Economics

Use energy to win independence, rather than independence to win energy

/ Dr Craig Dalzell / Leave a comment

“The problem with the idea of cause and effect is that what is deemed the cause is an effect.” –  Mokokoma Mokhonoana

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.

Scotland doesn’t need independence to start owning our own energy.

It feels like 2025 has come full circle for us at Common Weal. January started for us with an announcement from the Scottish Government that it was “not possible” to bring Scottish renewable energy into public ownership – an announcement made after the publication of a poll showing that more than 80% of people in Scotland favoured them doing so. We responded with a briefing paper called “How to own Scottish energy” which laid out the logic behind their announcement, why that logic was flawed and how they could bring energy into public ownership despite their own objections.

In short, the Government’s stance is based on an extremely narrow reading of the Scotland Act which actively prohibits the Scottish Government or Scottish Ministers from owning electricity generating, storage or transmission assets. Under this reading, there cannot be a “National Electricity Company” designed and owned in the same way as some public corporations in Scotland like CalMac or ScotRail.

However, we showed in our paper that various options were not blocked by this prohibition. For example, a Minister-owned “National Heat Company” could be designed to build and own district heat networks to keep us all warm (the prohibition is specifically about electricity, not other forms of energy). The Government could also build a National Energy Company and hand ownership over to a consortium of Scotland’s 32 Local Authorities. Or each Council could own their own energy companies. Or the Government could back the creation of a private energy company that is mutually owned by every adult resident of Scotland. Or, instead of complaining about the limits of devolution, they could be applying pressure on the UK Government to amend what is very clearly a completely obsolete prohibition in the Scotland Act (especially as a narrow reading of it also prohibits the Scottish Government from erecting solar panels on its own buildings).

Come forward now to December and the SNP have kicked off their 2026 election campaign with a new paper essentially saying the same thing as they did earlier this year except framing it around “we’ll do it, but only after independence”. On public ownership in particular, they aren’t advocating for the full-scale nationalisation of energy but their ambition appears to extend only to communities owning up to 20% of local renewable projects.

20% is far better than the current level of a rounding error above 0%, but it’s clear that even within devolution, the Scottish Government could do far more than it’s currently doing to support communities by giving them grants and loans to purchase stakes in developments, to pressure developers to sell or grant those stakes to communities as a condition of planning permission or the renewal of licences and to actively use opportunities like the “repowering” of developments, the end of their licence periods and break-clauses in contracts that would allow poorly performing developers to have their licences withdrawn and transferred to public bodies (in much the same way as the Government took ScotRail back from Abelio in 2022)

This doesn’t get the UK Government off the hook though.

Their recent announcement that some £28 billion will be added to consumer energy bills to pay for vital energy grid upgrades is going to stick in the craw of people whose energy bills are already too high. Worse will be that most of the profits of that investment will flow into multinational companies – including foreign public energy companies – with none returning to the consumers themselves. These investments, too, should be made on a staked ownership basis so that the people paying for them – us – should become shareholders in the investments and see a return on our investment. To make things perfectly clear, if the UK Government had announced that it was going to fully publicly own the assets built via this spending, then the added costs on your bill would be the same. In other words, the choice to publicly own the UK’s new energy assets will cost you the same as the choice to leave them in private hands.

“Can’t we use our public owned energy to help win back our independence, rather than claiming more weakly that we can use independence to win back our energy?”

The same will be true of assets in an independent Scotland – but given the Scottish Government’s “all in” approach to “inward investment” (something their plan published this week mentions more often than public ownership), I can completely see them making the same mistake and forcing us to pay for assets that someone else will profit from.

I freely admit that there are aspects of Scotland’s energy transition that are not in Scotland’s hands and which are not likely to be easily negotiated away as part of an adjustment to devolution such as Scottish consumers being forced to pay for extremely expensive and risky nuclear projects that even NESO (formerly, the National Grid) now says are not needed to meet Green energy targets but this does not let the Scottish Government off from making the changes it can make now rather than using the dangling carrot of independence as a means of delaying action. If anything, independence will come less from making a promise that might be fulfilled afterwards but by taking tangible actions now that push devolution to the limit and then saying to voters “if you want more, you know what to do”.

If it truly is, as the Scottish Government says, Scotland’s Energy – then shouldn’t we take back as much as we can now as use that as leverage to win the rest? Can’t we use our public owned energy to help win back our independence, rather than claiming more weakly that we can use independence to win back our energy?

When banks own housebuilders, house prices go up

/ Dr Craig Dalzell / Leave a comment

“A banker is a fellow who lends you his umbrella when the sun is shining, but wants it back the minute it begins to rain.” – Mark Twain

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.

The way we build houses in the UK could be costing you an average of almost £67,000. This could be fixed by making housebuilding a public infrastructure project rather than a means for very rich shareholders to transfer your wealth to themselves.

Volume housebuilder Taylor Wimpy released its annual report for 2024 yesterday and the details in it, which look excellent from the viewpoint of a corporate shareholder, reveal much that is broken with the UK’s housing sector.

The first important number in their report is the number of houses completed. Taylor Wimpy is one of the UK’s largest volume housebuilders – likely to be in the top three this year in terms of completed projects – yet built only 10,593 houses in 2024 – a substantial reduction over the previous three years (though they claim to be on track for about 14,000 this year).

The second is their claimed operating pre-tax profit of £416 million. The word “profit” is a very fluid term in the world of corporate accountancy as it’s relatively easy for companies to move money around via “one time charges”, inflated director bonuses or “loans” to subsidiaries or parent companies, so a better number to judge a company like this is the money it granted to its shareholders as a dividend as this represents money extracted from the company and not reinvested in any way (not even in the form of the labour of those hypothetical overpaid directors). The dividend for shareholders in 2024 was £339 million.

This means that the houses built by Taylor Wimpy in 2024 generated a dividend to shareholders of an average of almost exactly £32,000 per house. This is how much lower house prices could have been had the company not been in the business of extracting profits via dividends. Had the company been a not-for-profit business entirely, then its houses could each have been almost £40,000 cheaper.

It gets worse for you, the house-buyer, because it’s very likely that you’d be taking out a mortgage to buy that house and you’ll be required to pay interest to the bank on that loan. £40,000 added to a 25 year mortgage at 4.5% interest will result in you paying back £66,700 over that time. To say again, this isn’t the cost to you for paying for anything to do with the construction of the house itself. This is the cost to you for paying interest on the additional loan you took out to pay for the profits of the company, most of which were paid out as dividends to the company’s shareholders.

And who are those shareholders? Our old friends, US based asset managers BlackRock and Vanguard Group are near the top of the heap, owning about 15% of the company between them. Several of the other owners are banks like HSBC and Barclays. This means that if you have a Barclays mortgage, then part of the interest you are paying on your mortgage is being used to service the loan you took out to pay the dividend they gave to themselves to inflate the price of your house.

If Scotland had a National Housebuilding Company as we’ve advocated for the best part of the last decade, then we could be building houses at as close to not-for-profit as possible and could reinvest any surpluses into other public infrastructure to make the places around our houses and the services we need in our community more resilient.

If we built the houses to the plan proposed in Good Houses for All, then they would be constructed at a far higher quality than the conventional timber frame “diddy boxes” (our Board Director and premier architect Malcolm Fraser’s not-so-affectionate name for them) favoured by the volume development sector and would force remaining private developers to drastically improve the quality of their constructions (doing so wouldn’t even reduce their profits because such buildings are now cost-competitive with the diddy-boxes and then create further savings in terms of energy costs).

“If the whole of the UK brought in a Land Tax equivalent to our suggested baseline value of 0.63%, then Taylor Wimpy would owe an additional £2.14 million per year on its banked land”

A final point to note in their report is the amount of landbanking they do. Landbanks are when a company buys up land but then does not build on it for an extended period of time (or sometimes never, or the land itself becomes a commodity to be traded between companies). The report states that the company currently owns £3.4 billion worth of land spread across 79,000 “short term plots” and 139,000 plots in their “strategic pipeline”. They also purchased more plots last year than their number of completions so the total size of their landbank has increased. Given their completion rate over the past few years, they could stop buying land for around 20 years without risking running out.

Decreasing the supply of land without putting it to the intended use of housebuilding is a major factor not just in inflating the price of land but also actively preventing land from being used for building either by other volume developers, by Local Authorities or even by enterprising self-builders. Scotland should consider bringing in a Land Tax to charge companies for the land they own and should consider an additional surcharge on the land tax to account for vacant or landbanked land (which would encourage developers to build so that they can get the land off their books). If the whole of the UK brought in a Land Tax equivalent to our suggested baseline value of 0.63%, then Taylor Wimpy would owe an additional £21.4 million per year on its banked land – still a small fraction of its overall profits.

The way we build houses in this country is badly broken and has resulted in volume developers constructing cheap, cold, damp houses that are not fit for the purpose of living because the purpose of the houses is to extract wealth and deliver it to shareholders. Until we move to fix that and to end the financialisation of housing, we’ll all keep paying a very real and very substantial price for the roof over our head.

SNP Members back Common Weal’s public energy strategy (again)

/ Dr Craig Dalzell / Leave a comment

“All the mega corporations on the planet make their obscene profits off the labor and suffering of others, with complete disregard for the effects on the workers, environment, and future generations. As with the banking sector, they play games with the lives of millions, hysterically reject any kind of government intervention when the profits are rolling in, but are quick to pass the bill for the cleanup and the far-reaching consequences of these avoidable tragedies to the public when things go wrong. We have a straightforward proposal: if they want public money, we want public control. It’s that simple.” – Michael Hureaux-Perez

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The SNP members at their conference this month backed a major energy motion supported by the SNP Trade Union Group (TUG). This motion was developed in consultation with the STUC and with energy experts including myself and deeply integrates several aspects of Common Weal’s proposals for reform of the Scottish energy sector – including by moving forwards plans to bring energy into Scottish public ownership.

The motion was passed by acclaim and without objection meaning that this is now the fourth time that the SNP members have voted for an energy motion including public ownership at their national conference – each time achieving overwhelming or unanimous support. You can watch the presentation of the motion starting from the 1 hour 10 minute mark here.

The motion itself (pictured above) focusses on six key areas which are worth explaining in some detail.

1. Achieving Equity Stakes

Something that Common Weal has long advocated for is for the Government to stop just handing money to very large, often already very rich, companies in the form of tax breaks, loans or outright grants is no longer appropriate for a renewable energy sector that has for many years now demonstrated the ability to make a profit without public subsidy. At the same time, we’ve been shouting for some time about the obscenely high level of foreign ownership in the Scottish economy – particularly within the fundamental economy like energy.

Instead of just throwing money at the sector, the Scottish Government should demand equity – ownership shares – in return for public money and should even demand a public equity share as a precondition for planning permission or the granting of option rights in projects like the successors to ScotWind. Denmark recently did precisely this, calling for a minimum 20% public stake in offshore renewable projects.

This is, of course, a bit easier for Denmark as they have several publicly owned energy companies who, by definition, meet that stake simply by doing their job. Scotland – starting from the position of not having a public energy company – may have to take a position similar to that of GB Energy, being a kind of silent investment partner who merely provide the money and take the profits rather than taking an active role in developing the project.

However this should be merely a first step where small stakes are used as a training ground to build up the experience needed for the Scottish energy company to start joining projects as a co-developer, start to bid for projects on their own and then to move to a “no bid” process whereby the Scottish energy company simply start running all new Scottish energy projects by default.

The second part of the proposal is important for the initial “silent investor” stages. It would not do for the Scottish Government to be effectively investing in and buying ownership stakes in companies who treat their workers unfairly, so this provision would be an additional incentive for companies that if they want the support of Government then they have to meet a minimum standard of workers’ rights.

This is the approach the Scottish Government took to distinguish themselves from the UK with their “Green Freeports” which does show that the Fair Work principles are themselves not strong enough and might be of limited actual impact, but they do still represent a floor below which Government-supported jobs should not fall.

2. Appropriate ownership limits and break clauses

One of the things we discovered when researching for our second ScotWind paper was the discovery that the lease terms for offshore wind projects can stretch into multiple decades despite the turbines themselves reaching “breakeven” and starting to make a profit sometimes after only five or seven years or so. The “NR4” round of offshore wind in England promised a 60 year lease period for wind turbines.

With a normal lifespan of 20 to 30 years, this means that the lease would cover the operational lifespan of two or three generations of such turbines and if the five year payback period is achieved, then the lease could generate up to 50 years worth of energy profits.

Our default position is that until Scotland has the capacity to manufacture and install turbines ourselves then it’s fine to hire a developer to do it for us and perfectly acceptable for them to expect to recoup their investment and make a reasonable profit but that after a lease period that is as short as practical (say, ten years), ownership of the turbine should then be transferred to Scottish public ownership.

There is a caveat here. If the turbines have a 20 year lifespan, then nationalising them on year 19 would effectively just mean letting the corporations take all the profits and then socialising the decommissioning costs (much like what has happened with the Scottish oil sector).

In addition to a short lease there should also be strict break clauses whereby if the developer does not meet minimum standards such as on workers’ rights or if they break promises to invest in local supply chains or otherwise no longer meet reasonable standards as an operator in Scotland then the Government should activate a break clause in the contract, pull the lease in and give it to a Scottish public operator – this is precisely what the Government did in 2021 to nationalise ScotRail.

This is also how Scotland effectively nationalises all of our renewable energy for no cost to the electricity consumer. All we need to do is ensure that the current generation of generators are brought into public hands soon enough that they can pay for their replacements. This doesn’t just need to happen at a national scale with large developments like ScotWind. This can scale down to the community level where communities should be able to take over small onshore wind and solar farms.

That a community in Scotland recently failed to take over their local wind farm because a Scottish public body didn’t even consider the possibility of this shows how badly out of step Scottish policy is with the will of the people right now (I’m told that the community in question is now in the process of trying to buy out the land under the turbines so that they’ll get the rent from that and will control the next round of leases in the future – good luck to them).

3. Local supply and retrofitting

There is a massive mismatch between the Scottish Government’s energy supply policy and their energy demand policy (such that the latter exists). We all recognise that the climate emergency means that we need to use resources more efficiently. We also recognise that the vast majority of fuel poverty is caused by the fact that we need so much fuel to heat our homes. New buildings could be (but aren’t being) built so that they use an absolute minimum of energy (a properly built Passive House can use less energy to heat in a year than yours does in a winter month).

Transport policy could also be built to minimise energy use via much greater use of public transport for the vast majority of people. That traffic jam your stuck in where every car has an average of 1.1 people inside it is just about the least efficient way of moving people that could possibly be devised. Turning that traffic jam from a queue of fossil fuel burning cars into one of electric cars might be cleaner, but it’ll still double Scotland’s current electricity demand (inefficient heating would double it again).

So this part of the motion aims to double down on efforts to retrofit buildings and to boost local supply of materials to do so (for instance, the vast majority of sustainable insulation made from things like cellulose is imported into Scotland despite so much of our land being covered by monoculture sitka spruce plantations)

This week in one of our daily briefings (sign up here to get a short article on a news story that caught our eye every weekday) was on the story that one of the UK’s insulation projects had failed so badly that 98% of homes covered by it need to get it ripped out and redone. We outlined how to do this kind of work better not by relying on throwing money at companies and then not checking their work but by establishing the task as a public works infrastructure project to properly coordinate it and make it cheaper and more efficient to do. This plan has won favour at previous SNP conferences but, as with so many of our plans for public infrastructure, has been ignored by the leadership.

4. Establish an energy company

The SNP membership has supported a Scottish public energy company since we started lobbying for it in 2017. The SNP leadership has had to be dragged kicking and screaming towards that support too. The first Scottish Government plan for a Scottish electricity retail company fell afoul of a UK energy market that overwhelmingly favours large cartels over small providers and, as we warned at the time, an energy company that lacked its own generators and other assets would be entirely at the mercy of global energy price spikes. That proposal was dragged along without the reforms we warned would be needed until it was scrapped in 2021.

Earlier this year, another push from members to get the policy back on the books was blocked by the Government under the excuse that it couldn’t be enacted under the limits of devolution. We responded with a paper laying out six ways that Scotland could own Scottish energy assets under devolution – including via a network of municipal energy companies or via a National Mutual model where Scottish residents are shareholders in the company instead of Scottish Ministers (which is the actual thing that the Scotland Act blocks).

“The excuse that Scotland simply has to let “Foreign Direct Investment” suck our country dry, again, isn’t washing any more.”

This paper forms the heart of this part of the motion and we’re very happy that the SNP conference unanimously supported it. It is now clear SNP policy that Scotland should publicly own Scottish energy assets via whichever means that Devolution allows. I would favour either the Mutual model where the company is collectively owned by all of the people of Scotland or, failing that, by a National Energy Company collectively owned by the 32 Local Authorities.

Either way, the NEC should be combined with a mandate for the NEC to actively support municipal and community energy companies – co-investing with them in Public/Public Partnerships to help them bootstrap each other up to the point where the larger scale proposals outlined above like taking over existing developments at end-of-lease or outright developing ScotWind-scale projects becomes viable.

What is clear now is that the Scottish Government has run out of excuses. Their refusal to adopt a policy of publicly owning Scottish energy has not more legislative barriers left and now flies directly in the face of the will of their own party. I would expect to see their upcoming election manifesto reflect this will and, should the SNP be part of the Government after the elections, I expect to see proposals to bring about the NEC laid down and developed with all possible speed.

5. Invest in training and a Just Transition Jobs Register

The Just Transition is not going well. Despite the best efforts of polluting megacorporations to try to ride their climate emergency through just a few more quarterly shareholder targets, people are leaving the sector in Scotland either through choice or – as the closure of Grangemouth has highlighted – through the choice of others. However, we’re not seeing these skilled workers move into the renewables sectors at anywhere near the rate we need.

A policy passed at SNP conference a few years ago was the idea of a Just Transition Jobs Register. This would track how many people where being employed in the fossil fuel sectors and in the renewables sectors, would measure how many people were moving from the former to the latter each year and would actively seek to improve pathways to increase that flow. When the policy initially passed it was, again, completely ignored by the party leadership so its inclusion here in another motion must serve to highlight its importance.

6. Putting Communities and Workers First

Where the Just Transition is happening it’s too often being seen as a thing to do to workers, not as a thing for and by workers. I’ve seen corporate “Just Transition” plans that were entirely designed to transition the /company/ to a more sustainable footing but did so by replacing older workers with new apprentices rather than retraining existing staff. Meanwhile, studies like the one done by Platform in 2020 show that workers in the affected sectors already have very good ideas about how they’d like to see a transition happen while highlighting their concerns that they lack the power to do it.

Communities have similar ideas but also lack power. There are growing concerns about the flood of renewable developments in and around communities or the rise of electrical pylons designed to shunt energy past communities who are suffering from fuel poverty while not receiving any of the benefits of hosting the infrastructure. Even a plan such as ensuring that solar panels are built on houses and brownfield sites before taking away amenity space or Common Grazing land from locals would go a long way to helping people buy into the transition rather than turning against it because they see their environment transformed only to benefit companies and landowners.Conclusion

This motion represents a major victor for Common Weal’s influence within Scotland’s political circles but it’s an even bigger one for SNP members who have voted, again, for policies like this despite the party leadership trying to tell them that it couldn’t be done. The excuse that Scotland simply has to let “Foreign Direct Investment” suck our country dry, again, isn’t washing any more.

This isn’t merely an issue confined to the SNP, however. The other progressive parties in Scotland are all overwhelmingly in favour of policies like this too. It would be a Courageous Decision (in the Yes Minister sense) for leadership to continue to ignore not just the will of a majority of Scottish voters on this issue but the unanimous decision of their own party’s membership at their own conference.

Which hasn’t stopped them up till now – and therein lies the issue even with motions like this. There is still a vast gulf between “what members instruct their party to do” and “what the party actually does” with very little in the way of accountability or oversight to bridge that gap.

This is a problem in all political parties and may be a fundamental problem with political parties that limit their ability to manage a democratic government. The solutions to that are probably a topic for another time, but until then I encourage the members who supported this motion to make their voices heard. Do what you can to ensure that its principles make it into the upcoming manifesto. Do what you can to ensure that your local candidates support those principles. And make sure that they understand that your support of their election is dependent on them listening to their members.

And the message to other parties: If the SNP won’t do this despite that election, who will? Perhaps you?

Private Equity Ate My Cats’ Lunch

/ Dr Craig Dalzell / Leave a comment

“The standard private equity playbook: jawbone the unions, cut costs even at the price of damaging longer-term success, do a sale-leaseback of real property assets, take whatever public money you can get from communities eager to save their industries, and do an “add-on”—the Indiana Glass buy. And collect fees.” – Brian Alexander

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Regular followers will know of our three Policy Podcats (we still miss you Jinx) who were frequent uninvited guests on the old Policy Podcast. Being cats, they’re generally quite picky about the food we buy for them and it took us a while to settle in with a company that they liked. Last month, that company went bankrupt after 50 years of trading and after just a few years of being bought out by a private equity firm.

Private equity is a parasite on the already unwell body that is consumer capitalism. It takes the logic of capitalism to its furthest extreme and is designed to supercharge the extraction of value from a system that is already designed to extract (not create) value.

The version of capitalism that you’re probably thinking of runs something like this. I, a Capitalist with access to some degree of wealth, am able to invest that wealth into some kind of venture. Perhaps I’m particular passionate about the production of widgets and wish for everyone to be able to buy them.

So I build a widget factory, stock it with widget-making machines and hire people to run those machines. I pay people for their time, but ultimately the value I create by buying materials for the widget factory and selling the widgets is mine to disburse as I please. If my factory makes a profit, I make money.

Marx lived in that kind of world and pointed out that while the Capitalist owned the machines, it’s the workers who run them who actually create the value – they are the ones who produce value through their labour. Without their labour, the machines don’t run (though the rise of automation may be changing that assumption).

However, so long as the workers don’t own the capital, they don’t have the power to deploy that capital and thus are ripe for exploitation by those who own but do not labour. Communal ownership – Communism – was his solution to that imbalance as workers would share in the risk of the business but would also share in the power granted by it too.

It has been shown even in today’s world that worker ownership of businesses in Scotland results in better working conditions, better worker morale and higher productivity. We don’t live in a mostly Communist world though and so Capitalism ended up moving to the next stage in its development.

You see, while I, the Capitalist, can make a fair bit of money by building a widget factory then buying and selling widgets, that’s still a lot of work and a lot of risk. Under market capitalism, other people can build widget factories and maybe their widgets are better than mine, or cheaper, or they have better advertising and they end up selling more than I can.

It would be faster and easier to look for someone who has already built a factory and buy it from them. Maybe I could buy several and merge them together. If I buy ALL of them, then I have a monopoly and can control the market. Even if I don’t get all that way, then I can at least split the market between as few of my friends as possible and we can fix prices together.

Capitalists have always hated “free markets”. What they want are cartels and monopolies. This is how we get the situation where, for example, virtually all luxury sunglasses – regardless of their “brand” – are owned by the same company.

“BlackRock owns about 5% of just about every company on the planet that issues enough shares to attract its attention.”

But what if there’s an even faster way to wealth? We could, for example, not own a single factory but instead buy a small share in all of the factories. Not enough to need to bother with the responsibility of actually doing anything with them, but enough to extract a small profit from all of them.

Asset Managers like BlackRock and The Vanguard Group make billions this way – BlackRock owns about 5% of just about every company on the planet that issues enough shares to attract its attention. It’s very telling that when the world was very concerned about the monopoly power of the merger of computer software giants Microsoft and Activision, BlackRock already owned shares both of them and so could continue extracting its passive income regardless. That one company extracts about $20 billion every year from the global economy without having to do much to earn it.

But what if there was an even faster way to make a LOT of money? Enter, the world of private equity.

Unlike the more passive actors like BlackRock, private equity firms take a much more active role in the companies they own and to do this effectively, they need to own substantial fractions of them – perhaps owning them outright. Unlike a Capitalist buying out their competition though, they tend to spread themselves across multiple sectors. Crucially, unlike the widget entrepreneur, they are much less attached to the output of the widget factory than they are about the profits they can extract from it. Those profits can and should be boosted as much as possible, as quickly as possible.

And one way to do that is to cut costs – fire half the workers and get the other half to work twice as hard. Maybe even replace them with robots that make widgets of questionable quality, but don’t need to be paid at all. Cut materials. Cut research funding into the future of widget development. You could even take more money from the company than they actually make in profits – get them to remortgage all of their buildings and max out their credit cards then give you a “loan”.

This is why you see so many companies that were previously profitable suddenly start racking up massive debts when they’re bought by private equity. And when it gets too much and the banks start calling in those debts, you can make one last round of profit by firing everyone and selling the company’s assets for parts. What was once a profitable widget factory becomes a debt-ridden shell of itself and collapses.

This is what appears to have happened to the podcats’ food company. There’s a happy ending for them in that we’ve managed to source another company and the picky little furballs are eating it just as happily, but the march of private equity through the ruins of their own making continues.

Scotland needs a better way of managing its manufacturing and service economies. We need more in the way of sustainable and equitable investment. If you saw our daily briefing this week on the warnings about losses at the Scottish National Investment Bank you can see some of what we’d like to see – less parasitic profiteering and more patient finance, so that we can have an economy that works for All of Us, rather than just allowing a few already-rich folk to “win” capitalism at our expense.

What I’d Sacrifice For Wellbeing

/ Dr Craig Dalzell / 1 Comment

“Equality is not a concept. It’s not something we should be striving for. It’s a necessity.” – Joss Whedon

This is a transcript – edited for text medium – of the speech I gave at the Independence Forum Scotland Conference in Perth on the 14th of June 2025

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Image Source: Independence Live

The previous speaker posed us the question of what would it look like to bridge the gap between defining a Wellbeing Economy and achieving one. I’m going to try to look at that problem through the lens of sacrifice.

Those opposing economic change often frame the transition away from the status quo as causing us sacrifice.

Whether it’s sacrificing something abstract like the idea that “GDP Growth will make you rich”, even though it hasn’t.

Whether it’s “The climate transition will force you to give up your conveniences”, as if the only way to live sustainably is by moving into the forest, gathering berries and being robed in hemp homespun like some kind of hedge witch (actually…that sounds good…)

It’s sometimes even the outright conspiracy theory level of “15 Minute Neighbourhoods will take away your freedom to drive for 45 minutes to find a post box, if you can get past the military checkpoints at the end of your street”.

But what if a Wellbeing Economy wasn’t about sacrificing anything we’d miss? What if it actually was about fixing the things that are wrong with the way we live today?

In the next session you’re all going to be asked the question “What does a wellbeing economy look like?”. I’d like to throw in a few ideas here about what it means to me but looking through the eyes of what I might have to sacrifice to get there.

First – the daily commute. I’ve already sacrificed that. I’ve worked from home since the pandemic. I know. I get the privilege. I have a job that can be worked from home and, more importantly, I have a home that can be worked from. Not everyone who has the former has the latter. I’m a homeowner so I could modify my house to retrofit in an office. Renters in Scotland often can’t. Renters in Germany have the right to make reasonable modifications to their home though. So maybe we need to sacrifice the kind of landlord lobby that holds Scotland back and builds a housing sector for their profit rather than our wellbeing.

On the commute itself, the Scottish Government recently ditched its target of reducing car miles after being told they weren’t doing anything to meet it. The extra pollution this failure will result in will sacrifice people. That’s not a wellbeing economy.

Second, still on houses, I’d like to sacrifice my heating bill. Our housing sector is built for developer profits too, so we get cheap, crap, cold, damp houses that are hard to repair and retrofit. And we have a retrofitting strategy built around dumping the responsibility to fix things on you, rather than treating this as a massive public works infrastructure job for the public good.

I’d like to sacrifice buying things. The biggest mindset shift we as a society went through in the last twenty years was from “I need a thing, I’ll walk down the High Street and buy one” to “I need a thing, I’ll drive to the out-of-town outlet to buy one” to “I need a thing, I’ll buy it from Amazon Prime and have someone with a crap job deliver it to me tomorrow”. The next mindset shift needs to be “I need a thing, I’ll walk down the High Street and borrow one from the library”. The Scottish Government made a promise to the 2021 Climate Assembly to deliver 75 new Tool Libraries by the end of 2024. They only delivered 9. And the Minister at the time told me that they knew that 75 wasn’t enough to create that mindset shift but that they “hoped that the private sector would fill the gap”. Guess what. It didn’t.

While I’m down the High Street, I’d like to sacrifice the Thatcherist mindset that “there’s no such thing as society”. That mindset has actively pushed society out of our lives in favour of consumerism. Think about your community. How many of you can think of a space that you can go to, where you have a reasonable chance of accidentally meeting someone that you know. And it’s a place where you can exist for as long as you like without the expectation of buying something?

The protests over the removal of the steps in Buchanan St in Glasgow are emblematic of this. Let’s face it. Those steps aren’t particularly nice. It’s not a green urban nature reserve – it’s bare stone. They’re not comfy to sit on. It’s in the middle of a walking route. But they are a place to be in the middle of the city where you can gather and not buy and consume. They are a focal point for protest and organisation more generally – if that’s not “society”, what is? Glasgow Council keeps wanting to turn them into shops. I wonder if that plan is about suppressing protest more than it’s about encouraging consumerism.

It’s about sacrificing need and poverty. I want to see a Job Guarantee so that everyone who wants to work can work. But I also want a Universal Basic Income so that no-one needs to work, even if they want to. That need is what really keeps us poor. Keeps us powerless because it keeps us working for crap wages and bad conditions because if we don’t, we’re told that someone more desperate than us can replace us. The rich above us weaponise the poor below us to enrich themselves. It doesn’t even matter where “we” are in that ladder, because there’s always someone richer weaponising someone poorer.

And that’s the final thing I’d like to sacrifice to create a wellbeing economy. The idea that we’re not all in this together. The idea that there are people in this world who are better than you. Whether it’s by dint of Magic Blood, or by the power of their Magic Hat that can make you a Commander of the British Empire. Or whether it’s an overtanned manbaby who wanted to play with real life toy soldiers on his birthday. Or whether it’s any number of warlords who think that history will remember them kindly for their warcrimes or their desire to murder civilians by the score.

That’s what a wellbeing economy means to me. No Kings. Not real ones, not fake ones. Just a society that puts All of Us First.

Burning Down The House of Cards

/ Dr Craig Dalzell / Leave a comment

“What are the odds that people will make smart decisions about money if they don’t need to make smart decisions—if they can get rich making dumb decisions?” – Michael Lewis, The Big Short

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Image Credit: Dominic Alves

Rachel Reeves has signalled that she is “open minded” about the banks lobbying her to repeal regulations that came in after the 2008 Financial Crash. If she does, she will be accepting responsibility for the next one the banks inevitably cause.

One of the most important films dealing with the financial sector since the 2008 Financial Crash was 2015’s The Big Short. Comedic, irreverent and outright scathing of those involved, yet it remains one of the most incisive explanations of the 2008 Financial Crash and it managed to make the intentionally obscure world of financial alchemy accessible to the lay person. I’d go as far to say that it did for the idea of ‘sustainable investment banking’ as the films Threads and The Day After did for the idea of a “survivable nuclear war”.

If you haven’t seen it, please do so and pay particular attention to the scene explaining the concept of “synthetic CDOs” – where investors could effectively gamble on the possibility of you defaulting on your mortgage, and other investors could gamble on whether or not those investors will win their bet, and more investors could gamble on the outcome of those bets…all without knowing anything at all about your finances and the state of your mortgage.

One of the things that made these ‘financial instruments’ so destructive was that the ‘investment’ side of the banking sector – the bit that involves people effectively gambling amongst themselves with money that maybe was theirs and maybe wasn’t – was entirely leveraged on the ‘retail’ side of the banking sector – that’s the bit where you put money in your savings account and ask the bank for a mortgage to buy a house – but was completely divorced from it to the point that one side didn’t understand what the other side was doing.

When the housing boom of the early 2000s came to an end in late 2007 and people started defaulting on mortgages, this would have normally been tragic for those losing their homes and a sign of a substantial economic recession but would have ultimately resulted in a bounce back. But all of those ‘investment firms’ sitting on top of the sector were gambling with money that they ‘knew’ was ‘safe’ (because ‘safe as houses’) despite the houses not being nearly as safe as people assumed.

Not just assumed. The way the CDOs were structured made it functionally impossible for anyone to actually assess the risk of their failure. Because it was impossible to work how and if they might fail, the credit agencies declared them to be safe (yes, really) which encouraged banks to pile money into them.

It got so bad that the investment sector was gambling with something like $20 for every $1 actually involved in the mortgages. The investment gambling sector was many times larger than the value of thing they were gambling on. The liabilities on the banks ‘if’ their sure bet failed reached the point of being larger than the GDP of the countries they were based in.

It would only take a small increase in the percentage of mortgage defaults to utterly bankrupt the banks. An increase that might be caused by investment bankers encouraging retails bankers to take on ever riskier mortgages (with ever higher profit margins), paying exorbitant bonuses to bankers who could sell larger and larger mortgages to people who couldn’t afford to pay them.

Which is what happened. And the backlash threatened to pull down other sectors of the economy because the bankers weren’t just gambling on mortgages but on everything just about up to and including whether or not the sky was blue and the fact that the investment wings were entwined with their retails wings meant that if their investment bank failed, the ATMs on the high streets could be shut down too (runs on banks like Northern Rock showed the visceral reality of people faced with losing their savings because of someone else’s mistakes).

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The Lie Under The Nuclear Promise

/ Dr Craig Dalzell / 1 Comment

“Ours is a world of nuclear giants and ethical infants. We know more about war than we know about peace, more about killing than we know about living. We have grasped the mystery of the atom and rejected the Sermon on the Mount.” – Omar N. Bradley

This is a rough transcript – edited for text medium – of the speech I gave at Scottish CND’s fringe meeting at the STUC Annual Congress on April 29th, 2025.

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yellow and black road sign

When I was invited here, I was given a very broad remit for the topic of discussion. I thought I was going to talk today about the economics of nuclear bombs perhaps by way of talking about opportunity costs of investing in nuclear weapons – and what we could be building instead. Or maybe I’d talk about the cost of rebuilding a nuked city – though the images we’re seeing in real time from Palestine show that those costs can be visited upon humanity without us splitting a single atom. But when I sat down to decide what to actually say, something else came to mind entirely.

Here is my proposal for discussion: It is possible for an economy the size of the UK’s to sustain a civilian nuclear power sector without nuclear weapons. It is not possible for it to sustain a nuclear weapons sector without civilian nuclear power. Therefore, when politicians claim to back new nuclear power – especially in Scotland – despite renewables being cheaper, more effective, cleaner, faster to deploy and more secure, what they are actually doing is trying to shore up support for nuclear bomb infrastructure but they know they can’t say that.

To give a bit of a back story about myself and how I very nearly became an example of that proposal in action. Some here might know that I’ve not always been a policy wonk.
My degrees are in physics. I have a Masters in Laser Physics and Optoelectronics and a PhD in two-photon fluorescence with applications in distributed optical fibre sensing (don’t worry – no-one else understands it either).

Back in 2010, I was giving a lecture about my PhD work in London and got talking afterwards with someone who turned out to be from AWE Aldermaston. They were interested in some of the “extreme environment” applications for my research but amusingly, we had to cut the conversation short when he said “I don’t think I should say any more in case you start working out some secrets”. Probably for the best, though I’ll never know if my next thoughts were correct or not…

The point of that story is that I could very well have gone down that route. Several of my friends went into conventional military engineering. A couple went into civilian nuclear – including one who had to leave because he wasn’t willing to give up a dual citizenship for a promotion.

If we only had the couple hundred jobs sustained by the bomb sector, why would unis run those physics courses? As my friend Robbie [Mochrie] on this panel can attest – would he be teaching his courses if there were no jobs for his students to go into?

Where would the physicists and engineers who didn’t get those jobs go? Sure…some might become policy wonks…but while I love my job, I didn’t need to become a laser physicist to get it.

As an analogy, imagine trying to plan for an oil company and someone magics away all of the world’s plastic but nothing else changes. You’d lose a tiny fraction of your customer base but you’d still be selling oil to all the people with cars and gas boilers. You wouldn’t see much change in your business model.

A nuclear bomb sector without a civilian nuclear power sector is a bit like trying to run an oil company when all the cars are electric, the boilers are heat pumps and we recycle all of our plastics. The economics don’t work.

So bear this in mind when the politicians talk about bringing new nuclear power Scotland. There might well be a case for it – I’m not ideologically against it. But renewables are so cheap and Scotland’s potential so great that we don’t need that kind of civilian nuclear sector here. Unless…they want them here for the reason they know they can’t say.

It’s Scotland’s Economy – Or Is It?

/ Dr Craig Dalzell / Leave a comment

“It is not inequality which is the real misfortune, it is dependence.” – Voltaire

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.

Chivas Regal Scotch Whisky

Deliberate Government policy has resulted in Scotland’s economy being outsourced to foreign-owned companies to the point that we scarcely have a home-grown economy left any more. In a world of threats to global trade, this is a major problem.

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Tariffs for Penguins

/ Dr Craig Dalzell / Leave a comment

“Well, whiles I am a beggar I will rail,
And say there is no sin but to be rich,
And being rich, my virtue then shall be
To say there is no vice but beggary.
Since kings break faith upon commodity,
Gain, be my lord, for I will worship thee.”
― William Shakespeare, King John

This blog post previously appeared in Common Weal’s weekly newsletter. Sign up for the newsletter here.

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white and black penguin on snow covered ground during daytime

Note: This article was published on April 4th and the situation has developed substantially since then with the tariffs on most countries (with the notable exception of China) being reduced to 10% for the next few weeks or until Trump burps out some other policy after breakfast.

Trump’s tariffs are the product of a person who doesn’t understand the levers they are pulling, but the UK responding as if we achieved a victory is a flat out lie.

Donald Trump cannot conceive of a “positive sum game”, that is a deal where both parties end up coming away better off than they were before the deal was made. Collaborative community action is a positive sum game when the whole of the community is greater than the sum of its parts (watch once of those “Alone”-style survival programmes to get a glimpse into what true “individualism” actually means).

Trump believes that the only deal possible is a zero-sum game. If there is a “winner”, then there must be an equal and opposite “loser”.

Trump is also deeply narcissistic and believes that if he can perceive you “winning”, then HE must be the “loser” and that cannot be allowed to stand. In his “Art of the Deal”, a “fair” deal is one that he wins.

Now that the world is “fair” again, any attempt by any nation to apply a retaliatory tariff or other sanction will be met with fire, fury and injustice.

Don’t worry if you disagree with his logic or his assumptions here. The key to understanding the trade tariff announcements this week is not whether or not you think he’s right but whether or not HE thinks he is.

Sir Keir Starmer thinks he has won a diplomatic coup. That the “Special Relationship” has saved the UK from the wrath of Trump’s tariffs – at least compared to the EU. The UK got hit with a 10% tariff, the EU got 20%. This, if you watch the UK Government aligned media or commentators, is a sign that all of the begging and grovelling for concessions and special privileges helped take the edge off of a bad situation. Keir Starmer believes that his strategy is a vindication and that we must all “trust the process”.

Sir Keir Starmer is wrong. His actions played absolutely no role in how the tariff was applied to the UK. He could have begged harder and utterly prostrated himself in front of the golden throne. Or he could have stood straight and pushed back. It wouldn’t have mattered. Sir Keir Starmer is an irrelevance to Trump.

With a few exceptions like Trump’s hatred of foreign cars and the fact that these latest tariffs appear to be additional to the tariffs put on countries like China and Canada previously, the calculation of the rate for each country was disturbingly simplistic. For countries where the US has a trade surplus in goods (but not services – this will be important. Trump doesn’t believe that exports like Holywood movies, Microsoft Office subscriptions or licensing deals to produce goods outwith the USA under the Coca-Cola or McDonalds name are worth anything to the US), the rate is 10%. For countries where the goods trade balance is a deficit (i.e. a higher value of goods from country X enter the US that American goods leave for country X), then they took the value of the trade deficit (import value minus export value) and divided it by the value of imports. If a country sells $100 of goods to the US but only buys $60 worth back, then $100-$60 / $100 = 0.4, so they get an 40% tariff. Except Trump then halved the values above the 10% floor because he’s “being nice” (which, of course, undermines his stated purpose of the tariffs being the minimum amount required to restore a trade balance – once again, it doesn’t matter if you see why he’s wrong, only that he doesn’t).

This is why countries like Madagascar and some of the world’s poorest countries are high on the list. The largest single item that Madagascar exports to the USA is vanilla – one of the most valuable spices in the world at around $83 million per year. Goods experts from the USA to Madagascar are comparatively sparse. There isn’t much that the US can send that they can’t get from somewhere closer and, more crucially, high value goods are of limited value to a populace who can’t afford them. Madagascar isn’t “ripping the USA off”. They’re just selling spices that the USA is about to realise they used to really enjoy.

Other anomalies abound like the mention of sub-national states like the Falkland Islands and France’s “we don’t call them colonies any more” territory of St Pierre and Miquelon that sits off of Newfoundland in Canada. There are two main theories why these substates are included. One being that some Musk-ish techbro made the list by asking Grok or another chatbot for a “list of countries” and it returned a list of countries that have a country code top level internet domain like .uk or .eu (though if they did, I’m surprised that they had the awareness to remove .su so they didn’t try to apply a tariff on the Soviet Union despite America being somehow completely unable to export ANYTHING to them for going on 35 years now). The other is that they just copy/pasted the CIA Factbook list of notable polities which includes several sub-state territories of various kinds. (Fun Fact: I had to do this precise kind of filtering while writing our Profit Extraction paper because the World Bank’s database I used also includes various substates, suprastate regions like “West Africa” and multiple nations that no longer exist but did exist when the Bank started tracking their data).

The omissions are interesting too. Russia and Belarus were omitted “because we already have sanctions on them” but Iran – which is also under US sanctions – was not. There’s a very telling thing going on when you look at the nations that Trump is willing to break the sharpie out and deviate from the formula for.

There are two most “fun” additions to the tariff list. The British Indian Ocean Territory which is essentially exclusively inhabited by a US military base (the people who used to live there before the UK and USA ethnically cleansed them call them the Chagos Islands). The other, being widely reported, is the Australian external territory of the Heard and McDonald Islands. They got a 10% tariff as well (remember, 10% is the floor rate for countries where the US is already “winning” on trade). Major exports from these islands are…nothing. There is no trade. There are no people there. It’s mostly just penguins. Penguins aren’t widely known for their genius at negotiating international trade deals, but still somehow they managed to achieve the same level of success against Trump as Sir Keir Starmer.

And this is the core point. The Trump Trade War of 2025 has no logic to it (see Robin’s briefing this week on how nations SHOULD be applying tariffs as a means of correcting for pollution and other “externalities” that capitalism fails to pay for), it’s going to spiral worse for the countries that fight back, worse still for American consumers, and only marginally better for the countries that lick the boot to try to pick off country-specific, sector-specific or even just personal exemptions – at the cost of their own surrendering their own sovereignty to the Great Orange One.

But don’t be fooled by any of Starmer’s claims that he has steered the UK through the choppy waters better than, say, the EU. The numbers are there and plain to see. The UK got 10% not because of “winning”, or “losing”, or diplomatic ability, but because the UK simply doesn’t matter to Trump.

But still. “Trust the process”, Starmer asked us to believe, while failing to negotiate any better than a penguin.

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The Last Stand of the Oil Barons

/ Dr Craig Dalzell / Leave a comment

“You never change things by fighting the existing reality.
To change something, build a new model that makes the existing model obsolete.”  – R. Buckminster Fuller

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.

Station

The oil and gas sector advocacy group Offshore Energies UK has claimed that if it gets more political and financial support than the sector already gets then the UK could produce half of the 15 billion barrels of oil we’ll need before 2050 with the rest being imported from increasingly unstable and unreliable countries like the USA.

However, rather than feeding even more monetary and political capital into the insatiable maw of the companies that caused the climate emergency, it would be a far better idea would be to aggressively drive down that demand by investing instead in a Green New Deal that would reduce the heat we need in our homes, remove the need for that heat to be produced by oil and would retire fuel-hungry modes of transport like internal combustion cars in favour of active travel and electrified public transport.

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