It's because, not despite
Correcting Guardian headlines is one of those participatory sports that we think more people should take up:
Tesco defends £315m dividend plan despite business rates holiday
The actual claim being made is that the dividend is because of the rates holiday, not despite it:
Tesco has defended plans to pay a £315m dividend to shareholders at a time when the supermarket chain is benefiting from a business rates holiday worth £249m.
Of course, if we were to spend the time necessary to correct all of that newspaper’s mistakes we’d never have time for anything else. But the argument even as corrected has its mistakes:
Positive Money, a campaign group, criticised the Tesco move. Fran Boait, its chief executive, said: “There needs to be conditions to ensure that any company receiving public support in a time of crisis isn’t wasting money on paying out dividends to wealthy shareholders.”
The New Economics Foundation think tank said the money from business rates was used by local government to fund the vital local infrastructure needed for Tesco stores to function, such as refuse collection and the bus services that workers use to get to work.
“For Tesco to accept this relief, and then be able to turn around and pass the benefit straight on to shareholders, shows that the system is not fit for purpose – public funds should not be captured as private profit,” said senior economist Sarah Arnold.
Some snark is due over Positive Money there for they’re grand proponents of Modern Monetary Theory. Which insists that tax doesn’t in fact fund public spending, the government creates the money the economy requires by printing and spending it. An interesting implication of this being that if we’ve no inflation then government shouldn’t be taxing. We’ve not, they shouldn’t so stop bleating.
The more pernicious concept is embedded in NEF’s comment. Tesco is the product of over (just, by a year) a century of investment. A continual exploration of how to do retailing, of the expansion of logistics chains, of the management of supply. Those owners have delayed gratification, by continuing their holdings even if more money was only occasionally poured in, for that century. So, when we actually need experts in logistics, supply, when a pandemic closes most of the British economy and yet the population is still fed, watered and even bottom wiped, when we need the system it has taken a century to build, we’re to whine about the existence of the system that provides what we so desire?
We’re to insist that no reward should happen for that century of work?
Presumably the NEF thinks the system should be replaced with something more short term than capitalist free markets. But then there is a reason that Giles Wilkes insisted that the true meaning of the acronym is Not Economics Frankly.