Month: July 2025

So You’ve Won Capitalism: An Open Letter To The Billionaires

/ Dr Craig Dalzell / Leave a comment

“Democracy is supposed to be ‘of the people, by the people and for the people’. Capitalism is ‘of the capitalist, for the capitalist’. Period.” – Jerry Ash

This blog post previously appeared in The National.
If you’d like to support my work for Common Weal or support me and this blog directly, see my donation policy page here.

a bird's eye view of a beachfront home

Dear Billionaires,

I think we can all agree that you’ve won Capitalism. If the goal of Capitalism is to accumulate wealth via the canny deployment of capital (yours or someone else’s) for the purpose of spending that wealth on goods and services to improve your own lifestyle then you have been successful beyond measure. As a billionaire, you now possess more wealth than can be reasonably spent by any individual in a lifetime. In fact, you passed that measure a long, long time ago.

Continue reading →

You Have Options Too: An Open Letter to John Swinney

/ Dr Craig Dalzell / Leave a comment

“Squeezing the lives of people is now being proposed as the saviour of the planet. Through the green economy an attempt is being made to technologise, financialise, privatise and commodify all of the earth’s resources and living processes.” – Vandana Shiva

This blog post previously appeared in The National.
If you’d like to support my work for Common Weal or support me and this blog directly, see my donation policy page here.

wind turbines on snowy mountain under clear blue sky during daytime

DEAR First Minister John Swinney,

The UK is running away from the hard choices on energy. Its dismissal of ideas like zonal pricing – ­currently the only scheme yet presented that would allow the UK to maximise renewable energy generation, minimise infrastructure costs like ­pylons and to reduce fuel poverty while giving communities more incentive to take control of their own local energy generation – has been rightly criticised by you last week in a statement where you called out the UK for not doing enough on energy policy.

It was concerning to note, though, that your critique wasn’t backed up by much on what you want the UK to actually do instead. Even as you complained about the UK “ruling out all options to bring down ­energy bills” by abandoning zonal pricing, I’m not clear if you support it or would bring it in if you had the power to do so.

We all know that Scotland’s devolved powers in energy are limited and that, right now, you couldn’t do something like this, but also missing from your critique was what you plan to do with the powers you do have.

Scotland’s own devolved energy ­strategy has been woefully lacking in recent years – from the sell-off of ScotWind at ­bargain basement prices, through ­dropping ­climate targets that were designed to push ­action ever forwards, to flogging off (sorry, “­encouraging foreign direct investment in”) every piece of our renewable energy sector to multinational companies and ­foreign public energy companies to ensure that everyone in the world can profit from Scotland’s energy except us.

We can take another path, though. ­Scotland must ensure that we own our own renewable energy future and the way to do that is by bringing it into public ownership. Here are several ways that you could do it.

1) A National Energy Company

This is what most of us think of when we think about “Scottish public energy”, and it’s the model that the Welsh Government adopted under the name Ynni Cymru. This is a single national company, owned by the Scottish Government or by Scottish ministers (similar to Scottish Water), that would own, generate and sell energy to consumers.

There is a snag to this plan in that the Scotland Act currently prohibits the ­Scottish Government from “owning, ­generating, transmitting or storing” electricity, so if we want the National Energy Company to be based around supplying ­electricity, then the first thing that the Scottish ­Government could be doing is mounting a pressure campaign to amend the Act – it puts Scotland in the ridiculous position that it’s legal for the Welsh Government to own a wind turbine in Scotland but not the Scottish Government.

Until that campaign is successful, there is something you can do.

The Act quite specifically bans your Government from owning electricity ­generators. It does not ban other forms of energy. A National Heat Company based around deploying district heat networks could supply all but the most remote of Scottish households.

While this would be a large infrastructure project, it wouldn’t be larger than the one required to build the electricity pylons we need if we’re going to electrify heat instead and the pipes would have the advantage of being underground and out of sight while ultimately providing heat to homes in a cheap, more efficient and ultimately more future-proof way that the current setup of asking people to buy heat pumps and just hoping that the grid can cope with the demand.

2) Local Electricity Companies

So, First Minister, let’s say that you’re not a fan of campaigning for the devolution of more powers and really want Scotland to be generating electricity. You can’t create a National Electricity Company but you can encourage local authorities to set up their own Local Electricity Company.

Conceivably, the 32 councils could even jointly own one National Electricity Company – the Scotland Act merely bans the Scottish Government from owning the company.

In many ways, this would be an even better idea than the Scottish Government doing it. Government borrowing ­powers are far too limited and you’d need to ­campaign for more borrowing powers to get the scale of action required to build the infrastructure we need – but councils have a trick up their sleeves.

They are allowed to borrow basically as much money as they like so long as the ­investment the borrowing allows brings in enough of a return to pay back the loan. This is very likely how Shetland Council will finance its plan to connect the islands via tunnels – the construction would be paid for via tolls on traffic.

Energy, as we know, is very profitable indeed so there should be absolutely no issue with councils being able to pay back their loans and then to use the revenue from their energy generation to subsidise local households against fuel poverty and to support public services.

If we want to go even more local than this, then councils and perhaps the Scottish National Investment Bank could support communities to own their own energy.

We’ve seen multiple times that community ownership generates many times as much local wealth building – as well as skills and jobs – than the current model of private ownership plus paltry “community benefit funds”.

3) A National Mutual Energy Company

This is another national-scale energy company that the Scottish Government could launch but in this case wouldn’t own or control. Instead, the “National Mutual” would be owned by the people of Scotland.

In this model, every adult resident of ­Scotland would be issued one share in the company. They wouldn’t be able to sell it and they’d have to surrender it if they ever stop living in Scotland, but ­other than this, it would be much like owning a share in companies like Co-op.

The company would be run as any other commercial company and would be beholden not to the Government but to its shareholders – us. We’d jointly ­decide ­future energy strategy and even potentially have a say in how much of the company’s operating surpluses are invested in future developments or distributed to shareholders (again, us) as a dividend.

This model would be particularly suited to very large energy developments that cut across local authority or even national borders or to help develop offshore assets. Imagine ScotWind had been owned by the people of Scotland, instead of being flogged off to multinational companies in an auction that had a maximum bidding price attached.

Conclusion

First Minister, I applaud you for keeping up some sense of pressure on the UK Government on energy.

As we make the necessary ­transitions ­required of us under our obligations to end the climate emergency, this is one of the sectors of Scotland that will change the most. It’s vital that we get this ­transition right, or not only will ­Scotland see yet another generation of energy ­potential squandered in the same way that the coal and oil eras were, we’ll see Scottish ­households bear the weight of others ­profiting from that transition while we still experience crushing levels of poverty and economic vulnerability.

The UK Government may be ruling out all of their options on energy but that doesn’t mean that you need to do the same. We don’t need to wait until independence – as vital as it is – or to wait until Westminster gets its act together – which may or may not happen. We – you – have options too. It’s time to take them.

Yours, expectantly …

How to Launch a Scottish Wealth Tax

/ Dr Craig Dalzell / Leave a comment

“I am opposing a social order in which it is possible for one man who does absolutely nothing that is useful to amass a fortune of hundreds of millions of dollars, while millions of men and women who work all the days of their lives secure barely enough for a wretched existence.” – Eugene V. Debs

This blog post previously appeared in The National.
If you’d like to support my work for Common Weal or support me and this blog directly, see my donation policy page here.

person holding fan of us dollar bill

(Image Source: Unsplash)

“From each according to their ability, to each according to their need”. This used to be the core credo of parties of the Left – particularly the Labour Party in Britain – but it appears to have been eroded to the point of meaninglessness. Wealth inequality is increasing at an unimaginable rate and is currently substantially higher than income inequality. The rich are taking from all of us far more than they need and are giving back far less than what they are able to. This is a self-reinforcing problem such as where people who were able to buy houses when they were cheap (perhaps during Thatcher’s Right to Buy demolition of the social housing sector) became able to rent them out at ever increasing rates to people who can’t now afford to save the deposit to buy a house because house prices are rising faster than they can save due to the amount they have to spend on rent. Even the Office of Budget Responsibility is now warning (as I did several years ago in my book All of Our Futures) of the fiscal risks looming due to the number of people still privately renting when they retire and who will simultaneously be unable to afford to keep paying those rents and won’t have any capital saved in their house to subsidise their inadequate state pensions.

It’s not for no reason that the British public are increasingly demanding that the UK Government brings in a wealth tax to rebalance our increasingly unstable economy. I will say that there are good reasons for the UK to not bring in “a wealth tax” – by which I mean a single annual payment calculated as a certain percentage of the value of all of the assets and possessions that you own. Prof. Richard Murphy has articulated many of them well. It’s hard to value those possessions. Easy to hide them. And there are other taxes that the UK could use – such as reforms to taxes on stocks, shares, pensions and capital gains – that would achieve much of the same result. Not that the UK Government is going to do any of that either unless the pressure escalates to the point that the impossible becomes inevitable.

Let’s say, however, that the Scottish Government wants to take the first step. Could we do it here instead of waiting for the UK?

The patterns of wealth ownership in Scotland are substantially different than in the UK (particularly in London and the South East). We don’t have quite as many financial billionaires floating about the place. We don’t have as much wealth in stocks and shares – mostly because we don’t have a stock exchange in Scotland any more. Our generally lower rates of pay mean comparatively lower rates of wealth stored in pensions. There are, however, two sectors in Scotland where wealth is substantially stored and which could be taxed using devolved tax powers – Land and buildings.

Scotland already has its Land and Buildings Transaction Tax but despite the Scottish Greens seeking to apply what they called a “mansion tax” to it this would remain merely a surcharge on the transfer of assets, not a wealth tax applied to the holding of them. If you never bought another mansion, you’d never pay the mansion tax.

Council Tax is the most outdated and badly broken tax Scotland still insists on inflicting on the poor. The Scottish Government has stated that they’re not even going to think about reforming it until the end of this decade. This is completely unacceptable, especially as the solution is obvious. We need to scrap Council Tax and replace it with a tax based on a percentage of the present market value of the property. Common Weal argued that a rate of 0.63% would have been revenue neutral compared to Council Tax at the time we published the paper. That number could be recalculated now but we estimated then that a “revenue neutral” rate would actually mean a tax cut for eight out of 10 households as the burden of paying the tax would be placed more fairly on those who lived in the most expensive houses. We calculated that the “break even” point then would have been a house worth something like £400,000. This is based one a flat rate of tax too. We would argue that Councils should have the power to add progressive rates on extremely valuable properties like £1mn+ mansions or, as is the case with the current Council Tax, additional multipliers for multiple home ownership.

This would immediately act as a wealth tax both on the most expensive properties but also on multiple property ownership. Unlike Council Tax that is paid by occupants, our Property Tax would be paid by property owners and they could only pass on to their tenants the basic rate of tax. Landlords would have to pay any multiple ownership surcharges themselves.

The second wealth store in Scotland – land – is probably the greatest store of almost untaxed wealth in the country. Many countries tax the ownership of land as a distinct tax from properties built on it (sometimes because of local democracy, for example you might pay the land tax to your municipal government and your property tax to your regional government) but in Scotland there may be good reason to not do that but to simply extend the Property Tax to cover not just the land under and around your mansion but also the broader estate you own with it. Given that the two are often sold together, this will be much easier to put a price on than trying to calculate a separate Land Value Tax. We’ve estimated that doing this at the same flat rate as the Property Tax would bring in around £450 million a year in revenue – though this could be adjusted down to account for subsidies for small farms or up to better tax the 422 people who own half of Scotland.

One of the major advantages of both of these taxes – one that negates objections from both the UK and Scottish Government whenever taxes on the wealth have been suggested – is that it completely bypasses the idea that the rich will simply leave the country. Recent studies have shown that the idea of “millionaire flight” basically isn’t a thing (it’s not just a huge logistical hassle for comparatively little financial gain to pack everything up to go and live in a tax haven, even millionaires have friends and family as do their kids and tearing up those social bonds to save a bit of money just isn’t worth it) but this hasn’t stopped the media pushing that line anyway. Even if it was true, the wealth they have locked up in Scottish land and housing can’t move with them. The tax still needs to be paid by whomever owns them regardless of where they live (and many of the largest landowners in Scotland already don’t live here so the point is particularly moot there).

One of the biggest sources of instability in our current society and economy is wealth inequality. It urgently needs to be reigned in and reversed. If the UK Government persists in refusing to do it then there is at least something that the Scottish Government can do without having to wait for them. And if the current Scottish Government doesn’t want to do it either well, there are elections next year. Maybe politicians could suggest who we should vote for who will?

Four Ideas For Housing Scotland

/ Dr Craig Dalzell / Leave a comment

“The profits were staggering. In 1966, a Chicago landlord told a court that on a single property he had made $42,500 in rent but paid only $2,400 in maintenance. When accused of making excessive profits, the landlord simply replied, “That’s why I bought the building.”” – Matthew Desmond, Evicted: Poverty and Profit in the American City

This blog post previously appeared in The National as part of Common Weal’s In Common newsletter.
If you’d like to support my work for Common Weal or support me and this blog directly, see my donation policy page here.

Màiri McAllan has returned to the Scottish Government after a well deserved period of patient parental leave though has left her former post as Cabinet Secretary for Energy and has been tasked with fixing Scotland’s housing crisis. As a writer of policies on both topics I don’t exactly envy the position but I can at least lay out some of the options I and my colleagues in Common Weal have published over the years on the topic. Housing is about more than homes – as anyone can attest if they have ever objected to a planning application for a new suburban sprawl on the basis that it would add extra pressure to services such as GPs, schools and other public services without adding to provision – but about building a sense of place, of community and about meeting a fundamental human need for shelter. The task is far larger than I can do justice in these few lines of text but I shall offer Màiri four ideas to help fix housing in Scotland.

Actual Land Reform

You cannot build a home without having the land to build on it. This is a particularly acute problem in rural Scotland where despite having the space to build we often cannot access the land due to it being held by mega-estates and is simply not for sale or when it is, the price to buy is being speculated beyond control. We need a land tax and other mechanisms like Mercedes Vilalba’s proposal to cap maximum land ownership. One of the most powerful ideas though would be to allow Councils to buy land at “existing use value”. That is the value of land as it currently is, not an inflated value based on its “potential” for housing or other uses.

Build “Enough” Social Housing

The central reason why Britain’s housing “market” is broken is because we run housing as a market. Thatcher broke the previous system by selling off social housing and making it impossible for Councils to replace them. Social housing should never be the last option before homelessness but the first choice for housing for many. My paper Good Houses for All shows how the borrowing powers of Councils and the Scottish National Investment Bank could build essentially unlimited homes for social rent (Councils aren’t limited in borrowing powers like Holyrood is, so long as the rents are sufficient to pay back the loan). They could be built to the highest possible energy standards to outbid the private sector in both price and quality. And they shouldn’t be built to an arbitrary target of “more houses than the previous government” but based on actual need. Councils should have a waiting list of people who want one of these homes and be resourced to deliver them by a certain date. If we do this, the private sector will be forced to cut rents and increase quality…or their landlords will decide that they can no longer exploit people for a profit and will have to sell.

Fill Vacant Housing

“But what happens to the houses if the landlords sell?” Scotland already has more vacant homes than we have homeless households. Many of those homes are not being sold, but are still being clung on to as a speculative investment because prices are rising higher than costs. We also have even more vacant housing than appears in those statistics because many High Street shops in Scotland have housing units above them that are vacant but are classified as “commercial use” rather than residential. Look above the ground floor in many places in the centre of Glasgow and you’ll start to see them.

Policies like increasing Council Tax multipliers on empty homes and Màiri’s announcement this week of extra vacant housing officers will go a long way towards fixing this. Councils should also be resourced to allow them to use their Compulsory Purchase powers more aggressively – particularly to support them to purchase vacant homes not at “market rate” but at a fair rate that will include consideration of the costs to repair and retrofit the housing up to the standards expected of newbuilds – this will often be far cheaper than building new and therefore will contribute to the solution to the crisis in a much more resource efficient way.

Increase rental building standards

For the housing that remains in private rental hands, we need to continue the work already being done around tenants’ rights, rent controls and quality standards. As hinted above, many private rented houses in Scotland fall far short of energy efficiency and other environmental standards and urgently need retrofitted. France is rolling out a scheme whereby it will be illegal to rent properties that fall below a certain EPC rating and the minimum rating will keep rising every few years. Scotland should do the same. Before those retrofits happen, many of these properties also need to be repaired first (there’s little point in installing solar panels on a leaking roof). The aggressive recapture of housing for social rent mentioned above could also be done with private rented homes that still have sitting tenants if the landlord wishes to sell or is deemed no longer adequately responsible in their management of housing, converting them to social rents and offering a rent-controlled lifetime tenancy to the tenant along with an improving their homes.

Conclusion

The housing emergency in Scotland is perhaps second only to the climate emergency that Màiri was familiar with in her previous brief. The two are, in fact, interrelated and can’t be solved separately. What won’t solve it is shovelling more money into the maws of private developers under the guise of “affordable housing” that is barely either. It’s not going to solved by a single tweak anywhere or even if we only do everything on this list but every step we take will lead to more people living more affordably and more securely in a country that can more than afford to provide that but for too long hasn’t by design.

Continue reading →

What Scottish Independence Could Deliver For The Welfare State

/ Dr Craig Dalzell / 1 Comment

“How much time he gains who does not look to see what his neighbour says or does or thinks, but only at what he does himself, to make it just and holy.” – Marcus Aurelius

This blog post previously appeared in The National as part of Common Weal’s In Common newsletter.
If you’d like to support my work for Common Weal or support me and this blog directly, see my donation policy page here.

Back in the early days of Common Weal, while we were still finding our feet and building our reputation, we had an informal rule when it came to policy-making. We had to be able to show the policy working somewhere else.

This was because we felt that Scotland simply wasn’t ready for some of the radical ideas that we wanted to implement so being able to show it already working was a good way of building confidence in a nation too often told “we cannae dae it” (by which our opponents often mean “we shouldnae dae it” which is a different thing entirely).

We’ve since dispensed with that rule and we sometimes broke it even then (one of Common Weal’s very first policy papers, “In Place Of Anxiety”, was an advocacy for Universal Basic Income (UBI) long before it became one of the “cool” policies) but this isn’t to say that we can’t learn lessons from elsewhere.

Just this week, I was asked by a researcher which of our neighbour nations I’d like Scotland to copy if I could. My answer was that we shouldn’t copy any one but that I take a lot of inspiration from Germany on local democracy, from Denmark on energy strategy and from Norway for public ownership. Somewhere else we could do with taking inspiration from our neighbours is on social security.

The scenes this week from the UK’s attempts to hammer the poor and disabled and only backing down after shambolic chaos in the Parliament should be a lesson not just in humanity but in policy-making as well. Never fight a battle you haven’t won in advance. Never assume a large on-paper majority means certain absolute power.

With many of our neighbours basing their politics on proportional representation and coalition politics, this kind of legislation would have undergone a lot of negotiation and compromise long before arriving at the voting chamber.

The way that many of our neighbours deal with the issue of social security is markedly different from the UK in several ways. The first is that the systems are a lot more generous in general. Norway, Denmark and Sweden rank in the top three OECD nations for spending on disability protections at above 3% of GDP while the UK is well below the OECD average at less than 2%.

Many more social securities like unemployment protections follow a different model from the UK when they are calculated. In particular, instead of the flat rate paid under the UK’s Universal Credit, many countries follow a model where the protection you receive is based on a percentage of your previous income.

There are consequences to each of these models. A flat rate tends to be more redistributive if it is generous enough (which Universal Credit isn’t) whereas a proportional rate tends to be less disruptive to an individual who is already going through the shock of losing their job while still having bills to pay.

We’ve seen these impacts in the UK too. During the pandemic, the Covid furlough scheme was paid at a proportional rate to people who were employed but was often paid at a flat Universal Credit rate to self-employed people. This exposed a lot of people who were previously on the side of denigrating poor and vulnerable people as lazy slackers to just how meagre and cruel the UK “benefits” system is.

We had an opportunity then to get some serious change off the back of that and maybe we still see echoes of it in this week’s chaos but largely the Powers That Be wanted to make us forget that moment of reflection as quickly as possible.

On the other side and as tempting as it might be to copy a European-style unemployment insurance based on previous income, and as beneficial that would be to people in well-paid but otherwise insecure jobs, we have to remember that many people are not in well-paid jobs and that wage suppression has been rife in the UK for decades. Receiving 60% of your previous income when you were being paid poverty wages won’t protect you from poverty in unemployment.

So maybe rather than Scotland – particularly an independent Scotland – copying existing social security policies from our neighbours, we need to look to them for inspiration in another way and look back at that paper I mentioned at the start of this column.

Last year, the EU think tank the Coppieters Foundation published a paper called “A European Universal Basic Income” which found that a UBI sufficient to eradicate poverty across the entire union could be entirely paid for by relatively modest changes to income tax and the savings found from the reduction of poverty itself.

Its model called for a UBI of €6,857 per year for adults and half that for children under 14. This is the equivalent of £113 per week for adults and £57 per week for children. The paper claimed that the increase in income taxes to pay for this level of UBI would themselves be relatively modest and the “breakeven” point for people who’d pay more income tax than they’d receive in UBI would be at around the 80th percentile.

In other words, eight out of 10 people would be directly better off with the UBI. And, to repeat, while this is still a relatively small sum per person if you have no other income, it would be enough to eradicate poverty across the entire EU and would be cheaper overall – after the health, crime and social inequality costs of poverty are factored in – than the current systems.

When this paper came out I argued that this meant a UBI was now a moral imperative because it was cheaper than the cost of poverty, but there’s clearly a financial imperative too. Whether we’re discussing an independent Scotland seeking to create a better country for all of us or even just a cynical UK trying to save money in the face of a humiliating attempt to crush the poor, here is a solution we should all support. Eradicate poverty, save money, implement a Universal Basic Income.