World Economic News
UK Million-Member Union Calls for New Nuclear Generators
British union chiefs, led by Derek Simpson, the leader of the million-member Amicus union, was expected to make an "unprecedented call for new nuclear generators" last week, in the face of soaring energy costs, according to the Times Online Jan. 16. Amicus has organized all of Britain's manufacturing sector, including steel, auto, aerospace, energy, construction, shipbuilding, food, paper, and other manufacturing. Amicus officials will meet today to plan a campaign to educate the public about a growing energy crisis.
After many years of being self-sufficient in coal, oil, and natural gas, Britain has suddenly become a net importer of gas. Simpson warned as early as Sept. 13, 2004 that Britain could face blackouts and rising prices in 2005. In November, after prices rose during a cold spell, plants in two energy-intensive industries, Ineos Chlor and Terra Nitrogen, shut capacity in response to energy price hikes.
On Jan. 11, Simpson told the Amicus Officers' meeting at Birmingham: "The main reason given for outsourcing production by manufacturing companies in the UK is no longer labor costs; it's high energy costs." After pointing to the instability in the Ukraine/Russia supply line, Simpson said, "Thanks to the Tories, we have the largest stocks of coal outside of China, but no industry to extract it, and no power stations to burn it without catastrophic consequences for the environment. Successive governments have shied away from difficult decisions and left us with aging nuclear power stations, and as yet no plans to start a new building program. Together both have contributed to our over-reliance on foreign gas and foreign electricity generation.... We urgently need government policy to promote clean coal technology and nuclear power new builds so we can meet our medium-term energy needs, save thousands of jobs, avoid blackouts, rocketing household bills and meet our targets for reducing coal emissions."
The London Times reports that Amicus' call for nuclear power will infuriate the environmentalists, who also expect Tony Blair's November energy review to recommend new nuclear capacity. Support for nuclear power also lines Amicus up with the employers association, the Confederation of British Industry (CBI), whose head, Sir Digby Jones recently called energy prices the "biggest immediate issue facing British business."
The million-member Amicus union is in the process of merging with the GMB and T&G unions, which will create a 2 million-member entity by 2007.
Backlash Against Hedge Funds in Denmark and EU
Former Danish Prime Minister Poul Nyrup Rasmussen, currently head of the socialist group in the EU, attacked hedge-fund buyouts Jan. 18, in an interview entitled, "Nyrup: The funds strip companies." He told the Berlingske Tidende that in the drive for short-term profits, hedge funds often dissipate the knowledge concentrated in corporate headquarters, by stripping the companies and selling sections off. What is needed is "advanced employment, and an advanced development of knowledge and production development." Nyrup's critique comes amidst the controversy surrounding the attempted hedge-fund buyout of the Danish national telephone company, TDC.
In a related development, Danish Economy Minister Bendt Bendtsen attacked the hedge funds' pursuit of short-term profit a few days before Rasmussen's interview. He also attacked the Parliament for selling the physical cable network of the national telephone company at the time it was privatized, because it was against the national interest.
Today, the investment director for ATP, the pension fund which refused to sell their 5.5% share of TDC shares, attacked the tendency of hedge funds to sell companies to another hedge fund, for higher and higher prices, with no transparency.
Two weeks ago, the director of Denmark's third-largest bank, Anders Dam, attacked the hedge funds, saying that they have no positive function that is not already found in a normal corporate structure.
A Big Switch to Coal, Away from Natural Gas, Is On
The latest projections from Alstom, Siemens, and General Electric show that about 40% of the worldwide orders for electricity turbines in the next 10 years will be for coal-powered units, while gas-fired plants fall to between 25-30%, the Financial Times reported Jan. 15. This reverses the 1997-2001 trend, when gas was preferred for 60-70% of new power stations, and coal for only 20-30%.
The shift, says Marsh, is occurring because coal technology has reduced its pollution, while the price of natural gas is rising, and its supply is seen as insecure. In addition, many countries in Asia, which is expected to provide half of all new power station orders in the next decade, lack easy access to gas reserves. The switch to coal is expected to be dramatic in Britain.