On 3rd May, hundreds of protesters from across the country will target the UK Energy Summit in the City of London. They intend to stop the conference from going ahead and to challenge the corporate control of energy.

The UK Energy Summit plans speaker sessions and debates including CEOs of the Big Six energy companies. The Big Six have recently come under widespread criticism for drawing in record profits whilst one quarter of UK households have been pushed into fuel poverty.

The Summit will take place at The Grange Hotel, near St Paul’s Cathedral. The Climate Justice Collective (CJC)  is linking up with UK Uncut, Occupy London, Disabled People Against the Cuts (DPAC), Kick Nuclear, UK Tar Sands Network, Campaign Against Climate Change, Biofuelwatch, London Rising Tide and Fuel Poverty Action to organise the protest – the Big Six Energy Bash.

Billie Blackwood of the CJC said: “This conference is corporate elites, including the government, conspiring to keep high energy prices, soaring profits, growing climate instability and disaster capitalism. This conference is the wrong people asking the wrong questions and proposing the wrong solutions.”

Katharine Jones, an anti-cuts protester from Manchester said: “The UK Energy summit gives the Big Six an opportunity to push the government further into their pockets. The Government is already worsening fuel poverty through brutal welfare cuts. It’s great that groups like UK Uncut and DPAC are teaming up with climate activists to oppose the corporate control that is driving poverty, austerity and climate crisis.”

Andrew Fisher, LEAP co-ordinator, looks beyond the fluff to discover the real issues in the Budget.

Pasty tax, charity tax, granny tax and even caravan tax – if you live too much of your life on planet Twitter then you’d be forgiven for thinking these were the main issues in the Budget. I admit, as someone who doesn’t tan, I was initially perturbed about a “pasty” tax – until I realised it referred to Cornish pastries rather than a lack of cutaneous pigmentation.

The real stories of the Budget – involving the big billions – were about the more commonly known income and corporation taxes. Osborne gave corporate Britain another cash giveaway: taking corporation tax down from 26% to 24%, and committing in his statement to reduce it further to 22%, with the aspiration of reducing it even further, “so that by 2014, Britain will have a 22% rate of corporation tax ... And a rate that puts our country within sight of a 20% rate of business tax that would align basic rate income tax, the small companies rate and the corporation tax rate.”

This largesse to big business will cost the Exchequer an extra £3.76 billion in the period covered by the spending review. This is on top of the £25 billion in tax breaks for business announced in 2010 which included Osborne’s commitment to cut corporation tax from 28% to 24% over four years.  Now Osborne will cut taxes for big business to 22% over the same period.

It is not as if the previous Government had been loading the tax burden on business either. Under New Labour, corporation tax fell from 33% to 28% – which LEAP estimated cost the Exchequer £50 billion over 13 years.

How does Osborne’s new corporation tax rate compare with other countries? He was kind enough to tell us in the Budget: “A headline rate that is not just lower than our competitors, but dramatically lower. 18% lower than the US. 16% lower than Japan. 12% below France and 8% below Germany. An advertisement for investment and jobs in Britain.”

So it’s more like... Ireland? By coincidence that is a country that Osborne deeply admires. It was Osborne who said in 2006, “Ireland stands as a shining example of the art of the possible in long-term economic policy-making”. The problem isn’t that Osborne said that in 2006, but that he still believes it now! Ireland has been through an even more adverse austerity shock doctrine than Britain, and has slipped back into recession this year.

Slashing corporation tax simply undercuts the tax base and hinders recovery. It does something else too – it redistributes wealth. Lower corporation tax means larger net profits, which go to large shareholders in dividends and to directors in bonuses. These same directors will be laughing all the way home from their banks thanks to Osborne slashing the top rate of tax from 50 to 45%. That will cost £3 billion per year, which will stay in the pockets of the richest 1% in the country.

This was the issue that Ed Miliband led on when he rose in the House of Commons to challenge the Chancellor’s Budget. It was an uncharacteristically forceful performance, coruscating Osborne for cutting taxes for his Cabinet mates and their chums, while doling out austerity for the 99%.

Of course, Ed Miliband went from that to photo ops in Greggs, and jumped on every bandwagon (or should that be caravan?) going. Now he leads the charge against cutting tax reliefs for wealthy philanthropists – from class warrior to woolly liberal in two weeks. It is a snapshot of his leadership – vacillating, inconsistent and ultimately inconsequential.

As for the Budget, the lost corporation and income tax revenue requires other taxes to rise to make up the void and/or public spending to be cut. In a throwaway remark, Osborne casually added that to balance the books “we would need to make savings in welfare of £10 billion by 2016”. This is on top of the £20 billion in welfare cuts already set out and being implemented with much misery and resistance.

What was unique about this comment was that when you delved into the Budget Red Book (the lengthy tome that accompanies that parliamentary pantomime), there was no detail. All you could find is that the precise figure is £10.5 billion and neither Treasury nor social security ministers could say where a penny of these new cuts would fall.

The Budget highlighted that we have an incompetent government waging class war let off the hook by a pallid – some might say pasty – opposition.

• Visit http://leap-lrc.blogspot.co.uk for more economic commentary from the Left Economics Advisory Panel (LEAP).

Mick Brooks, Ealing Southall CLP, looks at how much the banks are costing our economy.

Banking, we are told, is one of the few things Britain is good at. Our manufacturing base has been ravaged, but the City of London is still the greatest financial centre in the world. The financial sector generates a £36 billion trade surplus and provides £53 billion in tax, more than 10% of the total take. We can’t do without it. That is the view of New Labour and the Con-Dem coalition.

Hang on a minute. Aren’t we going through a terrible economic crisis, arguably caused by the banks’ irresponsible lending? Haven’t we spent billions to bail them out? Do we really benefit from the banks?

A year ago the Good Banking Commission (made up of the New Economics Foundation and Compass) did the sums:
“The tax revenues from the finance sector in recent years are offset by the immediate cost of the bank bail-out. In five years up to 2006/7, the finance sector paid and collected £203 billion in taxes, but the upfront costs of the UK bail-out are £289 billion, rising potentially to £1,183 billion.”

We were £86 billion out of pocket by 2007, and the bills keep rolling in. This is just for starters. This is just what the banks paid us compared with what we paid them. The banks also crashed the economy, and that has cost the rest of us a hell of a lot of money – and we’re still paying. Britain, in common with most advanced countries, is actually poorer (in terms of national income per head) than we were in 2007.

Andrew Haldane of the Bank of England tots up these wider costs: “World output is expected to have been around 6.5% lower than its counterfactual path in the absence of crisis. In the UK, the equivalent output loss is around 10%. In money terms that translates into losses of ... £140 billion (for Britain)”.

He gives further evidence to show that, “These losses are multiples of the static costs, lying anywhere between one and five times annual GDP.” He goes on: “Put in money terms, that is output loss equivalent to ... £1.8 trillion and £7.4 trillion for the UK.”

How does this square with assertions that the financial sector is responsible for generating up to 10% of GDP? The figures are a nonsense and have often been disputed. The “contribution” of an industry is usually measured by Gross Value Added. This is easy enough to work out for a car: deduct the price of components bought in from the sales price of the car and you have a measure of GVA. How do we calculate the value added by financial services?

Haldane explains (in The contribution of the financial sector – miracle or mirage?) that the “value added” for loans and deposits is calculated by the difference between the actual rate of interest and a “reference” rate. You are right to think this is a fiddle. You will really smell a rat when you hear that calculations from National Accounts come to the conclusion that the “contribution” of the banks to GDP was at a maximum in the fourth quarter of 2008. This was the time when the banks were on the verge of collapse and the Government was hurling our money at them. Clearly the National Accounts are wrong. Haldane gives the detailed argument why this is the case, but he reckons that the “contribution” of finance to the economy is at best 60% of the official figure.

We do not need the City earnings, not at the price we pay. We cannot afford to keep subsidising the City banks with taxpayers’ money at the expense of ordinary people’s living standards. Four years after the onset of crisis the banks are paying out record bonuses once again, while refusing to lend to hard-pressed working people and small businesses. They are out of control.

Everyone in Britain is completely dependent on the smooth circulation of money. If the banks had collapsed in 2007 and 2008, that would have been a catastrophe for the people of the country. We do need banks – but as a public service. We do not need crazed speculators who, if they lose the bets they have placed with other people’s money, remind us that we have to bail them out – and the banks they work for – because they are too important to fail.

We need to nationalise the banks, to make them servants of the real economy and not our masters. We can’t afford NOT to take them over.

Michael Roberts looks at the human cost of bailing out the banks across Europe.

King Juan Carlos of Spain was flown back from Botswana in a private jet after he broke his hip while hunting elephants.  He fell over on the way to the toilet in the early morning.  Maybe he did not wake up properly: he had told the Spanish public just a few weeks earlier that he could not sleep for worrying about the 50% rate of youth unemployment and the grave economic crisis.  Such is the empathy of the rulers towards the ruled as the impact of the Eurozone debt crisis deepens.  After all, we are all in it together.

The response of Juan Carlos was lack of sleep and shooting elephants.  The response of Dimitris Christoulas, a retired chemist in Greece was more tragic.  The cash-strapped Greek pensioner shot and killed himself outside Parliament in Athens.  In a suicide note found by police, he said: “This Tsolakoglou Government has annihilated all traces for my survival, which was based on a very dignified pension that I alone paid for 35 years with no help from the state… I see no other solution than this dignified end to my life, so I don’t find myself fishing through garbage cans for my sustenance.”

Tsolakoglou is a reference to George Tsolakoglou, a military officer who was appointed by the Germans in 1941 as Greek Prime Minister.  Mr Christoulas correctly identified the nature of the current banker-led Greek Government as collaborationist.  It has agreed to a crippling destruction of Greek living standards, public services and jobs in order to bail out Greece’s creditors, Europe’s banks, insurance companies and hedge funds – and to lie down before the neoliberal policies of the dreaded Troika (the EU Commission, the ECB and the IMF).

Unfortunately, Mr Christoulas’s act is not an isolated one.  The suicide rate in Greece used to be the lowest in Europe, but it has soared during the crisis.  Last year, the number of suicides in Athens alone jumped over 25% from a year ago.  “This is the point to which they’ve brought us.  Do they really expect a pensioner to live on €300 a month?” asked 54-year old Maria Parashou. “They’ve cut our salaries, they’ve humiliated us.  I have one daughter who is unemployed and my husband has lost half of his income.”

This Greek tragedy is now playing out in Spain, Portugal and Italy too as the “bond vigilantes” (Europe’s financial institutions) demand yet higher and higher interest rates for lending money to their governments, while the Troika demands yet more “fiscal discipline” and austerity for the bulk of the people.

Italy’s neo-liberal economist Prime Minister Mario Monti’s appeals for sacrifices (as we are “all in it together”) sound very hollow when Italians find out how their politicians squander their taxes.  In 2007, former Justice Minister Clemente Mastella took his son to see the Italian Grand Prix at Monza.  Instead of driving or taking the train like everyone else, they went by state jet.  The one-day plane ride from Salerno to Milan cost taxpayers 20,000 euros.

Italy has almost 1,000 national lawmakers.  The majority have a base salary of €11,283 per month before tax, plus €3,503 for expenses which they do not have to itemise.  By contrast, the lowest-earning Italian households live on less than €8,000 per year, or €667 per month, after taxes.  The poorest families have already lost almost 12% of their real income between 2006 and 2010, more than double the national average.

Spain is now in the cross-hairs of finance capital.  The Spanish Government has been forced to agree to the most draconian reduction in its budget ever, to try to get the Government’s deficit down from 8.2% of GDP in 2011 to 3% by the end of 2013.  Given that the economy will contract by around 2% this year, there is not a snowball’s chance in hell of achieving that target.  Yet the cost to the Spanish people is immense, with the unemployment rate hitting 24% and average real incomes from work and pensions being slashed, while house prices plummet and rents rise.  The conservative People’s Party, fresh from a landslide victory in a general election, is now demanding that regional governments destroy their services in education and health to meet the Troika targets.

It’s the same story in Greece, Portugal and Italy, where right wing or “technocratic” unelected governments are imposing austerity measures, along with so-called reforms in labour and product markets.  “Reforms” mean destroying employment protection rights; cutting benefits and deregulating markets – yet again!  There is no genuine reform of the system, no programme for investment, employment and growth – and without that, no amount of austerity will revive these economies, let alone get public debt levels under control.  This year, the Portuguese economy is set to contract by more than 3%, Italy and Spain by 2% and Greece by 6%.  Despite the pain inflicted on the Europe’s people, the austerity option is not working.

Soon the Eurozone governments will have to decide whether to provide the likes of Greece, Portugal and even Spain with yet more funding to meet the obligations of their governments and banks to bondholders.  It remains to be seen whether they will cough up enough money to do so, or call it a day with the euro.

The alternative – negotiating a restructuring, or “orderly default” – on all this debt is not even considered.  That’s because it would mean that Europe’s financial sector would not get its kilos of flesh for its shareholders – and yet it is the greed and speculation of finance capital that caused the crisis in the first place!  Ireland’s public sector debt was doubled to bail out its banks after they collapsed when the global property bubble burst.  Irish bank bondholders (European banks, pension and hedge funds) are being paid back in full under the instructions of the Troika, a burden for the Irish taxpayer that will last more than a decade.

The alternative policy of default would have to be accompanied by pan-European public ownership of the banks (wiping out compensation for shareholders and bondholders), so that the banks can provide credit to small businesses and households.  This could be combined with pan-European state-driven infrastructure and environment projects to create jobs and public services, not destroy them.

The current Eurozone governments have no intention of doing any such thing: but their electorates may have something to say about that.  The newly-elected right-wing Spanish PP Government failed to win the recent regional election in impoverished Andalucia, where the United Left doubled its share of the vote to form a coalition with the Socialists.

Even in Italy, neo-liberal economic Prime Minister Mario Monti, heralded as a saviour by the media and establishment when he took the job, has seen his popularity fall fast from 62% to 44%, with now two-thirds of Italians opposing his labour “reforms”.  In Greece, the two collaborationist coalition parties (the conservative New Democracy and the Blairite PASOK) look like failing to gain a majority in the coming election.  Instead, the anti-Troika parties will hold the balance of power and could provide an alternative if they stopped squabbling with each other.

Above all, in France, the Party of the Left candidate, Jean-Luc Mélenchon, has shown the way forward against austerity in a barnstorming campaign for the French presidency (see page 24). Mélenchon has put huge pressure on the Socialist candidate Francois Hollande, who is set to win, to break with Troika policies.  If the left win the parliamentary elections in June, it could increase the momentum for an alternative policy for Europe.  For if there is no break with austerity and the grip of the Troika, Europe faces a decade or even a generation of impoverishment and misery

• See http://thenextrecession.wordpress.com.