Tuesday 31 May 2011
This is a short post but a large subject, like what in blazes is going on? If these people do not know, as well as many others, is anyone going to be right or are they all going to be wrong.
Given this, and that they have access to more or less the same data and sources as our civil service and government and may understand it better, then can we believe anything we hear coming out of Westminster or Washington DC?
The link below is a collection of other links about the nature of uncertainty at present; apparently the answer lies in the leverage. The banks are said to be running it at 20 to 1.
If that is not bad enough a lot of the assets on which the leverage is based are government bonds. These are issued by the same governments that have borrowed heavily to support the banks.
What really worries me is that I look on them as optimists.
Monday 30 May 2011
In the UK we have forgotten much of our own history in Greece. Between 1945 and 1947 the UK spend £85 million in the money of that time maintaining a large force of its own troops and supporting the Army of the liberated Greek Government in a bitter Civil War.
This happened because in the agreements of the Great Powers at the end of the war the restoration of Greece came within the UK remit. With a financial crisis at home the USA then had to step in to take on the tasks.
The history of the Greek State from then to now is very complicated. It joined the EU in 1981 and signed up to the Euro project that began in 1999. In recent decades the growth in tourism had led to many Brit’s visiting Greece and some migrating there.
There was a time when some of my best friends were bankers. It was another time and in another place and in a different world. In a passing conversation I was asked my opinion of the Euro project and the wisdom or otherwise of the British internal wrangling over joining.
The bankers were entranced by the removal of all that fiddling with many currencies, the apparent ease of exchange and the hope of a single currency imposing a degree of common purpose and Germanic discipline over the various governments. There was almost a belief that the Euro would end uncertainty.
My doubts were not welcomed. First, it was a purely fiat currency that was based on a theoretical construct of money management through rates of interest set by the new European Central Bank. They thought that being German it would be stable and able to control.
My concern was that as the actual money issue was in the hands of so many people there could be a problem. The other issue was whether the governments of the relevant states could actually begin to control their policy management and economic policies to achieve that stability.
More to the point was that whilst a common currency might help things along in the good times, what happened in the bad times and when some sort of external shock or parallel shocks occurred? Could the levels of co-operation and common purpose be maintained if conflicts of policy began to arise?
The country that I was concerned with was Italy, once notorious for its inflation and depreciation of the lire. Spain was also problematical, the old peseta being highly variable. The French were not much better, the old franc had collapsed and the new Franc just about jogging along before the Euro came into being.
For the smaller countries there was an assumption that if the larger states kept their heads and sensible financial and economic policies the rest would fall into place or be forced by some unknown force field in compliance. What I knew of history told me that unbridled optimism was the high road to disaster.
Now we are seeing what could amount to another collapse of government in Greece this time with some ugly issues. The high income groups now pay little tax at all, the public sector is large, there has been major inward migration and the welfare provision is both extensive and generous.
The outside authorities have entered the fray because they are providing the bail out money and there will have to be conditions. These seem to amount to a virtual sell off of much of the public sector provision and generations of severe debt repayments on high interest, characterised as the debt slavery of the Greeks. This may be right.
In 1823 after a bitter war the Greeks managed to detach themselves from the Ottoman Empire and attain a degree of independence. Many in Britain gave their voices, money and full support to their cause. Now the IMF has moved in.
As Byron might put it “The Assyrian came down like the wolf on the fold, And his cohorts were gleaming in purple and gold…” But that was about another place. He also said “The isles of Greece, the isles of Greece! Where burning Sappho loved and sung, Where grew the arts of war and peace,”
Byron died in Greece, not in battle but as many did in that period during any war but of a fever. He was widely honoured in Greece and elsewhere for his vision of liberty. Now his Greece is no longer independent and its people are in yet another period of foreign domination.
“The mountains look on Marathon – And Marathon looks on the sea; And musing there an hour alone, I dream’d that Greece might still be free”
Sunday 29 May 2011
Kurt Cobb in a recent Energy Bulletin post asks if vested interests would starve the world. In this case he is referring to international companies with major influence on government bodies and organizations.
The questions relate to the products of these companies which in the short term might deliver some added food output but which have the potential to trigger a serious collapse in the production of key crops.
This is apart from the activities of traders with computers playing hide and seek with commodity figures who are alleged to be factoring in much higher prices than real markets would command. Or bankers needing the biggest cut they can get in the shortest possible time.
Meanwhile in the United Kingdom people will be walking over lands with lost villages, on BBC1 is a programme about how satellites have identified many lost cities in Egypt and MSN, being American, is concentrating on the threat the Yellowstone Caldera poses to civilization. With a major drought risk in the mid west and maybe the sub-continent it may not need anything volcanic to happen.
Personally, we shall be watching our saved item on Hubert Parry with the Prince of Wales. Parry grew up in Gloucestershire, albeit born at Christchurch. In 1851 as a boy his father, a prosperous man, Thomas Gambier Parry employed servants. One was Jane Greening, of a local family.
In 1857 Edward Elgar was born not far away in Worcester, the son of Anne, whose maiden name was Greening and of humble origins. His father was a Man of Kent who moved north. It is difficult to work out but Anne’s family seems to have come from south Herefordshire and Gloucestershire.
Also on this patch was Gustav Holst, from Cheltenham, of German paternal stock but his mother was Clara Liddiard, also a Gloucestershire family, but a quite prosperous farming/minor landed one. Not too far away a little later, at Downe Ampney, we have Ralph Vaughan Williams.
Just a handful of people who were from a very small area yet who had such impact.
Friday 27 May 2011
With the stage set with Cameron and Miliband the main protagonists, the mind wanders back to other similar political contenders of the past. I will skip the longer history but the BBC4 piece on the decade long era of Wilson and Heath gave me reminders of how bad it was and how little we have learned.
By the time this began in 1964 I had been working a while, mortgaged, with children and hard pushed to run an elderly Standard 10 car on the family budget. In an age without credit cards, when food was relatively more expensive and when consumer goods in general were relatively costly in comparison with disposable income, there were no foreign holidays, no big spending and necessarily a close interest in politics.
After a job change a couple of years before, in 1967 I was asked to give a short talk to the local Junior Chamber of Commerce about what the Wilson government were faced with. My thesis at the time was that it did not look good and it was clear that we had ugly choices in whether to try to have progress and prosperity in industry and commerce i.e. “growth”, continue pretending to be a world power or whether the welfare state was sustainable.
My boss heard about this and was livid, denouncing me to all and sundry for my lack of loyalty, my failure to understand the crucial need for prestige, my suggestion that the British Government had significant imperfections and that the British pound could not continue to be central to the world economy and future.
Six weeks later the pound was devalued, we departed from East of Suez and it was clear to any sane person that the game was up. My boss never spoke to me again, so I moved jobs.
The trouble was that sanity was not much in evidence in the higher reaches of the governments of either Wilson or Heath. Because of the system we had politics that turned almost solely on the then marginal constituencies, what was spent on who and keeping the London media happy. If you look at exactly were the marginal seats were then it will tell you a great deal about many decisions at the time.
What I see little of is just what was in the heads of either Wilson or Heath. We see all the hindsight studies about who did or said what at the time. But what were the experiences that shaped them? Wilson was a bright boy who went to Oxford and was on course for an academic career when the war turned him into a senior Civil Servant largely dealing with supply and the Home Front.
In the 1940’s this meant the centralisation of almost everything and the extension of state power and interference into every aspect of life, in short “Whitehall Knows Best”. The 1945 Election meant a Labour government determined to secure the “commanding heights of the economy” and run them for the theoretical good of the State, which is where the Labour party began to come apart at the seams.
Wilson’s economics were learned in the 1930’s and whilst he may have kept up with the subject it was already moving rapidly in several directions. Certainly, it was very difficult to work out which was most likely but Wilsons background was not going to help make the right decision.
Heath on the other hand, another bright scholarship boy, spent time in a Europe riven by enmities and civil conflict leading to war. He then served in the Royal Artillery and seems to have done his duty very well. But The Gunners way of working was not quite like that other arms. This is a large subject I will skip. But the Gunners were highly organised, needed managing in detail and precision was the key to their efforts across their activities. Quite unlike politics in the UK. Also his economics were learned at the same time and in the same town as Wilson’s.
After the war, Heath pitched up in the Ministry of Civil Aviation for a brief spell. This ministry at the time was almost a total statist organisation. Like many other nations there was a firm belief that all aviation, military and civil was a central government operation and any civil elements were incidental but worked under direction.
Then Heath went on to Brown Shipley and Co., private merchant bankers with a central role in trade and financing. Again, basic to many of these companies was the need to keep the UK at the centre of world finance, almost at all costs. The firm still exists and can be googled. It has a brief history on the web page.
After that in 1950 Heath entered politics and make rapid progress because of his diligence, Gunners attention to detail and contacts in The City. But between him and Wilson, apparently so different, there were common intellectual and general policy interests that would take them along similar lines with disastrous results.
It is all there on the web to be seen in the biographies. There were the clumsy defence economies and the endless bad decisions with consequences that could have been foreseen however unintended. Also, the major changes to local government, the Health Service, major industries that were destructive of jobs, growth, and community and not least the surrender to Europe.
The reason was really quite simple. When the two of them, with their cronies and media advisers went in for hyperactive State activity they did not see or realise how the changes in progress in many areas were going to change the structure of industry, how commerce operated, how people would choose to live their lives and how finance was going to become so dominant.
So what changes?
Wednesday 25 May 2011
Once popular farces were a staple of West End Theatre, either three act or two act they made audiences happy and were great fun to watch. The world has moved on now and they have become rare events. TV and other media comedy has different ideas. But I wonder if the British tradition of farce has now taken over politics?
Almost everywhere you look in our systems of government, law and administration you see not simply the basic elements of farce but situations where it is the way our leaders and power brokers run their own affairs and those of the nation.
But this is not fun. Certainly it may be satisfying to laugh at weeping members of the House of Commons being carted off to prison for expenses and other fiddles for which there is no rational explanation only greed, stupidity and arrogance but these are the people who have been passing all these laws.
Yesterday I saw a report in which a peer under the cosh for House of Lords expenses was saying that the second chamber of our Parliament was really a cash machine for passing peers and their friends. There are alleged to be 792 of these people all in the queue. There have been some odd people, very odd in some cases pleading that from time to time it is rumoured they do something useful, but this has escaped me.
If they are so good and so experienced in high affairs how come we have had in the last decade or more a tidal wave of badly flawed legislation that has all but ruined the economy, any community, much of family life and a great deal more?
How come that in the last months of the Labour government the House of Lords permitted a deliberate wrecking policy to ensure that the country would become almost ungovernable and what attempts were made to put things right would be obstructed at every turn by organisations filled and run by Labour placepersons.
Human Rights ideals were turned into the farce of judges attempting to end free speech and for that matter any academic debate that any corporation disliked as well as ensuring that fraudsters, criminals, dealers in drugs and death were freed from criticism or questioning, even by Parliament or the police.
The funding of capital projects in the public sector had saddled major areas of vital provision in health, education, social care and the rest with huge debts that will impact the budgets in such a way that only major cuts will solve.
In addition, so many more crimes, duties and regulations have been created that few people know what they are about or why or what to do. And that is those who are running things let alone the poor ordinary citizen who no longer knows who governs, why or what they are doing.
Whilst all this is going on the world economy still looks too prone to any adverse event or development. The stresses in Europe are increasing. Many more people are on the move. There are wars still being fought and in the making. So what do we see on the TV?
The President and the Prime Minister playing ping pong as a break from the party re-election games. But which of them will lose their trousers?
Sunday 22 May 2011
When President Obama visits Her Majesty, there may be an exchange of gifts. My suggestion for Her Majesty is that she might consider giving The President a bust of the Duke of Wellington to replace the one of her old friend, Sir Winston Churchill that the President had removed from the Oval Office.
Also, one that would be fitting along the same lines would be a boxed set of all the “Sharpe” series that appeared on TV. Perhaps some time might be set aside for them to watch together one or two of the better ones accompanied by a few slugs of choice Tullamore Dew. Sharpe and his men in the films are from the 95th Rifles (see below) and the series are largely about The Peninsular War and Waterloo.
The President has Irish ancestry in the maternal line going back to male Kearney’s whose marriages in the period of the late 18th and 19th Century included a Donovan and a Holloway. Irish Origins dot com has a table. It is possible that the Holloway might be of English origin.
So I had a look at the indexes. On the Trafalgar Roll there four Holloway’s listed, all from England and nor do the Waterloo and Army listings yield any of that name that might be possible. in Ireland.
But for the Donovan’s at Trafalgar there are sixteen Irish names listed of whom seven are from Cork with two from districts adjacent to where The President’s family were. The Army listings have many Donovan names but as there are many families in that general area of Ireland it would take a great deal of research to sort out the lead possible cases.
For the Kearney name in the Trafalgar Roll with near variants there were about a dozen Irish who were scattered, with three from Dublin where one branch of The President’s family were. So there is an outside chance there but far from certain. With the Kearney name there are some Army names to check up and it is easier to work out what is possible. There are some interesting possibilities.
In families with several children and a number of sons, often some of the younger sons had to find other things to do away from the family home. They turn up in many and various places notably the Army or Navy. So the chances are that none of the direct ancestors may have served but it is likely that someone in the family did one way or another.
Many would have been in local Militia’s, a form of conscription for local policing and law and order, but the militia’s could be sent anywhere in the UK and were. Often large drafts of men went on to the Regular Army proper as volunteers, of a sort.
In Plymouth in 1807 over 200 of the Worcestershire Militia transferred to the 7th Regiment, known as the Royal Fusiliers and regarded as a London regiment. Another 20 skilled and literate men went into the 43rd Light Infantry, including my direct male forebear of the same name. The 71st Highlanders at one stage picked up 70 men from Surrey.
There was a Thomas Kearney from Athlone who served in the 7th Regiment from 1800 to 1821 ending as a Colour Sergeant. Rather later Maurice Micklewhite (aka Michael Caine) was in Korea with the Regiment on active service. The Kray Brothers were on its strength at one time, but deserted. They did not have the bottle for the 1950’s Army.
The brothers, who were active in West End nightclub life were on close terms with some of the US Democrat’s celebrity supporters notably Frank Sinatra, friend of Joe Kennedy and Judy Garland. Her Majesty’s father, King George V had to put up with Joe Kennedy as US Ambassador and did not like him much.
Looking at the known Kearney family names of The President’s there are some in the listings for the period. There is a Michael from near to the President’s Irish acres who served in the 19th Foot, known as The Green Howards from 1800 to 1813, but they were in India during this time.
They did see a good deal of action in The Maratha Wars, notably the 1803 Battle of Lasswaree and the 1804 Farrukhabad. The latter was famous for The Great Chase when a few hundred Regular and East India Company cavalry defeated several thousand Maratha’ and pursued them for 24 hours to inflict severe losses. The 8th Kings Irish Hussars were present.
There was one William who was close who signed on as an older man in 1808 serving until 1821 with the 88th Foot, completing his time with the 6th Veteran’s Battalion. This Regiment was better known as The Devil’s Own, The Connaught Rangers. They gave astonishing service in the Peninsular War. They were not at Waterloo but another William was, this one a Driver in the Royal Artillery and he came from Mallow.
There are three John’s. One born in Dublin, (was he one of the President’s?), served with the 11th Hussars, The Cherry Pickers, from 1799 to 1828 and they served both in The Peninsular and at Waterloo. Another from not far away in Limerick, served from 1817 to 1829 with the 83rd Foot. This was a Dublin regiment that before his time had served in the Peninsular and at Waterloo.
The third John is intriguing, he was at Waterloo with the 2nd Battalion of the 44th Regiment, The Essex Regiment. In 1814-1815 the 1st Battalion was in America notably at the Battle of Bladensburg and then burning Washington DC. They were commanded by Arthur Brooke, Deputy to the force, and a Brooke of Brookeborough in County Fermanagh.
A later Brooke of that family, Field Marshal Alan Brooke has a statue in Whitehall, a testament to his crucial service in World War 2 and again known to Her Majesty. He shared her father’s dislike for Joe Kennedy. Also, with a statue nearby is one to Field Marshal Bernard Montgomery, although born in London, of Ulster family.
His were not far from the family of Major General Robert Ross of Rostrevor, County Down who commanded the 1814 Force and when entering the White House found the dinner still warm in the kitchen left by the fleeing family of President James Madison. Perhaps, when The President and Her Majesty dine something flambé might be on the menu.
Turning to others of the Kearny surname with other Christian names, there is a Patrick from Limerick who served with the 53rd Foot and then 66th Foot from 1815-1817 but neither served at Waterloo. A David was with the City of Limerick Militia in 1803.
Robert, another Dublin man served with the 16th Light Dragoons from 1805 to 1828. The regiment were raised in 1759 as Burgoyne’s Light Horse and served in America at the Battle of Brandywine. They too were in the Peninsular and at Waterloo. Later, they became embodied after World War1 with the 5th Irish Lancers to form the 16/5 Lancers. He was discharged as worn out in the rank of Troop Sergeant Major.
An Edward served with the 21st Light Dragoons from 1801 to 1818, this regiment being disbanded in 1821 and later revived in 1861 in India. It served in San Domingo and South Africa in Edward’s time and a troop provided the body guard for the exiled Napoleon on St. Helena until his death.
There are two more, one a Daniel was with the 2nd Battalion of the 95th Rifles at Waterloo. It is the other who has caught my eye for the place at the top of the short list.
It is James Kearney of the 1st Battalion of the 95th Rifles (as in the Sharpe series) who served from 1805 to 1816 and must have seen it all in The Peninsular and at Waterloo. He was discharged at York as old and worn out, as well he may have been. James was from very close to The President’s Irish acres.
There could be others because the internet sites are not full or reliable. A few years ago I did a lot of work on Army muster rolls of the period at the Public Record Office and one in particular, the 71st Highlanders. The depot was in Glasgow with the consequence that the regiment had many Lowlanders as well as number of Irish.
They had been ordered to America in 1814 but were then disembarked in Cork and sent up to barrack at Limerick for a short while before going to Flanders to deal with Napoleon in 1815. It is probable that they took on some recruits while they were there.
Like most others of the British Army there it was a raw bunch of men that had to face the French at Waterloo. I have lists of names transcribed as well as photocopies of a part of the 71st’s Waterloo Roll.
I decided to check the online Waterloo Roll for accuracy only to find many names missing and a few others where the spelling was changed. So there could be others that only searches of the original documents will yield. Amongst them may be your relations or mine or indeed The President’s.
As a courtesy Her Majesty might ask The President how his 82nd Airborne Division are faring at present. In 1944 the airfields they went to for the drops at the Normandy Landings and later Arnhem were not very far from Sandringham.
At the time both she and Prince Philip were in the services. He would learn that Her Majesty, as well as being expert in animal husbandry knew how to drive, maintain, service and change the wheels on a truck. There are few Heads of State with these broad practical skills around in the modern age.
Here’s forty shillings on the drum, if you want more try “Over The Hills And Far Away” on Youtube, the Davros Team one is quite striking. It does not shirk the business of what war is all about either then or now.
Friday 20 May 2011
The journal “Science” has featured a report from the University of Texas concerning the sense of smell and the development of the brain in mammals in the long past.
The link is below, the thesis seems to be that when mammals began to be able to smell better and more effectively this jump started the development of the brain.
An implication of this is that if humans have high performance brains then this might just be because they had a sense of smell that enabled the thought processes to function far more efficiently and selectively.
As the scale and nature of air pollution in modern urban society probably means that most of us now have this sense seriously impaired does this mean that the urban human race is reverting to a dimmer and more dismal past?
It might explain why so many things are going so badly wrong.
Thursday 19 May 2011
Had Her Majesty, Queen Elizabeth, visited the Republic of Ireland a decade ago her speech writers would have put in many fine words about the wonderful prosperity, the “Celtic Tiger” and the happy future that was to be. This week she will be avoiding economics and I think sticking to horses, notably at the Irish National Stud.
The question she asked at the LSE in 2008 to the effect that why didn’t all those experts see the crash coming would be much too sensitive. Given the way that Dublin finance was embroiled with the City of London it would open too many sores.
Also, the row this week over the bust Bank of Ireland and its UK banking license and who is liable for what does not help. That the Post Office Savings bank with all those British Army accounts is involved adds to the whole affair.
How “independent” has the Republic been since 1922? It depends how you look at it. Certainly, it has had some freedom of action and decision. But the economy has been a different matter. The currency, the Irish Punt was in the Sterling Area until 1979 and tied to the UK pound.
All the ups and downs of the UK economy and the pound in that time affected the Irish. As problems at the centre all too often worsen as you get to the periphery it is arguable that when the UK economy had issues then the Irish had bigger ones.
Also, it meant that as the Great Agricultural Depression that began in the Atlantic Isles in the 1870’s came to an end post World War 2, there was not the capital or finance in Ireland to enable real recovery and it wasn’t coming from London. Into the 1950’s and 1960’s there was still desperate rural poverty and limited economic opportunities.
In 1979 the punt detached from the pound under the European Exchange Rate Mechanism which Ireland joined when the UK did not. The ability to manage the currency together with the grants and subsidies gained from the EU began a period of growth that injected prosperity and confidence into the Republic.
When at the end of the 1990’s the punt converted to the Euro this growth became rapid and uncontrolled money expansion. One part of this was the reluctance of Irish coalitions to put the brakes on early. This was compounded by the inability of the Irish government to determine its rates of interest. These were fixed by the ECB.
Another was the creation of a quasi tax haven status which brought all sorts of funny money taking advantage of the tax breaks and the dislocation of interest rate levels. This added to the overall debt and encouraged high levels of personal debt. Now Ireland is financially a broken state with a bleak and difficult future.
My Grand Aunt Lily, baptised Elizabeth but did not like being called Lizzie, married an Irish hotelier and went to Newbridge in Kildare close to The Curragh and not far from what is now the Irish National Stud. She kept in touch with her family especially the nephews and nieces. From time to time she would pass on tips that often were welcome and it is said saw some of my family through their education.
They proved to be far more reliable than any of the financial predictions ever made by all those experts in recent times. As I said above, Her Majesty knows her horses.
She might be a better bet than either the ECB or the IMF.
Wednesday 18 May 2011
The business of the Head of the International Monetary Fund, Dominique Strauss-Kahn, or DSK is keeping many people busy, not least Gordon Brown’s sidekicks. Given the track record of Gordon’s little friends it is no surprise that all sorts of stories are circulating around the media about DSK.
DSK is currently held on remand at Rikers Island in New York, its main penitentiary which has a lurid reputation. Remand does not presume guilt.
He is there because the court in which he first appeared took the view that he might do a bunk and was held to ensure his appearance to answer any allegations.
Nor does doing a bunk presume guilt either. The UK welcomes many people who have done a bunk from the home countries because they might face arrest for something we disagree with or have to spend a long time awaiting trial or indeed be faced by a court that is hostile to them.
In the meantime DSK has exercised his right to be represented by lawyers. If the reports are correct these are experts for whom many in their trade have a great deal of respect for their abilities in defending people on trial.
How things will go in court is not known nor can we estimate what the jury might make of it nor what guidance or views the judge may hold as the case proceeds.
As someone who was one of the very few who backed Featherstone Rovers to beat Hull in 1983 I am aware that a majority general received opinion may not be the best guide.
What happens, I ask, if DSK is found not guilty?
Tuesday 17 May 2011
Income can be generated and redistributed in many ways, not all to the benefit of the long term economy, most people or a particular nation state. Indeed there can be winners and losers and those who think they are winning are often hell bent to be losers, read the football pages if you do not believe this.
To begin with what most of us do, retailing and eating and drinking out became a key sector of the economy and much of it is owned by either firms or indirectly by financial interests that are outside the UK. It is not just those sectors, but in other now regarded as key activities, Finance, Tourism, Entertainment and Property amongst them.
This extends to most of our public utilities, transport, other commerce, industry and many of the minor activities. Referring to my classification of the structure of the economy as divided between the Taxable, The Alternative and The Illegal, then a great deal of the surpluses generated from the Taxable Economy alone find there way out of the UK.
Additionally, so much of ownership is vested in complicated structures of companies to govern and deal with the financial matters that the great majority of the real economy is seen as a basis for meeting financial targets. The monies extracted are then too often channelled into speculative or risk finance.
Consequently much of “growth” is paper growth, so who really benefits?. According to reports the distribution of this into individual incomes in the last decade or so is now becoming very different from the late part of the 20th Century.
Not only are the gaps between the incomes of those at the top compared to the ordinary employee far bigger but there is an increasing concentration of “wealth” into many fewer hands. A number of these in London, which is central to this, are not UK citizens and nor do they retain much of the money in this country for real investment for the future.
A good deal of public sector spending is alleged to be “investment” when it is not; it is consumption, some of it at the expense of productive investment. Also, much private spending is little better and very often is simply taking in each other’s washing. How many ordinary people put money into long term projects other than property, itself an unreliable form of wealth?
As I have commented before the more difficult issues arises from how much has gone into the Alternative and the Illegal Economies? My view is that in the last two decades a great deal has and the proportions have expanded substantially Neither of these areas of economic activity do much to create the basis of real growth and moreover remove what might have been real investment funds from the UK.
There are other areas where large sums go from the UK economy in ordinary spending amongst those with middling and lower incomes. In fact if you look at what household money is actually spent on a great deal comes from abroad, often including the chicken, potatoes and peas on the dinner plate.
If we compare all this to the actual real workings of other economies such as those of France and Germany and others it is easy to see why growth is sluggish. The nightmare is that the London Politics and Media see only the paper and debt fuelled consumption parts of the economy as a way of generating financial statistics that may look like growth but are far from in any true economic reality.
There is another and darker side to the way the financial potential for the future flows out of the UK. Bluntly it amounts to financial looting of the UK by others and this is inextricably linked with international corruption and a web of activity in jurisdictions that enable secrecy and associated malpractice to thrive.
Most of the undeveloped world has suffered from this and their problems are growing Back at home in the UK to put it at its simplest, trying to manage the economy on the same basis that most Premiership football clubs seem to be run is just not going to work.
Is the UK due for relegation?
Monday 16 May 2011
There is almost 2000 words below, a summary of the situation, then the Press Association story from the BMC Geriatrics Journal concerning a University of Newcastle study on provision for the oldest members of the population in Care Homes.
There are a number of growing issues here which are going to grow a great deal more. Below that are three comment items taken from the Yahoo page that illustrate differing personal perspectives.
With the public sector care homes diminishing in numbers and some major problems in the private sector, notably the tribulations of Southern Cross, financially on the brink and again a good deal of worries about what care at what price, this could soon be one of the many things that go bad.
There are some new private care homes being built but many are not ideal. One not far away from us is characteristic. It is beside a major traffic junction with heavy traffic more or less 18 hours a day, has no outside facilities or seating and limited parking for visitor. It is an ugly barrack block with minimal social or communal facilities and rooms of minimal size and provision.
This blog has said a lot about the Retirement Housing sector and the work of Carlex (dot org), the Campaign Against Residential Leasehold Exploitation with special reference to the retirement housing sector which is a mess which is going to cost a lot of trouble.
The government are repeating their mantra about Care in the Community. But who is doing the caring? Some have no family, others have families who have divorced and dispersed, others do have family but they need to work and have other commitments. Those that do not work rarely have the resources to give much effective support.
The result is that “care” depends on a horde of female part timers rushing about in and out with little training, less backup, and no discretion trying to tick the boxes that say what can be done or should be done. Much of it is barely workable. How the government can expect this sector to carry the load I do not know but the people needed are not there now and are unlikely to be in the future.
Moreover, for many staying in their own home is costly. If they cannot do DIY or ordinary maintenance then keeping it up can be very costly. Heating is a major cost problem and many of the most infirm cannot manage the full range of household tasks, notably food and basic hygiene. So there is a growing population in places they cannot afford to run who are increasingly cold and hungry.
With the current attrition of pension incomes and with many now entering retirement without the comparative level of retirement incomes of the past it is going to more difficult.
Between what is said by the government, Newcastle University, Carlex and vox populi of those who comment there seems to be little common ground and a totally different vision of the present and future.
Press Association Report:
A massive increase in the need for care home places is looming in the next 20 years because of the rising numbers of over-85s in Britain, academics warn. But a comprehensive survey of people in their late 80s showed that eight out of 10 of them happily live independently with no need for daily support from others.
The 85+ study was carried out by Newcastle University's Institute for Ageing and Health and although this is the fastest growing demographic in the country, it claims to be one of only a few studies worldwide into very old people.
According to the experts, in 2010 there were 2.6 million people aged over 80 and by 2030 that is expected to rise to 4.8 million. That means there is a need for an 82% increase in the number of care home places, 630,000 extra places, between now and 2030 in order to cope.
The survey found that 41% of those questioned never had help and a further 39% were supported to live independently but not every day. That meant one in five people aged over 85 needed either regular help or critical 24-hour care.
The findings, published in the BMC Geriatrics journal, indicated that with the massive increase in numbers in the older age group predicted in the coming years, more and more pressure will be placed on care services.
Professor John Bond, Professor of Social Gerontology and Health Services Research, said: "There are two ways to look at this. With your glass half full or half empty.
"We have found that 80% of people in this age group need little or no care which is great news. But on the other hand there needs to be some major investment to ensure that those who need help can access the care they need."
A Department of Health spokesman said: "Demand for care home places in recent years has been going down, not up. Most older people want to stay supported in their own homes for as long as possible and the extra £2 billion we have given to councils will help them care for older people in an environment that's best for them, not necessarily in a care home.
"We are determined to protect the most vulnerable members of our society and the extra investment in social care will act as a bridge towards a sustainable long-term solution to funding of adult social care. We know that the funding system for care and support needs to be reformed and have established an independent commission which will report in July."
Comment From A Carer:
As A carer I see both sides some of our clients now are pulling someones leg like the man we shower then he goes to town shopping or to his Daughters or the lady we shower then she takes her dog for a walk? Excuse me but if both can manage these,,,,,,,,,,,,,,, walking out on there own surely they can shower sat in safe council provide wet rooms with seats?
We see lots of financial abuse by there children who cant wait to get there hands on there money , but they dont want to have to do anything to help there parents live independantly as possible. It amazes me how when there parents were alive they didnt visit but as soon as they die they appear out of the woodwork and there parents house is emptied and on the market before you can say jack robinson.
The wages we get do not reflect the job we do most people gringe at the thought of doing personal care for someone else or emptying a . commode that has been sat there for hours . So next time you think we are overpaid think again would you do the job?
Most carers do the job because they do CARE about others there is no financial gain we get paid little to do a worthwhile job and we do it with a smile and compassion ,hoping that the people we care for feel better and and that someone ,even if its only the person who gets you up feeds and medicates you ,cooks you dinner , makes your tea and puts you to bed, who has nothing to gain but feels she or he has made a difference to your day chatting and helping you stay in your home where you want to be ,and often making excuses for your children who again haven’t bothered to pop in to see you or bring you a meal but they will be there when you die to go over your precious bits and pieces and often fall out over who gets what . What a wonderful society we live in.
Also we work 365 days a year every other week-end and the bosses want us to be available from 7am till 11pm tell me any other job where you need to be available for that amount of time?
Comment From a person in their 80’s:
We have worked very hard all our lives, saved for the future as reccomended by our parents , to do this we said no to holidays no to new furniture and saved all we could we were self employed for 40 years and retired retired and sold up.
10years ago my husband developed Dementia its a 24X7hard task, no life oF ones own but i am willing to do this because we are so close. However i need respite the cost 800pounds A WEEK yes 800, so watch out you savers you will see all your savings disapear and eventually when the last one dies a hefty bill.
Forget inhertance for the children, forget trying to keep the family home , we are both over 85yrs and struggle on no way will i allow my husband into a care home permantly and see our hard earned savings disapear.
WE were both in uniform during the War paid our dues and stamps but try and get help? all we are told is "you dont qualify you have savings.but our neibours who spent all in their lives get all the perks, who’s the fools?
From someone I think with an interest:
Council care homes are closing because of costs- to start with the costs of employing people is higher in the public sector than the private sector. yet the money allocated to say a care home in the public sector is less than the costs to keep it open.
If you compare a council care home with a private care home there is less investment in the council homes and they are often(but true not always) in a worse a state of repair.
I am not SAYING PRIVATE CARE HOMES are great- some are really bad- but many are very good and because of business people being in charge work more efficenty and effectively.
Problem is with council homes they are, or let me say were not working to a budget in costs, only in recent years when councils have had to look at cost have budgets being set and tightened up.
Now of course there is not the money to refurbish homes in the public sector costs for one home in my county were, for refurbishment over 500,000 and that was because over the years the council had not put any investment into the fabric of the homes and teneded to repair rather than rebuild.
The money was given to staff as wages to have a rise every year- many staff at council homes earn a lot more than private homes. Now the buildings are in need of total refurbishment the councils have not got the huge amounts of money to do that and or pay a lot more staff more and more each year(The staff at council homes was and probably still is a lot higher in numbers than a private one- the latter still have to have minimum staff on by law.
But some council homes have twice the staff and more of the private ones, that cannot be sustainable and many councils have found it is not sustainable to pay a lot of money out for a home when they merely have to give money to a private home and have no capitial costs themselves.
Yes it has gone down (the amount) but many councils are in the process of closing their own homes so the money will eventually flow for residents in a private home. BTW council homes have had no better inspection reports (some a lot worse)than many private homes so that excuse for keeping council homes is a none starter.
Saturday 14 May 2011
While we are all watching the football and passing fancies of the media there are places in the world where problems are arising which fall into the category “No Right Decisions” which broadly means to quote Armageddon dot org, “you are damned if you do and damned if you don’t.
The US Army Corps of Engineers who have the job of dealing with the nation’s waterways and their defences against flooding have to decide whether or not to open the Morganza Spillway, a barrier against Mississippi flooding central to the control of the river now in full flood.
If they do the waters go into the Atchafalaya Basin in Central Louisiana and will cause extensive flooding there affecting thousands and wiping out crops over a wide area. Many people will have their lives and finances ruined and the damage will take years to put right.
If they do not the waters will then flow further south and the State Capital Baton Rouge is at risk as well as New Orleans where huge efforts need to be made to add protection to the levees and avoid a repeat of the flooding of 2005. We think that it was Hurricane Katrina that was the cause then, but the sea storm surges came up against existing high river levels.
At present it is normally too early for any major tropical storm or hurricane to add to the worries and this year is supposed to be less active given La Nina, but there is really no “normal” in summer weather conditions in The Gulf. Hope and prayers are at present the only options.
As the year progresses the USA could have more problems. There are worries about the harvest already because of the unusual weather conditions. With so much land being removed from wheat production for corn for ethanol under government subsidies to keep down petrol costs, more corn for all the sweeteners helping Americans to grow so much and more corn again for force feeding cows and pigs for cheap meat for home and export it may all go badly wrong.
This will mean looking hard at the complicated structure of tax breaks and the rest that prop up so much of all this and from which such huge sums are ploughed (sic) back into US politics via the lobbying system to continue and extend this. In the meantime with so many now dependent on food stamps there is another kick in the donkey to quote an old Iowa proverb.
According to Science Daily the variations already known within the weather systems of the last 1000 years or so can and do shift in a way to cause major impacts on both ecology and the related patterns of human existence and ability to survive in numbers.
So whether it is all about Global Warming Or Cooling or Change of Earth Mood if we are about to have another twitch of wind and water patterns a lot of people in a lot of places are going to have to make both group and individual decisions. Given the human history of the last 1000 years the consequences will not be welcome for those who want to live a contented and peaceful life of hedonistic consumerism, especially if the monsoons fail in the Sub Continent.
Meanwhile something else could be in the wind. While many places have cut back their air monitoring and other facilities, there are some still left and one is the Norwegian. According to their confidential assessments we may or may not be in for some extra sun tan this summer coming from Japan.
Essentially, the radioactive iodine is up there and the question is how much and where it may turn up and who it might affect but the Norwegians do not want people to become excited. In any case they are more worried about the geophysical twitches going on in Iceland that might put their air monitoring in the news again.
Meanwhile the campaigns are beginning for the next Presidential elections in the USA whilst in the UK the Mexican Standoff that is our government policy continues.
So who will be making the decisions?
Thursday 12 May 2011
In general I prefer my posts to be on the easy side. This is because it makes them easier to write and means I can get back to volcano and earthquake watching. This brings me to Iceland whose territory is one of the most volatile on Earth.
The BBC has been doing Iceland in various ways this week. But they are sticking to the geography and the way they live and how different it is from Islington or Hoxton. The basic assumption is that they are strange and we are not which is something I am far from sure about.
But Iceland recently has been volatile in other ways notably in the World Money Crisis which is rolling on around the world in unexpected ways. Despite a population of only 320,000 by a series of accidents Iceland’s misfortunes became central to the whole financial collapse.
The Market Oracle covers a book on the subject, “Deep Freeze-Iceland’s Economic Collapse” by Phillipp Bagus and David Howden”, who have taken a long hard look at the whole business and how Iceland became Paperland.
It is a story, more or less, of Hagar The Horrible Becomes a Banker. In the link below Andy Duncan suggests that they make the story clear and explain why it all happened.
Reading down the article it is comforting to see many of the usual suspects lined up against the wall, albeit with different names. “Security mismatching” is our old friend lending long and borrowing short by different means. They really did think that could take on huge debts that might fall due for repayment before you could get your money back from those you had lent on to.
One reason for this was the invention of a wide range of financial devices to enable the stock of money to he increased on paper and sloshed around the world, often in secret by wheeling and dealing. That way it disguised the extent of imbalances between the borrowing and lending.
In effect it meant that the financial institutions, unleashed by politicians from earlier regulation or supervision effectively were given control over the money supply and creation. You may recall Meyer Rothschild’s dictum about if he controlled the money then nothing else mattered much.
How so much of this centred on Iceland arose from serious mispricing of interest levels in various places. In general rates of interest were far too low and the artificial discrepancies created in places like Iceland and Ireland meant that huge flows of money went there and then on to the Neverneverlands of borrowing.
The Irish situation had been dealt with splendidly by Morgan Kelly in the “Irish Times” in an article that has been well flagged around the serious web.
Meanwhile, back in our own little grubby corner of the Atlantic Isles the Governor of the Bank of England has become Mr. Glum, we have a government castigated for cuts that is increasing spending and liabilities and too many of the population seems to be heading into the debt slavery forecast by the links above. For those with property the advertisements promising “Equity Release” seem enticing. If prices crash however, where will all those borrowers be?
As for the Icelandic connection, unluckily some of the Conservation Party’s major backers are now facing problems that arose from debts incurred from Icelandic credits, our government owned banks face failing to get the Icelanders to pay up and if international interest rates do lurch up as they might then all the Treasury sums may need to be done again.
Next time round, if it happens, we will begin to see some bigger cuts that will be far from better. I wonder if Iceland has facilities for economic refugees?
But historically, we have been here before. In 1772 The Heron (Ayrshire) Bank went down, lending long to its own directors and borrowing short in London. There the lenders had some very fancy arrangements notably in East India Company stock on very high rates of leverage. It all turned very badly.
Then it cost us the American Colonies, what might it cost this time?
Wednesday 11 May 2011
With all the dangerous things happening in the wider world much of the UK media is spending a lot of the time looking at each other or giving blanket coverage to issues of little or no real importance except to themselves and their political servants.
A committee of the House of Commons spent hours with full coverage on the question of why the England football chiefs, with the Prime Minister and Prince William in tow, failed to have a football competition put on in a few years time. In a more robust age the advisers to the PM and the Prince would now have their heads spiked on London Bridge.
The answer to this was money and benefits and who bid the most. Instead of applauding this application of free market principles in a changing world we have heavy duty whining about the lack of moral fibre of Johnny Foreigner.
But the whole exercise may be a front for someone from somewhere to put in hand a breakaway from FIFA and set up another world football body. If England can rope in both the USA interests and their creditor Chinese they could be in with a shout. I will not name names but mutter quietly about TV rights being the key.
Meanwhile, the world economy is beginning to resemble the old Dodgems rink at Great Yarmouth in the happy days before Health and Safety. There a mechanic had discovered the means of upping the speed and bounce of the cars and it could be quite exciting, like football, if you were on the winning side.
But there will not be much attention paid to Parliament this summer because it will not be functioning much and when it does will be spending its time avoiding all the difficult issues. A major worry is that there are going to enough media frenzy news items coming that will cover all the announcements that the government or others do not really want us to know about but have to publish.
At present nothing makes any real sense and there is no indication that the people allegedly in charge are any wiser. The reason for this may be that those who make the real decisions and control the strings to the money bags are neither elected nor answerable to anyone.
But their world view is very narrow and critically they have little concept of how or why their actions can have consequences that damage both themselves and the rest of us. There are enough of them out there all going their own way to cause some really serious damage if they are not very careful.
Just like when one of the Great Yarmouth dodgems side swiped another, careered into one of the main pillars and the roof fell in. At the time, I believe, the mechanic was playing the hit record through the Tannoy called “Rock Around The Clock”.
Monday 9 May 2011
It is bad enough to see uncomfortable information and figures, especially when they relate to so much of your life and the modern economy. What is even more worrying is when you know the information and figures you are going to need to make critical decisions are not going to be available.
There are cuts and cuts but when they can lead to worse trouble in the future if you do not know what you are doing then it can all become very difficult. The Oil Drum site is one of the few that do attempt to allow a real discussion.
It does not like the closure of an agency of the USA that studies the supply and demand for oil and related products.
Given the present instability around the commodity markets, in part about differences of perception about future supply and demand and in part because the loose money has to go somewhere, then the more and better information we have on real trends and from reliable sources the better.
To add to the issues about oil there are also the food commodity markets that need some clear information gathering and sensible analysis. This story below on the risk of drought impact on European wheat supplies is an example of an impending problem that might happen and we need to know about.
Given the UK has little or no functioning government machinery capable of working out what next or why in almost any sector of its activities the risks of us being hit hard by something expected but not seen or discussed are high.
The trouble is that we few, we unhappy few that do try to look beyond next week and scratch around looking for reliable information are regarded as trouble making types who just want to spoil the party.
What scares me is how much that can go wrong and how little we know about any of it.
Sunday 8 May 2011
Staggered into London yesterday, it was not one of the better trips; hot , humid, very crowded and with foul air quality, luckily the performance made it just about worth the journey. But there was one thing that caught the eye.
The current flag of the Duchy of Lancaster was being flown rather than a Union Jack over a building owned by the Crown. It is by the Savoy Hotel and this part of the Strand was the fabulous Palace of Savoy of the Middle Ages that was home to the Dukes of Lancaster when they were not rampaging around their other estates and in dynastic conflicts.
Later, it became a Royal Peculiar; that is a location that was outside the normal legal system with literally having its own laws. It was a favourite haunt of debtors, minor criminals and people with a reason to set themselves apart from others. Quite unlike the Savoy Hotel of today which hosts only the superior kinds of such people.
One of the fictions of present myths is that the dynastic conflict between the Houses of York and Lancaster somehow equated with the much later provisions for the Counties in local government, sport and the rest. The main base of the Lancastrians was the Honour of Pontefract from the castle there and taking in a large part of mid Yorkshire.
One of their major supporting magnate families were the de Welles, based in Lincolnshire and around. Similarly the Yorkists were well spread out across the land. So all those people, as for example at Butlins’s Holiday Camps who were engaged in rivalries were encouraged to believe that this somehow mirrored the chivalry of the Middle Ages.
This ancient dispute seems to be resurfacing amongst the many fractures now in our political system. At the Royal Wedding, the Princesses Eugenie and Beatrice of York made a blatant fashion statement to attract attention and the support of the fashionista celebrity London media needing to protest against the domesticity and tradition of the Lancastrian factions.
This was retaliation against the spurning of the Duchess of York and the sniping at the present Duke of York. He, in the meantime, has been cultivating a number of our richer and more commercial politicians and their associated oligarchs. He has visited a number of wealthy tyrant magnates on their behalf to build a power network of formidable strength.
Historically, there have been few monarchs named Eugenie, one was the Empress of the French Second Empire of 1851-1870 who retreated in exile until 1920 to deepest Hampshire, Farnborough, adjacent to the rifle ranges of the Aldershot Garrison. Her only son died with the British Army in South Africa caught in open ground by a Zulu impi.
This Eugenie was much admired in Paris during her reign for her cultural, fashion and style interests but the levels of conspicuous consumption entailed amongst her elite did a great deal to encourage the spread of socialism amongst the masses and the eventual creation of a Third Republic.
She was a maternal grand daughter of William Kirkpatrick of Closeburn in the County of Dumfries, not far north of where Robert Burns farmed at Ellisland. Her later family married into the Battenburg (Mountbatten) family of Prince Philip and that of King Alfonso XIII of Spain, one of the unluckier monarchs of history who upset General Franco.
My problem is that in England if the simmering rivalry between the Houses of York and Lancaster emerge again which side should I be on? It is all very complicated.
And history is not much of a guide; perhaps I should read some Burns again?
Friday 6 May 2011
Whilst our child politicians continue with their various games of tag and leapfrog in the junior playground, in the senior one the big boys are being to fight again. It is beginning to get rough there as the things they want are in short supply, chiefly money and there is too much confusion about they ought to be doing.
It won’t be long before some of them are back amongst the politician juniors wanting to take whatever they have whether they want to give it or not. We little people in the infant and nursery playground can only wonder what is in store for us. The juniors will be coming to us to make up for their losses.
The difficulty is that it seems that the card and other gambling games that are the main feature amongst the seniors because so many of the cards are marked and the dice loaded nobody really knows who has what and what one owes to another. On top of these the game of bulls and bears is turning bad again where so many of them have bet so much money.
We infants have been kept happy with pretty pictures and visits from clowns and other entertainers. Also, we have been made lots of promises of more parties and fun to come. Unluckily there is a rumour that the teachers may soon come back from the public house and we will be back scratching at our slates with pencils and learning that sparing the rod spoils the child.
But even the teachers have trouble with the big boys. The result is something of a stand off where the seniors go through the motions but are then allowed to do exactly as they want when teacher tips the wink or looks the other way.
There are times when the teachers go in with the boots and fists but only at the weaker of the big boys. It does serve however to cause the others to remember their place. It is not the law of the jungle; that is much nicer place where the creatures tend to take care of their young and normally eat only what they need.
Unluckily, the seniors are not like that. As well as taking everything they do enjoy mindless vandalism and arson. They often call it creative destruction because out of the ruins something new will emerge.
The trouble is it is often bigger than needed, ugly and costs a fortune to keep up. Quite why the teachers think this is a good idea nobody is sure, perhaps it is that it is not long since they were big boys and have not quite lost the habits.
Ring a ring a roses, a pocket full of posies, a’tishoo a’tishoo, we all fall down.
Thursday 5 May 2011
The world may be tottering and all may be confusion, but at least the political philosophers still seek to address the great questions before us. The Mises Institute has published two articles on the subject of household washing.
One is to illustrate how so much of our government now is self defeating in most of its activities. The other suggests that for all the “progress” things are actually getting worse. This thesis might apply to many other things.
In the developed world over the last half century the domestic washing machine has had a major impact on all households and how they function. Arguably, it has been one of the most “liberating” features of the age for many women.
Before then, it was perhaps the sewing machine that had held this role. This is vividly illustrated by Betty Hutton in this 1947 film with the undertone that the machines may have helped many women in the home but had meant that they were only released for hard factory work at low pay.
The same might be said of washing machines in their turn and for other work.
They don’t make them like that any more.
Wednesday 4 May 2011
When a government talks about decentralising or others chant “Power to the people” or we assume that by devolving administration or powers of decision to localities that there will be the people who want to and will take on this work.
Over the last three decades in the UK we have seen the atrophy of the major political parties and the others might have numbers of subscribers there can still be a dearth of those who want to be active.
One way or another with all the complexities of our personal lives these days together with all the techie gear to entertain us and grab our attention for the young it is hard to get interested or started and for the older there really are other, better or worse, things to do.
Essentially, these leaves us with either those wanting to push themselves forward or who see something for themselves there and those with long standing family connections or with a belief in one thing or another.
As you look around the UK now compared to the past there is a dearth of voluntary work being done together with those societies etc. still functioning they do so with many fewer members and a preponderance of older people.
Recent government has not helped by creating higher hurdles for reasons of health and safety, complex employment laws, who can do what when, who is liable for what and how and the need generally to seek formal and expensive permission to do many things.
One of the most striking things is with extended education together with more strictly controlled and more expensive voluntary work so few young people are able actually to work at something, organise it, put together initiatives and the rest without embroiling themselves with complex bureaucracy.
In any case the schools they attend today and the impact of the media notions of lifestyle and the rest impact on the images of what a young person should be and it is not someone doing much for others.
At the age of 17 or so did I and my friends really hire halls, book the bands, organise the cloakrooms and the catering and take care of the money?
Meanwhile in other places they cannot find people to take on the business of local government:
Are we going the way of Bhutan or is it already worse?
Tuesday 3 May 2011
We have now had a period when major stories have commanded the media together with the fall out from the very messy election and referendum campaigns. While these go on many other issues vanish from sight. Given what could develop, they might stay out of sight for some time yet.
Drought or more problems arising from the nuclear reactors in Japan or other events around the Mediterranean could be occupying the media space as well as any impacts they may have in the UK.
It is tempting to go with the mainstream but if I have nothing much to add then perhaps picking away at some matters with long term implications might seem to be avoiding the big ticket things but they may be more important for the future.
There seems to be a lot of odd business going in the question of UK taxation. When New Labour with all its mysterious intricacies and money flows within fell from power there was a hope that a fresh and fairer approach might emerge.
This does not seem to be the case. If anything it is not simply business as usual in the London Village, in some respects it may be worse. The selling off of HMRC premises for cash and going into leasehold/rental may have seemed clever. But the substantial annual sums payable over many years will cost a great deal and moreover are going to people and places whose UK tax liability is minimal.
Recent editions of “Private Eye” have been plugging away at what the HMRC is up to and the sight of its top man doing sweetheart deals with the likes of Vodaphone and Goldman Sachs is not a pretty one. Especially, as he seems to be taking decisions without reference to either law or internal advice.
There are other things too. Nicholas Shaxson notes this one:
This picks up on other stories:
And from another standpoint:
This is one to make you wonder, The British Virgin Islands and Russian roads:
In the meantime:
Some of these may be from the viewpoint of the Left, such as it is. But there are a lot of people now from other areas of politics who wonder not only just where is all the money going but how on earth we can raise enough to do what is necessary.
The famous 1979 Tory poster said “Labour Isn’t Working”. It does not look as though our taxation system at present is working. This may be another legacy from Labour but the present government could be making matters worse.
When a tax system becomes so inequitable that not only does a regime lose control of it but if the only people they can collect from cannot afford them and revolt then regime change will occur.
It is happening in other places a good question is when it will begin to occur in one part of Europe or another. Certainly, the EU tax and spend policies are making matters even worse.
Monday 2 May 2011
Just as the aftershocks off Honshu continue so those of the Brown and Blair years do in UK politics. In the last few days, while other things were going on, the head teachers union voted for a strike at an alleged 98% in favour. This followed a similar move by other teaching unions.
Little mention in the media was made of the 2006 government agreements implemented in 2007 which gave a number of “improvements” to retirement provisions for teachers; nor of the gradual relaxation of conditions and other improvements made down the years.
The teacher’s pension scheme is an “unfunded” one which was founded and run for many decades on the basis of the contributions made by employers and teachers year by year meeting the outgoings of pensions payable to those retired.
In the time of my father’s education before the First World War there was relative price and wages stability and in any case the qualified teachers were in a minority in the schools. By the time I was in school there were still many unqualified and outside the scheme but of those who were entitled many did not make it to take their pensions at 65 for men and 60 for women.
In any case for both sexes of teacher the effect of wars on one and family needs on the other meant that a good many of those who did make it over the last fence did not put in enough years to have full entitlement.
Until the 1970’s moreover, there was no adjustment for inflation nor were there widow’s pensions or provision for early retirement other than in the most serious medical cases. By then the drive was on to end unqualified teachers and to extend the training and increase the qualifications of all and by definition pay and eventual pensions.
Additionally, all the salaries were determined on publicly based national scales centrally determined. So by the 1960’s a Head teacher retiring from a £2,000 a year job would have £1,000 or less and a teacher on the basic scales from around £750 at the top of their scale to £375 or less.
Over the last three decades, early retirement moved from being a device to clear older teachers to make way for new more highly qualified ones with longer training to what became a “right” along with a raft of other tweaking to add to the liabilities.
The theory was that the uprating of the teachers and their salaries would give the extra inputs of contributions to meet the added expenses of earlier and longer retirements of relatively lower paid teachers, especially as a period of surpluses had occurred.
That all this might begin to run out at some time and the question of deficits arise was all put out of people’s minds. This was a decade or two away. Then the central government began to change the way the schools were run and notably, pay at the top end.
So now we can have someone on £100,000 retiring on a £50,000 a year pension, index linked, at not long over 50 years of age. They may have worked for 35 years or less yet be retired for 30 or more years.
This was never going to add up. No wonder the relevant Head teachers voted to strike if this was going to be taken away from them.
The trouble is that Gordon Brown and friends not only needed to buy the teachers and their influence on the voters but they believed that the Goldilocks economy would cover any deficits especially if covered by managed inflation. Already most of capital spending on schools was shifted off balance sheet to PFI.
The trouble is that if you pay a group of employees more then you create a greater eventual pension liability on a final salary scheme. If it is a scheme based on those paying in, if this falls short where does the money come from to cover the payments?
Does it come from taxes? That is everyone becomes contributors indirectly. Does it come from raiding other schemes, in the case of New Labour the private pension sector? Does it come from reserves? But we have no reserves and Gordon sold the gold. Does it come from borrowing? This just puts off the evil day.
Does it come from inflating the economy by creating money? We have tried that before and it finished in disaster. In our globalised world now we could never get away with that one in the way that Wilson and Heath tried to.
The teacher’s pension fund now does not and will not work on the existing basis. This is especially the case if those who do retire at the highest levels of salary and at an early age are taking out historically far greater multiples of pension than those from ordinary levels of salary.
The teachers pension scheme is just one example of the serious and damaging mess that almost all public sector pension schemes were left in by 2010 for the governments of the future to sort out.
I understand that History these days is little taught in schools.
Sunday 1 May 2011
We think that the world of spin, the doctoring of information and presenting it in a new light is all very modern. But it seems it was alive and literally kicking in the 17th Century during the Civil Wars.
Prince Rupert was an able and feared commander of the Royalist Cavalry. Also, he liked to hunt. But whilst being nobody’s poodle himself, his preferred dog was a Red Hunting Poodle.
You may find this difficult to believe but see the link below to “Past Horizons”.
The breed is still alive and biting although one with a less elite following today. Google or Bing “Red Hunting Poodle” and you will find where to buy one.
They are featured also on Youtube as you many imagine, which is bad news for ducks.
At the moment I am fantasizing as to which politicians I would like to chase round the Royal Parks with a pack of Red Hunting Poodles.