Putting A Damper On The Fun

There is so much material flying about at present, never mind the seasonal hysteria, that whilst I would like to comment, it might well just be lost in all the fog and the hurly burly.  But as it is the season George Monbiot on his blog had something to say which lists him amongst Scrooge’s media advisers.

It is about pathological consumption and the urge of humanity to strip the world of its vital resources in the pursuit of the needless acquisition of goods based on improvident spending.  A point he makes that a lot of gifts given at Christmas are then little used and cast aside after only a short time.

This coincided with the news that the balance of trade figures were bad and that at Southampton the new world’s largest container ship arrived chock full of goods for the season for us all to buy.  Well, some of us.

At one time the media and the nation hung on information such as the Balance of Trade figures and if the news was bad it was regarded as a national disaster.  A government would be faced with a bad press and real trouble and it might put the value of the pound in peril.

Now we neither care nor take much interest and if the pound varies in value the immediate concern is how much foreign holidays will cost or the effect on property values.  This month the news has been buried by a flood of other matters.

At first I wondered whether to agree with George and whilst we will not be shopping as it happens we will be doing other things.  They will involve spending even more ephemeral than pathological consumption in that we will be at a couple of performances where there is only a personal memory at the end.

Doubtless excuses could be made and justifications that this somehow is good, helps to increase both gross national product and employment, but the fact remains it is not in the last analysis necessary and certainly involves carbon emissions.  Like almost all other Western people we do more than our world share in that department.

However, George might have made more of one basic resource, water.  In the LSE Connect this week, Judith Rees reminds us that “The pace of urbanisation has outstripped connections to water infrastructure” under the heading “Water, water, everywhere, nor any drop to drink”.

This is about the UN International Year of Water Co-operation in 2013.  Across the world severe shortages and problems are arising as populations and demands increase.  Unsafe water, poor sanitation and other problems are increasingly common and governments seem to have little strategy or awareness of the complexity of the issues.

Inevitably, one response is to create a new academic discipline for the study of water.  The essential issue is the vast cost of addressing and dealing with both the human and environmental implications.  It bears on food production, industry, how far urban societies can continue to grow so rapidly and above all health.

Also in the last few days a number of leading UK politicians have called for the rapid fracking of oil reserves to go ahead to meet our critical energy needs.  Whatever the for and against arguments for this, one thing is certain; it needs a great deal of water.

And when rain is on the way our weather forecasters tell us relentlessly that this is bad news.  Sometimes it may be, but not always.

Voices That Disturb

The news about HSBC being whacked for $1 billion plus by the USA for serial money laundering whilst the formerly respectable Standard Chartered was being done for $400 million plus for below the belt money games on Iranian sanctions came as little surprise in some quarters.

In Rowans Blog, hat tip to Nicholas Shaxson, an insider in the last couple of days has roundly described the City of London as a criminal sink.  It is a longish and sharp piece but if he is right, as he seems to be, one can understand.  A couple of separate paragraphs are quoted below.

http://rowans-blog.blogspot.ch/2012/12/the-city-of-london-is-criminal-sink.html

Quote

“The City of London, in recent years, has become a criminal sink, populated by a criminogenic community of spivs and wideboys made wealthy beyond the dreams of avarice, by the ludicrous pay schemes and bonus awards, made possible in an environment where all sense of worth, value, and ordinary law-conformity, has been jettisoned, in return for vast sums of money far and beyond anything that might normally have been paid only a few years ago. The entire financial sector has become an organised criminal entity.

You can get away with just about anything in London, money laundering through the banks here is regular and commonplace, because no-one takes very much notice of the Money Laundering Regulations.

I met an experienced banker this week who has worked for a major bank here for many years and only this week he took his first anti-money laundering training session, because his institution is finally under the remedial cosh! You can move the proceeds of foreign tax evasion, you can launder the contents of corrupt dictators’ slush fund accounts, you can engage in sanctions abuse or the proceeds of drug trafficking, because no-one is going to stop you, and even if you do eventually get disciplined, you only get fined, and that falls on the shoulders of your shareholders.”

Unquote

Meanwhile over at the LSE, there is disquiet about the Autumn Statement by Kimberley Trewhitt, entitled “Without further reform efforts to bring the public finances under control in this Parliament will be undone”.  The essence of it is that the government has not yet begun to fully grasp the extent of changes that will have to be made.

http://blogs.lse.ac.uk/politicsandpolicy/2012/12/10/29169/

The final summary of her article is below:

Quote:

“The Government’s current austerity plans fail to address this long-term unsustainability. The health budget is ring-fenced and the Government is unwilling to renege on manifesto promises to pensioners such as the Winter Fuel Allowance. The introduction of the triple lock indexation on the state pension and plans to introduce a single tier pension also have significant cost implications.

The Government needs to take action now otherwise the public sector debt will be on an upward trajectory again from the 2030s. The OBR has projected that it will reach almost 90 per cent of GDP by 2060. Efforts to bring the public finances under control in this Parliament will be undone.

Furthermore, the costs of tackling the challenge will be greater further down the line. Not only will financial costs be higher, but politically reform will be more difficult; by 2020 45 per cent of voters will be aged over 55.

Commitment to reforming public services and tackling unsustainable spending areas to put the public finances on a sound footing is the only way to ensure economic stability and growth in the long run. The Autumn Statement was a missed opportunity in this sense.

Unquote.

Although apparently separate the two do go together.  Today Nick Shaxson in his blog in the long transcript of a TV interview makes the complexity of the current situation clear and Richard Murphy points to the extensive complicity of the Big Four accountancy firms in all the sharper and less desirable practices.

What brings all this together is that we have a government that cannot govern.  It is a member of the EU which is becoming less of a union by the day.  Meanwhile the world depends on a money system much of which is locked in secrecy and not accountable to anyone.

We are hearing a lot about the Mayan prophecies about the end of the world, if they were really talking about the collapse of their trading and monetary systems they may be more right than we think.

Greed Is Good And Greed Was Good

On the documentary channels picked up a programme, yet again about King Henry VIII, but this time concentrating on his 55 palaces, all apparently fitted out in the latest fashion of the time and with the best money could buy.  For example large tapestries, a lot of them, made with gold and silver thread. 

Given the relative scarcity of gold at that time, the riches of America only recently were arriving in Spain; this meant huge sums of money.  They were not the only decorations; all these large buildings would have been covered in bright colour and festooned with remarkable works of art.

On this basis Tony Robinson, the presenter and normally a fervent Republican, bounced around marvelling at the wonder of it all and referring to Henry The Great.  But he is an entertainer and our entertainers are mostly all in favour of high government spending, notably on the “arts” and have a lot to say about it. 

Looking at it my thought was that rather than “The Great” Henry might well be called “The Greedy”.  If you have over 50 palaces then there are going to be a lot that will be rarely, if ever lived in.  One, that on the Field Of The Cloth Of Gold in France was only temporary and a prestige project for display.

Given a very rough estimate of the population of that time, there would be one for about every 80,000 people.  Given that you could expect to have a Bishop’s Palace as well, together with a major aristocratic residence as well as a handful of gentry locations this is a lot to support given typical incomes of the period.

To this should be added all the major ecclesiastical establishments with their extensive interests and needs.  No wonder Henry went broke and that when he did he raided, that is reformed and privatised much of The Church.  All this would have been the public sector of the period and given the limited real cash available there would not be a lot left for the actual private sector of the period.

What makes me wonder is what else might have been done with those resources.  What kind of effective road network with bridges could have been put in place?  How many real dockyards or trading facilities created? 

If the money had been left with the people might the industrial revolution began a lot earlier than it did?  There was certainly an awareness of the possibilities of technical and other development.  But capital was a problem just as much as the set ways and intransigence of the guilds. 

Another factor was the sale of monopolies in later reigns.  King James VI and I severely damaged the complex and critical wool trade by the sale of one.  The effect on the wider economy was such as to reduce his tax revenues.  With both him and his son King Charles I trying to rival King Henry VIII for display it is little wonder that we had the Civil war.

In the last two or three decades we have had a period when unstinting admiration have been given to the greedy with both the media and politicians fawning on them and hanging on their every word.  We still have governments fixated on big schemes needing big money that will never earn any real return and push greater losses and debts on the economy.

What a way to run a railway.

Going To The Balls

Ms. Helen Flanagan, see Wikipedia, writer of the “tweet” is a celebrity actress in the major “soap”, “Coronation Street” and Nadine Dorries, the receiver, is a back bench Conservative M.P. who attained quasi celebrity status recently in a TV “reality” show. 

Nadine has been criticised for taking time off her Parliamentary duties without leave and is not currently one of the more favoured MP’s by the Prime Minister.

The picture comes from the web site Conservative Home and the Leftwatch section which has a vested interest.  The lady in the picture is Helen Flanagan the man is Ed Miliband, the Leader of the Opposition and Labour Party, although perhaps only temporarily.

It tells us how politics and celebrity are intermingled today, as for Ed’s reaction the picture rather says it all about who is really important and his immediate feelings.

On the other hand it could be argued that little has changed.  At The Queen’s Concert in 1868 a study of the Guest List reveals a similar pattern although the celebrities then were largely of the aristocracy. 

In fact at the Countess of Caledon’s ball in the same year it is almost the same people but minus the politicians, so they all had much more fun.

No Care At The Care Home

Recently, the Equalities Commission has released a report, organised conferences and promoted interest in the question of care for the disabled and the aged.  The recent raft of legislation and regulation has made this necessary, together with a number of adverse reports on some care homes and community care providers.

We are being made aware that the difficulties in these areas have increased in recent years.  There are many reasons, one being medical advances enabling the survival of many severely disabled people and others together with the increasing expectation of life, and therefore care.

Initially, in the UK most of this was shifted out of private and local provision some time ago with the creation of the National Health Services and with changing ideas.  The old workhouses, geriatric wards, and asylums were closed.    For private options down the years, the lodgings, guest houses and hotels with long term residents on annuities or pensions have largely gone.

Then many local authorities created residential homes for the elderly and disabled both to keep them in their communities and in part to release housing for families in their council houses.  As the numbers rose and the degree of care needed in individual cases become more demanding, so the costs of resident care have risen

So we have outsourcing of care to private providers together with a great deal of reliance put on “care in the community”, that is delivered to the homes of the individuals.  This has become more and more outsourced as the complexity increases.  This meant staff, rather than being located in one place, moved around from home to home to deliver the necessary services.

Regulation and enhanced health and safety requirements together with a great deal of employment and other legislation have added to the costs and to the work to be done at management and intermediary levels.  In and amongst all this there is a great deal to do that is apart from and too often above actual care.

Then there have been the twin curses of the cult of modern management coupled with the intrusion of financial rent seeking extractive investors fastening on a sector that can only grow and whose clients are both vulnerable and weak. 

Management by targets depends on the targets.  If the targets are driven by “efficient” daily routines and turnover and throughputs then what is paramount to the accountants and the owners will take precedence over the unpredictable and messy business of having to deal with difficult patients on the ground.

Now we are in a situation where for those in residential homes a large part of the sector whose owners went in for high leverage lending for takeovers and speculation is now in financial trouble and this has cascaded down into the quality and nature of the work in the bedrooms and lounges of the homes.

Low paid staff with little training and pressured to complete work and duties in ever shorter periods of time cannot give the care, attention and medical awareness to each and every resident.  Their laundry is skimped, their hygiene is forgotten and a few are left to lie until the bed sores rot their bodies.

For too many, the nutrition and food quality is bad and it is common for residents to suffer at least mild and sometimes severe dehydration.  The emotional effects of this are dealt with by shoving increasing quantities of anti-depressants down their throats.

For those remaining in their own homes there are many for whom it is an unending struggle in which they are almost always defeated.  Again, even if the intent and hope is there many of the transient carers have little or no time to spare to do anything other than the specified duties on their task sheets.

Also, few receive training at such a level as to make them aware of the first signs of deterioration or onset of really serious problems in the people they try to help.  One key area here is those with incipient dementia and another the little things that are mini-strokes or TIA’s that signal danger.

The consequence of this is when the inevitable happens for many there is too little too late done and a crisis occurs.  If a Care Provider has rather too many people on its books, not enough carers and a lot of people at risk, then their management may simply stagger from medical crisis to medical crisis.

It is then that the hospitals have to try to pick up the pieces, if they can or if they are equipped too.  One of our local hospitals figures in the twelve with the highest proportion of patient deaths.  It is not a surprise given the number and nature of the very elderly arriving in the emergency ambulances.

We now have a report suggesting that too many hospitals are close to “bursting point”, again no surprise, I always did feel that the official estimates for the future demand for hospital treatments were wildly optimistic and removed from realities.  Over the last decade there have been a couple of close calls, will this winter be the bad one?

All this was beyond the capability of the NHS management system that has just been discarded which was no better than the one it replaced.  The new one that has been introduced, because of its internal contradictions, seems certain to be overwhelmed in this sector. 

Because the management systems are designed for management preoccupations they cannot cope when complexity, where rapid medical decision making and treatment are essential and thorough individual care facilities are needed.  Nor is there any sight of what can be done long term for individuals in need.

Of course, the first priority is to meet all those big Private Finance Initiative bills coming in both now and for decades to come.  What can we look forward to?

The Return of the Workhouse?

Your Fiscal Cliff Is My Mountain To Climb

In the USA, President Obama, his team and Congress have to work out what to do next.  Their fiscal cliff has been in sight for a long while and has come closer as the debate goes on in the bus of state as to whether to turn right or left or just stop or reverse continues. 

In the UK we have our own fiscal cliff and the Chancellor will have something, or not much to say about it.  Almost everyone will disagree with him.  Unluckily, it will be worse in that those who do will be entirely at odds with each other.

Meanwhile with The Continent, i.e. Europe going into isolation they have a wide range of cliffs on offer, except apparently in Germany.  Even the French have stopped buying their state produced cars.  The trouble is that Germany may be obliged to pick up the pieces of those who do fall over one cliff or another.

The Euro men in Europe are threatening to divert their money flows from London to ensure they can control them.  This has the effect of brining down a fog which will make the as and when the edge of the cliff here and there is reached nobody will really know.  It will only when we hear the screams that we can be sure.

This leaves all us taxpayers and consumers with mountains to climb.  When that is done we may then have our own personal cliffs to fall over.  There is talk of increased sales taxes, various ways of attaching property and other devices to take more and more money from us.

The essential difficulty is that if an economy has been run on extreme debt and consumer spending with delayed paying it arrives at the edge of reason.  Because our mountains are quite steep, and we can neither consume at the same rate nor pay off debt quickly and successfully then we may be climbing the cliff.

Trying to climb a cliff when the government is falling off it seems to create a range of hazards that nobody wants or has really anticipated.  We have not had a crash like this for some time and then in the past the situation was very different.

More to the point in the past people had very different attitudes to both money and the personal lifestyles that they felt were appropriate to their needs and standing.  Adjusting to a life without much money, security and which is a long hard slog against adversity isn’t in the modern books of marketing or government management.

In the more critical reaches of the web where there is discussion on economic matters that are alarmist and scary there are many tales of woe about the deceits, frauds and lesser known crises under way.  They range from gold to dirt with everything in between.

In the UK at present there is a real debate about whether our particular form of democracy is defunct and unworkable.  In the USA, it is argued that California is now such a liability it might be better if it became a sovereign state.  In Europe stresses are building up in other nation states.  Will we see a renewed Kingdom of Bavaria?

We seem to have elites which no longer fund public buildings in their home areas to impress people or support local sporting or cultural activities.  They buy yachts and homes elsewhere and take their money away.  If they stop paying tax and the rest of us cannot fund governments at their current spending levels then we may be happy to see our governments go into history.

The maps of some parts of the world have changed radically in the last century or two and down the centuries past the story is one of persistent change.  There is no reason why another series of major changes should not be under way.

The lesson could be that if you do not want to go over the cliff you do not climb the mountain.

Housing, Room At The Inn?

As well as The Energy Bill, issued under cover of The Leveson Report fracas, there has been the matter of the Government’s thinking, or rather the Civil Service thinking on what to do about housing.  The answer is to build lots more properties.  As space in the urban areas is becoming limited and all that green stuff out there seems little populated the cheap and quick answer, as ever, is to build on that.

This has become mixed up with the issue of migrants and their requirements.  As a citizen of the world my suggestion is that we should leave aside “race” and the related jargon and ideologies, the basic problem is the numbers and the real implications of those numbers, such as feeding them, whoever they are and wherever they come from.

If the Euro crashes and tens of thousands or more one time Brit’s return broke from their enclaves across Europe the chances are they will want to be treated according their expectations.  These include benefits and critically housing roughly of a standard to which they have become accustomed.  Also, they will have votes and may want to use them.

This is only a possible influx, at present the UK is struggling to cope with the effects of incoming large recent groups in one place or another.  What the Labour government forgot in its passion to import supporters for the future was that amongst them were many young people from communities who still married and had numbers of children. 

Also, many of them regard it as the norm to have “oldies” around the house and brought those in as well to add to the traditional pattern of family life that are their customs and religious responsibilities.  Some of them regard our individualism and detachment from both old and young as strange and improper.

For the politicians and the media, holed up in Fort Westminster, our political equivalent of Fort Zinderneuf, they have become pathetically reliant for supplies and sustenance provided by large corporations, especially property and related financial ones of all sorts with crucial interests in building and related lending. 

Inevitably, they tell the battle weary political privates and corporal civil servants on the media battlements that salvation, namely economic growth and employment lies in building, building and more building. 

At the same time we have two, perhaps three, generations of voters who have been led to believe by relentless propaganda that “their” property is sacrosanct and the duty of the state is to subsidise, protect and support them at all costs.

There is a claim that there are a million homes currently vacant, some long term and many whose ownership is uncertain.  The Bona Vacantia listings from The Treasury of unclaimed estates account for a few of these because if there is no eligible claimant at probate then it will be a long time before action is taken.

Also, there are some just left empty, where the owner if known, may not even be paying council tax and leaves it there to gather price appreciation.  Then there are those where the local economy has shrunk so badly that there is not a normal working population.  But all these are just a part of it.

A little while ago, I was looking around holiday cottages etc. to let and checking booking dates, but the patterns I was seeing looked quite odd.  So I did a much larger survey, having the time and wondering if this represented an interesting statistical aberration. It went past the point of that. 

It may well be that there are a great many “holiday cottages” which are rarely let out to the public and those lettings that are booked are possibly false ones within the family for tax purposes.  In short there was some sort of advantage, perhaps a tax wheeze of having a “holiday home” rather than a simple second home ownership. 

Then there are all the “second homes” of different kinds, a feature of the property market that boomed immensely in the times of easy credit.  Some have bet their pensions on this sector.  There are pensioners who still owe large mortgages.  A net result of this is many villages and attractive locations which are part “ghost towns”.

One big nasty problem is the very many properties which have space to spare, depending on how you define it.  There was a row a short while back when one charity concerned with homes for migrants suggested winkling the old age pensioners out of their homes, especially those in social housing, to be downsized and to make room for others.

In the pensioner group are many owners who are cash poor and property rich.  One effect is that many cannot either maintain or heat the homes properly.  Another is that there are people on benefits living in valuable properties with the expectation that the state will support them at that level.

The idea of added higher bands for council tax has been mooted to attempt to bring a fairer basis to the regressive effect of the old levels which is in line with real values.  The immediate reaction was that was outrageously unfair to cash poor people who in capital terms might be million or even multimillionaires and their likely heirs.

If the governments intention to invite millionaire plus Russians to migrate to London to live with tax advantages goes ahead this will certainly help to keep prices up but the expense of all those who cannot afford to begin to buy.  The property market is now so compromised by government action, direct and indirect it has lost its real function.

Historically, the situation now is astonishing.  As someone who has flogged his way round many a census return in most parts of the UK for the period 1841 to 1911 it is instructive to see the numbers resident in most locations.  This does not mean the poorer areas; it means the richer ones as well. 

Just out of interest recently I have looked at a lot of domestic properties in the richest part of London in past Census Returns to match reality against both media impressions and much written history.  Wherever I looked in this category the numbers actually resident in domestic housing between 1841 and 1911 were hugely greater than the comparative figures for today.

Shifting down the scale today there were local small factories and workshops and some larger which once gave long term employment which have been knocked down to be replaced by blocks of flats, shoehorned in and similar to the old Courts of the 19^th and early 20^th Centuries.  This is called “investment” especially when it is social housing.

But doing the head count, for an equivalent amount of housing space then, even with an earning working class resident, the numbers there now, many single persons, are far less comparatively than those in the distant past. 

Essentially, we have become used to and demand from the State housing space, often on benefits, much greater than that of our own history, never mind those elsewhere in the world today and in the past.  How many single mothers are there with fathers who also live singly?

One intriguing difference is that in many of our new flats locally the residents complain bitterly about the lack of and limitations of parking space.  The irony of this is that the flats are within easy walking distance of the town shops, the bus station and the railway station.

Also there is a 1970’s estate of several hundred houses some still occupied by the original residents.  My estimate is that this now has rather less than half the people living there than when the houses were originally occupied. 

What is more to the point is that this whole expansion of living space has been fuelled by high level debts.  The building companies borrow from financial houses operating on highly leveraged debt and speculation.  The properties are sold and fitted out at high margins for purchasers borrowing at much higher multiples of earnings than in the past.

The social housing notably in the Housing Associations is also marked by major debt again normally at historically very high levels.  In the leasehold sector property management services might be owned by financial agencies again operating on high leverage. 

Behind all this are hidden subsidies from a government whose own debt is rising steadily.  The possibility that the increasing numbers could or should be largely absorbed in the existing housing stock by active reforms is not one that any party or vested interest is willing to entertain.

Yet despite all this we are being told that we must continue to build and to build on agricultural land.  The TV programme “Wartime Farm” reminded us of a recent past when food supplies became critically scarce and every scrap of land was needed to grow food for the very limited rations we were given.

In the late 1940’s the problem was not the U Boats or the availability of shipping, it was that nationally we could not afford to return to the levels of food imports that had been characteristic of the 1930’s.

There have been other times in the past when food shortages, hunger and sometimes starvation were the lot of the poor both in urban and rural life.  The last three or four decades of the 20^th Century are the only time in our history when food prices were at such a low proportion of average incomes.

As well as trying to keep the property price boom going at all costs our leaders tell us that there is no problem of food supply security.  This is not the picture some of us are getting from present trends in food production, distribution or prices.

Wait and see.