertreich.substack.com
      TopicsUS economyOpinionFederal ReserveEconomicsBiden administrationUS politicsUS domestic policyUS taxationcommentReuse this content More

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      in UK Politics

      British Gas owner appoints Amber Rudd as a director

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      Former minister Amber Rudd – who as energy secretary oversaw the development of the energy price cap – is joining the board of British Gas owner Centrica, just as the government is facing pressure to change the cap.Ms Rudd, also a former home secretary, was a high-profile opponent of Brexit before the referendum, warning during the campaign that electricity costs could soar if the UK quit the EU single energy market.She will become a non-executive director of Centrica just as energy companies are seeking to have the price cap for consumers raised so they can pass on more of the wholesale price rises in people’s bills.They want the government to remove environmental taxes from energy bills and suspend VAT.Average annual household bills are forecast to shoot up by around 56 per cent, to £2,000, in April when the price cap is recalculated.Scott Wheway, Centrica chairman, said: “As secretary of state for energy and climate change, Amber was the driving force in the UK’s participation in the Paris climate change agreement, the first legally binding global commitment to reduce national carbon emissions.”In 2016, Ms Rudd warned of “a massive electric shock”, saying British bills would soar by the equivalent of around £1.5m a day, and giving Russian president Vladimir Putin more influence over Europe.She also backed plans to keep Britain’s oldest nuclear power plants generating electricity for up to seven years longer than planned.Centrica’s chief executive, Chris O’Shea, said the company was not interested in receiving a government bailout to help it reduce the effect of soaring energy bills on consumers.Ms Rudd’s other private-sector roles include senior adviser to cybersecurity firm Darktrace, adviser at public relations firm Teneo and senior adviser at Finsbury Glover Hering, founded by her brother, Roland Rudd. More