Thursday, October 22, 2009

"Learn to Tolerate Inequality" We're Told

Lord Griffiths of Fforestfach is vice-chairman of Goldman Sachs International and a former adviser to Lady Thatcher during her spell in office.

He is quoted in the Times with this:

Lord Griffiths said the general public should “tolerate the inequality as a way to achieve greater prosperity for all”, saying also that “we should not ... be ashamed of offering compensation in an internationally competitive market which ensures the bank businesses here and employs British people”.
An interesting argument. I'm not against inequality. There are people that are many times more useful to society than I am so why shouldn't they get paid many times more than I do? The support stops when we get to unearned inequality.

That's what we have in the finance sector at the moment. Any other sector wouldn't be able to hold us to ransom the way the bankers are. Why is it possible for them? They have the access of course. Thanks to the fractal reserve system they can make money without labour and pay themselves handsomely with it.

“tolerate the inequality as a way to achieve greater prosperity for all”
That's a statement of conquest that is. Rather than the hundreds that make up the bankers forego their unearned bonus, the millions that make up the public are told to put up with it. Far easier and noble would be the former than the latter.

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Thursday, October 15, 2009

Taxpayer's Alliance on Road Pricing

I have to confess, I struggled to see the point of an article titled Road pricing blather from Boris on the Taxpayer's alliance blog "Economics 101".

The statement “There is absolutely no scheme in the Mayor’s Transport Strategy to introduce road user charging in London.” followed by an anti road user charging commentary diminishes the whole thing. Weird. I had to comment.

The British do themselves a lot of self harm by our generalised obsession with home ownership, car ownership and apathy towards politics. If I haven't said that succinctly before it's worth saying now.

The car ownership argument is probably the harder one to sell. I think of it this way: when 50 years are up and all the oil is gone (with the exception of personal hoards kept by the very rich most likely) we will look back and think "What on earth were we doing allowing petrol to be purchased so cheaply and then burnt up travelling 100 yards to the top of the road."

With the exponential growth and demand for oil from the rapidly growing economies I think I'm being generous saying as much as 50 years. I think it'll be much shorter than that but I've put out a figure you may be able to get on board with. The dangerous figures that keep floating about are numbers like 250 years or 800 years. They are a nonsense based on the arithmetic of exponential consumption and ever decreasing discoveries of new supplies.

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Wednesday, October 14, 2009

Selling Assets in the Deflated Market

This weeks re-announcement of the sale of government assets originally announced in the 2009 Budget by Alistair Darling has received a rather poor response from the media and blogs. The reason for this is that this government has a track record of not getting the best deal and selling at the trough.
They've confirmed themselves that this isn't a good idea by scrapping plans to part privatise the Royal Mail on grounds that market conditions are poor back in July.

I'm of mixed mind on this. Criticising the government for selling low and not getting the best value for the taxpayer is easy. Counter to that is the willing selling of assets at the price they are worth now on a large scale will perform the write down of assets so desperately needed to bring us back reality.

Mitch Benn rounded up the situation best:


So now we've had a good look and realised where we're supposed to be. The only thing stopping us getting down there and building a proper platform to stand at this level of prosperity is the fact that there are still a huge number of people flailing around in mid air, Wild E Coyote style, thinking that they can still stay provided they ignore the laws of financial gravity long enough for someone else to build the platform.

So in this case if the government is going to sell I hope it starts a trend.

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Tuesday, October 13, 2009

Expenses Are Back and Better Than Ever

The big break was back in May when the Daily Telegraph started published details of leaked documents from the Fees Office. After years of digging their heels in, Parliament finally gave way and published farcical redacted documents a few weeks later. The difference between the two sets of documents proved that the Parliament produced record omitted details that would reveal the second home flipping.

Elliot Morley became arguably the first person on the planet to forget he paid off his mortgage. Oddly inconsistent are the dates if I have these correct. The mortgage was paid off in 2006 and claims were made 18 months subsequently. At the latest that makes the claims stop in June 2008. It was nearly a year later before he repaid the money.

Did he stop claiming because he thought he'd paid off his mortgage in 2008 or (much, much more likely) did he stop claiming but didn't feel he needed to pay overpayments to him back, only realising he did because the press got hold of it? If there is a case to be pressed for prosecution on fraud grounds, this is the one to watch. Morley has been out of the news since he decided to step down at the next election in late May.

Deciding to step down at the next election is the answer of choice for scores of MPs. Very few wish to force by-elections (Ian Gibson of the Labour Party did and votes for the party slumped by over a quarter passing the seat over to the Conservative Party) and there is some nice cushy parachute payments for serving the full term in the House of Commons. Speaks volumes. Good on Ian Gibson for doing the right thing when stepping down in such a scandal, which is to step down immediately.

What's new is the story is that the independent auditor has used his own set of arbitrary rules to determine what he believes MPs should pay back. What he deems as sensible limits that weren't explicit for cleaning and gardening for example. Retrospective rules are an ugly business. Is it really fair for the politicians to be charged for abusing rules to didn't exist at the time?

The MPs are an angry bunch at the moment, off the record. None are being stupid enough to say anything in anger on camera sadly. So now both the public and parliament are in equal moods, both feeling unfairly treated. The angry MPs still appear to be missing the point though. Allowances, as written, didn't specify upper limits where all good sense say they should have. Quite frankly, I don't understand how a garden is wholly necessary for a MP to perform his/her duty so a £1000 limit is very generous. The same goes for a cleaner and £2000.

Where Sir Thomas Legg proposes that they should pay back any money claimed and received over this amount they should bite the bullet and accept that this is punitive measure that is an indictment on their judgement. Their acceptance of this will prove that they understand the feelings of the electorate. If they can't make that sacrifice to prove their worth then that only goes to show they were only ever in it for the money. Serving comes second.

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Saturday, October 03, 2009

Labour Conference - Gordon Brown Speech

Just back from my holiday in the glorious South West of England and playing catch up on the Labour conference. So I'll just share the notes I made whilst watching the Party Leader's speech:

Sickly opening by wife. Nothing in there that I or anyone else couldn't do. No reason why he is best to run the country.

Good praising on Labour achievements in the past 12 years.

Sickly praising of Harman and Mandy. Slightly more respectful praising of Darling. The face on Balls, who wanted the chancellor job going into the summer was priceless.

Statement saying we have 2 choices. That's not democracy and if it is, it's shit.

Back to the easy habit of Tory bashing. Yawn.

The whole theme of the speech seems to be that he doesn't understand that he has bought 2009 and hopefully 2010. The price is every year that follows. Any government could chose to do that. That's not the hard choice, that's the short term choice.

"What failed was the conservative idea that markets always self correct." If that's the case then there has to be the failure of the left wing idea that markets don't work unaided and that in 10 years they couldn't pick this up.

Claiming credit for the NHS. As a party yes. Unless I'm missing a trick he wasn't born at the time of it's creation...

"The banks will pay back the British people". Not likely.

Next election: 1st term of a new global age. Green ecomony, finance as the service not the master, bring all the talents of the country to bear.

250,000 new green British jobs. Lets see how that one will work.

"Will invest more in schools". The money for that is coming where?

"Started recession with the 2nd lowest debt in G7 economies" Reduce debt by 50% in 4 years. Raise tax at the top, cut costs and make savings for front line services.

Inheritence tax again. Little to do with Labour apart from them starting the practice... weird thing to mention.

Minimum wage. One of Labour's good points.
Ooh, next the welfare system. More uncosted increases.

Children having children. 16 and 17 year old parents to get supervised homes. Interesting idea.

50,000 most chaotic families to go on family intervention program. What a chart that is.

When talking about the service level agreements for policing I couldn't help but notice the conferences slow pick up of applause when 48 hours was the closing remark. Sounded like they expected 24.

Terrorism and immigration in the same sentence. Bad idea. That's BNP talk.

No compulsory ID cards. Only took a few years and a shed load of wasted money to work that one out.

Constituents right to recall their MP for wrongdoing. Good move.
Referendum for the alternative vote system. Also good.
House of Lords again. Good, but is it believeable.

More Tory bashing. Yawn.

Paying respect to dead soliders in Afganistan. Basically buying a standing ovation.

Long waffle on NHS with presumably rare personal letters from individuals positively affected by changes made by New Labour. Hate these kind of things. One side of a highly complex story.

The footy results coming in are taking my attention as the waffle continues.

Labour embracing hope. Hah! Too bloody right you do.

Beating cancer in this generation seems to be a big thing in this speech. How's that going to work?

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Labour Conference - Mandy on Brown

The problem is we, the public, don't know him.
"He's hard working, determined, conscientious, doesn't take no for an answer"

Apart from the fact the last attribute can be relabelled as 'bloody minded' this doesn't describe a unique personality yet alone whether that's all the criteria necessary and valued in a Prime Minister.

Where Lord Mandelson has more of a point is that we no longer listen to Gordon Brown. He will forever be haunted by "no more boom and bust", "not only have we saved the world" and "I take full responsibility, that's why I fired the man responsible".

Sure there are some things that can be forgiven. The change of heart on parking charges in hospital car parks for example. If you change your mind on that year to year you aren't going to find me giving much of a monkey.

When you've the steward of the whole economy, miss the forthcoming abyss and then shout and scream about how you should be praised for only seeing us to the edge and not falling yet, then you're not going to get off so easy.

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