(A government FAILS to persuade bankers to lend to the common people.)
This is what Chancellor Gideon said about Mick Philpott, the scumbag who killed his own children through an act of gross stupidity:
“Philpott is responsible for these absolutely horrendous crimes and these are crimes that have shocked the nation. The courts are responsible for sentencing, but I think there is a question for government and for society about the Welfare State and the taxpayers who pay for the Welfare State, subsidising lifestyles like that. I think that debate needs to be had.”
These ill-conceived words from an ill-conceived Chancellor have sparked a debate because of the link made between the crime and the Welfare State. Let’s test Osborne’s opinion with a small substitution:
“Shipman is responsible for these absolutely horrendous crimes and these are crimes that have shocked the nation. The courts are responsible for sentencing, but I think there is a question for government and for society about the NHS and the taxpayers who pay for the NHS, subsidising lifestyles like that. I think that debate needs to be had.”
It doesn’t work, does it?
Philpott is the product of an upbringing, a British education, a social environment, a learned set of values and generations of genetic programming.
Juxtaposing the Welfare State and Philpott’s crime was yet another “bad call” in a long list of bad calls by the Chancellor.
The Genesis of the United Kingdom’s Welfare State is to be found in the Liberal Welfare Reforms of 1906-1914, under Liberal Prime Minister Herbert Asquith.
Surely, Gideon and Dave aren’t going to blame the Libdems for this one too, are they !?
Yesterday’s Budget had all the marketing qualities of a statement which is already anticipating the next General Election.
A few give-aways, something for the housebuyer, a little bit for the businessman and of course, a catch phrase!. In fact , the Chancellor provided three:
The Saatchiesque “Aspiration Nation” , another “nod” to Margaret Thatcher in the shape of the “Help to Buy” and of course, “Britain is open for business!”
This was the Budget of a Chancellor who either does not fully appreciate the scale of the United Kingdom’s economic decline or who is trapped but feels that he ought to show willing and fiddle at the peripheries.
Bitter past experience has shown that direct Government interference in the housing/mortgage market always ends in tears. On the face of it, it now looks as if the government may be encouraging house purchase by those who may not be able to afford it. That is what cause the 2008 banking meltdown. Luckily for the Chancellor, there is unlikely to be a big take-up of the “interest-free up to 20%” additional loans which the government is offering. Depending on how the £130 billion in “loan guarantees” is dispensed, it may just be more Quantitative Easing in disguise. Previous form suggests that once cash is handed to the banks by government, the difficulties arise when attempts are made to prise the money from their cold grasping hands. We’ll see!
Let us hope that on this occasion, some of the cash does end up in the hands of the house buyer rather than in Stocks or Commodity speculation by the banks.
The Chancellor’s “Rabbit out of the Hat” 20% Corporation Tax Rate already applies to businesses earning up to £300,000 with a marginal rate being paid by those earning up to £1,500,000. So, for several years, this will mean very little. Yesterday’s CT announcements were for big business only.
The Chancellor’s headline-writers may have had a good day but in reality, commerce has NOT received the shot in the arm which it needs TODAY.
Finally, here’s a bit of lateral thinking: How about the government having the courage to make a massive investment in agriculture. The returns would be in the Exchequer’s coffers far sooner that having to wait for those “forced entrepreneurs” to contribute.
p.s. Gideon……sack your voice coach.
Regrettably, I will not have the pleasure of hearing the hubris-fired reading of the Budget Speech by Chancellor Gideon…..and I do SO enjoy hearing fiction read out-loud!
Today’s press is full of advice for him but unfortunately, he will not be able to stray far from the path he has already chosen for us.
The components of today’s Budget will be cosmetic low-cost “initiatives” , largely fueled by Public Service casualties. Gideon WILL brazen it out by feeding the nation carefully chosen and spun statistics but since he painted himself into Austerity Corner, he cannot move. He will try to give the impression that he is able to somehow warm the economy……. but this one-trick pony Chancellor will do it to the accompaniment of: “Throw another Public Servant on the fire!”
Yes, there may be talk of “saving through efficiencies” but we know that efficiencies are a myth.
“Need a quick £2.5 billion? Sack a load of Public Servants and slash services.” The arithmetic is very simple!
By the way, don’t just blame Gideon. The Cabinet of “yes men” is fully supportive of his fiscal fumbling. They’re right behind him!
Incidentally, the OBR is publishing its latest growth and borrowing forecasts today. More ripping yarns!
The government’s target for the elimination of the structural deficit, in keeping with tradition, continues to slip further and further into the future – where it will remain for many years to come. At the moment, the projected target is 2017/18.
We can already predict that the next estimate may be headed towards 2018/19……and so on.
p.s. I wonder if he’ll mention the banks?
At the time, John Major was not considered to be a very dynamic leader, certainly not one judged to be a GREAT Conservative leader. In fact, he was a bit of a joke and was mercilessly brutalised by the media, notably by those pesky Latex satirists, Spitting Image. Remember the Grey Major and his conversations with Norma about peas? Remember the Y-fronts and the safety-pin?
Yet he was a good man, an honest man, a straightforward man, a man from humble beginnings. After all, his father had been a circus performer!
At the time of his surprise 1992 election win – when he defeated the windbag Kinnock, he could have represented a new beginning for the Conservative Party.
Briefly, the Conservatives had been in an egalitarian frame of mind. Meritocracy was still on the menu. No more Alec Douglas-Homes, Macmillans or even Heaths. Had the grocer’s daughter from Grantham been the catalyst for a less aristocratic and more egalitarian Conservative Party? Had John Major, albeit reluctantly, picked up the baton on behalf of the lower orders?
We tolerated Major. His image, voice and mannerisms were, let’s face it…. grey and boring. Even the revelation that he had been shtupping Edwina Currie would not have made any difference to his image. But we liked him. He was a Man of the People. The Conservatives had turned the corner. No more Eton and Harrow toffs running the show!
Anyone could become a Conservative Prime Minister.
1992….sounds a long time ago, doesn’t it? Well…..that was the LAST TIME that the Conservative Party properly won a general election.
TWENTY ONE YEARS AGO!!
Our current Rulers are keen on numbers and statistics. Let’s have a look at some.
In 1992, under the lame John Major, the Conservatives won 41.9% of the Vote with 336 seats.
In 2010, under the new dynamic David Cameron, the Conservatives won 36.1% of the vote with 306 seats.
The last (2010) General Election election was less than two years after one of the worst financial crashes in history with the Labour Party under the stewardship of Gordon Brown. He is now widely acknowledged to be one of the worst Prime Ministers in History.
The Conservatives should have won an easy overall majority.
Had the Conservative Party Oberkommando made a fundamental error in relentlessly having pushed forward one of their gilded own towards the inevitability of the top job?
“Riding shotgun” was yet another “hooray”, in the shape of the simpering and credibility-free The Rt Hon George Gideon Oliver Osborne. His only business, industry or commercial experience had been as a Conservative Central Office speechwriter! Suddenly, “The Unemployable One” was running the world’s seventh largest (and counting) economy!
Dave and Gideon between them have rendered the Conservative Party unelectable. They are going to lose the 2015 General Election and they will take the Libdems down with them.
Since the political assassination of Margaret Thatcher, the Conservative Party has shown itself to be lacking int the “Let’s Choose a Leader” department. All you have to do is to look at the array of zombie Conservative Party leaders who have graced the top job since John Major’s severe and politically terminal bout of “Inter-scapular Neuralgia”.
….and now it seems that both David Cameron and Chancellor Gideon are beginning to feel the odd twinge between the shoulder blades. Neither really deserves it because they were both encouraged and promoted to well-above their level of incompetence far too early.
Let’s hope that the next time, The Party gets it right.
The piece below is over 2000 words long and I have just completed it for a client .
It is about the random nature of an economic system.
Have you ever wondered why ALL economic predictions are wrong? Have you noticed that in spite of a proven record of error, economists and politicians continue to bang their heads against the forecast-wall and refuse to do anything else but continue to predict outcomes which by now, they must realise will be incorrect?
They certainly use all the latest computer models which have been empirically derived and used for many years.
So, are there any incorrect assumptions about “fundamentals”?
Is the economic process Stochastic (a sequence of random variables)? Or is it Deterministic (when the output of a system is totally dependent on its initial state and subsequent inputs – and therefore, predictable)?
(Mind you, to add to the confusion, deterministic systems may occasionally produce random and therefore unpredictable results. )
Is economics a question of Stochasticity v Determinism?
Why do I ask the question? Because there appears to be a total absence the ‘stable equilibrium’ predicted by classical economists.
On the contrary, Market Economics behaves like a collection of dynamically unstable systems. The instability is attributed to external ‘shocks’ rather that any fault in the basic concept. There is what can only be described as ‘non lineality’.
One solution to this ‘non-lineality’ is CHAOS THEORY!
So far, no real evidence has been produced of ‘low – dimensional’ Chaos in economic processes but there are definitely discrepancies between the ‘expected’ according to classic economic models and the ‘observed’. Just look at any economic prediction within your memory. It was probably incorrect.
We still have a ‘mechanistic’ view of the world and economics as a ‘hangover’ from 18th century SCIENCE.
Scientific thinking is very simple: ‘Measure, predict and adjust until you no longer have any more surprises. Then keep measuring to confirm that what you measured in the first place can be replicated’.
Economics was conceived on that same principle . It was established as a ‘science’. That’s where the Determinism crept in.
It was at this time that man first considered the possibility of his own intellect being so unconstrained that he would eventually understand the ‘Universe and everything’ through the medium of scientific reasoning.
This principle was applied to all sorts of activities and thinking – including economics.
The so-called ‘Enlightenment Policy’ would help man in his pursuit of happiness. Especially in the sciences. Science was cool and now in the early 21st Century it is enjoying a bit of a revival.
Of all the subjects on offer, Physics became the admired Paragon for Enlightenment and so it continues.
The way Physics works is simple: Carefully describe an environment and you should be able to predict the outcomes of any experiment conducted within that environment.
Likewise in Economics: Know the initial environment and you should be able to predict outcomes based on subsequent inputs.
The belief stemming from that philosophy is that EVERYTHING is governed by ‘NATURAL LAWS’ which are a set of ‘cause-effect’ regularities. That means that everything can be predicted.
These same principles have been applied to Economics.
A simple scientific rule is that ‘The state of any system is a consequence of what it was in the preceding moment…..and so on.’
In the beginning, random occurrences had no place in such linear thinking. Everything was governed by Mathematics and Laws.
However, there is one major flaw in the way that we ‘do’ science: That is our ignorance of the CAUSES which generate phenomena and events.
For instance, we know the effects of gravity – which we can measure but we don’t really know the CAUSE.
However, in spite of our ignorance of the exact causes of events added to the imperfection of our analyses, we still cannot have 100% certainty about the vast majority of phenomena.
Economists also appear to have forgotten both the imperfection of analysis and their ignorance or (at best) of the exact CAUSES of events.
What is the solution? What is to be done about our comparative blindness?
Our ‘crutch’ is the science of probability. Chance.
Current economic thinking is a throwback. In economics, the world is still viewed as totally deterministic.
‘STOCHASTIC’ is non-existent – as is uncertainty because uncertainty is treated as ignorance or a failure to understand the deterministic rules of a very complex system.
Yet, with ALL our processing power, no-one has yet been able to establish those rules which should predict outcomes.
So, as Chaucer wondered in The Nonnes Priest Tale – Travelling from A to B: Freewill or Predestination?
Looking at the unpredictability of economic outcome, we move from linear to non-linear dynamics, from certainty to probability, from Economic Theory to Chaos Theory.
Theories of economics have been shaped by the assumption of ‘Rational Man’ who behaves in accordance with a known set of rules.
The evolution of economics into a science was ‘booted’ into becoming a science when it was ‘mathematicised’. Formulae arrived and suddenly, it became a bona fide branch of Applied Mathematics.
Many of the original people who translated economics into a mathematical form were physicists, engineers and mathematicians…… and it still shows. At that time, their view of the world was ‘linear’.
Does that work in economics? The short answer is ‘no’. That is why economists are struggling, interpreting and making excuses.
Marshall in his ‘PRICIPLES’ compared the study of economics to the study of tides. The number of variables affecting tides means it is impossible to create a consistent dynamic picture.
Even nowadays, there isn’t enough processing power to generate an accurate picture of such a dynamic system, especially as the number of variables affecting such a system is, for all intents and purposes – infinite.
Imagine random stones being thrown into the sea or small outcrops of rock or variations in the seabed. They all have an effect on the ‘shape’ and speed of the tide.
And so it is with an economic system: lots of rocks, stones and other variables.
It is not possible to formulate or predict a picture of such an infinitely dynamic system.
Currently, economic theory appears to predict that any shock to such a dynamic system will (obviously) have an effect on the system but that it will ultimately converge-to or seek either a new equilibrium or ‘tend’ towards its original equilibrium because, after all – that’s what ‘systems’ are supposed to do!
Economic Theory assumes a tendency towards stability and equilibrium with certain ‘oscillatory happenings’ on the way.
So we have a situation where economic thought was (and still is, in most cases) linear, deterministic and quasi-dynamic. That is to say, the ‘set-in-concrete’ notions of certainty, invariant economic laws and sameness……………..rather than approximation, probability and infinite variety.
For instance, the Bank of England predicts an inflation rate one year ahead, based more on hope than fact or perceived fact. But when such predictions are (always!) wrong, there is no revisiting of the thought process, merely another prediction with little or no basis in anything-in-particular.
Often, both ‘inputs’ and predicted outcomes are decided by committee and vote!
All predictions appear to be based on an assumption of an ultimate convergence of economic process to stability, via those periodic cycles which, although not understood are treated with a certain sense of fatalism.
Chancellors are so locked into predictions based on erroneous facts that they will even massage their outcomes in order to land somewhere near the expected landing point – purely in order to retain credibility not only for themselves but also for ‘the system’.
What cannot possibly be countenanced are the random fluctuations of what is most likely a permanently unstable economic system. We don’t do that sort of thing because it may suggest a lack of control!
Let’s have a look at non-linear Economic Dynamics.
Actual (REAL) economic results indicate little resonance with the symmetry and regularity suggested by a linear mechanistic dynamic system. (Something that moves predictably along a pre-determined path).
On the contrary, fluctuations and movements are totally unpredictable. That means that regular Deterministic Laws cannot apply.
If we look at an economic situation in say, the Eurozone at a particular point in time, we may try to predict an outcome in say, 10 years’ time.
However, a small variant or an incorrect assumption in our analysis of the initial economic situation will have an effect on the ultimate outcome. The earlier that variation occurs, the more devastating will the effect be.
For instance Greece’s hidden debt at the time of its accession to the Eurozone, undetected at the time, is having a huge effect on the Eurozone’s economic outcome.
Meanwhile, the economists, bankers and politicians crave and need the comfort of ‘stability’. They know that the further the Eurozone travels from the initial conditions at Greece’s entry into the Euro, the more anomalies“The Greek Effect” will generate. It’s a self-amplifying issue.
Consequently, the bulk of the work of Eurozone politicians is now concentrated on creating a series of ‘faux’ stabilities.
It is the fallout from Stochasticity which is causing fear with Determinism being their comfort and shelter.
It was only 60 years-or-so ago that stochastic considerations were appended to classical economic theory.
But the so-called New Classical Macroeconomics was no more than a compromise. “Let’s introduce a Factor X because we can no longer ignore it.”
Yet, the economists still needed their ‘models’ – because deep down they were still the mathematicians and physicists of old.
A formula was devised (SLUTSKY) which took the linear dynamic business cycle model and added random (not necessarily economic) terms which attempted to explain the real ‘actualités’!
At last, an attempt had been made to explain ‘exogenous shocks’ to an economic system by the introduction of nothing more than random error terms.
But what was REALLY missing in classical economic reasoning was the concept of NON-LINEARITY.
So, the battle was between a Linear Model with a Stochastic Term (a fiddle factor) versus a pure Non-Linear Model.
Obviously by now – 200 years from the beginning, we have to assume that the evidence for linearity in economics has been overestimated!
So, if we agree that we do need a new non-linear model of econonomics, what are we searching for? What are the other ingredients and how do we ‘work them in’?
Do we want a synthesis of economics, psychology, politics and sociology? Or do we simply stick to the notion of determinism?
Human evolution is viewed as a random process (although the way it is often expressed makes it seem as if scientists view it an ‘inevitable linear’).
The evolution of an economic system is also pretty random, except that, applying psychology, politics and sociology, it can never be a system that can develop naturally. (For example, Survival of the Economically Fittest).
Mind you, economists have already had several attempts at introducing the concept of non-linear economics.
Followers of Keynes developed theories which generated Real Business Cycle Theory but any exogenous shocks to the new non-linear system were considered as merely ad hoc disturbances.
Economists could NOT break away from LINEAR THINKING. Linear thinking was being applied in an attempt to imprison a loose and free system, which tended to CHAOS.
The result? More economic models that you can shake a stick at!
It is only fair to say that our understanding of economic phenomena has been greatly enhanced by all these models and formulae…… but still no cigar. No General Theory of Economics. No equivalent of E =mc2….+εe
So Chianella, Pun, Goodwin, Kaldor, Baldrin, Woodford, Barmal, Benhabib etc have all done their bit but we’re still NOT QUITE there.
Unfortunately, for all intents and purposes, many of the models did no more than introduce the concept of economic ‘white-noise’.
Chaotic systems generate their own randomness without need for external input. Therefore in a chaotic system, predictions can ONLY be very short term and even if there were deterministic rules within such a chaotic system, an inability or failure to 100% ‘book’ the initial conditions of the system will always yield forecasting errors.
This all suggests that economic forecasting (except that on a very short time-scale) is a nonsense. PLUS – the bigger the system, the bigger the CHAOS.
That would suggest that a proposal such as a EUROPEAN ECONOMY is a flawed concept because there is very likely to be an exponential amplification of Chaos.
The dynamic of a mega-economy is very different to a housewife balancing the books at home – although economists are still applying the same principles to both.
Unfortunately so far, classical economists continue to resist economic chaotic concepts.
The reason for this apparent intransigence is simple: it is very difficult to extract evidence of chaotic dynamics from economic data – especially on a meaningful scale. Especially if another dose of chaos is injected into the ‘mix’ by erroneous or spurious data.
In order to predict in a chaotic system a VAST (infinite) amount of data is required – far more than is normally available and so far, the search for Chaos in economics has not been successful.
Meanwhile it is Chaos which is making long-term economic forecasting totally impossible and increasingly sophisticated and precise measurement of ‘initial conditions’ incredibly difficult and potentially prohibitively costly.
If we imagine an economy to be like a cloud – subject to all those forces that clouds are subject to, we can see the impossibility of a mathematical model which can predict the size, shape and exact direction of the cloud or even its shape and volume as it travels.
Its ultimate shape will always remain a mystery.
Politicians, bankers and economists ought to be able to say ‘I don’t know’ without us constantly expecting magic answers which do not exist.
For example: ‘Mr Chancellor or Mr Banker – what will be the effect on the economy of billions in Quantitative Easing?’ Correct answer? ‘We don’t know.’
“The initial conditions of a system are always uncertain, while Chaos guarantees that these uncertainties make prediction impossible.” (Heisenberg)
THAT is the essence of Chaos within an Economics System.
Banks will fail, more housing markets will collapse and panicked governments will attempt to raise taxes from the survivors as they borrow even more in a vain effort to create yet more economic stimuli.
Today, in the UK, after Project Merlin (“a great success!”), the National Loan Guarantee Scheme (“a great success!”), we have the launch of the Funding for Lending scheme.
This latest scheme, is potentially worth £80 billion but to the trained eye, looks suspiciously like rebranded Quantitative Easing.
This scheme , like most “schemes” promises no economic outputs or goals and the wording is very interesting (and flabby):
“Funding for Lending aims to encourage banks to lend to both businesses and households”.
It “aims to encourage”.
Give it a rest, Gideon.
British politics are cyclical and there are two views as to the nature of the cycle. One is that Labour is in power for a bit and then the Conservatives come along with lots of shovels and clear up the mess. The other view is that it is Labour politicians who wield the shovels after the Conservatives’ turn.
There is another other great political constant , not-only in British politics but worldwide. Ultimately, all party leaders fail – as do their parties. Then the other lot make an attempt. Then the shovels come out etc. etc.
This is an unbreakable cycle. The cycle can only be broken by totalitarianism . However, totalitarian States always have a “sell-by” date because the chaos of the democratic party-based cycle is always waiting in the wings to deliver its own flavour of damage. Totalitarianism often degenerates into tyranny, followed by the chaos of either imposed or self-imposed democracy. Just look at Iraq.
The root cause of chaos in democracy is always created by the impact of political ideology on economics. The latest change in the United Kingdom government is an excellent example.
There is no doubt that the British economy is in chaos and that the Conservatives believe that their policies are the only way to hose away the Labour mess.
Chancellor George Osborne is standing where he started two years ago. In the economic foothills of a great 5-year economic and political climb. Unfortunately, the peak towards which he is guiding us will not remain still and two years after the journey began, the ultimate goal has moved.
If he is a good Chancellor, he will not be afraid to change direction as we travel. Let us hope that he does not repeat Labour’s mistake and refuse to shed the shackles of ideology when the going gets tough. To put it in political terms, there will be times when he will need to think as a Socialist and other times when he will need to be even more right-wing than currently seems healthy.
That is why it is good for him to have a few Liberals in tow – although, ideally a few left wing Labourites may have been preferable.
Adam Smith is his Wealth of Nations (1776) referred to the United Kingdom as “a nation that is governed by shopkeepers“. Subsequently, Napoleon said “‘Angleterre est une nation de boutiquiers.” In typical French fashion, neither original nor accurate but we understand what he meant. He thought that he was being disparaging whereas Adam Smith’s original quotation was more about the Britain expanding its Empire for the sole purpose of establishing new markets of customers for its own economy. Like shopkeepers would.
Had Napoleon foreseen what the British economy was to become in the 21st century, he may have said, “Angleterre est une nation d’administrateurs, fonctionnaires et conseillers en gestion”
England is a country of administrators, Civil Servants and Consultants.”
If there is one good reason for the present change in government, then that is it.
There are jobs which create wealth and there are jobs which are the so-called “Cost Centres” – the jobs which only spend. Administrators, both public and private who don’t actually contribute to production are a drain on an economy. Any organisation which is heavy on administration compromises its ability to generate a surplus – the same applies to a State.
Under New Labour, organisations such as the NHS experienced an massive influx of administrators and there has been a mushrooming of Quangos. More and more inquiries have cost the economy millions, as have the gradually expanding mini-Westminsters that are our Local Authorities. Empire-building has become the Public Sector’s favourite contact sport.
Obviously being politicians, the Conservatives are not able to say that there are too many non-productive civil servants but that is exactly what they do mean when they point out that the so-called Public Sector needs some rationalisation – but the gradual expansion of the administrative classes is nothing new.
My first job many years ago was in the Scientific Civil Service. Our establishment had just over 200 of us researching and more than 400 administrators. We were in prefabricated temporary structures whereas the pen-pushers had a modern office block. The argument was that as we were spending taxpayers’ money, no cost was too great in order to ensure that every single penny spent was controlled and accounted-for. Plus ça change.
Until very recently, there has been a “no expense spared” attitude among both public servants and politicians with little or no incentive for either of them to control expenditure. A case of rampant accelerating Cost Centre growth.
That is why the Chancellor announced a freeze on Public Sector pay and launched a probe into public service pensions and why the budgets of government departments will be cut by 25%. In addition, the Civil List has been frozen at £7.9 million p.a. and the Government will dispose of some of its assets in order to raise cash – notably, the air traffic organisation NATS, the Tote and the student loan book.
However, in spite of the banking system remaining one of the government’s major creditors, it has been “clobbered” with an annual levy which will probably only collect about £2 billion per year. Compare that with the total cost (so far) of rescuing our banking system, which is well-in-excess of £850 billion.
Unfortunately, the government is also committed to hand-outs to a long queue of advisers and consultants. Notably, Slaughter & May, the international law firm will be paid nearly £33 million for commercial legal advice and Pricewaterhouse Coopers over £11 million for its work on asset protection.
The government is also paying Credit Suisse at least £500,00 per month for advice on the asset protection scheme with a similar amount being paid to Deutsche Bank.
Needless to say, there are other government “advisers” on the payroll so the final total cost of the government’s bank rescue activities is far from established because it is open-ended.
In spite of the crippling government (and therefore taxpayer) expenditure on the banks, they are still declaring weirdly high profits, paying themselves bonuses and not delivering the commercial lending agreed with the previous Chancellor.
The government has not been able to fund all this purely from the income that it generates from taxation so it has had to borrow more and more. Hence the huge deficit and the international pressure to do something about it.
That explains the increase in VAT, the quite major changes to the benefits system, the various “tweaks” to personal taxation, the sell-offs and cuts in public expenditure.
That has all had to be counterbalanced by an encouragement for business to produce more, hire more people and thereby generate not-only more tax for the government but also stimulate us all to spend more in order to maintain the “produce-sell-buy-spend” cycle.
The Chancellor has taken a bit of a risk because he is assuming that the “produce” stage of the cycle will ultimately act like a defibrillator applied to a dying patient’s heart. He believes that ultimately it is business which makes an economy function. On the other hand, the Socialists believe that the cycle begins with “spend”. Hence their concept of , for instance spending on roads, railways and other government-driven projects in the hope that “spend” creates employment plus income for the individual, which in turn stimulates demand which drives production. Same principle but a fundamentally different starting point.
It has been shown many times that Cost Centres (mostly support functions) do not generate direct profit. The drivers of any economy are Profit Centres – the ones that make something and then sell it at a profit.
The current debt-ridden economic climate needs the harsh but correct approach favoured by the Chancellor. For the moment, the Profit Centres have it. Although that does NOT mean that the “Austerity Method” cannot be tempered with a bit of good old-fashioned government spending when necessary.
Ideology must never be a bar to sound economic common sense.
Finally, the government has the one major Cost Centre and that is the Benefits System. The system has been abused – of that there is no doubt. As part of its strategy, the last Labour government needed to massage its unemployment statistics. Encouraging more and more individuals to avoid the dole queue by remaining in education is an example of a transparently obvious ploy. The other was an over-generous benefits system especially the blatantly abused Disablities Allowance which cost the taxpayer over £11 billion per year.
The Disabilities Allowance was introduced 20 years ago by a Conservative government when under 1 million people were eligible. In the intervening years, the number of claimants has grown to approximately 3 million which represents a substantial percentage of the working population.
The Chancellor’s approach of proper medical testing for Disabilities Allowance claimants may sound Draconian but absolutely necessary because in spite of the fact that unemployment statistics will doubtless be adversely affected, there will be a corresponding increase in those eligible for work. Once again, an example of Cost Centres being converted into potential Profit Centres.
What of normal productive workers, entrepreneurs and those engaged in support functions which are designed to keep the economy going? Have we escaped intact?
The answer is that we are all subject to collateral damage, either through increased living costs or unemployment. The real unemployment figure has been approaching 3 million for a few years and it is only now that Gordon Brown’s Canute-like posturings have been consigned to the poubelle of history , that an accurate picture has emerged.
The picture is this:
None of us is as well-off as we imagined during the New Labour years of illusory plenty. Many have been screwing the system for too long. It started with the politicians and it is now our turn to realise that the days of “Fur Coat , No Knickers” are well and truly over.
FUEL, CIGARETTE AND ALCOHOL DUTIES
JOBS AND EMPLOYMENT
BUSINESS AND INDUSTRY
“Growth” is a word which is used far too rarely in all the messages and communiques which we have become accustomed to hearing emanate from the million-and-one Euromeetings.
Consequently, it is refreshing to see something (anything) written-down which indicates some intent from our own government.
On the face of it, a raid on Pension Funds (see below) does not look like a good plan and none of the goals (below) have dates attached to them. If they did have dates , we would probably realise that this is not a plan for an immediate growth-explosion but something which first needs to be created, drawn, discussed, re-discussed before the first spade is ever sunk into the ground. Neither is it an integrated plan – on the contrary, it can best be described as a series of disparate initiatives.
These projects will NOT make the country any richer, because they represent a “spend” rather than an “earn”, that is to say, they are not something which we can exchange for goods or cash with other countries. These are job-creation schemes which are often confused with proper growth.
Nevertheless, it’s a start. We have lift-off!
The Chancellor of the Exchequer, George Osborne, and the Business Secretary, Vince Cable, have announced a wide-ranging package of more than 140 reforms to build a stronger and more balanced economy. These measures include actions from the second phase of the Government’s Growth Review Phase II and the National Infrastructure Plan.
These measures are supported by an infrastructure package of £30 billion. This includes unlocking up to £20 billion of private investment through signing a Memorandum of Understanding with two groups of UK pension funds, an additional £5 billion of infrastructure spending in this Spending Review period, and commitments to £5 billion of capital projects in the next Spending Review period. In addition, the Government is supporting around a further £1 billion of investment by Network Rail.
To make the UK’s infrastructure fit for the 21st century, the Government has published its National Infrastructure Plan 2011. The plan sets out a critical analysis of the state of the UK’s infrastructure and sets out a pipeline of over 500 infrastructure projects. It commits to clear ambitions to address the key challenges in each major infrastructure sector – energy, transport, telecommunications, waste and water.
The key measures in the National Infrastructure Plan include:
The second phase of the Government’s Growth Review has been led jointly by HM Treasury and the Department for Business, Innovation and Skills (BIS). The Autumn Statement announces a set of further reforms building on this, including:
The Chancellor of the Exchequer, George Osborne, said:
“We are committed to making Britain the best place to start, finance and grow a business. The measures I am announcing today will help us to achieve this by creating an environment in which businesses are easy to set up, have access to credit when they need it and are able to grow without being held back by red tape. This action supports our deficit reduction plan and the Government’s monetary activism as we build a balanced economy.”
Business Secretary, Vince Cable, said:
“These measures are an important element of the Government’s work to create the right conditions for business to start up, invest, grow and create jobs. They sit alongside our deficit reduction plan and work to increase the supply of credit.
“I attach particular importance to infrastructure and Government capital spending, including that on innovation and science, and the credit easing initiative. Speedy and effective implementation is now required, building on the major progress that has been made implementing phase one.”
The first phase of the Growth Review was published in March 2011. Work has started on all 137 commitments and substantial progress has been made. The Government has published an update on every single measure announced in The Plan for Growth.
“We will do whatever it takes to protect Britain from this debt storm” in Europe.
Office for Budget Responsibility does not predict a recession in UK.
OBR forecast: GDP growth estimated at 0.9% in 2011. 0.7% in 2012 (down from 2.5%).
Borrowing falling but not as fast as forecast.
OBR sees additional borrowing of £5bn in 2011/12, £20bn in 2012/13 and £30bn in 2013/14.
Public sector pay awards set at average of 1% increase after the pay freeze ends next Spring.
NHS and schools budgets protected.
Deal on public sector pensions is “fair”.
In 2026 – state pension age will rise to 67.
Benefits uprated by 5.2% next April.
Credit Easing to help small business – ceiling of £40bn. National Loan Guarantee Scheme to use country’s record low interest rate to ease interest rates charged to firms who borrow from banks.
Country’s low rate to benefit families too through mortgage indemnities. Will reinvigorate “right to buy” to also help construction sector.
Bank Levy rate to rise from January 1st.
National Infrastructure Plan to get Britain building to improve roads, bridges, rail, schools etc. It will be paid for through”British savings for British jobs.” £20bn to come from pension schemes.
£5bn of additional Government spending on infrastructure plan – 90% of homes will have access tosuper-fast broadband.
Regional Growth Fund for England to get extra £1bn.
£0.5bn for science projects.
Corporate tax rate to fall to 25%.
Business rates holiday extended until April 2013.
8.7% unemployment rate forecast for next year by OBR.
New Youth Contract to offer work experience and assistance getting into private sector to help ease youth unemployment.
Extra £1.2bn to schools with 100 extra ‘free schools’. Maths Free schools to help UK’s science industry.
Free nursery places for 40% of the country’s 2-year olds (260,000)
Planned 3p per litre fuel duty increase in January is cancelled. August’s planned increase to be reduced.
Rail fares capped at 1% higher than CPI inflation
“Bend over, George”
A huge slice of the financial services industry is under taxpayer control – or so we all thought. The truth is that a phrase such as “owned by the taxpayer” is a nonsesnse. “
“Bailed-out with taxpayer cash” is the only truth.
The Royal Bank of Scotland, Lloyds Bank, as well as Bradford and Bingley have been bailed-out using taxpayer money but in truth, there is nothing that we, the taxpayers can do , even if the Treasury decides to sell all of the the taxpayer bank holdings to say, Poundstretcher – for a pound.
The Eurozone is about to go “pop” so it must be a good idea for the government to take steps to remove the taxpayer from what promises to be a bloodbath and to put all the bailed-out banks back into private hands – at the same time remembering that demutualisation and placing bank ownership into private hands is what caused the problem in the first place.
The Chancellors USP appears to be that the sale of the good part of Northern Rock to the Virgin Group will inject much needed new competition into the banking sector.
No it won’t.
If Branson has any sense (which he undoubtedly has), the new Virgin Bank will be tarted-up and floated within a few years. No matter what Branson does, the fact remains that “the taxpayer” has been royally screwed to the tune of of up to £700 million. Once again, an example of professionals negotiating with politicians and Civil Servants.
As far as “injecting competition into the High Street” is concerned – that is no more than a tacit admission by the government of its failure to control the banks during their 20-year gorge-fest. Even now, banks continue to profit while economies “tank” and they do it with taxpayer money PLUS a government guarantee! The classic “We win, you lose because we cannot lose” scenario.
The remaining piece of Northern Rock – the quaintly-named Northern Rock Asset Management (NRAM) is still “owned” by the taxpayer. The pattern is as follows:
The Treasury gives away the profit-making bits and is forced to keep the remaining dross, ultimately taking yet another “hit”. Companies such as NRAM, Bradford and Bingley with their very poor mortgage books will deteriorate and become moribund as a result of their customers’ increasing unemployment and the consequent accelerating mortgage delinquencies. A classic “lose lose” situation.
Here’s something to spell out to all governments: There is no such thing as a profitable exit from taxpayer-funded government interventions in the financial sector. (As the Eurozone is beginning to find out.)
Politicians don’t “do” profit. Otherwise they wouldn’t be politicians. Ask Gordon Brown and his gold sale.
The Chancellor is patting himself on the back that (subject to FSA approval) he has managed to extract £747 from Virgin and that, in addition, he appears to have been paid 90% of the book value of Northern Rock (the bank’s assets minus its debts). Once the ink has dried on the contract, just watch Virgin Money revalue those assets – if they haven’t done so already!!
There are supposed to be a few additional payments to the government from Virgin. For instance – another £50 million by the middle of 2012 and a similar amount if the company is sold-on within five years. Best keep an eye on that!
Northern Rock used to be a great Newcastle-based Building Society – so it is a great shame to see yet another former fat northern lass stripped and screwed in such an undignified way.
Not-0nly has the Government lost at least £400 million on the deal (that’s in less than three years) but the mortgage delinquencies within the remaining piece of our former Geordie Giant will ensure further mega-losses for the hapless taxpayer.
No doubt, the government will soon want to do some more “businessing”.
For instance, our 83% stake in RBS plus our 40% stake in Lloyds add up to a cool £40 billion.
(Lloyds is currently the MOST likely bank to experience something akin to the 2007 run on the Northern Rock – especially as it is increasingly reliant on the rapidly seizing-up wholesale money markets. Its share price has dropped by over 15% in the fortnight since its CEO, Horta-Osório took stress-related sick leave. One to watch closely!).
It is only a matter of time before the Chancellor will appear on our screens to tell us that his sale of RBS and Lloyds at a £20 billion loss was a “good deal” for the taxpayer.
Eurozone countries will have to swallow “a big loss of national sovereignty” by pooling resources and control over fiscal policy to restore long-term stability to the single currency, Chancellor George Osborne has said.
Mr Osborne said that the global economy was at its “most dangerous moment” since the crash of 2008, with real risks to British jobs and growth.
But he insisted once again that the UK will not be part of any EU fiscal integration and will not bear the financial cost of bailing out the single currency.
Writing in the Evening Standard, Mr Osborne said: “The financial risks of standing behind the currency will ultimately be borne by eurozone citizens. The eurozone has the financial capacity to restore stability. They now need to deploy it without delay.”
Mr Osborne also restated his opposition to a Europe-only Financial Transaction Tax, warning that a levy on trading in shares and derivatives which does not include the US or China would be “economic suicide” for Britain and Europe.
The European Commission launched proposals for an FTT in September, and they have the backing of France and Germany, who think the levy could help finance the eurozone bailout. Meanwhile, campaigners want some of the revenues from a “Robin Hood Tax” to go towards aid for the poor world.
But the Chancellor said: “Proposals for a Europe-only Financial Transactions Tax are a bullet aimed at the heart of London… The EU should be coming forward with new ideas to promote growth, not undermine it.”
Despite “grounds for optimism” following the formation of new governments in Greece and Italy, Mr Osborne warned that “this remains the most dangerous moment for the world economy since Lehman Brothers went down in the autumn of 2008”.
And he added: “The epicentre may be across the Channel in the eurozone, but the risks to Britain are no less real.
“Jobs and growth in our country have already been damaged by this euro crisis. In such uncertain times, this coalition Government’s priority is to help Britain ride out this storm instead of being consumed by it.”
Copyright © 2011 The Press Association. All rights reserved.
Dr Liam Fox and now Oliver Letwin have given David Cameron the sort of distractions which he does not really need. There has been speculation about each man’s political future and the doom-mongers reckon that “it’s all unravelling”. Nothing could be further from the truth.
A few years ago, I had a meeting at Conservative Central Office (when the Party could still afford Smith Square) with Lord Freeman who, at the time, was in charge of Candidates. We discussed the possibility of me testing prospective members of Parliament so that the Party did not have to rely on patronage and the depressingly amateurish local interviews which continue to be a feature of candidate selection.
Had we gone ahead with the plans, the present Cabinet would have contained some candidates who would have been pre-vetted by me. In the event, it was decided not to go ahead with something which may have caused certain future Ministers embarrassment. Mind you, this parliament has produced those who are managing maximum embarrassment without any external help.
However, in the main, DC has assembled a surprisingly able bunch of characters.
I’ve said it before and I’ll say it again – David Cameron is a good, solid Prime Minister and, given the time, he could become a great one. There is just one thing holding him back – the lack of depth in his “one-downers”. The Cabinet.
Here’s the list:
Nick Clegg, William Hague, George Osborne, Ken Clarke, Theresa May, Liam Fox, Vince Cable, Iain Duncan Smith, Chris Huhne, Andrew Lansley, Michael Gove, Eric Pickles, Philip Hammond, Caroline Spelman, Andrew Mitchell, Owen Patterson, Michael Moore, Cheryl Gillan, Jeremy Hunt, Danny Alexander, Lord Strathclyde, Baroness Warsi, Francis Maude, Oliver Letwin, David Willets, Sir George Young, Patrick McLoughlin, Dominic Grieve.
No problems at all with the first five:
Nick Clegg has the most difficult job, both as a politician and nanny to his confused Liberals who, in spite of (mostly) enjoying the aphrodisiac nature of power, are still a bit uncertain as to whether they are really participating or merely ballast. His sometimes diffident manner disguises a will of steel.
William Hague has grown into his job, in spite of the shaky start with Libya. He has credibility abroad which is probably one of the most important attributes of any Foreign Secretary.
George Osborne, unsurprisingly has been the recipient of more “stick” than any other politician but , love him or hate him, he has shown courage and tenacity and sometimes, downright stubbornness. Whether those attributes are born of economic understanding or just downright bloody-mindedness, remains to be seen. What is in his favour is that, unlike many others – he takes decisions and stands by them.
Ken Clarke has made the legal system accessible. I know that sounds a bit fanciful but in spite of his occasional too-straight talking , he is a great antidote to a legal system which makes bankers and their bonuses look like paupers. Currently, both the economy and David Cameron need a Lord Chancellor who at least “appears” non-elitist because sooner or later, we are going to scrutinise the multi-billion pound cash machine that is THE LAW.
Theresa May is annoying. However, she is good at her job and so far, does not appear to have put a a faux leopard skin kitten-heel-clad foot wrong. She too is not afraid to take unpopular decisions. Her handling of both the News International scandal and the inner city rioting was impeccable.
I would also add Iain Duncan Smith and Michael Gove to the A-team. IDS has proved that there is life after political death and has been delivering spectacular results with his pensions initiatives. He is both a great theorist as well as having a rare quality among politicians – he is a “doer”.
Michael Gove has been quietly ploughing the Education furrow and shaking-up an over-bureaucratic education system and has not been afraid to take some very unpopular decisions. He too is a “doer”. His thinking on education harks back to the 60s when children were educated and not used as test and statistics fodder. 10/10
Philip Hammond at Transport also belongs in the A-team and is without doubt a star of the future. He is lucky though to have both Norman Baker and Mike Penning as Parliamernary Under Secretaries. Norman the Idealist and Mike the “no shit” British Bulldog. Philip Hammond is seen on TV as a government spokesman much more than you might expect from a Secretary for Transport.
Dr Liam Fox has been delivering what, on the surface has been a solid job – if not a bit over-influenced by the balance sheet. He has always looked like the Conservatives’ “nearly man”. Soon, he may be the “never really was” man – as his political career begins to unravel. He, in common with all politicians should remember that Perception is King. The current perception of him is now tending towards the seedy.
Vince Cable was always going to be a problem and continues to be a bit of a thorn. He is a natural backroom boy and looks terribly uncomfortable in the back of a Ministerial limo. However, by far his biggest handicap is the fact that he is having increasing difficulty in disguising his Socialist views. He seems to be in permanent pain. Very soon, his political career will describe the downward arc of the parabola. He is the Statler and Waldorf of the Cabinet and compared to some of the other youngsters is from the wrong generation. His obssession with the bankers is hurting his credibility because he has not managed to do anything about them and never will.
Chris Huhne is even more annoying than Theresa May (!) but his personal life and the alleged driving licence naughtiness has totally blown his credibility. He is lucky that he is a Liberal – otherwise he may have already participated in an exit interview with DC.
Andrew Lansley is running the NHS in the way that you would expect from a career Civil Servant. He is doubtless very able – as a Civil Servant – but the NHS currently needs a large dose of commercial thinking. Everything that he has put forward so far has been through the wringer. Wrong man in the wrong job.
Eric Pickles is a great man in every sense. He provides the Cabinet with some Northern credibility. From a Labour family, this ex-Communist has travelled the entire political spectrum and is one of the shrewdest operators in Government. He is one of the few in Cabinet who is 100% suited to his brief with the advantage of being a working-class Conservative.
One Cabinet member who one could have been forgiven for thinking would, by now be running one of the great Departments of State is Francis Maude. He is a rock-solid operator and should, without doubt be on the real A-team. As Minister at the Cabinet Office and Paymaster General , he has been handed a temporary consolation prize. He has not peaked yet. As a former Managing Director of Morgan Stanley, he knows things. Street-wise.
Oliver Letwin is Minister of State at the Cabinet office is DC’s Policy Adviser. Like many intellectuals, he appears to be constantly stressed and “away with the fairies”. He is the archetypal analytical-amiable who cannot manage himself – or others – and has been given the “Special Projects” brief. He is currently the recipient of a press-roasting but, like a good luck charm, will always be retained in some capacity. It is a pity that other Cabinet members cannot spot “burn-out” when they see it.
David Willets, like Letwin is a white-hot intellectual who is good to have around. He is articulate and fiercely bright. He would have done much better , had he not looked like a spud. His great disadvantage is a lack of any “street-cred” because he has always been a political “wonk”. Having said all that, he is the ideal person to be looking after Universities and Science with the advantage of being so clever that there isn’t a single other member anywhere NEAR as suitable for this job.
Danny Alexander is another (young) career politician and his appointment has always smacked of tokenism with the added suspicion that David Laws is hanging about whilst DC waits for a respectable passage of time before he invites him back.
Sir George Young SHOULD have been Speaker of the House and his present post as Leader of the House is his consolation prize. He is marking time because he will probably be the next Speaker. In spite of a comparatively undistinguished Parliamentary career so far, he gives the Cabinet gravitas.
Next we have the Cabinet “solid citizens”. All are capable but not stars: Caroline Spelman, Andrew Mitchell, Owen Patterson, Michael Moore, Cheryl Gillan, Jeremy Hunt, Patrick McLoughlin and Dominic Grieve are all OK but will never set the world on fire.
Finally we have the youthful, Lord Strathclyde, or should I say Thomas Galloway Dunlop du Roy de Blicquy Galbraith, 2nd Baron Strathclyde. As Leader in the Lords, he is a very safe pair of hands and is a Conservative straight from Tory Central Casting. A great asset to the Cabinet.
Baroness Warsi is Chairman of the Conservative Party and although a competent TV performer, she always sounds as if she’s reading from a Tory pamphlet. She is very likely to be reshuffled out soon. Bearing in mind that Perception is King, her appointment smacked of tokenism.
So, you see that , in spite of the elitist-millionaire tags, the Cabinet is largely populated by a very cabable and solid bunch of operators – although the real depth of talent within the Coalition parties is still a bit of a mystery – even, one suspects, to David Cameron himself.
This Cabinet has a good mix of experience, intellect and toughness.
Whether or not you share their views or politics – they are (by far) the ones who have the very best chance of extricating us from where we have landed.
The next economic and banking collapse is going to make the 2008 crash look like a slight adjustment.
Once-powerful Western economies are booking quarterly GDP growths of 1% or less. For the non-mathematicians, that is within a rounding error of ZERO growth. So when you hear a Chancellor deriving solace from an economy achieving a growth of say 1.5% which was “better than the expected” 1.3%, we know that they and we are in trouble.
Politicians and central bankers have exhausted their entire repertoire on a THREE YEAR attempt to put their economies in order whilst at the same time propping-up a broken banking system. None of it has worked!
They all know that the tsunami is coming but there is no high ground to run to.
European politicians are rushing about, turning inaction into an art-form whilst economies and banks are merely standing on the trapdoor and holding hands hoping that somehow all this will go away and the entire system will somehow self-right. Their impotent prevarication can (and will) only result in two things – collapse and bankcrptcy.
Bankruptcy of governments, business and of private individuals.
Last week we had the very first example of a banker who more-or-less threw-in his hand, admitting that there was little-else that money could do. The Federal Reserve’s Ben Bernanke had the choice of either printing more empty dollars or not. The so-called Quantitative Easing 3 would have increased US inflation and made Investment Bankers happy. It would have enabled the bankers to further plunder the markets and create more of those illusory profits. They’ve been operating on that basis for two years now and perhaps Bernanke decided that enough was enough.
Mainlining money is never the long-term solution – it’s too addictive!
However, No U.S Quantitative Easing has simply accelerated the collapse of the United States economy.
Yes! It’s as clear-cut as that.
In the end, Bernanke took a leaf from the politicians’ book and decided to do nothing but sit and wait. NO mention of QE3 and no steps to promote economic growth.
He has decided to kick the the whole thing forward yet another month in the vain hope that Congress can deliver the next promise. THAT’S what you call a long-shot!
For the moment both Europe and the USA appear to be quite content to pause and doze in the middle of their joint economic tightrope until someone else (as yet unknown, probably China) comes along to coax them out of their torpor.
Unfortunately, America and Europe are entwined in such a way that if Europe falls, so will the USA.
We used to dismiss the PIIGS nations as the ones heading for the econo-slaughter house — Portugal, Italy, Ireland, Greece and Spain. Their problem is very simple – they have debts so huge that there is absolutely NO prospect of them ever being repaid. Their politicians are also waiting for something miraculous to happen sometime in the future.
The Euro saviour WAS supposed to have been the “strong man of Europe”, the one with the largest economy – Germany. Unfortunately,Germany has also hit the economic buffers. It’s growth in this year’s second quarter was just 0.1 percent!
France, Europe’s second-largest Euro-economy, has also ground to a halt. President Sarkozy’s has followed the UK route with huge budgetary cuts. That certainly looks good on paper and may lower deficits but will produce an impossible drag on an already-waning economy. THAT will inhibit growth and ultimately lower tax revenues – which will inevitably result in higher taxation.
The United Kingdom’s Chancellor can take the credit for showing everyone else the way to economic stagnation through the triple whammy of Government budget cuts, rising inflation and plunging consumer confidence. EXACTLY the conditions to discourage anyone from risking any sort of entrepreneurial initiative or borrowing from the banks to fund commercial expansion. That is, if the banks weren’t continuing to sulk.
Europe is frantically cutting spending in a desperate attempt to postpone the inevitable debt meltdown. Meanwhile Washington continues to rack-up up its national debt at the eye-watering rate of more than 10 percent per year.
All that America has achieved so far is to have its credit-rating slashed by Standard & Poor’s while its local governments, states and cities frantically try everything from releasing prisoners early to selling off the family silver.
The ENTIRE Western economy has ground to a shuddering halt with the weird unwanted bolt-ons of climbing inflation and consumer confidence at near an all-time low.
So what IS the solution?
The solution is comparatively simple and should be attempted in stages.
The first would be to reconcile ALL sovereign debt.
Secondly, the markets and banks would collapse – but at a controlled rate.
Thirdly, it should be admitted that the Euro and the Eurozone were both very bad ideas which developed into a grotesque sacred cow.
Then we could ALL start again.
The alternatives are greater budget shortfalls, greater deficits, even faster growths in government debt, followed by catastrophic collapses and Depression.
The former all require political decisions of such magnitude that even the politicians have come to realise that we do not have anyone with even remotely the courage to raise his or head above the parapet to take control.
So for the moment, it seems as if we’re knowingly headed for an economic holocaust.
So, unless the politicians wake up soon, we need to create hell and not wait for it.
From “Brother, Can You Spare a Dime,” lyrics by Yip Harburg, music by Jay Gorney (1931)
The MOST wretched Cabinet job is that of Chancellor of the Exchequer. I spent years criticising the “Iron Chancellor”, Gordon Brown. During his posturing days when he was surfing the economic wave created by his predecessor Ken Clarke and even when Tony Blair had declared him the “best Chancellor we’ve ever had”. I saw that he was overspending and that if he’d carried on, the solids would have hit the air conditioning even earlier than they did .
He was given the credit for keeping us out of the Euro but I suspect that the only thing that stopped him was his innate inability to make a decision. He was constantly hounded by self-doubt – and quite rightly so.
It took others several years to realise that the Iron Chancellor was more Irn Bru than of the metallic variety and in retrospect, perhaps didn’t quite deserve the consolation prize of the keys to No.10.
I had a sneaky admiration for Alistair Darling because he and I once shared a platform in the early 90s when he was in charge of Pensions. He came across as a Minister who had taken the trouble to familiarise himself with his subject and anyone who can do that with Pensions earns my undying respect. Plus, when the bankers crapped their own nest, he was the one who managed to wipe their noses and bottoms, give then some pocket money and send them back to their offices without alarming the rest of us.
His contribution has never been fully recognised because his then boss was arguably the worst manager and motivator I was lucky never to come across.
Nowadays we are in the hands of Gideon “George” Osborne. His public manner and voice belie that fact that he is a shrewd operator and very bright. The only problem that he has is one of communication. He is too defensive.
The Labour Government left him NOTHING. In effect, he was (and still is) is in a start-up situation. He has to create the conditions which give the rest of us a reasonable chance to create an economy which, had it been a horse, would have been shot by now.
For several years I have been saying that Economic Theory needs a healthy dose of Chaos Theory appended to it. Consequently, what has become increasingly obvious t0 some of us in the last few years is that economic forecasting has become a mug’s game. Both economic forecasters and politicians ought, by now to have learned that any projections have an inbuilt error of up to 100%. So, if growth is forecast at 5%, it is just as likely to be either 10% or Zero. This is exactly what we are finding today with inflation predictions. The Governor of England may as well hire Russell Grant or Mystic Meg to hand him the numbers.
Hence the overuse of the phrases “Higher than expected” and “Lower than expected”. In spite of the unpredictable variables – from the Japanese Tsunami to the Middle East Riots, politicians still persist in their own special brand of blind optimism. The nearest that they come to admitting that they are no longer in control of events is the occasional “Because of global economic conditions…”
Unfortunately, blaming the Global Economy now looks like an excuse, on a par with “the wrong kind of weather”. The “Global” excuse is only pulled out of the hat when things appear to be going wrong.
The fact is that a loosely integrated global economy contains an infinite number of variables, so Finance Ministers ought to relax and freely admit that currently, they are OBSERVERS rather than SHAPERS of economic events.
We have just seen a “surprise” increase in the United Kingdom’s unemployment figures. The figure is 2.49 million – which in reality means that there are probably over 3 million people out of work.
The Chancellor says that in spite of the “disappointing” figures, his policies “are creating jobs” – and do you know – HE IS RIGHT!
He has already cited “world markets” as an explanation – and once again, he is absolutely right! Unfortunately, after a year of unnecessary excuses, that in itself looks like yet another routine excuse.
The number of unemployed women has risen by 38,000. That is the sharpest increase in 2 years and the highest number of unemployed women for 23 years. Why is that? The truth is that no-one really knows. Unfortunately, politicians and “experts” cannot find it in their hearts to admit that they do not know. So we will have yet more pointless explanations.
The Chancellor of the Exchequer is NOT responsible for the current moribund state of our economy. That was caused by a mixture of Gordon Brown’s ineptitude, crooked Bankers and the resulting recession.
George Osborne may have the communication skills and manner of a 30s lounge lizard but, technically, he is without doubt the best we’ve got.
He deserves our support so that he no longer feels the need to sell us what is undoubtedly the most foul-tasting economic medicine that has EVER been dished out by a peace-time government.
Be nice to your Chancellor. The alternative sits on the bench opposite – a Brownite about to explode out of his grey suit and it ain’t a pretty sight!
Hug a Hooray.
Let’s get one thing straight. Neither the Chancellor, the Treasury or the Government have any legal hold over the banks. Except, of course National Savings, the mortgage part of Bradford and Bingley(the good bit was handed to Santander) and Northern Rock (they had no choice on that one).
The banks are holding ALL the aces and the Chancellor can do nothing except appeal to the bankers’ better nature.
The so-called “Project Merlin” , like the Big Society and its bastard and as yet unborn child “The Big Society Bank” are no more than pretty average marketing slogans. The concepts do however have the “all furs and no knickers” qualities that the ConDem Coalition seems to have applied to everything that it has touched.
Bob Diamond of Barclays will still have his £9million bonus, RBS’ Stephen Hester will still earn over £2 million, Stuart Gulliver of HSBC will take home over £5 million and Lloyds’ departing supremo Eric Daniels will soon be cashing in his severance present of nearly £1.5 million in Lloyds shares.
So the smugly complacent George Osborne continues to have achieved nothing. He should therefore STOP trying to fool the electorate – we had enough “spin”, half-truths and downright lies from the last lot. The ones who are the cause of the “tough choices”(yawn) that we keep hearing about.
So what is the magnificent “deal” that this former Conservative office backroom boy has managed to negotiate with the hard-nosed banking bastards to whom politicians are no more than a light starter and who, for years have been running rings round these primped amateurs who (wrongly) believe that they know how to negotiate and play with the big boys?
Politicians have always confused rank with ability. Most have been elevated on a Prime Ministers whim, whereas any senior banker has had to fight his way to the top and bears the sort of negotiating battle scars and responsibilities that someone like George Osborne can only dream of.
(Remember that it was politicians who cleverly more than doubled General Pracitioners’ incomes through their artful negotiation and it seems that they’re about to do it again).
I have acquaintances who relish negotiations with anyone political – hence the over-priced computer systems and all the other peripheral rubbish that has been flogged to governments over the years. The latest was the expensive and pointless www.police.uk There are hundreds of other examples of bad government negotiation, both at national and local level.
It has to be said that former Warburg Investment Management Director and now (very recently) former ConDem Coalition Treasury spokesman, Baron Oakeshott of Seagrove Bay was right and continues to be right.
In December 2008, he said “…banks must start lending to small and big business again or they will imperil the British economy”. He went on to say that the then Secretary of State for Business had grasped “much more quickly than the amateurs in the Treasury how shocking it is that the banks have virtually gone on strike.”
He continued:” Private companies with millions of jobs are in great danger of going down next year and we need to focus on lending to big business too.”
Over two years later, the banks are still not lending and the only major change is that the New Labour group of Treasury amateurs has been replaced by new cannon fodder, led by the posturing Gideon “George” Osborne .
Yesterday Lord Oakeshott left “by mutual consent” (was fired) for saying that the Treasury’s negotiating team had an “awful combination of arrogance and incompetence”.
So what did the Osborne Gang achieve? Was Matthew Oakeshott right again?
John Walker, chairman of the Federation of Small Businesses said that the commitments which the bankers signed up to were “unenforceable”. He’s right.
The banks have agreed to “show restraint” in the matter of bonuses. That is meaningless. When you negotiate and you reach an agreement, it should contain two out of three of the following measures (they’re very straightforward): Quality, Quantity and Time. For example: By the end of 2012, the maximum bonus that anyone within the banking industry can receive will be not more than 25% of their base salary.
That would be a properly negotiated agreement. “Show restraint” is a mere promise with no comebacks . It is a gentlemens’ agreement.
Tha banks have agreed to disclose the salaries of their five highest employees. Why? It’s pointless and, oh yes, although the amounts will be disclosed, the names of the recipients will not. When negotiating, one technique is to throw your opponent a worthless bone which he thinks is of value to him. The bankers threw Gideon the useless “disclosure bone” and he lapped it up, no doubt brought it back to his master for the customary pat on the head. “Well done Gidders. Goood boy!”
Apparently the banks have agreed to lend £190 billion to businesses including £76 billion to smaller businesses. When? Starting now? Which bank is lending what? Are there any new rules? Is the government expecting the banks to ease their too-stringent lending criteria? Is there going to be a Lending Ombudsman to complain-to when my own bank refuses a perfectly reasonable request for a couple of million unsecured folding wedge?
The most scandalous part of the agreement is the £200 million which the banks intend to steal from bank “dormant” accounts in order to fund David Cameron’s currently abstract “Big Society Bank”. These accounts belong either to dead people or people who have simply forgotten that they have a bank account.
There are about half a million dormant bank accounts containing over £500 million languishing on bank balance sheets. These are accounts which have not seen transactions for a while but on which banks continue to pay interest. Presumably, once the accounts have been plundered in order to fund Cameron’s community projects, the banks will no longer have to pay interest to the dormant account beneficiaries.
Another well-negotiated victory for the banks! They not-only stitch up the Chancellor but they manage to save money as well!
The bankers continue to rob their own clients while the ConDems simultaneously act as” lookout”, “wheels man” and “fence”.
This has been promulgated by the Chancellor as a cleverly negotiated deal and needless to say, he is expecting maximum Brownie points.
On the contrary, what he has been given by the condescending bankers is a series of shallow (and worthless) concessions or promises which are not worth the paper they’re written on – assuming of course, that they did actually commit to paper.
No doubt, the Treasury Press Office will shortly be distributing the historic document.
Lord Oakeshott was right. Amateurs.
There has been some negative publicity for Google and the fact that while they were zooming around the country, photographing, they somehow managed to hack into our unprotected routers and glean personal information from our PCs. A few weeks before, we had the scandal of reporters hacking into mobile phone signals and snooping on private phonecalls made by celebrities and politicians. Here is the transcript of one such conversation:
George: Hello, is that you pater?
Sir Peter: Who is this?
George: It’s George. ….Your son
Sir Peter: Oh, is that you Gideon? How are you?
George: Pater – Please don’t call me that. You know that I prefer “George”.
Sir Peter: OK GEORGE. What can I do for you. What about ” Gidders”. Your chums used to call you that. “George ” sounds a bit common these days.
George: “George” is fine. Funny you should mention that because that’s what I want to ask you about. I can’t ask anyone at the office because they’d laugh at me.
Sir Peter: Well….erm… George….If… it’s about the birds and the bees – I thought that we had that conversation when you were 26.
George: No, Pater. It’s about the working classes.
Sir Peter: What about the working classes.
George: Have I ever actually met one?
Sir Peter: Have you ever met what?
George: A working class? I think that I’d recognise one if I saw one but I’m not quite sure what one is. What exactly is it? Is it a person? For instance is it to do with being poor? Is everyone who earns less than £100,000 a year “working class”? Do they wear caps and suffer from consumption? Where do they gather?
Sir Peter: Forgot to ask you George – what are you up to these days? Still writing jokes for that northern bloke who wrestles with Sebastian Coe? Now what was his name? William? William Bushmill?
George: Hague! It was William Hague!
Sir Peter: I knew it was some sort of whiskey. Hague. That’s right. Wasn’t he Leader?
George: Pater! I’m the Chancellor of the Exchequer!
Sir Peter: (LAUGHTER) Chancellor of the (SNORT) what? Did you say Exchequer? Do you mean Ken Clarke’s old job. What’s Ken up to these days? He’s a right laugh. He’s working class but he’s managed to do such a good accent that we almost treat him like one of our own. Anyway – what do you mean Chancellor? You did History at university, didn’t you? What is it about history graduates and the Chancellor’s job. You were never good with numbers. Wasn’t that Commie Gordon Brown another History boy?
George: David asked me to do it, so I’m having a go. Didn’t you see me on the television? I wore my best suit and when I finished my speech, Dave and the rest of them patted me on the back and then we went for some fizz cocktails. It was brill!
Sir Peter: That was you, was it? Your hair looked so black. Have you been colouring it Gideon? You naughty boy!
George: It’s George. Fucking GEORGE!
Sir Peter: Calm down, Gideon. What would your mother say if she heard your potty-mouth. You sound SO working class.
George: Working class? Do you really think so? That’s cool.
Sir Peter: What is cool? What’s that mean? Have you been at the Colombian nose powder again. You promised ………Gideon?
George: For fuck’s sake, pater. I’m Chancellor of the fucking Exchequer. I’m an important politician……There’s a big Jag that goes with the job!
Sir Peter: Do you still keep in touch with those Buller Boys? Such a nice crowd. Still having a good time with that nice Nat? Always liked him.
George: Pater…That fucking Rothschild wanker tried to drop me in the shit by grassing me up about a visit to a yacht and trying to bum £50k off his Russian employer. He’s supposed to be an adviser to the Russian but I reckon he’s no more than his fund- bitch. A hedge whore!
Sir Peter: Gideon! I’m afraid that I didn’t understand a word of that. You are definitely sounding common.
George: Really? Thanks, Pater. Our GDP growth is up. 0.8% up. We’re having a party later but Dave says that we must be careful in case we’re spotted by poor people. Those working classes.
Sir Peter: GDP? What’s that?
George: Not quite sure, Pater – but I have lots of advisers. Some of them know.
Sir Peter: Why is 0.8% a good thing? It sounds pretty crap to me. 0.8% in a month is only 9.6 per year…..I read that the Chinese managed that is the quarter between July and September
George: Between you and me…it IS crap. But we put the word out that it was going to be much worse and the surprise is keeping everyone happy. Even those zombie economists. By the way, the 0.8% wasn’t for the month. It was for the quarter between July and September. The same quarter during which the Chinks managed 9.6%. Really crap but we’re getting fed up with blaming those Labour tossers so were making it look as if we did it! The most exciting bit is that Standard and Poors have increased Britain’s credit rating. Reeesult!
Sir Peter: Standard and Poors? Isn’t that a bisquit? Gideon – why don’t you come back and help us with the wallpaper. For the moment we’re doing really well. As you are Chancellor – can we put “By Appointment to the Chancellor” on our van?
George: No pater, you cannot! I have to go now. The First Secretary to the Treasury is being beaten up again. He gets beaten up more times than an adopted cross-eyed ginger kid. I don’t think you’ve met him. We call him “Beaker”. You know, Beaker from the Muppet Show.
Sir Peter: I really have no idea what you are talking about. You are such a disappointment to your mother. Osborne and Little is so well-known and yet you go off to Westminster and become Chancellor of the Exchequer when there’s a REAL job waiting for you. Right here.
George: Have to go now, pater. My chauffeur has just turned up and is taking me for a ride.
Sir Peter: You have a chauffeur? Still drinking, eh? You asked about working class. A chauffeur is working class. Talk to him.
George: He’s not working class. He’s quite clever and used to be an existentialist.
Sir Peter: An existentialist chauffeur? How do you work that out? What made him an existentialist?
George: He used to sleep on his sister’s kitchen floor with his gay boyfriend and claimed Jobseekers Allowance. He helped me with the Spending Review.
Sir Peter: Still mixing with a bad crowd I see, Gideon.
George: There’s nothing wrong with the Bilderbergers. Even Ken Clarke goes to the meetings. It’s just like Round Table but without the Estate Agents and Dentists.
Sir Peter: I have to go now, Gideon. Your mother needs to go to Homebase. We’ve run out of wallpaper paste and I still have no idea what you’re talking about.
George: Bye pater and love to mummy.
Sir Peter: Goodbye Gideon. Please pass on our good wishes to that Derek Cameron and his friend Sam.
“Do you know what THIS means in Italy?”
Since the Chancellor’s spending statement you may have noticed that we are being fed the occasional snippet of information which was not mentioned in the original speech.
For instance, the government is in severe danger of damaging its hard-won “green” credentials by allowing DEFRA to sell-off half of the land currently looked after by the Forestry Commission. Publicly-owned forests may soon be turned into golf courses, holiday villages and other little-needed leisure facilities. They are planning the sell-off for two reasons. The first is the obvious one – to raise cash and the second is the over-simplistic belief that such a move will create jobs.
As usual, the government is planning a sell- off when prices are at a historic low. Margaret Thatcher did it with our oil, Gordon Brown sold our gold to the Chinese after he had driven the price down and now, the obscenity that is the coalition is about to dispose of our heritage – some of which protected by laws enacted in the Magna Carta.
Zac Goldsmith MP headed David Cameron’s environment task-force says that he is in favour of Forestry Commission land being disposed of. Not-only content with vandalising our economy, this government appears to be readying itself to destroy our green belt. In twenty years’ time, are we going to enjoy driving through the New Forest ” housing and golf” estate or the Forest of Dean caravan comple? Perhaps we should hand the lot over to Centre Parks and be done with it.
The clowns in government are once again demonstrating attempts at politico-entrepreneurship bycreating economic havoc and in the long run, costing the nation a fortune.
The government is once again meddling in things that it does not understand and by playing at business, it is surely beating the economy into the ground just as effectively as Labour managed to do from the nineties onwards.
It was announced today that not-only is confidence at an all-time low within the public sector but also in the private-sector. When private sector confidence takes a bashing, it tends to suggest that those in charge are not in a bullish frame of mind and are waiting. Currently none of us is sure what anyone is waiting for but this week there will probably be announcements that we are about to be visited by what we have all been expecting – another hard-earned dose of recession. The famous “Double-dip” – but that is still no excuse for flogging-off the country’s assets.
Any State which is thinking of selling assets is no different to the strapped-for-cash individual who convinces himself that he doesn’t really need his TV or computer and sells it on ebay. OK, he then has money in his hand but he spends it and…….? It’s back to square one. He can continue to dispose of assets until he has none left. Then what?
A report published today says that the average UK household-debt is approaching £9000 – and that excludes mortgages. At the end of August , the total UK personal debt stood at £1,457 billion.
Between us, we owe more than the whole country produces in a year but what is most surprising is that personal debt in the UK is still on the increase. Sadly, some people are now borrowing in order to eat and to keep a roof over their heads. This is the atmosphere in which our coalition government seems to believe that business is about to expand and thus create jobs which will offset those lost as a result of their decimation of the public service industry.
They appear to believe that Government rhetoric is all that is needed to convince us all that they have the formula for a miraculous economic recovery. Meanwhile, the Office for Budgetary Responsibility put the chances of the government’s strategies working at no more than 60%.
George Osborne is about to announce a £200 million investment is many government’s favourite word – TECHNOLOGY. Oooooh! Harold Wilson used the technology scam first and since then, whenever a government is in trouble, they roll-out the T-word. There will be Innovation Centres which will help “connect business to new technologies“. George, dear, we already have Innovation Centres and they are populated by ex- bankers who dispense advice to “budding entrepreneurs” on how to find their way around a balance sheet and how to prostrate themselves when they visit their own bank to beg for development capital.
Talk to real entrepreneurs and we will tell you that rather than waste another £200 million, the government should use that money to repay a day’s interest on the national debt and not attempt to recreate what are in essence talking shops and luncheon clubs.
The Chancellor talks of a “New Economic Dynamism”. Nice phrase, well constructed but without a coherent plan, there will be no New Economic Dynamism. Economic recoveries are notoriously fickle mistresses and are certainly not to be relied-on to happen just at the time when you wish that they would.
It’s no good looking at the Germans and the incredibly fast upturn in their economy. They are still the world’s top mechanical engineers – that’s why, for instance they are China’s main supplier of industrial machinery.
In February 2009, Gordon Brown said that Britain’s recovery from recession can be helped by doubling exports to China. George Osborne said the same thing three months ago. The only problem is – what can we export that the Chinese want? Call Centres?
That’s an important question because there is no point in producing goods without there being a demand. Currently, every economy in the world is looking at China as its next main market – as China moves from being a pure producer to major producer-consumer .
In his address to the CBI this morning David Cameron managed to avoid the “broad, sunny uplands of economic recovery” phrase – but the might as well have used it – because that was his overall message.
If that is what is in his mind, he ought to beware. Winston Churchill took the United Kingdom through its darkest hour and look what happened to him.
He lost the 1945 General Election.
Mind you, it was different then.
He had been at the head of a dodgy coalition government.
Public sector employees, the unemployed, those on benefits and students did not cause this country’s economic woes. They were the fault of incompetent politicians and insatiable bankers.
So who is now going to bear the burden, as the Chancellor attempts to dig us all out of a hole by….well….digging.
In spite of the Government’s protestations, it will be the poor who suffer the most. The poor were put on this earth to hurt and in the past, it has always been the most disadvantaged who were made to feel the real pain. Today is no different.
Good Conservatism is a very straightforward concept. It is about giving the individual and family the means to provide for themselves and at the same time making sure that society’s most disadvantaged are looked after. Good conservatism is fair and compassionate.
The present mutation of a government is anything but compassionate – on the contrary, it appears to be revelling in the dreadful measures which are about to place a stranglehold around the taxpayers’ collective neck.
There is a “faux” triumphalist air and false bravado, as a young and inexperienced Chancellor continues to exhibit the youthful arrogance of someone who believes that he is right and all dissenting voices are wrong. This is beginning to look suspiciously like the beginnings of a totalitarian state. The Prime Minister said that politicians should learn that they “serve” and do not rule the people. Once again – empty soundbites.
Remember the Nanny State? That was the main criticism of the last Labour Government. Somewhere between last May and now, the Labour Nanny appears to have morphed into a strict Conservative Governess – a Miss Whiplash. It seems that we have a Miss Whiplash State. Do as you’re told.
The government has also made a point of saying that it welcomed “independent” assessments of its work. Transparency and all that. Well, the Institute for Fiscal Studies has said that the Chancellor’s Spending Review is NOT fair and that on “every measure” the poorest households will be worse-off. They will be the ones bailing out the banks.
Let’s get one thing straight about the banks. They do NOT make anything. They are a service industry and their primary function is to move and redistribute money. That is all that they do. They are very good at “creating” profits out of what is effectively thin air and every now and again, they will be exposed because their sums can never add up. Creating more money on paper than exists in an economy is not a difficult accounting exercise but it is of course, a con trick.
Go into any bank and add up all of the money that their clients have on paper and then ask to see it. You will be told that the money is not there because it is “invested” in property, shares, gilts etc. Another con. Go to the funds and ask to see the money and you will be told that it is held by the banks. What about property? That sounds like a good solid investment.
In 2005 RBS moved into new premises which cost £350 million. No doubt that over the last few years, this head office has been revalued to increase its book price in line with inflation but think about this: An asset is worth only what you can sell it for. How many people do you know who need a £350 million head office? So how much is that building really worth? Nothing. Another con.
There was a time when banks could (and did) operate on the margin between what they paid their investors and what they charged their borrowers. Their cost base is now so high that they are forced to gamble in a vain attempt to make the books balance. The money which they ran out of in 2008 was their clients’ money as well as a very large slice of “smoke and mirrors” fictitious money which never really existed and was used to con governments into very rash handouts.
The Chancellor’s new Bank Levy (which, unlike us,the banks were briefed about a couple of months ago) will raise about £2.5 billion a year from 2012. The levy will apply to the global balance sheets of UK banks and the UK operations of overseas banks.
The Treasury said that the legislation will encourage banks to take fewer funding risks. That is arrant nonsense. How the Treasury makes the mental leap from Bank Levy to having created some sort of deterrent which will encourage the banks to be more prudent in their investment strategy in anyone’s guess. It is a con.
There is only one way to encourage the banks to fall into line and that is by legislation which limits their ability to invest in commodities, shares and derivatives and which requires them to invest a set proportion of their investments in the comparative safety of government gilts.
Meanwhile, the banks are already moaning that any additional tax burden placed on them may undermine the attractiveness of the United Kingdom as a financial centre. Another con. £2.5 billion is such a comparatively minuscule amount that it will be totally unnoticeable to the banking industry – especially as the government will soon be handing them yet more money through the medium of Quantitative Easing
Mark Hoban is financial secretary to the Treasury and said that he HOPED that the legislation would. “Firstly, ensure that banks make a fair contribution in respect of the potential risks they pose to the UK financial system and wider economy.” A con. The 1.5 million children who lose their Child Benefit will contribute almost exactly the same amount as the banks.
Mr Hoban continued:“Secondly, the final scheme design incentivises banks to make greater use of more stable financial sources, such as long term debt and equity.” The bank levy will have no effect at all in steering the banks to more responsible investment operations. Why should it?
The British Bankers’ Association, which is the bankers’ attack dog, has warned that the levy would have an “significant impact” on more than 200 overseas banks operating here. Their main argument appeared to be that some overseas banks who would be asked to contribute may be taxed several times in different jurisdictions. Tough.
The banks have already spent several years avoiding their tax obligations by offsetting losses during the financial crisis against their current and future tax bills. The banks made losses, offset those losses against their corporation tax, then were bailed out by the taxpayer to the tune of trillions of pounds. They will continue to use those losses to their advantage for many years to come.
Effectively, the banks are profiting from their losses by withholding tax revenue. The amount? Banks may avoid £19 billion tax in future years by offsetting profits against losses sustained during the financial crisis.
Chancellor George Osborne said that he wanted “to extract the maximum sustainable tax revenues from financial services”.
“We neither want to let banks off making their fair contribution, nor do we want to drive them abroad,” “Many hundreds of thousands of jobs across the whole United Kingdom depend on Britain being a competitive place for financial services.”. Those are the words of a Chancellor running scared before the banking industry and who is willing to distress vast swathes of the British population rather than even fluster one banker.
Mr Osborne also made it clear that he expected the major banks to sign a new code of practice on tax avoidance.
So far only four of the 4 out of 15 leading banks operating in the UK have signed up but the Chancellor says he wants all of them to do so by the end of November. Again a measure of the disdain in which politicians are held by bankers. George may have to beg the banks to sign the code of practice but no doubt there will be a price to pay. Let’s hope that he can disguise the carpet burns on his knees.
Britain’s government still owns large stakes in Lloyds and RBS , which together with Barclays and HSBC dominate the country’s banking landscape. That means that the government has lots of “clout” within the banking industry but is still afraid to use it. The government has been comprehensively out-negotiated and out-maneuvered by the banking fat-cats.
The government bailed out the banks with £200 billion of taxpayers’ money. That added to the deficit which means that once again, it is the taxpayers’ money which is required for a bail out – only this time, we’re bailing-out the government itself. Then the government will once again bail-out the banks etc etc.
PLUS, while they’re awaiting the next handout, the banks remain custodians of our money and as a bonus, are allowed to rip us off on charges. To add insult to injury, they are making it near-impossible for the small businessman to borrow development capital – except at eye-watering interest rates which are designed to ensure that although funds “are available”, no-one can afford them.
Fair? Fairness has nothing to do with it.
“Oooh! Yesss! That WAS good! I was SO good”
Jobs , jobs, jobs. There is no doubt that the coalition government is gambling on jobs suddenly reappearing Phoenix-like as the economy awakens from its present inanimateness. Make no mistake, it is no coincidence that the Chancellor’s Statement was delivered towards the end of October. Christmas is on the way. We all tend to spend a little more in the run-up to Christmas and that buys any government a little more time as underlying consumer figures are distorted by the abnormal pre-year-end activity. Traditionally, there is even a small upswing in the employment figures as retailers and producers hire temporary staff.
However, it is still fair to say that the jobs market has become markedly more difficult over the past few months.
Of course it’s going to get more difficult as the government’s austerity programme to address the country’s debt mountain begins to kick in. How will it affect the economy? Of course, if there are people losing their jobs or are fearful of losing their jobs, they tend to save more and spend less. That has a very significant impact on final demand which is expected to remain under pressure. All the boarded-up shops in our towns are testament to the continuing downturn in demand for all non-essential goods.
The negative job-market and consumer demand predictions will ensure that economic activity will become even more becalmed than many commentators believe.
UK inflation continues to remain above near-term projections but the medium-term outlook is for inflationary pressure to fall back. That’s according the Bank of England’s own quarterly inflation report. Then, it believes that inflation will rise because of the impact of VAT hikes – because the tax increase will most certainly be passed onto consumers by every retail outlet still in business.
However because the bank judges the risks to inflation to be high both on the upside and on the downside and given more general economic concerns, then economic policy, monetary policy and interest rates in particular will remain where they are for a considerable period of time. It follows therefore that there won’t be a huge amount of pressure to unconventional monetary policy either.
Currently, the Bank of England is showing signs that it believes that it is best not to touch anything – with one notable exception. The only fiscal stimulus that they know. The Easy One. Quantitative Easing.
If you take the view that we might have a double-dip depression, then you are presupposing that we have already had some sort of recovery. Some of us take the view that although the data shows that the we’ve had a recovery, it is no more than a statistical anomaly associated with the earlier substantial fiscal stimulus enacted globally to try and kick-start economic activity.
If you strip-out that stimulus, the underlying figure is very much more pedestrian and much more in keeping with a prolonged period of very subdued or zero growth. Technically, we appear to be out of recession but actually we are not. That alone is a very good reason to suppoose that the Chancellor’s timing is very wrong.
Of course whether an economy experiences +0.1% or -0.1% growth, it won’t really really feel like it to the man or woman on the street because conditions remain remorselessly tough as they have done so several years now.
Measures such as those outlined by the Chancellor always have consequences. For instance, an increase in petty crime, strikes, absenteeism, a decrease in productivity are just a few. The United Kingdom already has one of the world’s worst shoplifting records. To the year-ending June 2010, retailers lost £4.4billion to theft. That’s well over £12 million per day! That will increase.
It seems that the Coalition government is attempting to clear-up the inherited economic mess by sapping the very foundations of United Kingdom society. The Welfare State and the Public Sector will be undermined as never before and judging by yesterday’s reaction of the entire Parliamentary Conservative Party, it has all been done with a mixture of social sadism, joy and vain hope. They should remember one thing though – this is a first. This type of extreme “slash and burn” has never before been attempted and could easily plunge our economy into depression.
There are some (Price Waterhouse Coopers among them) who say that there is a real possibility that for every Public Sector job lost, a job will be lost in the Private Sector. That does not bode well for the Chancellor’s hopes for an entrepreneurial upswing in the SME community.
The preening Chancellor’s performance was not for the British public, it was for the international financial community and others. He was showing-off to the IMF, the World Bank, his Bilderberg chums, his family and friends. It was a “Hey, look at me now” curtain-raiser to a potentially short Front Bench career.
His irksome performance during yesterday’s Spending Statement was not a particularly edifying spectacle. The post-“I commend this statement to the House” backslapping and whooping on such a sombre occasion was sickening.
One suspects that in the months to come, we will see a chastened, more contrite and wiser George Osborne at the Dispatch Box.
The Chancellor says that the economic measures that he has listed in today’s Spending Review will not endanger the United Kingdom’s economic recovery. The reality is that he doesn’t know what the effects of his course of action will be.
The phrase “Global Economy” is usually saved by politicians for the time when their plans take a battering and they need a “Get-out-of-Jail” card. The best that any government can do is to take a 50:50 punt as to whether or not its economic measures will produce positive outcomes.
However, if other economies flounder – especially those which spend money with us, then we will be in real danger of recession and depression. We have absolutely no positive control over other economies and we remain as vulnerable this afternoon as we were this morning. As draconian as the Chancellor’s measures appear, in the grand (global) scheme of things, they could be irrelevant.
It is still seems bizarre to some that decisions are still taken on a micro (national) level, rather than on a macro (international) level. Not what you would expect in a fully interdependent global economy.
The Coalition government is relying on private sector growth and the theory is that private sector companies should provide employment as order books swell and revenue increases. Unfortunately, here within the UK, we are not spending as much as we should and our international clients (people we export to) are not buying either.
More and more people will soon be appearing in the dole queue which will “up” the government’s unemployment benefit bill and offset many of the savings that are being engineered as a result of today’s spending review.
The unemployed will not be spending and those who are in employment, simply awaiting the inevitable will not be spending either – out of fear. That means that demand for goods will come down.
There are other possible sources of increased revenue for the government but it appears to be half-hearted in their pursuit. The Chancellor has announced that HMRC will go after an additional £7 billion in “avoided” tax. The latest figure for tax evaded and avoided adds up to between £20 billion and £40 billion per year.
Who is being blamed for the deficit? The consensus appears to be Bankers and/or the Labour Government.
George Osborne said that the government will make the largest cuts to public spending since World War II by slashing benefits and public sector jobs in a five-year austerity plan.
Osborne confirmed that over the next five years there will be £83 billion in government spending cuts . That’s approximately £15 billion per year.
In that time, many as 450,000 public sector jobs will be lost, welfare payments will be sharply reduced and dozens of scheduled government projects will be halted. He added that even Queen Elizabeth II will take a hit, cutting her royal household budget by 14% over four years.
“It is a hard road, but it leads to a better future,” Osborne told a lively House of Commons in his hour-long statement.
After spending billions bailing out indebted banks, and suffering a squeeze on tax revenue plus a hike in welfare bills, he said it would take “time to turn around the debt supertanker.”
Osborne said that a temporary levy on banks which is set to be introduced in January will be made permanent, potentially raising billions of pounds.
“We will extract the maximum sustainable taxes from the banking system,” he said, being mindful of the fact that if there was an attempt to “skin” the banks, they would be very capable of “upping sticks” and operating from offshore. Another Chancellor tiptoeing around the banking industry.
He said the state pension age for men and women will reach 66 by the year 2020, four years earlier than planned, potentially saving £5 billion per year.
Osborne told MPs that cuts would fall in almost all areas of government spending.
The police budget will fall by 4% each year, while the Justice Ministry will cut its budget by 6 percent per year through a combination of redundancy and a more lenient prisoner-sentencing policy.
But Osborne explained that spending money on tackling terrorism would be maintained to help Britain guard against al-Qaida and dissident Irish republicans and to ensure the safety of the 2012 London Olympics.
Hundreds of London-based diplomats will lose their jobs under a 24 percent cut to the Foreign Ministry’s budget, while the BBC must take on the full costs of running the World Service. Previously, the World Service was funded by the Foreign Office and that used to raise questions of its impartiality.
However, Britain will meet a U.N. target to spend 0.7 percent of gross domestic product on overseas aid despite budget constraints.
“Britons can hold their heads up high and say even in these difficult times we will honour the promise we made to some of the poorest people in the world,” the Chancellor said.
Members of the public have been anxiously awaiting details of Osborne’s plans for a few weeks and through a mixture of “spin” and carefully choreographed leaks, the total impact of the expenditure cuts was greatly lessened.
Recent surveys and protests suggest that many British voters are uneasy about the cuts and economic opinion is divided as to whether or not this government has made the correct decision to deliver such swingeing cuts to public expenditure.
The following assertion was made by George Osborne: “Today, Britain steps back from the brink”. That was an excellent speech writer’s sentence but the line was delivered more in hope than fact.
These days, world economics owes more to Chaos Theory than Keynes, therefore it seems a little premature to think that we have stepped back from the brink. We are still standing on the edge. If we have distanced ourselves from the brink there is always a good chance that the step back has been into the double-dip starting blocks of recession.
The next few weeks will be crucial. There is a real likelihood of more quantitave easing which would explain the Chancellor daring to suggest that he intends to clobber the banks – especially if they have been pre-briefed by the Bank of England.
On the down-side, the next two weeks will also be remembered for the endless debates between politicians and economists as to the efficacy or otherwise of the Chancellor’s initiatives.
The fact is that no-one really knows because the Coalition and its Chancellor are assuming and not guaranteeing economic growth. Economic growth figures were noticeably absent from the chancellor’s statement.
p.s. It has been announced that the Hubble Telescope has identified the most distant object ever seen. They should name it Gordon Brown. He did not attend Westminster today.
Q: “How many people work in the Public Sector?”
A: “About half of them”
The United Kingdom workforce numbers about 29 million. Six million work in the Public Sector.
When Labour came to power in 1997, the number of Public Sector employees was fewer than 5.2 million and had been falling for several years. The downward trajectory continued for another 12 months but from 1998, the number began a steep climb – as the Labour Government expanded its spending.
When the present Coalition government reduces the number of public servants by 500,000, they will only in fact, be returning to the numbers of 10 years ago.
The fastest rates of accelerated employment have been in Education and the NHS.
It would seem that because there are high concentrations of public servant at the United Kingdom’s extremeties, the worst-hit will be Wales, Scotland and Northern Ireland.
The Liberal-Democrats are fully behind the Chancellor’s Public Sector “slash and burn” but here’s an extract from their May 2010 election manifesto:
“We have identified £3.1bn of public spending that can create 100,000 jobs.”
By the end of this week, after we have heard all of the government’s pronouncements on slashes in expenditure, perhaps we may not be as sure as we were about the principle of Self-flagellation Economics.
The Brown-Darling method was the softly-softly approach which combined slow growth with a slow decrease in public expenditure. The major flaw in what they achieved during their 13 years in power was their unbridled expenditure and their total lack of negotiating skill. There are government armaments contracts which have the taxpayer “done up like a kipper” for a generation to come. The various government contracts were negotiated so well (by the suppliers) that it would cost more to unravel the contracts than it would to honour them.
The best example is the farcical situation of having to build two aircraft carriers which will not have any planes landing on them.
The Labour government has left a “Gordian Knot” expenditure legacy which will potentially plunge two generations into poverty.
The coalition government – or should we say, David Cameron and George Osborne know that they are past the stage of papering over the cracks of a broken economy and like Alexander the Great, they have been more-or-less forced into taking the sword to the problem. Potentially that’s the economics and Conservative ideology taken care of. Unfortunately, they have forgotten the politics.
The “We are in this together” mantra which has been continually boomed out by DC and his disciples is beginning to sound a little thin and unconvincing. Agreed that most of us will be well and truly “in it” but the majority of the Cabinet is immune from the upcoming economic trials and tribulations because they are rich and/or have a Trust Fund or two. That is not the Politics of Envy – just straight fact which is harming the coalition’s plausibility.
The government is beginning to lack credibility for two reasons. The first is that many members of the government belong to the high-end of socio-economic Group A. The rest of us tend to be Group B-down, with the majority C1 and C2. That very conspiquous disparity has signalled the potential rekindling of the Class War. The Cabinet is connected at the stratospheric levels of business, commerce and banking and appears to be increasingly detached from the ordinary voter.
The other grounds for the government’s lack of credibility are found in the uncomfortable shotgun wedding that was the Lib-Con coalition. Make no mistake, the Liberals are there purely for the head-count. Had it not been for Gordon Brown refusing to vacate the sand-pit, the Liberals would be building sandcastles with Labour. The coalition was a triumph of duplicity over decency.
After this week, the government will enter the most difficult part of its short tenure. The Federal Reserve has announced QE2 ( Quantitative Easing – The Sequel) and where Uncle Sam goes, we are sure to follow.
It was pointed out yesterday that the proposed reduction in Child Benefit (which will really clobber the C1s and C2s) will contribute more to government savings that the banks. Very soon, the Treasury will be handing more money to the banks so that they can “tidy up” their balance sheets and lend more money to small businesses. Or more accurately, the government will hand banks more pretend money which will be used to buy shares and government gilts which in turn will create profit and bonuses – for the banks.
Somehow, this all feels like a recipe for a very unhappy electorate, so don’t be surprised if very soon you find yourself, Frenchman-like, standing outside somewhere-or-other, holding a placard after having withdrawn you labour (that is if you have any labour to withdraw).
Prepare for a long hard winter.
Message for Wayne Rooney
Piss off. You’re beginning to make Jordan look interesting.
Speaking of socio-economic groups – here’s a “Z”
Another one of those ugly pikey women who looks like a pink Shrek with a ponytail has made the papers. This one has put her 2 year-old daughter on a diet “so that she doesn’t end up looking like me”. She will.
These were her words of wisdom: “With an eating disorder, you can get through it with therapy. But when you’re fat, you’re fat for life”. Not a good excuse to make your young child go hungry – or is she doing it so that there are more chips and fishfingers for her?
By the way, does anyone know why nowadays, women in their early twenties have cultivated such fat wobbly rear-ends – usually accompanied by a ponytail, a Maclaren buggy, arms like a docker and terminal stupidity – you know, the ones who are a TV interviewer’s favourite Vox Pops. They always say either “I think it’s disgusting” or “Words fail me. I don’t know what to say.”
And where can you buy stretchy size 30+ jeans and those plain short-sleeved tops?
In the old days, at least women waited until their 40s before they enjoyed the comfort of accelerated below-the-waist growth.
Spanish Air Traffic Controller: “Tango Yankee Bravo 141 is just entering French air space. I am handing him to you. Over.”
French Air Traffic Controller: ” I spit on your plane.”
I love the French.
Let us start with a statement. The Rt Hon David Cameron MP should be our next Prime Minister. I do not mean “should” in any wishy-washy “if that’s all right with you , chaps” sort of way. I mean it in that “I’ve seen his previous form, his experience, his pedigree and his leadership” way. In addition, I have worked-out the real reason why he appears to be allowing Gordon Brown to catch him in the opinion polls. It’s all to do with the printed Press.
On the Left, we have the might of Routledge, Maguire etc but on the other side, we have a bunch of TPPs (Tory Press Pussies) who appear to be suffering from “analysis paralysis” and instead of selling Cameron for what he is – a leader of great potential, they think that they will somehow affect the voter by smearing the already terminally-smeared Brown. They could not be more wrong. Incidentally, when I refer to the Tory Press as being a load of “pussies” , I am of course excluding that tough little bugger Danny “the Fink” Finkelstein of the Times. There should be another twenty of him and then perhaps, Cameron would be where he belongs – at least twenty points ahead in the polls.
I don’t know who Cameron’s advisers are but they have obviously told him to try and look a little more “statesmanlike”, a bit more serious. It seems that George Osborne is being advised by the same prat who is advising Cameron.
Be yourselves, boys! Let your characters shine through. You do not need to look like a pair of emotionless, constipated cutouts with all the charm of a Jehovahs Witness on a double-dose of Valium. (Remember George Osborne’s last conference speech). Cut loose and share yourselves and not your contrived images with the general public. Ditch the Valium-look and let us see you talking and acting as if you have the energy to drive United Kingdom plc forward, deep into the 21st Century. We want to see a Viagra double-dose look. We like to see our politicians acting as if they come to work with a hard-on instead of worrying that they’re going to upset some bitter and insignificant socialist hack or hackette.
Some of us perceive Cameron and Osborne as a pair of irreverent funsters who would probably be quite good fun to get drunk with – and that is why the rather dowdy images that they are currently projecting are consistently failing to ring true. I am not suggesting that they should be photographed staggering out of Chinawhites after demolishing a case of Kristal with a white powdery residue on the top lip and a giggly perma-tanned tart on the arm but there has to be a small degree of “chill”.
David Cameron appears to be afraid to say anything too definite, hence all that we can perceive are the odd grains of belief and truth in what he says but it also looks as if the only thread holding his views together is the shaky thread of a studied -but-reluctant negativity and the fear of putting a foot wrong. That is where he should take a leaf out of Boris’ book and remove the fear of screwing up. The voter will love him all the more for it.
As for the Tory press – the same applies to them. Chill out and write what you feel. Write with humour and wit and not of rumour and shit. Read some of Danny’s stuff. Most will never write with the rough-handed lyricism and passion of a Routledge but they should have a go – even if the Oxbridge Economics degrees, Chablis hangovers and unfulfilled lives do sometimes get in the way.
Gordon Brown is perceived as an honest, passionate but sometimes chaotic man who is advantaged by the fact that we all think that we know him. David Cameron has been branded as a shallow hooray on a bike without any strong views. Whoever advised him to go jogging in Brighton last weekend should be ritually disemboweled. All that Dave managed to achieve was to look like the boy who came last in the Wednesday afternoon school cross-country race. The “face like a peeled tomato” look is never a good one – especially in front of a slavering pack of Labour snappers. It beggars belief that he can get it wrong so consistently.
So “Eton” Dave and “Wallpaper” George are a pair of young but very able politicians with an image problem. We know that Dave’s wife Smantha is a little poppet and it is good to see her out and about a bit. Although a bit on the shy side, she is a tremendous asset. George’s wife is more anonymous but then again, George should be seen out a bit more with his missus and allow the media a tiny bit more access. Then he may shake off the slightly gay Tim “nice but dim” image.
There is absolutely no excuse for them both not to be a thousand times more popular than their opposite numbers but it is a perceptual thing and nothing at all to do with policies. Not so long ago, I know that David Cameron was warned against an overly-triumphalist à la Kinnock attitude: (“Well…….allllllriiiiight”). That was OK when the lead was 10 points and there seemed little chance of Labour recovering in the polls. Today, Brown has managed to shake-off the smell of damp earth and rusty shovels and there is a strong belief that he may actually “do a Major” and win.
That would be the ultimate travesty. Get your finger out, Dave.
Yesterday, Alistair Darling, the Chancellor sounded like an undertaker reading a suicide note. When he finally sat down, George Osborne leapt to his feet and we all expected some action – if only to help us to ward off any residual thoughts of self-mutilation that we may have been experiencing.
Although he had been taking notes throughout the Chancellors monotonic monologue, Prefect George missed the target. His reply to Darling had been pre-written and was obviously the work of a committee. He referred to “the Prime Minister” rather than the Chancellor because he, quite rightly assumes that Gordon Brown is still the closet Chancellor and Darling just reads the words.
This was a time to criticise facts and not policies. We are all aware of this government’s monumental cock-ups and the fact that they have driven blindfold into an economic cul-de-sac but George should have attacked the fact that once again the government is attempting to micro-manage its way out of trouble.
The Shadow Chancellor was quite right when he said that the government should be cutting costs and cutting them big-time. He should have pointed-out that the Chancellor was being distracted by irrelevancies such as bankers’ bonuses. He should have said – “and this is what we’re going to do when we come to power.” Instead, he sounded as if he was reading a list of David Cameron’s old Dispatch Box put-downs.
One has the feeling that the Conservative Party is on the back foot as a result of the New Labour spin doctors having latched onto the fact that the Conservative front bench consists of a bunch of toffs. It is normal nowadays to hear most government spokesmen to refer to the Conservatives “and their rich friends”. The spectre of Zac Goldsmith is hanging over Westminster and Alistair Darling even took the opportunity to refer to individuals who “enjoy non-domicile tax status”.
George Osborne shows great promise and is obviously very bright but he needs to realise that every utterance, speech and policy that the current government produces is less to do with the economy than it is with electioneering. That is why Alistair Darling’s budget review skirted round the edges of the UK’s current crisis. He is hoping to leave the whole mess to the next Conservative Administration to sort out.
There needs to be more backbone in the Tory attack. There needs to be a touch of “No more Mr Nice Guy” in their approach – especially George’s. They are dealing with a bunch of incompetents and they should say so. The evidence is there.
The modern face of Royal Mail
So the Royal Mail strike is on. It has been booked to continue for only two days but the fallout will last for the next few weeks. The Royal Mail system will not suddenly right itself after two days of inactivity. Letters, people, vans and parcels will not magically materialise at the depot where they are supposed to be. Continue reading CWU – An Assisted Suicide.
A survey has just been published of the world’s top Broadband Countries – taking into account speed etc. The United Kingdom is languishing in 25th place. The top country? South Korea. Is this another indicator of the rise of the East and the slow eclipse of the West?.
The Daily Mirror has adjusted its reportage of the Tories today – presumably in response to the Sun’s decision to back the Tories. It’s going to be a right mess leading up to the election. The gloves are off
At the Labour Conference yesterday, the jurassic Tony Woodley, leader of UNITE, was cheered when he tore up a copy of the Sun. One presumes that he had looked at the pictures first. He said: “I suggest the rest of the country should do exactly the same thing”. Labour should persuade more progressives such as Tony Woodley to give voice to their views – that way they’re absolutely GUARANTEED to lose not only the next election but several after that. During Tony Blair’s tenure these Brylcreemed 50s throwbacks used to be kept in a darkened room or padded box until after Conference. A dignified silence without even a platform-mention of the Sun would have been far more powerful.
Financial Analysts seem to be confusing the state of the FTSE 100 with the British Economy. The fact is that many of the billions invested in the Stock Exchange consists of foreign money. That’s where many of the profits are going – abroad. Instead of flying to Monaco to play the tables at the Casino, many foreigner “investors” are winning lots in the Casino that is the London Stock Exchange.
The FTSE 100 has experienced its biggest quarterly rise in 25 years. Once again, this is being hailed as some sort of success. It simply means that lots of bets have been placed. The punters will be taking their profits soon. Then the Government can once again blame the bankers. Let’s hope that they don’t break the bank again.
Politicians are always saying that it is the Pension Funds and Insurance Companies own most of the assets traded on the Stock Exchange. In fact, between them, they only own about 25%
Today the national minimum wage rises by 7p an hour to £5.80 and for 18 to 21-year-olds, the minimum wage increases by 6p to £4.83 per hour. This is also the day when the government legislation on “tips” has changed. From today it illegal for bars, restaurants and hotels to use tips or service charges to make up a minimum salary. That is all very well but in the grand scheme of things, it is a comparatively trivial matter and possibly not a terribly cost-efficient move by the Government. Especially as the Government has already conceded that the changes governing tips will lead to an estimated £60m in extra costs to ensure the legislation is implemented properly. The new code will also lead to higher National Insurance payments. This is an inflationarymove because bars , restaurants etc will simply “up” their prices to maintain their margins. The British Hospitality Association (BHA) estimates the new rules could lead to an additional £130m in costs and up to 5,000 job losses. There are those of course who feel that a tip should be a customer’s expression of appreciation for good service and should not be used by an employer to bring wages up to the minimum. Mind you, both the Federation of Small Businesses and UNITE are both in favour of the changes. The only people who will be really affected are the tippers and the tipees. The customer tippers will experience increased prices and the waiter tippees may suffer up to an estimated 5000 job losses. There is a saying: ” If it ain’t broken – don’t fix it.” Needless to say, one of the few groups who will not be affected is Politicians. You may have heard that when they eat out or stay in hotels – it tends to be on expenses.
Interesting statistic which doesn’t appear to be receiving the publicity that it deserves: In the United States, a house is foreclosed or repossessed every 7.5 seconds. As usual, the politicians are taking care of business at the macro-level, while the grass-roots are burning.
It is an excellent idea for Gordon Brown to take-on the other two Party leaders in televised debates. Any future Conservative or Liberal vote should be a “pro” Conservative or Liberal vote and not an anti-Labour vote. The Labour backroom boys, led by Darth Mandelson are obviously running a campaign centred-around the comparative inexperience and youth of the other two leaders. That’s fair, because that’s exactly what the Tories did to Tony Blair in 1997. Admittedly, David Cameron and the Liberal David Whassisname look fresh and youthful compared to Brown – who currently looks as if he has been cage-fighting with his hands in his pockets but in spite of his comparative lack of political fitness, he is not to be underestimated. He will be boring but he will come out fighting. There will be blood. We’ll know by late next week whether David Cameron and George Osborne have steel and substance. Constant criticism and sniping at the Government by the Opposition is quite entertaining but when it comes to a General Election, we will need to witness views and hear policies. Having said all that, remember that PERCEPTION is king and if in spite of brand-new shiny policies from the Tories, the Labour spin machine manages to make David Cameron look like a shallow “oik” then the forthcoming election will be much closer that we currently perceive.
One of the ideas being kicked about at the moment is the saving of millions of Education pounds by cutting teaching assistant jobs in schools. In the UK there are 40,000 teaching assistants – they’re the ones who sit in the classroom with “challenged” children or take them on zoo trips. They are all very nice people, I’m sure – but a waste of money. Many of the children don’t need a glorified baby-sitter – they need specialist teaching. While we’re on the subject of cuts , I would take an immediate horizontal slice through the current Education Department bureaucracy and take-out all those school advisers – the ones in the designer suits with Series 3 BMWs. They are a waste of time but unfortunately , many are ex-teachers.
Conference time is the time when politicians churn out populist crap in order to grab newspaper headlines and cheap applause. Gordon Brown now says that he will turn 11,500 Post Offices into the “Peoples Bank”. That’s what Building Societies used to be. There was one other bank which used to be popular with the “people”. Now what was that called?…… Oh yes, it was called the Trustee Savings Bank. Whatever happened to that? Here’s a quote from Gordon: “I want the Post Office to step in to help hardworking families to save and access their money easily with banking for the people in our neighbourhoods”. If Brown thinks that he is going to create a new banking system in under eight months, then perhaps Andrew Marr was right about the happy pills. Brown is obviously playing without the full complement of marbles. Oh yes – one final thing. “Hardworking” working class families need JOBS. They rarely save their Giro cheques.
Today’s the day that Gordon Brown will either read the best speech of his life or stumble his way through the world’s most-boring and longest-ever suicide note. Whichever way it swings – there will be lots of applause, back-slapping and standing-up.
If you keep putting rats in a cage and keep adding rats, there comes a time when they start eating each other. The human equivalent is the run-down council estate. Weak rats are prey to the bigger and stronger rats. That is exactly the phenomenon which killed Fiona Pilkington and her disabled daughter Francecca. Mrs Pilkington was driven to such desperation through being goaded and verbally abused by a gang of young pikeys that she set-fire to herself and her daughter. Not the best way to die. Needless to say there will be enquiries, lessons will be learned, the Social Services will be exonerated, the Police will make excuses, the local Council will hold a press conference and make a statement. By now, the whole process is probably in an Operations Manual somewhere.
Jack Straw is surprisingly eloquent today. The trouble is that The Brighton Centre seems half-empty or as the Tories might say “half-full” or as the Liberals would say “too big”. Let’s hope it fills up when the leader performs. The Labour Party is going to play dirty this time. Straw mentioned Section 28 of the 1988 Local Government Act. This was repealed by Labour in 2000 and was the section of the 1988 Act which stated that a Local Authority “shall not intentionally promote homosexuality or publish material with the intention of promoting homosexuality”. They should stop dragging up 20-year old legislation (under which there wasn’t a single prosecution). Homosexuality is not an issue in 2009 and “New” Labour is clearly demonstrating what little legislative success it has had in the last 12 years. Occasionally they still bang-on about 13 years of Tory Rule!!! Labour should fight on current policies. By the way, when Jack sat down, the reception was at best muted, at worst underwhelming. As the spin doctors might say: He received a seated ovation.
Fiona Phillips off the telly is speaking but she is having difficulty speaking because she appears to have her tongue well-stuck up Alan Johnson’s well-groomed backside. She is acting, flicking her hair and simpering like a love-struck typist who’s just shagged the boss. At least Johnson, who looks (and sounds) more Bookie’s runner than Statesman has the good grace to look embarrassed. What the f*** was all that about? “Airhead introduces Postman Pat”?
There is one session that we presenters and speakers like to avoid – if given the choice. It is the session immediately after lunch when your audience arrives full of food and drink and whose brains are temporarily in semi-shutdown as their stomachs begin the digestion process. We call it the Graveyard Session. Wonder who’s speaking this afternoon? Oh yes! Him! Perhaps the audience needs to be semi-comatose. If it isn’t, it soon will be.
I’ve just been watching a recording of John Denham speaking at the Labour Conference. Is it me, but doesn’t he look like a Conference League Football Referee? He’s another one who disapproves of David Cameron’s “Notting Hill” Policies. All Labour speakers are talking-up the social gap between the poor and the Conservative Party. A dangerous and desperate strategy. Only Mandelson has verbally placed the Labour Party firmly in the middle of the political spectrum but he also took the opportunity to accuse the Tories of lurching to the right as soon as they are elected. The Socialists are going to defend that middle ground to the death. That is where the election will be fought. The Labour strategy appears to be to make the electorate perceive the Tories as a gang of inexperienced extreme right-wing Notting Hill hoorays.
Have you noticed how the Party that’s behind in the polls always accuses the BBC of “bias”. Today we have anti-Government bias – in the old days, under Her Thatcherness and John Major, we had BBC left-wing bias. Apparently the BBC is capable of bias in all sorts of delicious flavours and colours.
Gordon Brown has started his speech with a list of Labour achievements. That’s the first five minutes gone. He has obviously structured his speech very simply. The next list is one of his cabinet and their achievements. That will probably be another ten minutes. Luckily I have a hairdressers appointment at 3 o’clock. He’s just mentioned Northern Rock. Talking off-script? He started with a smile but has now forgotten it and his expression has returned to looking as if he’s defusing a Taliban bomb. I notice that his <pauses for applause> seem to be immediately after he has mentioned a large number of some sort and his intonation changes as if he’s saying “Crackerjack pencil! “He’s mentioned Harriet and Alistair but has now stopped naming Cabinet members. My current thought is that his speechwriters should be ritually disemboweled and fed to Darth Mandelson. His speech has now become the usual drone. As he is slagging-off the bankers, I fear that it is time to go. If you listen to his speeches, you will notice that he seldom uses adjectives or adverbs. I just killed a fly and wonder whether I should turn the Aga back on today, in spite of the sunny weather. Our field was cut a couple of days ago but I just cannot summon the energy to cut the lawn. It takes two hours. Gordon Brown is still talking. He doesn’t like banks, does he? Surprising therefore that he’s invested so much of our money in them. I’ll record it and come back later after a couple of Bushmills. He’s just used the most exciting phrase of the whole speech – Economic Model. Enough. He’s off on his pre-leaked Post Office bollocks. Low carbon Zones? He knows how to give his audience a good time.
What’s all this about “Middle England”? Why don’t they just say Northamptonshire? Or do they mean Middle Earth?
In the USA, the Federal Housing Association has a leverage ratio ( What it owes compared to what it owns) of 50-1. Interestingly, that’s just about the same as Bear Stearns had on the eve of its collapse. The FHA insures about $750 billion in mortgage debt. In the UK, “leverage” is known as “gearing”. They are both euphemisms for debt.
Have you noticed that the £-Sterling is just about to achieve parity with the Euro?
An ASBO is an Anti-Social Behaviour Order and it is usually given out to pikeys and their parents. The trouble is that most of them are so thick that they probably think that an ASBO is a qualification which will be worth a few points on their UCAS form when they go to University to study demolition or vehicle hotwiring. I’ve just seen some ASBO-pikeys being interviewed and it seems that the sub-species favours a single earring and a tattooed neck (men) and the women have to be very fat with bleached hair. Their natural habitat is either a bus shelter or a stained sofa which faces a television. They only eat orange-coloured food – as long as it doesn’t contain fruit or vegetables.
Just saw a re-run of Sarah Brown introducing Gordon. She was good. She will be a major Labour weapon in the forthcoming General Election. I wonder if David Cameron’s wife Samantha is taking Powerpoint and sincero-talk lessons?
Excellent headline grabbing by that jug-eared gargoyle Andrew Marr. He is without doubt a supreme journalist but his questioning of Gordon Brown yesterday was inexcusable. Suggesting that Brown needs prescription drugs to get through the day, followed by Brown’s admission that he has trouble with his eyesight was a direction that no journalist should steer. There is a real danger that if the Tory Press goes down the ” Brown’s a sick man and therefore unfit for office” route, there will be a swell of pro-Brown sympathy. Then, if the Socialists succeed in portraying the Tory Shadow Cabinet as a bunch of hoorays lounging about in the senior common room with David Cameron as a self-serving Head Boy, there is a very real possibility that Labour will retain office. Undecided voters are driven by PERCEPTION and not by policies or past performance. Remember John Major’s victory in 1992? He was behind in the polls, yet in that year claimed the most votes in British electoral history. Leading up to the 1992 election, Labour had been ahead in the polls since 1989 plus the economy had entered a recession under the Tories. Yet Major won and remained in power until 1997. He won because the electorate liked him and thought that Neil Kinnockwasaprat. Nothing to do with policies.
Alistair Darling is going to deliver his usual speech on bank bonuses. “Clawback”, “Unacceptable” “Deferred” etc.will all make their appearances – as they have done for many months. Alistair Darling will “pledge” to clean-up the banking industry. The proposed Fiscal Responsibility Act sounds like another focus group creation and no doubt, there will be another Financial Services Act close on its heels. He is obviously working on the principle of “If you can’t win the argument – legislate”. It’s all a monumental waste of time but look on the bright side – we will be living in a society where the highest earners are footballers and pop singers. Something which our children can really aspire-to.
Gordon Brown says that he won’t ”roll over”. I do wish that his speechwriters would give him words that he is comfortable with. What’s next? “I ain’t goin’ to be no Tory dude’s bitch. Shabba”?
Roman Polanski arrested on a 31-year-old warrant. Apparently in 1978 there was a plea-bargain andhewasto receive a nominal sentence if he pleaded “guilty”. The judge then reneged on the deal so Polanski absconded. Originally, Polanski has been charged with rape by use of drugs, perversion, sodomy, lewd and lascivious act upon a child under 14 but the plea-bargain reduced the charges to a single charge ofunlawful sex with a minor. Polanski was six years old when WW2 broke out and like many Polish children who grew-up during the war, he was damaged. Add to this the horrors of the Manson murders and the killing of his pregnant wife, Sharon Tate, it is doubtful whether Polanski has ever been in what we might call a normal psychological state. However, the fact remains that he did horrible things to a 13 year-old girl and is a convicted criminal who probably still poses a danger. There is no Statute of Limitations for this type of crime but as his victim has forgiven him and so much time has passed, one hopes that the high-level diplomatic activity currently taking place will result in some sort of amnesty. There should be a White House statement soon.
The next Labour Prime Minister is the new the darling of Conference. Yes, Peter Mandelson earned a standing ovation and became the Labour Party joker today after delivering an appalling speech. He stumbled over the funny lines, his timing was out and his voice was its usual oleaginous drawl. However, the Conference highlight up to that point had been Alistair Darling and had it not been for Mandelson, they audience would have been engaging in synchronised self-harming. That’s how dire it had been. He is going to extend the scrappage scheme <applause>. Sadly, he appeared to be talking about motor cars and not the Cabinet. The scrappage scheme will keep the Japanese, German and Korean car industries going for a couple more months so let’s hope that their own governments can take over soon after that.
Tomorrow Gordon Brown is widely expected to give “the speech of his life”. That good eh? He’s probably in his hotel room practicing by reading the instructions on his Corby trouser press – that’s just about the level of excitement that he’ll generate tomorrow. But the Labouristas will clap and there will be a standing ovation. Is it true that the conference-hall doors lock from the outside?
Alistair Darling’s speech also had all the excitement of a talk on basket-weaving at the local WI . He obviously had gaps in his script indicating <pause for audience reaction>. Unfortunately, the pauses were more exciting and informative than the text. As expected he did some pointless macho posturing on the subject of bank bonuses – in the certain knowledge that the whole thing will be picked up by “Boy” George Osborne and lost in the mountain of unfinished business that Labour will leave behind in the May 2010 rush to clear their desks.
The British Frigate IRON DUKE scored a decent stash of Colombian Marching Powder, weighing 5.5 tons with a street value of £250,000,000. Apparently , the fishing boat containing the stuff was sailing erratically and suspiciously. That’s Coke for you! The only worry is that instead of sinking the boat WITH the cargo, the frigate is now taking the cargo to New York. Let’s hope that H.M.S Iron Duke doesn’t sail up 34th Street all shiny-eyed and twitchy to tie-up outside Macy’s.
Just down the road in Brighton THEY are arriving for the Labour Party Conference – or should that be the New Labour Party Conference. Did we elect Labour or NEW LABOUR? Anyway, that’s now just a technicality or a long-forgotten dream of how things could or might have been. Here’s a Labour FACT, given to me by a friend who used to be Chief Barman at the Grand Hotel. More Champagne is consumed at the Labour Party Conference than at all other conferences and he told me stories of vintage Champers being quaffed – not from a young lady’s glass slipper but from PINT jugs. If I recall correctly, that particular incident involved a gang (?) of Trade Unionists. Now THAT’S Socialism.
You know things are bad within the Labour Party when John Prescott begins to look like a Statesman (comparatively speaking). When Johno was Deputy Prime Minister, he used to deliver those grammar-free rabble-rousing “calls to arms” which could have been such fun if we’d understood what he was talking about. This year it’s Harriet’s turn and it won’t be the same. It will be the difference between a drug-crazed, alcohol-fuelled multi-position shagfest anddoingitquietly, Missionary-style with the lights out.
Gordon Brown is to introduce a law which is currentl;y being referred-to as the Fiscal Responsibility Act (FSA) (running out of ideas,perhaps?).The Act will oblige all future Governments to reduce the country’s borrowing by a set minimum amount. Needless to say, the amount and timescale are yet to be decided – probably a commission or enquiry… So what will happen if a Government fails to repay the minimum amount in a given year? A fine? Arrests? I suggest firing squads.
The Labour spin doctors have decided that David Cameron will be portrayed as a shallow toff – a script and autocue-reading “hooray”. Normally, that would upset the Tories but then they remembered the alternative.
Quote from Gordon Brown: “By 2015 we want our country to be fairer, greener, more prosperous and democratic.” Seems to me that we have several Labour admissions in that sentence.
Lord “Darth” Mandelson has referred to David Cameron as “hugely arrogant”. Not really much more to say on that one.
Mandelson has said that he believes that the forthcoming election is “up for grabs”. Yes it is – by the Tories.
Great interview in the Sunday Mirror today. Vincent Ross interviews Mandelson and re-defines the phrase “butt-kisser”. Perhaps a spin-job awaits at No.10?
Iran is launching missiles today. So, they have missiles and they’re developing the capacity to stick nuclear warheads at the missiles’ sharp-end. I am now off to have another “No shit, Sherlock” moment. I shall report when I’ve worked it all out.
Why are the authorities making such heavy-weather of Baroness Scotland and “CLEANERGATE”. If they announced an amnesty for all illegals, they would have to hire at least one Wembley Stadium to fit them all into. Leave the Baroness and her cleaner alone. Is it because she’s clever, female, attractive and black? Mind you, she is Labour. See what you mean.
Ken Livingston has just married. At London Zoo. There are some things which are way, way beyond parody.
“I want this so badly” “It’s been a great journey for me” “Singing is my life” ” I’m doing this for my (sob) brother/mother/ sister etc” and ” I’m sure he’s looking down on me” The last one is about Simon Cowell. He’s not dead – just incredibly condescending.
Great quote from Strictly Come Dancing’s Brendan “Shagger” Cole on Jo Wood. ” One of Jo’s big strengths is that she’s alive.”Considering how long she lived with Ronnie Wood- it has to be worth a mention and maybe a box of chocolates. We all hope that Ronnie Wood is reunited with Jo as soon as possible-he is currently risking his life. Some of those Russian girls will do anything for a bowl of Borsch and clean sheets. Anything.
In 2008, the NHS collected £112 million in parking charges. With such figures, perhaps the NHS should concentrate on parking and stop the healing and surgery activities which probably distract them from where the REAL profits are. Perhaps a joint-venture with NCP beckons? Worryingly, £28 million was collected from its own staff. It’s a great wheeze. Tax the sick, tax their families and tax those who look after them. Who helped with the Business Model? Gordon Brown?
The American Fed has issued the following statement: “To provide support to mortgage lending and housing markets, and to improve overall conditions in private credit markets, the Federal Reserve will purchase a total of $1.25 trillion of agency mortgage-backed securities and up to $200 billion of agency debt.” Now we can watch the demise of the once-mighty American Dollar. Fund Managers and Investors will now start dumping dollars like confetti. A TRILLION is a million millions and in this case, it represents more Quantitative Easing or to be strictly accurate, the purchase of toxic assets with “printed” i.e non-existent money. The sort that caused the global banking meltdown. This is a case of throwing bad money after bad.
President Obama has announced tough new capital requirements for banks as well as more stringent rules on bank borrowings. If you were to ask what these rules are likely to be or when they are to be implemented, the answer would probably be “We haven’t really decided but it will definitely happen later.” They are saying that the rules will be phased-in once financial conditions improve and recovery is “assured”. Leaders have been discussing a cap on bank bonuses for a while but they still haven’t agreed any numbers or timescale. The only thing that they have agreed is that bonus payments should not be guaranteed for many years, should be deferred in part and should not exceed a percentage of the bank’s revenue. That is how vague it is at the moment. When the global economy has healed itself and both governments and banks return to generating profits, most of this will be forgotten because by then, the balance of power will, once again have shifted back towards the banks and the next boom-bust cycle will begin.
The least entrepreneurial profession of all is banking. There is a vastly different mental attitude between say, an entrepreneur such as Richard Branson and say, MervynKing, the Governor of the Bank of England. That rule works all the way down the line until we have the small local businessman and the small-town banker. Chalk and Cheeze. Incidentally, when I say “entrepreneurial” – I am referring to people who take risks with their own assets. Just to reinforce the cultural difference – bankers will gladly take risks with other people’s money – especially in very large amounts – as evidenced by the cause of the current Global Banking crisis. However, when a local business goes to its local bank in order to borrow say £20,000 to purchase a machine, lots of fiery hoops are assembled for the business to jump through, fees are charged, personal guarantees are demanded, forms need to be filled out, cash flows and business plans are sought . So when a small businessman goes to his bank – the MOST likely answer (especially nowadays) in “NO”. Perhaps unknowingly, the banking profession is not-only killing itself but it is also slow-strangling the business community. The banker chose to work in a bank because he didn’t want the worry of not having a pay cheque at the end of the month, he did not want to work a 16-hour day and he didn’t want to cold-call people in order to drive his business forward. What he needed from his life was predictability, order, neatness and a company pension. This is the paradox: The banking profession has managed to evolve itself into something which it was not designed to be and it has managed to do it by what is known as the “Halo Effect”. There is a saying “Get them by the balls and their hearts and minds are bound to follow.” Banks now have “business advisers” ; mostly young people with degrees who cannot possibly have ever tasted the fears of an entrepreneurial businessman. Bank management has developed a culture of self-importance and inaccessibility. Remember the time when a bank manager tried to impress you in order to win your business? Now , you have to ask him to welcome you to his club so that he can look after your money. He is now doing YOU a favour – unless it’s ” I’d love to help you but the System ( or those upstairs) say “NO”. The banking tentacles have moved further into he business community. Local Enterprise Organisations and Business Clubs are now both Governed and heavily populated by more bankers. Entrepreneurial andmanagementadviceisbeingdispensed by a profession with little or no practical or first-hnd business experience or knowledge. That is the Halo Effect. Put simply, because the banker knows about money and has you by the balls, you assume automatically that he is able to dispense Tax Advice, Marketing Advice, Sales Advice, Organisational Advice, Training Advice, Recruitment Advice, Purchasing Advice and any other Advice that you need. The total power of the banking community is evidenced by the fact that Chancellors, Prime Ministers and even Presidents are having to say “Please do something about your bonuses Mister Banker.” Banking has developed into a multi-headed all-powerful Frankenstein. It is not a simple case of imposing a few rules. What is really needed is a massive cultural change within the banking industry and a massive perceptual change from both private and business clients. If you’re a businessman or work for yourself in any way, ask yourself – ” Am I comfortable with taking business or financial advice and all the other captive-audience advice that they like to dish-out, from an organisation populated by people who obviously did not heed their own advice and lost billions but have no idea what really happened?” WATCH THIS SPACE.
I received a letter from a Member of Parliament today. He addressed me by my Christian Name. What’s going on? Paranoid? Moi?
The airlines appear to be learning from the banks. British Airways will be charging us again AFTER they have our business. We book a flight and then pay an additional fee to get a seat. Genius! Can you bring your own seat and pay corkage?
There’s only one thing wrong with an Indian Summer. The Global Warming Mullahs will wake from their torpor and deliver the usual speech about our emissions. I think that 4X4 vehicles should be compulsory. Have to go now and have my dolphin steaks and light the coal fire.
In the last two years, 150 teachers have been sacked for sexual misconduct. A loss to the teaching profession but what a bonus for the Vatican’s recruitment team!
Gordon Brown has been voted World Statesman of the Year – mostly for giving away any leftover taxpayers’ money that Mervyn King has not given to the banks. Brown has been generous to Africa and quite right too. In addition, he has enjoyed many politicians’ or Pope’s ultimate wet-dream. An embrace from Bonio who , apart from being big in the dog-biscuit trade, is (apparently) some sort of Irish pop singer. He plays in a popular beat combo named after some American spy-plane. U2, I think. Crucial.
Remember Gordon Brown selling off the UK’s gold to China a few years ago? Who better to value, melt-down anddoitallover again with that pile of gold Anglo-Saxon tat recently dug up in Staffordshire – wherever that is. Middle Earth?
There’s a very exclusive TV Club – the old dears who used to read the news and appeared on the Christmas Morecambe and Wise show in the 50s and who did high kicks andeithermarriedapolicemanorshagged Jon Snow or went to live on a farm in Scotland. Pretty soon, the pre-teens running the BBC andthecommercialchannel will be playground-bullied into re-hiring these venerable oldsters. Prepare for News at Ten to look like a re-run of Macbeth, Act 1 Scene 1.
In 1959, Typhoon Vera struck Nagoya in Japan. There was a 20 ft tsunami, 150 mph winds and 5000 people died. Did you know that they managed ALL that without Global Warming! They could do stuff like that in the 50s. We have a lot to learn.
TV’sDoctorGorgeousappearedtohaveeverything – but he was struck by the one affliction that even he could not cure. He lost the ability to keep it in his trousers. Marriage, Mistress, Divorce, Mistress, two-timed Mistress, Girlfriend. Best of luck mate. The definitive case of “Surgeon heal Thyself”.
In an average week, I speak to 5 or 6 Chief Executives – guys I’ve either trained, coached or who I know personally. This week I had the most weird experience with a company CEO and company owner. He fancies himself as a “leader” but is just realising that he has recently reached the upper limits of his incompetence. The stress-levels are phenomenal and I shall devote a whole article to him next week. Look out for it – it WILL be libellous!
Fantastic evening for crumblies. ITV is celebrating 250 years of Cliff Richard. He hasn’t changed one bit – apart from wearing Frankie Howard’s old rug. Well, it’s either that or a very quiet ginger cat.
The mole who leaked the MPs’ expenses information to the Daily Telegraph has revealed what motivated him to do so – apart that is, from the £110,000 fee that he was paid. It now appears that his primary motivation was not money but the fact that serving soldiers were “moonlighting” at the House of Commons. They were working in the Security department and protecting the Civil Servants who were dealing with confidential matters – one of which was Members’ expenses. Apparently, it wasn’t long before the soldiers realised the extent and extravagance of MPs’ expenses and so glimpsed the comparative opulence and excesses of the politicians’ lifestyles. The very people who represented them and who had sent them abroad to be shot at. The sums of money involved in the claims that they either saw or were told about were further amplified by the fact that the soldiers were doing this extra work in order to buy decent boots and body protectors and other items which would make their soldiering duties easier and safer. It is currently very easy for us to feel very emotional when they hear stories such as this – but we should proceed with extreme caution because it now seems that the mole is trying to justify his actions in leaking the information. He appears to be telling us that he now feels vindicated because of the “poor” soldiers and because MPs have to-date returned over £500,000 in mis-claimed expenses. Planes bearing dead blown-to-bits soldiers, processions through Wootton Bassett and full-page photographs of a recently mutilated soldier paying his last respects to his blown-up dead buddy certainly do tug at the heart-strings. Great propaganda andimmaculatetimingbyourmole. Now the facts: The mole received £110,000 pounds from a right-wing paper. Currently each soldier receives Osprey lightweight body armour and£3500 – worth of state-of-the-art equipment – including boots and shoes. The mole’s motives for leaking the information would not be in question had he not accepted such a large amount of money – which one presumes has been donated to the Army Benevolent Fund. I am not a great supporter either of this Government or of the pointless shenanigans in Afghanistan but sometimes there are over-sugared pills which are just too difficult to swallow.
One question remains: Why were security men -serving soldiers or not- allowed to either view or be given confidential information.
China , India and Brazil are to play a more prominent part in G20 and will also have more IMF votes. Currently, China wields 3.7% of IMF votes compared with France’s 4.9%, although the Chinese economy is now 50% larger than that of France and in spite of the fact that China has over 20 Provinces which each has a population greater than that of France. This looks very much like the dawn of the Eastern or New economies and the inevitable sunset for the once all-powerful West. Regrettably, not only is it a question of size and manufacturing power but the West is currently “in hock” to China. Chinese and Indian savers enabled all of us to be borrowers. Now economists are saying that the East has to create the same free-spending and borrowing consumer society that we have enjoyed for so many years: just look where WE are now! Are we really so well-placed as to be dispensing economic advice?
Another New Labour piece of legislation which has been languishing in the long grass for a while is the changing or possibly the removal of the Statutory Retirement Age. It is a shame that there are ex-teachers, ex-managers, ex-engineers who happen to be over 65 and who are now either shelf-stacking, working at B&Q or watching Countdown. What a waste. The Government says that the matter will be dealt-with in 2010, in other words, by the Tories. Meanwhile, at least 300 over 65s are taking ex-employers to Tribunals and yet again, lawyers have become involved. That is New Labour’s one big success – through their intransigence and incompetence, they have produced the best-ever Lawyer Job-Creation Scheme. The Brits have always been obsessed with 65 being their time to stop work, relax, take long holidays etc. Unfortunately in many cases it’s retire, sit around for a bit, die. We are changing as a nation and it is not purely because of the recession or plundered company pension schemes that people wish to carry-on working. Our “retirement mentality” has gradually been disappearing and people genuinely WANT to work for as long as they can. OK, there are very physical jobs where at age 65, you’re clapped-out. For instance, building, mining or farming. You can punish your body to such an extent that by the time you are 50, you start looking forward to the day when you can stop. However, nowadays many of us are engaged in non-physical work which means that we SHOULD be as fit at 65 as we were at 45. Policies should not be driven by a Government with one eye on unemployment statistics because as usual, public opinion is against them. It’s now time for the Statutory Retirement Age to be abolished.
Nearly forgot: “O Prophet! urge the believers to war; if there are twenty patient ones of you they shall overcome two hundred, and if there are a hundred of you they shall overcome a thousand of those who disbelieve, because they are a people who do not understand.” (8.65)
These are Iran’s main Nuclear sites:
The Government has criticised the Football Association for not reforming itself. It has also asked the F.A to spend more time and resources on ethnics and women as well as telling them that they should provide better leadership. Perhaps when the F.A has completed its restructuring it can then give H.M Government a few tips. Talk about Pot-Kettle.
A recent U.S survey shows that many Americans think that Tony Blair is the British Prime Minister. Someone ought to tell them who the real UK Prime Minister is. Darth Mandelson.
Mandelson has been quoted as saying that Gordon Brown ought to “lighten up” a bit. Not THAT smile again PLEASE!!!! NOOOO!!!
What is it about meetings beginning with a “G”? Why is our expectation level do low? Is it because we know that the post-meeting statement has already been written? Is it because all previous meetings were such a monumental waste a waste of resources, time and money? Anyway – who DOES write that n-page statement which announces the next meeting in 6 months? Gordon Brown’s LAST such meeting.
Is it true that Obama snubbed Gordon Brown? Obama has had one-on-one meetings withotherleaders. Why not with our own Prime Minister? Is it because of the Megrahi affair or could it be because of the increasingly prominent sell-by date on Gordon Brown’s forehead?
Banks are currently reducing their assets and hoarding cash because of liquidity requirements. Put in simple terms, that means that the magic conjured-up money – the so-called Quantitative Easing is making it in through the banks’ back doors but the front doors remain only slightly ajar. READ REST OF ARTICLE
In 1998, the Saville Inquiry began its investigations into the shooting of 29 Civil Rights protesters by soldiers of the 1st Battalion of the British Parachute Regiment. Five protesters were shot in the back and two injured protesters were run down by Army vehicles. Fourteen people died. This was the Bloody Sunday Massacre which took place on 30th January 1972 in Derry. The original Widgery Tribunal concluded that the soldiers actions could be best described as “bordering on the reckless” . Unsurprisingly, the Widgery report was widely regarded as a whitewash. Hence the Saville Inquiry. Now we hear that the Saville Inquiry will report in March 2010!!! Apparently, there’s a printing issue that needs to be resolved. Once again , this 11-year inquiry brings into focus two great British institutions – queueing and inquiries. Not to mention a steady income for a whole “shark” of lawyers.
The anniversary of Lehman Brothers going down the toilet has passed anditisnowayearsincethesolidsreallyhitthe air-conditioning big time. For those who do not really understand finance – and who really does these days, here’s the deal. Politicians and bankers knew for at leat 18 months before the collapse that there was not enough cash in the system andthatmost, if not ALL banks were now standing on foundations of sand. It was only when Lehman had to admit that there was no real money – only paper ” instruments” which could be worth cash , that it was realised that the real currency that the banks had been dealing-in was bullshit and promises. Politicians are now beginning to strike heroic poses as they tell us how they saved the banking system and that they only-just managed to avert a financial Armageddon. The real fact is that they knew what was happening all along and lived in the HOPE that somehow (they did not know how), the financial system would self-adjust or self-regulate itself back to stability . It didn’t and the solution that is being applied today is exactly the same as that which caused the collapse. Imaginary money. Eighteen months ago, bankers and politicians were HOPING that the system would sort itself out and that is EXACTLY what they are hoping for today. What is really needed is a total restructuring of the banking system but there isn’t the global political will to make that first all-important move.
There’s a (denied) rumour that Gordon Brown is going blind. Obviously we all hope that he is not. In spite of the fact that he has all the leadership qualities of damp Kleenex, he is a decent man. The rumour that he is blind has obviously been started by someone who is confusing his eyesight with his policies and management style.
Apparently, there is a small but statistically significant rise in patient deaths when junior doctors start work in August. Perhaps the same survey should be done with slightly different parameters: Before pubs open and after closing time.
A friend sent me a cartoon yesterday which, for the first time, explained the constant Midde East conflict . Jewish man looking up at the sky saying, “Now, let me get this straight God. The Arabs get the oil and you want us to cut the end off our what….?”
This snippet explains better than anything the anonymous nature of the Liberals’ leader. Nick Clegg will be delivering the Leader’s rabble-rousing Conference for the THIRD time!! He will attempt to come cross as a TOUGH leader. Doesn’t compute, does it? He always looks as if he’s just taken a “NICE” pill.
Justin-lee Collins has said what many are thinking: Bruce Forsyth should have stopped TV presenting three or four years ago. There’s a touch of the Emperor’s New Clothes about the whole thing. So much so that no-one appears willing to say ” Brucie, you are now coming across as an old twat. Piss off”. Instead the poor old bugger is being patronised, allowed to be unfunny (obviously from the tumbleweed school of humour) and worst of all, he’s being referred-to as “sprightly”.An adjective every man dreads because it is THE word which signifies the beginning of the end. It is NOT a compliment. It means that you are past-it and when you attempt to tap dance avec embarrassing Sammy Davis Jr-esque gurning, you look like a swinging cadaver with a ferret up a wet trouser leg.
I have just discovered that Chas & Dave have split up. p.s. I am writing this on Beachy Head.
Kristna Rihanoff whose Strictly Come Dancing partner is Joe Calzaghe celebrated her birthday yesterday. Rumour has it that Joe and Kristina have grown very close. I wonder whether he had any difficuty in wrapping her present?
More meaningless military “sincero-talk”today. Acting Sergeant Michael Lockett was blown up by a roadside bomb in Helmand Province. “There’s now a gap in our ranks that will be so very difficult to fill” and “Sgt Lockett’s raw bravery and seflessness cost hm his life but undoubtedly saved that of one of his soldiers.” are just two more examples from the Army Book of Fine Words. Meaningless twaddle. Sgt Locketthas left behindastrickengirlfriend and three children aged eight, seven and five. “We take solace in the fact that he died doing a job he was born to do” was more puke-inducing bollocks – this time from his father. Stop this pseudo-heroic crap and bring ALL of our young soldiers back here to the United Kingdom, where they belong. The Taliban certainly do not see these young soldiers as heroes – more like fairground ducks.
When will the Vatican be called to account over the tens of thousands of children that have been abused by pervert priests? The Catholic Church has been accused at the United Nations Human Rights Council of a systematic and long-standing cover-up. The Vatican is in breach of its obligations under the United Nations Convention on the Rights of the Child. Handing out MILLIONS in compensation is really not the way forward. It’s customary to pay for sex up-front , not ten, twenty or thirty years after the event. Let us hope that one day there will be a time when the Vatican can close its child-abuse fund and get on with the business of religion.
Nothing about Gordon Brown today because he hasn’t said anything new or original. Situation normal.
Did you see Darth Mandelson being questioned on the subject of bankers’ bonuses last night? As Business Secretary, he has the power to stop the bankers in their tracks. But he cannot and he would not answer any bonus-related questions.
General Stanley McChrystal, the top US commander in Afghanistan has warned that the war there could be lost unless there is an increase in troops within a year. He is asking for an additional 30,000 troops. This is truly developing into another Vietnam. Currently, there are 100,000 troops in Afghanistan, 62,000 of whom are American. Time to talk.
The United Kingdom is needlessly wasting resources by sending too many average and some downright thick students to University. In fact, there are too many Universities. Hence the current funding crisis. The solution is so simple that even an Education Minister ought to be able to work it out.
The worldwide recession and the resulting drop in consumer demand has had a profound effect on industrial production. That has had an unexpectedly welcome effect on greenhouse gas emission – it has fallen by over 40%. Perhaps the Global Warming Mullahs will take this opportunity to shut up.
Anish Kapoor, the 1991 Turner Prize winner has a solo exhibtion the Royal Academy. This event is unusual because Anish lacks the traditional qualification for such a exhibition. He isn’t dead. If you enjoy abstract sculpture and/or you like spouting pretentious arty bollocks, then this exhibition is for you. Here’s a nosegay from Anish himself: “That sense of the poem being put together as word objects relates to sculpture in a very fundamental way. Sculpture also has this ability to be what it isn’t. It’s kind of about the illusory and the real.”Quite. Anish is very keen on vaginas so do look out for the odd wobbly red letterbox shape.
The media seem surprised that construction companies and builders have been ripping-off Local Authorities and other organisations which are spending other peoples’ money. It’s been going on for years. This is from April 2008 – CLICK HERE– and it includes a scene from the Coconut Club, which you will be hearing more and more about over the next few weeks.
This week is Climate Week – a crucial week in the quest for a global climate deal. World leaders are meeting at the UN in New York and a G20 summit in Pittsburgh. Meetings such as this have been going on for a few years now so let us hope that the current series of meetings produces something that has been sadly missing from previous encounters. Action. In December the Copenhagen environmental conference will hopefully be the real turning point and turn meetings into agreements into action.
Global Warming: Predictions are made using computer models and although the general consensus is that Global Warming is occurring, there are scientists (the so-called “deniers”) who have alternative models which suggest that the Earth will cool before its becomes hotter. Regrettably, the religious-like aspects of Global Warming, treat scientists who deny Global Warming as heretics who are often lampooned andmarginalisedby both the scientific and political communities. The latest of these is a Professor Mojib Latif, from the Leibniz Institute of Marine Sciences at Kiel, who has suggested that the long-term warming trend could be masked – perhaps for as long as 10 or 20 years – by a temporary cooling caused by natural fluctuations in currents and temperatures called the NorthAtlanticOscillation. It all seems to depend on which set of data is plugged into which computer model. However, it is the politicians who are the true believers who only appear to read data which supports their dogma.
Helen Goddard , music teacher has been jailed for 15-months as the result of a lesbian affair with a 15-year-old pupil. How modern. Not nice – but definitely “of the age”.
Rumour has it that Louis Walsh, the Irish spud and pop manager from the X-factor is going under the knife in order to improve his looks. There must be a long queue of knife-sharpening volunteers. Surprising that he hasn’t yet benefited from sitting so close to that pair of BotoxedBookends – Simon Cowell and Danni Minogue – by osmosis.
Sir Bobby Robson’s Memorial service must have been an ordeal for Paul Gascoigne. There was only one photo of Gazza that the snappers wanted – and they got it.
This is the sort of medical research that we like: If you have alcohol in your bloodstream, you are far less likely to die from a head injury, says Dr Ali Salim from Los Angeles. The findings are based on a 5-year study of 38,000 people. You can’t be too careful. Cheers.
Nothing in the Press about Jordan today. Max Clifford must be on a long weekend break.
Attorney-General Baroness Scotland is still facing an uncertain future. Gordon Brown, her boss is being his usual decisive self. This is what he said this morning: “We will have to find out what has actually happened and I will have to wait for that report this morning and she will want to answer the questions that are put to her. We will have to make decisions.” Brown obviously has not been watching the news or reading his Daily Worker. The fact is that Baroness Scotland employed someone who did not have authorisation to work in the United Kingdom. In fact, her papers expired five years ago. As usual, the long grass is quivering in anticipation.
It now appears that Womens World 800m champion Caster Semenya was tested ages ago and there has been concern over her sex for months. The issue did not suddenly materialise at the last Word Championships. The whole thing has been handed so badly that there is every likelihood of IAAF resignations.
Baroness Scotland will probably resign this week. If every politician who made a mistake resigned, Westminster would be empty by now.
It looks as if Megrahi is going to be the first criminal to be retried on the Internet. We’re still awating an intervention from God and the miracle recovery. There has been one previous miraculous recovery by a convicted criminal. Ernest Saunders (1980s Guinness Scandal) was freed by a judge because he was suffering from Alzheimer’s. So far, Ernest Saunders in the first and only recorded case of a total recovery from Alzheimer’s. The recovery took place soon after he was released from jail. Speaking of miraculous recoveries – Ronnie “released on compassionate grounds” Biggs has been seen out and about on his mobility scooter. Megrahi or Biggs? I’m off to Ladbrokes to make a small investment.
The Liberals are having their occasional rush of blood and putting themselves forward as a party of government. Remember David Steel in 1981? “Go back to your constituencies and prepare for government.” Forget it boys and girls. There’s Vince Cable and Norman Baker and after that it all becomes a bit anonymous. Nick who?
The Liberals want to tax home owners whose properyis worth in excess of a million. They will be the only Party whose policies will be derailed by a property crash andonthatbasisalone, this policy has the depth and solidity of a closing-time back-of-a-beermat “I really lovvve you” concept. They’re not sponsored by the Royal Institution of Chartered Surveyors, are they? This new policy is the Liberals’ biggest-ever lurch to the left. The sort of thing that New Labour would have done when they were Proper Labour.
The elephant in the room – the one that no-one is talking about is still there. I am of course referring to the economy.
Several big companies, including a couple of large builders as well as the Royal Bank of Scotland will be coming to market very soon to raise many billions. Watch those share prices. Here we go again.
Have you noticed how Kerry Katona’s nose is looking more and more like Danniella Westbrook’s last nose-but-one?
The Education bods are gettinng a bit twitchy at Ed Balls’ suggestions of swingeing cuts in Education. It is the designer-suited BMW-driving “advisers” at County Hall who should think twice before renewing their gym membership or booking that holiday in Tuscany. CLICK HERE
I did not see Alesha Dixon’s debut on Strictly Whatsit but it sounds as if she had a list of pre-prepared crap written down, dispensed it quite randomly and personalised it by adding bad grammar.
Rules are being published this week which will exempt family and friends from being prosecuted after assisting in a suicide. It is purely coincidental that these rules are being rushed through just before Gordon Brown’s conference speech.
Manchester City manger Mark Hughes is complaining that too much time was added on at the endofyesterday’sderbygame with Mancheser United. Michael Owen scored Man Utd’s winning goal in he 97th minute. Hughes forgets that his team had the identical extra time in which to score.
Alistair Darling is engaged in a series of meetings in order to decide where spending cuts can be made. If you’re expecting decisions within the next few months – stop being so silly. Although professional pundits do now have the opportunity to make pointless predictions.
Andy Burnham is suggesting yet more NHS changes. The God of Change strikes again! This month’s idea is that we will all be able to choose our GP. I would like one that’s qualified, understands human anatomy and is sober.
Baroness Scotland should know that in a Court of Law, ignorance is no defence. Mind you, the Baroness is the Attorney General. Hopefully, hiring someone called Loloahi Tapui(clue!) with out-of-date papers was just an oversight and as such, does not generate a witch-hunt. Oh yes – there’s an enquiry. There’s always a feckin’ enquiry.
Suddenly, Jordan doesn’t want to talk about “the rape”. It seems that her PR people are running out of interesting stories. The only remaining possbilities are either ” I was abused as a child” or “I was abducted by aliens”.
Bit of a “to-do” about unofficial sperm donors. Apparently, ladies can contact a sperm donor on-line, arrange a meeting and either be handed a container-full of the stuff or on occasion have it delivered direct through the medium of sex. Hence the phrase : “”Bottled or draught?” Sounds like an excellent service as well as an interesting career move, although it could mess-up the old CV, especially if the CV is printed on a sheet of Kleenex. Just realised that if this type of work is a career, the phrase “hand job” begins to make sense.
How would the management at Student Loans UK feel if they were told that because of administrative incompetence, their September salaries will be paid at the end of October. They would probably be quite upset. Next question: How do young kids with the incredible stress associated with leaving home feel-when they’re told by Student Loans UK that their University grants will be paid “about” four weeks late? Why is the beginning of the academic year ALWAYS a surprise? For the record and to help Student Loans UK: The next academic year will be starting in October 2010. Hopefully, that’s enough notice.
Scientists at Newcastle University have produced human sperm in the laboratory. Didn’t know that there was a shortage. Just take a chipping hammer to any Confessional carpet.
Gordon Brown said today “Cooperation between nations at the G20 summit will be crucial to ensure global economic recovery” That is probably the twentieth version of the same sentence . It is a truism and it’s boring. Here’s another sentence which I hope Gordon finds as interesting as his own deep thoughts: ” The sun is in the sky”
Here is a quote from this evening’s No 10 bulletin: “The Prime Minister is launching a brand new podcast series this week talking directly to you about the big issues of the day. The podcasts, which will be available on our iTunes channel andonYouTube, will be recorded at Downing Street or around the world when the Prime Minister is travelling.” Wow! That Gordon Brown is so “street” -using that Interwebthingytoconnectwith the YouTube dudes. Way to go, MC Gordo! Soon, he’ll be buying a pair of those really cool Levi Strauss blue denim casual trousers with the turn-ups, copper rivets and the little red label. Sound! Should go well with the black brogues.
Remember what I told you about the American dollar going into freefall. Soon. Continue reading Monday September 7th 2009-Friday September 18th 2009