AltAusterity Digest #119 November 21-27, 2019

The Institute for Fiscal Studies (IFS) has critiqued the spending plans of the UK Conservatives, the Liberal Democrats and Labour in the leadup to the general election. IFS director Paul Johnson has said the Tory and Labour plans are “not credible” while the Lib Dems manifesto would be seen as “radical” in “most periods.” Labour is promising to renationalize rail, mail, water and energy, as well as give public sector workers a 5% raise in the first year in government. The Lib Dems want to prevent Brexit and increase all income taxes by 1% to fund the NHS. The Tories have postponed a scheduled corporate tax cut and have promised to increase spending on social services. While the IFS research is being used in the media to frame the election, the findings have been critiqued by other organizations and researchers.

The Organisation for Economic Cooperation and Development (OECD) has released a report issuing warnings of increasing risks to the world economy. Among the top risks to global economic growth is the growing climate crisis. According to the OECD, increasingly extreme weather events are expected to lead to disruptions in economic activity, lasting damage to capital and land, and could lead to increasing human migration. The OECD says that a lack of direction on climate policy has already had an impact on global economic growth as businesses have opted to hold back on investments due to uncertainty. Other challenges to the global economic growth include digitalization, the changing Chinese economy, and deteriorating trade relations.  

European officials met this week to vote on a new directive to curb tax avoidance by multinational corporations. The law will require corporations to reveal the profits and taxes they pay in each of the EU’s 28 member states. The country-by-country reporting will only be required for companies with an annual income of over €750m. Current estimates pin European tax avoidance at an estimated €50bn-€70bn a year. In the UK alone, the five tech giants of Facebook, Google, Apple, Microsoft and Cisco, are estimated to dodge £1bn in taxes each year. Proponents of the directive have stated that the increased revenues could be used to build new hospitals, schools and other public services.

Anti-austerity protests in Chile have been met with widespread police repression. Human Rights Watch has said that Chile must reform its policing after human rights violations have been committed over the five weeks of unrest. The report from Human Rights Watch follows Amnesty International’s finding that Chilean security services intentionally injured protesters to incite fear and discourage demonstrations. There have also been claims of sexual assault and torture in detention. According to Chile’s health ministry, between October 18 and November 22nd 11,564 people have been treated by emergency services. At least 23 people have been killed.

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