Pakistan, among the most vulnerable globally to climate change, has seen the highest rainfall in at least three decades. Skyrocketing prices are putting food out of reach in flood-ravaged Pakistan. The government warned that a food crisis is looming. 

Pakistan already reeling from dwindling currency reserves and the fastest inflation in almost five decades faces a food shortage after torrential rains submerged a third of the country and destroyed crops. The toll of extreme flooding on Pakistan’s food security is becoming apparent, homes and livelihoods wiped out. Eight more districts were added at the weekend to the country’s calamity list of 80 areas hit by floods. The floods, which will cost an estimated $10 billion worth of damage, have claimed the lives of more than 1,300 people and forced half a million into camps. It’s also submerged large swathes of farmland and flushed away crops in a country where agriculture accounts for about a fifth of the economy. The direct crop loss to flood damage is $2.3 billion, according to an estimate by Uzair Younus, director at the Atlantic Council’s Pakistan Initiative and economist Ammar Khan. Almost 800,000 farm animals have perished, and 2 million acres of crops and orchards have been hit, according to the United Nations. More than 100 bridges and about 3,000 kilometers (1,864 miles) of roads damaged or destroyed.

“The agricultural sector is in turmoil. The cotton crop and vegetables are completely wiped out in many key areas,” said Pakistan Businesses Forum Vice President Ahmad Jawad, who grows wheat, maize, citrus and sugarcane. “Wild weather just can’t give us a break. First the heat wave, now floods.”

A Bloomberg report said the surge in food prices will add stress to an already fragile and politically divided economy that has just been regaining some funding strength after securing a $1.16 billion International Monetary Fund bailout and $9 billion in pledges from Qatar, Saudi Arabia and the UAE.

It is raising the frightening prospect of inflation hitting 30%. Pakistan already has one of the fastest inflation rates in the region, with consumer price gains rising to a 14-year high of almost 25% in July. 

“The main concern from the floods is the impact on inflation,” said Amreen Soorani, head of research at JS Global Capital. “Food shortage from floods the last time in 2010 almost doubled food inflation in two months. We’re already in a high inflationary environment, making the scenario even more difficult.”

Consumer price gains quickened to 27.26% in August, rising for a sixth straight month before the full impact of the flooding is felt. Food inflation, that makes up a third to the basket, climbed to 29.5% last month. The calculus doesn’t include yet the full impact of energy prices rising by 50%, a condition of the IMF loan.

Inflation could accelerate to 30% in the coming two months and that would take the average price gains this fiscal year to 23%-24%, surpassing the central bank’s estimate of 18%-20%, according to Fahad Rauf, head of research at Ismail Iqbal Securities.

 The damage to food supplies will probably boost the nation’s need for imports and increase the pressure on global agricultural markets. Steps are being taken to import vegetables and other items from Iran and Afghanistan. Pakistan is also considering a temporary land route to allow duty-free shipments from arch-rival India.  Jawad said. “Indian imports are needed to help bring prices down.”

Sowing next year’s wheat crop, which starts in October, will be another challenge. Even before the floods, the country was facing a wheat shortage of about 2.6 million tons.

Pakistan Post-Flood Situation: Vegetable Costs Up 500% Threaten To Fuel Inflation| Countercurrents

 X Factoring

Votes cast and counted, there’s the liberty

Of one hundred and sixty thousand choices

Choosing without forty million plus voices

Being heard. Such is bourgeois democracy.

The “first amongst equals” is selected

According to the whims and partial views

Of Tories. Whoever might win or lose

Little can reasonably be expected

Beyond measures intended to serve

Capitalism’s best interests, its state

Designed to serve its purposes and fate.

And yet, the unconsidered still reserve

The power of all the present process mocks

To transform their lives via the ballot box.

D. A.

More than 1 million more people will be forced into poverty this winter even if the government freezes energy prices at current levels, according to a conservative thinktank, the Legatum Institute.

It estimated that even if the energy price cap was held at its summer rate of £1,971, another 1.3 million people would slide below the relative poverty line compared with pre-pandemic rates.

With living standards collapsing, many people on low incomes would still struggle with rising costs in other areas such as food, clothing, rent and transport, partly because energy prices were already high, and partly as a result of the government’s decision to award below-inflation benefit increases in April, when benefits were increased by 3.1%, even though inflation was at 9% at the time.

Legatum said government intervention to freeze energy prices was essential to avert what would otherwise be an even more drastic “once in a generation” explosion in poverty.

The institute estimated that if ministers failed to tackle gas and electricity prices, and the energy price cap rose as projected to £3,549 in October and again in January to £5,300, then numbers in poverty in the UK would increase to 16.65 million, compared with the 2019-20 rate of 13.9 million.

“Even under the assumption of energy prices fixed at summer 2022 levels, there will still be 15.2 million people in poverty over the course of 2022-23. This would represent the greatest number of people in poverty since the Social Metrics Commission began measuring poverty in 2000-01, and an increase of 1.3 million when compared with pre-pandemic levels,” the analysis says.

1 million more people in UK face poverty this winter, analysis shows | Poverty | The Guardian

  Companies have raised a record $58bn in initial public offerings in mainland China so far this year, according to Bloomberg, a financial-information firm, compared with just $19bn in America and $5bn in Hong Kong. Another 1,000 firms are reportedly lining up to go public. A fresh cohort of tycoons is emerging, too. 

China’s ten richest magnates have accumulated a net $167bn in wealth since the start of 2020.

According to the Peterson Institute for International Economics, an American think-tank, by 2020 privately controlled companies accounted for more than half of the market capitalisation of China’s 100 biggest listed firms, compared with less than a tenth a decade earlier. 

The private sector employs four in five urban workers, or around 150m all told. 

Thirty-two private Chinese companies feature in the Fortune 500 ranking of the world’s biggest firms by revenue, up from none in 2005.

 China’s wealthiest man is  Zhong Shanshan, who built Nongfu, which sells bottled water.

Muyuan has grown into one of the world’s biggest hog producers. The Communist Party of Nanyang city, where the company is based, has an explicit goal of putting it on the Fortune 500 list. In late 2021 the local party told officials to make land available for Muyuan, and to streamline its various applications and inspections. The company is to receive subsidies for farm equipment, and local engineers and other workers are to be connected with the company, the plan ordains. The fortune of Muyuan’s founder, Qin Yinglin, has swollen to $23bn.

The central government wants to create 1m innovative small and medium-sized firms between 2021 and 2025. Of those, 100,000 will be dubbed “specialised new enterprises” and 10,000 will earn the distinction of “little giant”. The state still takes direct stakes in private companies. But it is finding new ways to influence and guide the private sector, often through industrial parks and a system of state-designated status.

 Designations such as “little giants” act as endorsements and signal where capital ought to flow. Such labels also make for “good public relations”, says Gu Jie, founder of Fourier, a robotics startup. Obtaining them eases access to places like Zhangjiang Robotics Valley in Shanghai, part of a larger high-tech development zone housing 150 research and development (r&d) centres, more than 24,000 companies and 400,000 workers. The local government owns and runs the zone.

The recipients of such largesse do not see this as the first step to nationalisation. Zhou Hanyi, co-founder of Xinzailing, a company specialising in lift safety, likens it instead to a bank loan without a fixed maturity, which does not typically engender state meddling. If a particular company fails, its technology and workforce can be absorbed by others without too much waste, says Christopher Fong of Welkin Capital, a private-equity firm in Hong Kong (and investor in Xinzailing). Older businesses, too, are opting to join state-backed innovation parks. 

 Xi’s ideal private sector might look something like Germany’s Mittelstand, according to Enodo Economics, a research firm: “a large stable of small private firms that are innovative, generate high-paying jobs and produce technologically advanced manufactured goods”. Some entrepreneurs say bureaucracy is being cut back in professionally managed industrial zones and that the state is meddling less in their operations. 

Meet China’s new tycoons | The Economist

 Some Socialist Party meetings/talks/discussions are online via Discord or Zoom, and some are in-person. Please contact spgb.discord@worldsocialism.org for instructions on how to join Discord. 

CENTRAL BRANCH MEETING

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Saturday 10 September, 11.30am-6pm

STALL AT WIGAN DIGGERS FESTIVAL

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Glasgow Discussion Meeting

Second Saturday of each month at The Atholl Arms Pub, 134 Renfrew St, G2 3AU. Let’s get together for a beer and a blether. 2pm onwards. 2 minutes’ walk from Buchanan Street Bus Station. For further information call Paul Edwards on 07484 717893.

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 US life expectancy has fallen to the lowest level seen since 1996, continuing a steep decline largely driven by the Covid-19 pandemic. According to the provisional data, life expectancy fell by 2.7 years between 2019 and 2021.

 The outgoing UN human rights commissioner, Michelle Bachelet, has said that China had committed “serious human rights violations” against Uyghur Muslims in Xinjiang province which may amount to crimes against humanity. Investigators said they uncovered “credible evidence” of torture. The abuses described included beatings with electric batons while being strapped in a “tiger chair” (to which inmates are strapped by their hands and feet), extended solitary confinement, as well as what appeared to be a form of waterboarding, “being subjected to interrogation with water being poured in their faces”.

“Several women interviewed by OHCHR raised allegations of forced birth control, in particular forced IUD [intrauterine device] placements and possible forced sterilisations with respect to Uyghur and ethnic Kazakh women. Some women spoke of the risk of harsh punishments including “internment” or “imprisonment” for violations of the family planning policy,” the report said.

“Among these, OHCHR interviewed some women who said they were forced to have abortions or forced to have IUDs inserted, after having reached the permitted number of children under the family planning policy. These first-hand accounts, although limited in number, are considered credible.” 

The report noted that the average rate of sterilisation per 100,000 inhabitants in China as a whole was just over 32. In the Xinjiang Uyghur Autonomous Region it was 243. 

The report by the Office of the High Commissioner for Human Rights (OHCHR) concluded: 

“The extent of arbitrary and discriminatory detention of members of Uyghur and other predominantly Muslim groups, pursuant to law and policy, in context of restrictions and deprivation more generally of fundamental rights enjoyed individually and collectively, may constitute international crimes, in particular crimes against humanity.”

The report accused China of using vague national security laws to clamp down on the rights of minorities and establishing “systems of arbitrary detention”.

“Serious human rights violations have been committed in [the Xinjiang Uyghur Autonomous Region] in the context of the government’s application of counter-terrorism and counter-‘extremism’ strategies,” the report said. “These patterns of restrictions are characterized by a discriminatory component, as the underlying acts often directly or indirectly affect Uyghur and other predominantly Muslim communities.”

Sophie Richardson, China director at Human Rights Watch, said the report’s findings showed “why the Chinese government fought tooth and nail to prevent the publication” of the report.

https://assets.documentcloud.org/documents/22273382/22-08-31-final-assesment_unhr.pdf

 According to the study by the Trades Union Congress,  eight percent of the UK’s 3.9 million minority ethnic workers. (120,000) left their job as a result of the racism they experienced.

“Many told us they experienced racist bullying, harassment – and worse,” said the TUC general secretary, Frances O’Grady. “And alarmingly, the vast majority did not report this to their employer …”

The Chartered Institute of Personnel and Development, which represents human resources professionals, said the survey was a “stark reminder that far too many black and minority ethnic workers still face discrimination in the workplace on a regular basis”.

More than 120,000 workers quit jobs because of racism, UK study suggests | Race | The Guardian

 With real wages falling and bills rising sharply, people across the country are looking for ways to reduce spending and supplement their incomes, and the TUC said it was hearing about staff in both the public and private sectors who had concluded they could not afford to save for retirement. 

Growing numbers of workers are cutting their workplace pension contributions or opting out of schemes entirely because they cannot afford payments.

Its warnings follow data released in August indicating that the number of people choosing to opt-out of their company pension scheme increased by almost a third between March and July this year. The figures were issued by Penfold, a digital pensions platform used by private savers, the self-employed, company directors and businesses.

About 10% of people quit their workplace scheme, and the TUC said Penfold’s findings – which would translate into a two to three percentage-point increase in opt-out rates, lifting them to about 12%-13% – appeared broadly consistent with what it was hearing.

 Someone who opts out is essentially giving up the pension contributions from their employer, which effectively amounts to “a voluntary pay cut”, said Tom Selby, head of retirement policy at investment firm AJ Bell. “Furthermore, you will miss out on the upfront boost provided by pension tax relief,” he added.

Renny Biggins, head of retirement atTisa (the Investing and Saving Alliance), a membership organisation for UK financial firms, said possible solutions it was proposing included increasing the amount that employers had to pay in under the UK’s auto-enrolment workplace pension regime from 3% of earnings to 6%, in order to allow staff to cut their contributions and release some money to supplement their disposable income. Alternatively, employers could opt to continue paying pension contributions while allowing their workers to take a temporary contribution holiday.

“We recognise there are immediate needs for people to provide for their families, but we are nonetheless concerned that if people decide to reduce or opt out of their pension now, there will be consequences in the future,” said Biggins.

Jack Jones, pensions policy officer at the TUC, said: “Our longer-term policy target is for increased employer contributions.”

More people leaving workplace pension schemes, TUC warns | Pensions industry | The Guardian

 Despite being a technology still in development stages, carbon capture and storage has been put forward as a key element in the plans to reach net zero carbon emissions by 2050. Carbon capture and storage schemes, a key plank of many governments’ net zero plans, “is not a climate solution”, the author of a major new report on the technology has said.

Researchers for the Institute for Energy Economics and Financial Analysis (IEEFA) found underperforming carbon capture projects considerably outnumbered successful ones by large margins.

Of the 13 projects examined for the study – accounting for about 55% of the world’s current operational capacity – seven underperformed, two failed and one was mothballed, the report found.

“Many international bodies and national government are relying on carbon capture in the fossil fuel sector to get to net zero, and it simply won’t work,” Bruce Robertson, the author of the IEEFA report, said. “Although there is some indication it might have a role to play in hard-to-abate sectors such as cement, fertilisers and steel, overall results indicate a financial, technical and emissions-reduction framework that continues to overstate and underperform,” Robertson said. 

However, he added: “As a solution to tackling catastrophic rising emissions in its current framework, CCS is not a climate solution.”

Meanwhile, despite the huge profits of fossil fuel companies, global public subsidies for fossil fuels almost doubled to $700bn in 2021.

The subsidies soared as governments sought to shield citizens from surging energy prices as the global economy rebounded from the Covid-19 pandemic.

Most of the subsidies were used to reduce the price paid by consumers. This largely benefits wealthier households, as they use the most energy, rather than targeting those on low incomes. The subsidies are expected to rise even further in 2022 as Russia’s war in Ukraine has driven energy prices even higher.

“Fossil fuel subsidies are a roadblock to a more sustainable future, but the difficulty that governments face in removing them is underscored at times of high and volatile fuel prices,” said Fatih Birol, the director of the International Energy Agency, which produced the analysis with the OECD. “A surge in investment in clean energy technologies and infrastructure is the only lasting solution to today’s global energy crisis and the best way to reduce the exposure of consumers to high fuel costs.” 

“Significant increases in fossil fuel subsidies encourage wasteful consumption, while not necessarily reaching low-income households,” said Mathias Cormann, the OECD secretary general.

“A period of soaring fossil fuel energy prices, when oil and gas companies are posting record-breaking profits, should be the ideal time for governments to eliminate fossil fuel production subsidies – so to see rising government support for fossil fuels now is infuriating,” said Gyorgy Dallos, at Greenpeace International. “Governments need to stick to their green pledges. On the consumer side, they urgently need to replace untargeted support measures with targeted income support to people experiencing fuel poverty.”

The analysis covers 51 key countries and represents 85% of the world’s total energy supply. Subsidies that kept fossil fuel prices artificially low more than tripled to $531bn in 2021, compared with 2020. Subsidies for oil and gas production reached a record level of $64bn. The $697bn total covers explicit subsidies, including price reductions, government funding and tax breaks. Estimates including implicit subsidies, ie the cost of the climate and air pollution damage caused by fossil fuels, are far higher. These amounted to $5.9tn in 2020, according to the International Monetary Fund, or $11m a minute.

Carbon capture is not a solution to net zero emissions plans, report says | Carbon capture and storage (CCS) | The Guardian

Global fossil fuel subsidies almost doubled in 2021, analysis finds | Fossil fuels | The Guardian