WE have had Chancellor Kwasi Kwarteng’s financial statement, better known as a mini-Budget, best known as a declaration of class war on the working class and the people.
 
The Labour Party’s response at Westminster was feeble.
 
Shadow chancellor Rachel Reeves bemoaned the lack of any new windfall tax on the oil and gas producers and pointed out that working people will pick up the bill for the Chancellor’s energy rescue package, as bankers’ bonuses go up alongside interest rates, import prices and and inflation.
 
She questioned the effectiveness of “investment zones” and stamp duty reductions and attacked the Tory U-turn on future corporation tax rises, noting Kwarteng’s boast that Britain has the lowest headline rate of taxation on company profits of all the top G7 capitalist economies.
 
So far, so good, with even a hint of class politics. But what is Labour’s alternative?
 
Reeves proposed more targeted investment allowances, additional support for first-time homes buyers and restrictions on house sales to overseas investors.
 
She wants to see business rates abolished, but suggested no alternative — and more houses being built, without saying by whom and with what money.
 
Although standing up for workers and their rights, she also repeated the usual Tory mantras about business, entrepreneurs and enterprise.
 
As an instant response to the Chancellor’s statement, it was good in parts. An alternative mini-Budget it was not.
 
On Sunday, Keir Starmer announced that a Labour government would retain a lower basic rate of income tax at 19 per cent, but reinstate the 45 per cent top rate.
 
In her opening speech to the Labour Party conference on Monday, deputy leader Angela Rayner had much more to say on workers as the real wealth creators, green economic growth, public procurement policy (making unspoken use of the abolition of EU pro-big business rules), financial support for small businesses and innovation, more investment in local communities and less outsourcing of public-sector work.
 
But none of this adds up to an alternative economic and financial strategy.
 
Certainly, these policies would not radically change the current trajectory of the British economy as set by Truss and Kwarteng, who themselves have abandoned even the targets of “levelling up” and zero carbon emissions proclaimed by their predecessors.
 
We are heading for higher sustained levels of double-digit inflation, government borrowing and debt, unemployment, social and regional inequality and poverty than for at least a generation.
 
What kind of labour movement budget could avert such a catastrophe?
 
Across the political spectrum, many people agree that our transport, water, sewage and energy storage systems need urgent, large-scale investment.
 
Millions of homes have to be built, renovated, insulated and fitted with solar panels, with compulsory purchase of empty and holiday dwellings together with the adaptation of empty office accommodation where necessary.
 
To meet the challenge of global warming and climate change, we must invest in green energy sources, developing nuclear fusion and solar, wind, geothermal and tidal power in place of fracking and nuclear fission.
 
The lesson of privatisation is that these vital strategic goals will not be achieved by the private sector and that private finance initiatives are invariably a costly rip-off. Public investment at a lower rate of interest is vital, accompanied by public ownership, control and long-term planning.
 
Even so, taking the privatised industries and utilities back into public ownership cannot be done without paying reasonable compensation to small shareholders, savers and occupational pension holders.
 
How much would such a policy cost?
 
According to the Confederation of British Industry and parroted by liberal economic correspondents such as the Guardian’s Will Hutton, the bill for renationalising water and sewerage in England, gas and electricity (excluding generation and retail), the railways and Royal Mail would total £196bn.
 
This sum includes company debts that need not be purchased (£46bn in the water industry alone), plus a 30 per cent mark-up on asset values with the discredited claim that utility companies usually attract a higher price than their asset value.
 
However, the Public Services International research unit at the University of Greenwich puts the cost of renationalising water, the energy grids and Royal Mail at less than £50bn if shareholders are compensated for the amount they invested, rather than at market value.
 
British pension funds own just 5 per cent of the water and energy companies.
 
The cost of renationalising the railway industry is relatively small, even negligible, if it is done as the operating company franchises expire.
 
Public ownership would mean that water, energy, rail and Royal Mail customers would no longer have to pay for shareholder dividends or the interest on expensive private-sector borrowing. The assets and future profits would accrue to the state.
 
How could such an ambitious economic programme be paid for?
 
Low-cost public sector borrowing through gilt-edged long-term Treasury bonds is the traditional method.
 
But progressive taxation could finance much of the initial expense.  
 
According to HMRC estimates, the richest one-tenth of Britain’s residents own £6,619bn in declared personal wealth. To this can be added much of the £850bn held in overseas accounts, two-thirds of it in tax havens — many of them under British jurisdiction.
 
Even a modest 1 per cent wealth tax would raise up to £70bn.
 
A higher top rate of income tax (the norm was more than 80 per cent on the top slice for four decades before Thatcher took office in 1979) would bring in a billion or two more.
 
Corporation tax should be raised to at least the average G7 level, combined with windfall taxes on the super-profits of the banking, retail and armaments monopolies.
 
Free from EU “free movement” rules, private capital should be directed to invest in Britain, including in designated areas. This revival of a regional economic development policy could be backed up by a network of national and regional investment banks funded from government borrowing and tax revenues.
 

Council tax could be replaced by local income, land and property taxes based clearly on the ability to pay.
 
Tax justice would also require severe reductions in VAT, with many more essential goods and services exempted altogether now that EU rules no longer apply.
 
There should also be much greater economic and fund-raising powers devolved to the Scottish and Welsh parliaments and local government.
 
The priorities and independence of the Bank of England must be brought to an end.
 
Substantial increases in the statutory minimum wage and state pensions and benefits would immediately boost economic activity, although selective price and import controls would help keep down inflation and promote domestic production.
 
This is much more than a programme for a single Budget.
 
It is a programme for a left government, or for a Labour government that comes under mass pressure from an alliance of progressive forces brought together and led by a politicised labour movement.

Robert Griffiths is general secretary of the Communist Party of Britain.