The overthrow of capitalism’: Corbyn’s new shadow chancellor unveils economic plan – seizing control of banks and energy firms



Labour’s new shadow chancellor John McDonnell today insisted the economy would be ‘safe’ in his hands – despite previously calling for the ‘overthrow of capitalism’.

Mr McDonnell, a radical socialist and long-time ally of Jeremy Corbyn, wants to nationalise all the banks, railways and utility companies, hike taxes on companies and increase national insurance payments by 7 per cent for anyone earning more than £50,000.

The veteran west London MP this morning dismissed widespread criticism over this appointment and promised to make people more ‘prosperous’.

But the former Labour home secretary Charles Clarke told the BBC that Mr Corbyn’s choice showed he wanted to ‘go down the most hardline position there was’.

During Mr Corbyn’s election campaign, Mr McDonnell – acting as his campaign chief – set out a £10bn plan to scrap all tuition fees and restore student maintenance.

He said the plan could be funded either by a 7 per cent rise in national insurance for those earning over £50,000 a year and a 2.5% higher corporation tax on companies.

Another option would be to borrow more by slowing the pace at which the deficit is reduced.

Mr McDonnell wants to see the wholesale nationalisation of the railways, energy companies and banks.

Shares in companies privatised by George Osborne could also be seized back without compensation – potentially affecting thousands of post office and RBS workers.

Mr McDonnell told a rally at the annual trade union conference that he had been ‘campaigning for the nationalisation of the banks’ for years. ‘They are jokers, these bankers’.

He said: ‘Under a Corbyn Labour government this shameful era of governments and ministers colluding in the picking of the taxpayers’ pockets will be brought to an abrupt end.

‘Let’s also make it absolutely clear to any speculators in the City looking to make a fast buck at the taxpayers’ expense that if any of these assets are sold by Osborne under their value, a future Corbyn-led Labour government will reserve the right to bring them back into public ownership with either no compensation or with any undervaluation deducted from any compensation for renationalisation.’

Mr Corbyn and his shadow chancellor have also controversially pledged to introduce ‘people’s quantitative easing’ – forcing the Bank of England to print money to build roads and houses.

Mr Corbyn says: ‘One option would be for the Bank of England to be given a new mandate to upgrade our economy to invest in new, large-scale housing, energy, transport and digital projects: quantitative easing for people instead of banks.’

Mr McDonnell is against the third runway at Heathrow – where he is the constituency MP.

The Hayes and Harlington MP previously said a Corbyn government would pledge to clear the budget deficit, ‘but not by hitting the poor’ and refused to set an ‘arbitrary deadline’ for balancing the books.

Mr Corbyn says: ‘We all want the deficit closed on the current budget, but there was no need to try to do it within an artificial five years or even the extra five years George Osborne mapped out.

‘If the deficit has been closed by 2020 and the economy is growing, then Labour should not run a current budget deficit – but we should borrow to invest in our future prosperity.’

But Mr McDonnell today defended his appointment, insisting the economy would be ‘safe in our hands’.

He told the BBC: ‘I have got a long history in terms of financial administration. I was Chancellor of the Exchequer for London at the age of 29.

‘My new policies, with Jeremy’s, have been roundly endorsed by the leadership election, so the economy would be safe in our hands but also it would be more prosperous.’

Mr McDonnell believes a future Labour government could raise £120billion a year by cracking down on tax avoidance.

But even Mr Corbyn’s economics guru Richard Murphy has warned that only £20billion could be clawed back.
The scale of the problems Mr Corbyn faces in uniting the party were underlined as Hilary Benn, who is staying on as shadow foreign secretary, declined to offer full endorsement for Mr McDonnell’s appointment.

Asked if he was 100 per cent behind Mr McDonnell being handed the key economic job, Mr Benn told BBC Radio 4’s Today programme: ‘This is the choice that Jeremy has made. I respect the choice that Jeremy has made as leader.

‘We have just come off the back of two bad election defeats for the Labour Party, and our principle task is to win the people’s trust when it comes to the economy.

‘John’s first and last task as shadow chancellor will be to win the trust and confidence of the British people in arguing for a different economic policy.’

Posted by on Sep 14 2015. Filed under Economie. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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