Neil Harding has helpfully left a link to this particular bit of propaganda, published by the Department for Business, Enterprise and Regulatory Reform:
My responses (FWIW):
"More than half our exports" and "three million jobs"? Wot? Exports and imports account for 20% of our economy. So ten per cent of jobs are in exports and ten percent in imports (i.e. three million each way). If the EU accounts for half our exports, that's only one-and-a-half-million jobs. And ultimately, the EU can't and won't just boycott us, see points 3 and 8 below.
1. "might"? In other words "wouldn't necessarily"
3. I am a unilateralist. There is no need to negotiate 'bilateral trade agreements'. We will open our borders to all goods that comply with commonsense safety standards. It is mathematically impossible (in the long term) for us to import more than we export - even if France imposes a boycott on UK goods and services, they will end up buying stuff from the countries who don't boycott us. Further, it is quite easy to negotiate a bilateral trade agreement with the whole EU (Lisbon Treaty, Article 7a).
4. "Research"? "Framework programme"? Wot?
5. It is not rocket science to keep the best bits of "consumer protection protection" (for example, cooling off period for doorstep selling etc), we don't need the EU for that.
6. Ditto "workers rights". A sensible legal system has to balance the 'right-to-strike' with the 'right-of-employers-to-sack-strikers' with the 'right-for-consumers-and-taxpayers-not-to-be-held-to-ransome'. A difficult balance, yes, but being in the EU makes this more difficult, and not easier.
7. Ignoring the fact that this is factually and logically incorrect, I do like the inference that "Without us they'd be even worse". And the word 'British' is meaningless in this context. The last time I looked, this country is called "The United Kingdom of Great Britain and Northern Ireland", there is no such place as "Britain".
8. Yes, being in the EU must have some advantages. But it's not "inward investment" that I am fussed about any more than "outward investment". Let's get our own economy on an even keel first (80% of our GDP is purely internal, 10% is trade with EU and 10% is trade with non-EU) before we worry about "inward investment". What happens if our economy and our businesses are so successful that we don't need "inward investment'? Why shouldn't we be the ones snapping up overseas companies?
9. Wot? Negotiating with whom exactly? Would an American, Chinese, Japanese or Indian business give a UK business less favourable terms (whether buying or selling) if we left the EU?
10. This is factually and logically incorrect. Yes, if we want to export manufactures to the EU, we would have to comply with their standards, no prob's there. But we could choose to impose higher or lower standards within the UK. Again, they use the word "might", in the sense of "it is theoretically possible". As a matter of fact, Norway and Switzerland pay "market access fees" to the EU of a few hundred £ million a year. Seeing as the EU are net exporters to the UK, I am sure that we could beat them down to similar levels, if not even make them pay fees for access to our markets.
Monday, 30 June 2008
Neil Harding has helpfully left a link to this particular bit of propaganda, published by the Department for Business, Enterprise and Regulatory Reform:
There's nothing here that we didn't already know, what is interesting is that the BBC have called a spade a spade for once:
UK households could see their annual energy bill rise 20% to pay for the cost of meeting the EU's 2020 emissions target, Ernst & Young has predicted.
Perhaps one day the BBC will mention the £60-billion-plus that the EU costs us every year?
There's not much to add to this. What would be interesting is correlating public spending in each region with the number of Labour MP's it has.
From The Times:
One pupil who wrote “f*** off” was given marks for accurate spelling and conveying a meaning successfully. His paper was marked by Peter Buckroyd, a chief examiner who has instructed fellow examiners to mark in the same way. He told trainee examiners recently to adhere strictly to the mark scheme, to the extent that pupils who wrote only expletives on their papers should be awarded points. Mr Buckroyd, chief examiner of English for the Assessment and Qualifications Alliance (AQA), an examination board, said that he had given the pupil two marks, out of a possible 27, for the expletive.
Well, I've got two words for people like Buckroyd ...
Sunday, 29 June 2008
One loony right wing view (to which I subscribe) is that this sort of social engineering is madness, the best thing we could do is scrap tax & National Insurance relief for pensions contributions (total cost £38 billion, as against total cost of Basic State Pension of £47 bn, to get some perspective) and instead cut more damaging taxes (VAT, Employer's NI etc). For clarity - there would be no tax on money you withdraw from the capital element of your pension fund - in the same way as you do not pay tax when you withdraw money from a bank account.
The other loony right wing view is that people should not pay any tax at all on money put into a savings account, which, to achieve revenues of £X bn would mean higher rates on other income and would of necessity be regressive. These people have never described how it would work on an administrative level (if paying off a mortgage counts as 'saving', would taking out a mortgage be taxed in full as 'spending'? Or would taking money out of your savings account to pay off your mortgage could as 'spending', in which case, taking out a mortgage must count as 'saving'. And it that counts as 'saving', how do you distinguish between taking out a mortgage and running up credit card or other debts, which is clearly 'spending'?) and is a complete non-starter.
A sensible compromise would be to ditch principles, and look at a few facts and figures in deciding what the limit for tax relievable annual contributions should be:
Total market cap of FTSE All Share index, about £1,800 bn (as at last August).
Total number of employees/self employed 30 million.
Total UK government & local authority bonds in issue = £600 billion.
Total number of pensions (who have worked during their lives) = 10 million.
Let's assume that all employees/self-employed are saving the same amount over a forty-year working life. The average amount held in any pension pot would be £60,000 (£1,800 bn divided by 30 million savers), so we'd all start with nothing and end up with £120,000 on retirement. As the combined capital growth plus dividends is roughly equal to annual earnings growth, we can ignore that for simplicity. £120,000 divided by forty years = £3,000 per year. This is a good guide to the amount on which people can get tax relief each year.
At retirement, every saver takes his £120,000 pot and buys bonds (OK, you buy an annuity and the annuity company buys bonds, same thing really). So ten million pensioners would each own an average value of £60,000 in bonds (£120,000 on retirement, £0 on death). Ten million pensioners times £60,000 = £600 bn, in other words, annuity companies would own all UK government and local authority bonds in issue.
At current annuity rates, £120,000 is enough to buy an annuity of £5,473 for a 60-year old man or £3,956 for a 60-year old woman. That's an average of £90 a week.
So this idea that we can somehow all have handsome private pensions in retirement is complete nonsense, there just aren't enough shares and government bonds to go round! A tax system that gives tax relief for contributions of up to £215,000 per year is just completely mad.
A lifetime limit of £1.8 million means that the richest one million or so people would be end up owning all quoted shares and all government bonds, and there'd be nothing left for anybody else to invest in. Madness.
There was a mildly informative article in yesterday's Sun about the Royal Family's expenditure that I have only just got round to reading in full.
It ends with this:
More than £22,000 was spent on chartering a helicopter to take the Queen, Prince Philip and two pals to the Kentucky Derby in Louisville during a state visit to the US in May last year. The official five-day visit to the US cost almost £412,000 in total... Graham Smith, of campaign group Republic, branded the travel costs “a disgrace” and said: “Elected politicians would never get away with this kind of extravagance.”
What f***ing planet does he live on?
Not this one, obviously.
Saturday, 28 June 2008
First up is Prof Stephen Nickell:
A year ago he was bravely forecasting that house prices would rise to ten-times-income by 2026. Six months ago he had toned this down slightly and solemnly told the House of Lords that prices might 'only' rise to over nine-times-income by 2026. Here's the same chap again, solemnly predicting that house prices are now on the slide (oh, so he noticed!). And, apart from being wildly out with his original predictions and not apologizing for that in any way, he appears to think that house price falls are a bad thing: "Families must wait until 2015 for the property market to start booming again". For young couples who'd like to start a 'family' these price falls are a most wonderful thing!
Next up, Kate Barker:
She is the Government stooge who wrote the Barker Report back in 2004 and came up with the 'target' of 240,000 new homes a year*. The delectable Caroline Flint** referred to this as if it were Gospel in her recent FT interview with the FT:"The need to get up to 240,000 homes a year is as relevant today as it was yesterday and will be as relevant in the future, based on very detailed evidence Kate Barker pulled together demonstrating that we hadn't built enough homes."
Kate Barker has had four years to come out and distance herself from her earlier crap*** - but not much chance of that happening, is there?
What is so terrifying about all of this is that Prof Stephen Nickell and Kate Barker have both served on the Bank of England's Monetary Policy Committee.
Jumping Jesus H Jack F***ing Flash, with knobs on, are these really the best people they can find?
* To be fair, there is a lot of useful research in the original report, you can sort of imagine her sitting back and saying "F*** it, what we need is liberalisation of planning laws and/or Land Value Tax" but like that other government stooge Sir Michael Lyons, she only dared mention these possibilities very briefly.
** Yes of course she's an economic illiterate as well - she's a Labour politician, what do you expect? Her bright suggestion is "pressing ahead in the area where she believes she can make a difference - using the clout of public sector bodies to help housebuilders, not only by buying thousands of new-build homes from them, but perhaps by changing payment terms so registered social landlords pay more upfront. The move will be welcomed by the beleaguered industry, even if it is not enough radically to transform its fortunes."
Nice one, Caroline! And seeing as sales of cars, holidays, furniture etc will no doubt fall as well, how about doing something to help the "beleagured" car manufacturers, travel agents or furniture shops?
*** For a pleasing contrast, see Lord Joel Barnett, who has spent half his life "actively campaigning for a reform of his own formula".
"All [the children's] ferocity was turned outwards, against the enemies of the State, against foreigners, traitors, saboteurs, thought-criminals. It was almost normal for people to be frightened of their own children. And with good reason, for hardly a week passed by in which The Times did not carry a paragraph describing how some eavesdropping little sneak - 'child hero' was the phrase generally used - had overheard some compromsing remark and denounced its parents to the Thought Police." (George Orwell, 1984).
"The Swedish pressure group Children’s Rights in Society publicised recently 1,895 complaints by children about the way their parents used the household computer to access pornographic websites or sex chatlines. The Government is now looking into the problem." (Sweden, 2008)
Friday, 27 June 2008
Gregg Beaman (fellow libertarian Ukipper) asks, in the context of the Nulab rout in Henley:
As in 1997, when Blair trounced Major, and 1979 when Thatcher trounced Callaghan, there seems to be a fundamental change of mood in the country with the Conservatives benefitting. Are we destined to be stuck in a two party rotating dictatorship for good?
Probably yes. But that is not the point. If everybody who cared about anything just threw in the towel, or indeed threw in their hand with Nulab or Blulab, then we can say goodbye to democracy for good.
I see the two large parties as ships (albeit big, stupid, corrupt ships) that have to be guided and goaded into 'harbour' by smaller, more nimble vessels. The Greens, despite their relative lack of electoral success, have managed to brainwash everybody - Dave The Chameleon included - into this whole MMGW nonsense; quite what they gain from this is not clear to me, once it becomes clear that the whole thing is a scam. The BNP might be despicable, but the people who vote for them are not - the BNP primarily get the 'anti-politics' vote and, hopefully, as soon as Nulab-Blulab get the message that unlimited immigration and pandering to minority groups is not the answer (to whatever the question was) the BNP will fade from the scene.
And UKIP? We are chipping and kicking away at the EU. That the EU will one day implode is beyond dispute (I say this with neither glee nor sorrow), our job is to hasten that day. Whether UKIP will be able to benefit from the 'first mover advantage' when this happens is another topic. But no doubt Nulab-Blulab will divvy up all our brilliant policies between themselves and recapture the 'central ground'.
Ah well. Such is life.
* I can't be bothered thinking of an analogy for the LibDems, as they appear to have achieved the square root of f*** all for the past century or so. And LPUK are not on the public radar yet. Plus they have no sense of humour.
Great by-elections in English History, part 94.
The first comment under the article in The Times sums it up nicely:
HSBC are just relying on Joe Public to be gullible enough to fall for the low rate. But they are not alone, all lenders are now doing this in their mad scramble for profit ... Graham, Bradford, England
I wonder what King Canute will say about this?
From today's Metro (not online)
"As one half of a very happy gay couple, I would like to complain about the constant barrage of heterosexual kissing we are forced to watch on television these days. I realise this kind of thing happens in today's modern world, but how can we explain it to our cats?"
Andrew Exelby, London."
Thursday, 26 June 2008
She definitely looks like a witch. Question is, will she burn like one?
26 June 2008: The Goblin King said the government's plans represented the "most dramatic change in our energy policy since the advent of nuclear power".
16 May 2006: Tony Blair, The Vampire Slayer has given his strongest signal yet that he backs the building of a new generation of nuclear power stations in the UK.
Here we go again...
Tesco is accused today of exploiting workers who are paid an average 16p an hour. A damaging investigation alleges that Britain's biggest retailer - which made a £2.8 billion profit last year - is being supplied by an Indian factory where textile workers earn, on average, £8.75 for a 54-hour, six-day week.
From earlier 'research', we established that a typical salary in India is about £900 a year. Fifty-two weeks @ £8.75 = £455, so the salary that these textile workers isn't brilliant or anything, but it's probably enough to pay for life's essentials.
Actually, the article gets better and better ...
... the factory in Bangalore, which is not being named for fear of reprisals from bosses, make clothes on a contract basis for Tesco's hugely successful Florence and Fred range.
I happen to be wearing an Florence & Fred tie, but having checked the label, I can confirm that mine was Made In China, where I am sure that workers are treated much better. Plus they don't have as many mouths to feed. What does "for fear of reprisals from bosses" mean? Are they going to burn down their own factories in protest or something?
War on Want claims as many as four out of five women examined by doctors for the Indian workers' rights organisation Cividep showed evidence of malnutrition. The price of rice in India is said to have risen 20 per cent over the last year.
And Tesco is responsible for the world market price for rice ... how exactly? They've doubled the prices over here to reduce demand, there's not much more they can do, is there?
The Bangalore Garment and Textile Workers' Union has calculated that a living wage should be £52 a month.
Which is £13 a week, which illustrates my point that £8.75 a week ain't as bad as it first sounds.
See also The Daily Mash.
(And if 16p an hour in The Third World is low, don't forget that UK welfare claimants on the National Minimum Wage have a net hourly salary of as little 24p, once you take into account tax, NI and benefits withdrawal.)
Too bloody right! They're all armed to the teeth and have no respect for the law ... oh ... that's what they mean.
The highlight is this bit:
Beverley Hughes, minister for Children, Schools and Families, said it would become a criminal offence for a parent to let a child stay at their home on a foreign exchange visit without having a CRB check.
As "ChildLine founder Esther Rantzen said there were some examples of child protection legislation descending into "politically correct madness".
I like that BBC headline - for she is indeed "pushing discrimination"!
This is, however, not Happy Harriet's Greatest Idea Of All Time. That dubious honour goes to her suggestion of 2002 that battered wives be allowed to give evidence anonymously!
Er ... how many seconds is it going to take the defence to work out who the accuser is...?
Wednesday, 25 June 2008
"In Oceania at the present day, Science, in the old sense, has almost ceased to exist. In Newspeak there is no word for 'Science'. The empirical method of thought, on which all the scientific achievements of the past were founded, is opposed to the most fundamental principles of Ingsoc. And even technological progress only happens when its products can in some way be used for the diminution of human liberty... But in matters of vital importance - meaning in effect, war and police espionage - the empirical approach is still encouraged, or at least tolerated..." (George Orwell, '1984').
This is triggered by DK's post about some bastard MP who said "Global warming deniers have undermined well-founded public alarm on Global Warming. Panic is our only hope... Today's Observer poll suggests that six out ten Britons are not convinced that global warming is the supremely vital issue. The public fear must be cranked up again."
Trixy comments: "I am reading 1984 so I can find out which chapter the government are on and have an advanced warning of what will happen next.".
Well, there's your answer. 'Science', in the context of Global Cooling, is an instrument to crank up 'public fear' and to give the gummint yet another pretext for controlling and monitoring people's behaviour. Just like The Book* said.
* Strictly speaking, the above quote is from a book-within-a-book, that book in turn is 'The Theory And Practice Of Oligarchal Collectivism' by Emmanuel Goldstein, which is in turn ghost-written by senior Party member O'Brien. But hey.
Two short days ago, the gummint's line was ... In relation to ratification, there were all sorts of procedures that needed to be gone through, involving the Great Wafer Seal, and it always took several weeks for these procedures to be completed.
According to a PA report of today, as quoted by Open Europe, finishing off ratification is now only going to take "days or weeks"!
Did they stumble across the how-to guide on this 'blog?
Via Denis Cooper.
There appear to be some sensible suggestions in The Pitt Review, but where they completely miss the point is the idea that we need a dedicated Cabinet Office to dish out £800 million a year for flood defences.
Flooding is a supremely local issue! ('This is a local flood for local people'). So this is a job for Land-Value-Tax-Man:
Every local authority in flood-prone areas gets competitive quotes for whatever is needed (demolition, drainage, dykes, pumps or whatever) and works out the contribution needed in pence per annum per sq yd of all those plots of land that will benefit. It also gets indicative quotes from insurance companies by how much they would reduce insurance premiums for buildings and contents.
Whether to introduce the charge to pay for the works (or a range of possible options) is then put to a referendum of local property owners, who are given all the financial information on which to base their decision.
Update: The BBC website linked to this, he said proudly.
Per the BBC website "Stuart Wheeler has lost court attempt to force referendum on EU treaty. More soon".
Now let's see if it really takes the f***ers "weeks or even months" to sort out a couple of pages of paperwork.
Tuesday, 24 June 2008
There was much huffing and puffing last week, when the judge in the Stuart Wheeler case told the gummint it ought to stay ratification of the Lisbon Treaty until he had delivered his ruling (which ought to be any day now!).
Our Sub-Prime Minister then "told a Brussels press conference that the court ruling fitted the government's ratification timetable, which could take weeks or even months to complete."
Denis Cooper did a bit of digging on this; it turns out that 'Any lie will do, if they think they can get away with it':
The FCO's internal procedures (see part 5 of this) could probably be sorted out in a day or two, bearing in mind that these people all work within a few hundred yards of each other and have e-mail and telephone and stuff. If they need a steer on Step 5b) "Treaty section to draft Instrument of Ratification", they can just cut and paste from this handy two-page template for an 'Instrument of ratification'.
I can't find the original dove shot for the life of me, but you know what I mean. It looked a bit like this...
Photo from today's LondonPaper.
Vindico: Incidentally I object to the term 'public health'. There is individual health only, which can be compared collectively, but 'public health' introduces a meaningless collective perspective that makes it seem important to control
Er ... what about...
Bazalgette's Victorian sewers?
Smallpox and polio vaccinations?
AIDS and TB tests for immigrants? (never enacted of course, far too sensible and un-PC)
Semi-compulsory refuse collection? (scroll down the article)
Dearieme adds: Typhoid Mary
If the school leaving age were increased from 16 to 18, with the aim of forcing 16-18 year olds into 'education, training or work', how many would actually turn up?
Number of pupils in secondary schools excluded (temporarily or permanently) each year: more than one in ten.
Number of 16-18 year olds outside 'education, training or work': 11%.
Monday, 23 June 2008
Brendan Barber really is a bit of a twat:
TUC general secretary Brendan Barber argued: "Our economic difficulties are caused by reckless lending by bankers and current inflation comes from higher oil, food and commodity prices. "Asking low-paid and average earners in public or private sector jobs to make sacrifices when those who caused the difficulties continue to draw record bonuses breaches any test of fairness."
1. You can make up your own minds who's to blame for oil and food price rises, nobody's really sure. But, assuming that these rises result from global demand, we collectively have to accept that our standard of living will fall; the value of our labour, expressed in barrels of oil or bushels of wheat, has fallen and that is the end of that. Which is not to say that people aren't perfectly entitled to haggle up their own wages, but it is ultimately a zero sum game.
2. Now, I agree that "reckless lending" has contributed to our "economic difficulties", but not on the topic of "record bonuses"; if UK Bank plc has made £1m profit and keeps it as retained earnings, £300,000 corporation tax is due. If the bank pays it out as a bonus, then £476,950 income tax and NI is due, so in terms of filling the public coffers, these City chaps taking outrageous bonuses is A Good Thing, surely? Even better, those tax liabilities are being paid out of thin air - if UK Bank plc had done their accounts properly for the past couple of years, they would have noticed that there were no profits to pay out as bonuses!
3. An increase in public sector wages is paid via the taxes of private sector workers, so although he gives a nod to "average earners in private sector jobs", the majority of your pay rises will be borne by them.
4. And if he really felt for "average earners in private sector jobs", why are the unions threatening that "Everything from local government will stop - we are talking about bins, schools, council offices, environmental health inspectors - all those important services that local communities rely on". Isn't that demanding a disproportionate sacrifice from aforementioned "average earners in private sector jobs"?
- Posh people have big front gardens so they can live without weekly collections for a while, certainly a lot longer than people in flats.
- Posh people send their kids to private school anyway.
- Who gives a shit if council offices are closed? A bit of a bummer for yer welfare claimants, maybe?
- Threatening that "environmental health inspectors" will stop - oooh! I'm really scared now!
Going by the photo accompanying the article, shouldn't that be "... as whale MEAT opens"?
James McGrath, 34, quit after suggesting older African-Caribbean people should return to the West Indies if they did not like the new mayor. Asked in a tape-recorded interview if Johnson's mayoral victory would trigger an exodus of immigrants from the UK to the Caribbean, he replied: "Well, let them go if they don't like it here." McGrath, the mayor's deputy chief of staff who hails from the north Australian state of Queensland, made the comment in a meeting last month with Marc Wadsworth, a black activist and London-based journalist.
For the record, I am not 'Marc Wadsworth'!
To be fair though, I once lived abroad for nine years, and I can't say I was treated like a second class citizen (short of not being allowed to vote) but in the end I decided I preferred England and so I came back. What's wrong with that? Should I have stayed there and campaigned to make that other country more "Anglophile"?
Oxfam have come up with yet another report that conflates all the wrong issues and comes up with the wrong solutions.
According to the summary in The Metro;
Urgent action is needed to prevent millions of people being dragged into poverty because of rising fuel and food prices, Oxfam warned yesterday. Poor countries must slash their carbon footprint and invest in greener energies, while giving their people more of a voice, the charity said.
'Unless we act quickly, the gap between the haves and the have-nots will grow uncontrollably,' said Duncan Green, author of From Poverty To Power, 'We face either catastrophic climate change or serious economic decline. Either way, the poorest will be hit first and hit hardest.'
Every year, 30 million children are born facing a lifetime of poverty, poor nutrition and sickness.
Leaving aside all that crap about 'greener energies' (which are far more expensive than traditional sources!!); leaving aside the crap about the 'gap' (making rich people poorer does not make poor people richer); leaving aside the crap about 'catastrophic climate change' (global temperatures peaked a few years ago and are now going down again); how about this for a simple solution:
Simply invite those people who are reckless enough to have 30 million babies each year, regardless of the fact that that they 'are born facing a lifetime of poverty, poor nutrition and sickness' to ... er ... stop having babies?
The same logic applies to welfare claimants in the UK, of course. Heck knows why the welfare system encourages it.
I rejigged my Blogrolls using the Blogger 'BlogList' page element on Saturday at home on my Mac, and it all looked fine and dandy, with single-spacing between links.
Looking at it from work (which is Internet Explorer), I note that the links appear separated by double- or treble-line-spaces.
Does anybody know how to fix this? Or do I have to click the options for Title and Snippet to fill in the yawning gaps?
Sunday, 22 June 2008
Tim W highlights this heart-rending article.
My mantra has always been "Trade not aid!" but it might be useful to crunch some numbers:
Taking a round mid-figure of 100 million child workers in India (nearly ten per cent of the total population of India), and assuming that they can all earn 40 rupees/60 pence a day, assuming the poor little buggers work 7 days a week, that gives them an income of about £200 a year. The article does not make clear how much they have to pay for accommodation, but let's assume they're not being ripped off by their landlords, so 100 million children x £200 = £20 billion.
(A typical sort of salary for India seems to be £900 a year, so the claim in the article that children earn one-fifth as much as adults seems correct. So £200 a year is nowhere near as bad as it sounds, even though the working conditions are awful.)
The article says rather vaguely "The Indian textile industry is now worth hundreds of billions of pounds", which would appear to be complete and utter bollocks. According to this, the total value is £25 billion and exports are £10 billion; textile exports account for 20 per cent of total exports, so that makes total exports of £50 billion.
Of course, of those 100 million child workers, we don't know how many manufacture goods for export, let's guess one-fifth, so out of £50 billion going into the Indian economy, child workers earn £4 billion. Which doesn't seem too terrible.
(Next point, child labour was perfectly common in England until the end of the 19th century. India is a long way behind us in terms of economic development, but I doubt it will take more than 50 years from now for child labour to be unheard of.)
So we've looked at the "trade" side.
I looked at the "aid" side in this earlier post , it appears that India has got plenty of money to spend on other crap, so "aid" can't be the way either.
I also love the way that the article kicks off with "we reveal the brutal reality of a supply chain that sees children as young as 11 sewing T-shirts which cost shoppers just a few pounds to buy on high streets across Britain". Would the Guardianista be happier if Primark had bigger mark-ups?
Saturday, 21 June 2008
Blogger have invented a tip-top new 'Page element' called 'BlogList'. (Customise/Add Page Element/BlogList).
The advantage over a static blogroll is that you can choose the option 'Most recently updated' and it will shift a blog to the top the list every time there's a new post. So you only need visit a blog if you notice that it has jumped to the top of the list, so it's handy for blogs that you like but which are semi-dormant.
You can also tick boxes for 'Icon' (which looks messy); 'Title of most recent item' and 'Snippet of most recent item' (which may be of interest to occasional visitors to your blog, who might be inspired to wander off elsewhere, but not to the blogowner, plus it looks a bit messy); and 'Date of last update' (which is superfluous if your blogroll is sorted by 'Most recently updated', to be honest).
It's Summer Solstice today; from now on, the days will be getting shorter again...
And the nutters are out in force. Bless.
Friday, 20 June 2008
Eat shit, Goblin King! Even it is only for a week.
As a general rule, I am not in favour of the unelected, self-selecting and self-serving judiciary imposing their will on an elected government, but as said government has tramped all over the Will Of The People on this, good on 'em.
Here's an interesting article about the Labour-controlled Glasgow Council rejecting the SNP's plans to replace Council Tax with a Local Income Tax.
The SNP are supposed to be the economically clued up party! We can ignore the maths of this - the fact that HM Treasury is happy to pay Council Tax Benefit but would not pay 'Local Income Tax Benefit' - there is a more fundamental point:
Imagine a landlord who lets out properties in Glasgow. Tenants' total housing budget (rent plus Council Tax) is set by the market, so the actual rents that a landlord collects is the tenants' total housing budget less Council Tax. In economic terms, the Council Tax is borne by the landlord. There's a good Wiki article about the economic incidence of taxes here; the relevant chart is the one headed 'Inelastic supply, elastic demand'.
Further, in practice, housing is a 'normal' good, in other words, it is a fairly fixed proportion of people's disposable incomes.
Let us assume for sake of argument that tenant households have an average gross income of £40,000 and a net income of £30,000; average Council Tax is £1,000; and tenants allocate one-third of their net incomes to their housing budget. In this case, the average housing budget would be £10,000; £1,000 is paid in Council Tax and the rent paid to the landlord is £9,000.
If Council Tax were replaced by a Local Income Tax of 2.5%, the tenant household's average net income would fall to £29,000 so this depresses their total housing budget slightly to £9,667. But without Council Tax, the landlord can now increase the rent to £9,667.
So who would benefit most from a 'Local Income Tax'?
Thursday, 19 June 2008
Wot? If they're 'pro-life', surely they'd be rejoicing?
Oops ... "... after being born within the legal abortion time [limit]"
Killer statistic: Data from the Department of Health shows that 909 children were born between 22 and 24 weeks of pregnancy during 2005. Of those, 250 survived for at least a year.
Via Christina Speight
That's the beauty of the English language!
Every single word in that headline could be a verb or a noun. 'Fans' in turn could mean 'aficionado' or 'ventilator', of course...
It could mean:
a) "Fans of retail surges rate fear of rises" (rate = 'have a high opinion of');
b) "Surge fans available at retail outlets rate fear of rises"
c) "There is a fear that the rate of retail surge fans will rise"; or,
d) "The surge in retail [sales] fans the fear of a rise in [interest] rates" (the probably correct interpretation).
The Goblin King tried to justify the 42-day detention idea in a speech to the IPPR as follows: "The modern security challenge is defined by new and unprecedented threats [such as] terrorism ..." (full transcript here).
Has he never heard of Robert Catesby? The IRA? The Nail Bomber?
The summary on the IPPR website (see first link) is even more bizarre: "Gordon Brown has called for modern crime-fighting measures to be embraced and adapted to fit with the principles of individual freedom and liberty. Topics covered included the use of CCTV, DNA technology and the extension of pre-charge detention to 42 days."
Freedom and liberty? "Thought Police", more like.
Another delightfully misleading headline from the BBC. I can see another way of interpreting the chart that they helpfully provide:How about "Arctic Ice coverage on the increase"?
Look chaps, history repeats itself:
House prices go up; a bubble forms; the bubble bursts; prices stabilise at a low affordable level; and then they start going up again...
Empires come and go. AFAIAC, the Irish rejection of the CON-stitution is more-or-less the high water mark of the EUmpire.
Global temperatures have stayed more or less the same for ages. Pointing out that temperatures are now higher than in the Little Ice Age is about as unhelpful as pointing out that temperatures are lower than they were in the Mediæval Warm Period. I'm guessing that the most recent high was about five years ago (note that the Wiki charts end at 2004!) and we're now on a cooling trend again.
See also: A chilling tale from North
Wednesday, 18 June 2008
He said in yesterday's FT that "a Conservative government would throw support behind selling UK arms to the world by reinstating the Defence Export Services Organisation".
Which leads one to assume that UK arms manufacturers are struggling a bit. I was therefore surprised to see this in today's FT:
UK becomes largest exporter of arms
Britain became the world's largest arms exporter last year ... overtaking the US which normally occupies the top slot ... giving it a 33 per cent share of the world export market.
Wow! So maybe Nulab were doing exactly the right thing when they shut down the 'Defence Export Services Organisation' - if an industry is thriving, it's best for politicians to keep their noses out.
They were half-way through erecting (geddit?) the sign for the première of Will Smith's new movie this morning. Crowds of people were giggling and taking pictures.
Then the penny dropped - they had only got as far as putting up the last four letters of the title.
Tuesday, 17 June 2008
More Indian Bicycle Marketing, this time from The Scots Git in today's FT:
The likelihood of inheriting “unpleasant, unpaid bills” at the Ministry of Defence means Conservatives must resist the temptation of promising tax cuts, said Liam Fox ... setting out plans to realign UK defence policy, shifting further away from Europe ... and opening the door to buying more “off-the-shelf” equipment from the US.
Rather than simply relying on “preferential treatment” to support a UK defence industrial base, a Conservative government would throw support behind selling UK arms to the world by reinstating the Defence Export Services Organisation, he said.
“That is why I take every opportunity, despite being an ardent tax cutter myself, to warn my colleagues that we may find a number of unpleasant unpaid bills left behind by Labour on taking office,” he said.
For some reason, the Tory Right love a) tax cuts, b) spending more on the military, and c) the USA. So he has to try and appeal to all these interests. But d'you see what he did there? He appears to have mastered Doublethink and to be able to espouse completely contradictory standpoints:
a) UK 'defence' [sic] spending is about 2.5% of GDP. The bulk of that is actually 'attack' spending, so you could easily double 'defence' spending if you simultaneously halved 'attack' spending.
b) He's trying to garner the votes of people who'd like to see tax cuts and in the next breath saying there won't be any! He cheerfully ignores the simple maths that the gummint wastes 10% of GDP on complete crap. Increasing 'defence' spending from 2.5% to 3.5% of GDP could easily go in tandem with overall tax cuts.
c) Bugger the USA. I am no more in favour of being the 51st state of the USA any more than I am of being the 27th state of the EU. Or, for that matter, the 4th state of the UK.
d) Altho' the Tories are supposed to be more free-market, The Scots Git is simultaneously calling for us to buy more weapons from the USA (yes, that would make them cheaper, but also make us pretty beholden to them for spare parts and software updates etc) and also calling for subsidies to UK weapons manufacturers, which would make them more expensive. It's either one or t'other, AFAICS, or preferably neither.
Summary: he is a complete and utter shit and should f*** off back whence he came.
Stop it! Stop it!
It reminds me of this exchange:
DOUGAL- Father Stone's been in there a long time. Do you think he's dead?
TED- Dougal! No, they're probably just... keeping him in for tests.
DOUGAL- What kind of tests? General Knowledge?
TED- No, medical tests!
DOUGAL- Sure, what would Father Stone know about that?
(pinched from here)
This type of tax (see also 'roof tax', 'Planning Gains Supplement') is vaguely heading-in-the-right-direction, but it starts from the wrong end (if that's not a contradiction in itself).
1. The most fundamental question is whether local councils should be able to control planning/building this tightly. I am all in favour of rabid liberalisation, but by the same token, I am in favour of returning as many powers as possible to local councils, and if local voters are Greenies/NIMBYs, then I suppose it's only fair to let them stifle developments/improvements.
2. Yes, more people in an area impose greater 'infrastructure' costs. But by the same token, those increased costs are shared between a larger number of people. And you should never overlook the benefits of agglomeration.
3. Further, who's to say that the man in the story wanted to use both additional rooms as bedrooms? How would the council respond if they had instead caught him chucking out his beds and buying half-a-dozen sets of bunk-beds to go in the existing rooms? (Answer here!)
4. Let's assume, that local voters are happy with the idea that everybody can extend his house by 25%. For sure, on the one hand, that makes the area a bit more crowded (depressing land values) but, on the other, the fact that there is implied permission to build an extension improves the value of each individual house (increasing land values); there is such a thing as a happy medium.
5. Then let's assume that we had a sensible system of local taxation, i.e. Land Value Tax to pay for all locally controlled expenditure and ...
5 a) Council #1 has very liberal local planning by-laws. A lot of people build extensions, so local population increases. There's more pressure on local infrastructure, so the council then does a cost-benefit-analysis: would widening roads, increasing frequency of buses etc. make the area more desirable again, thereby increasing land values?
If the additional tax revenues from the incremental increase in land values would cover the additional costs, then that extra spending is worth doing and home-owners do not lose out (else not, plans shelved). Bluntly speaking, local residents and businesses are getting what they pay for. And as mentioned, a larger local population means that the total money to be raised is borne by more people, so pro rata, nobody has to lose out.
5 b) Council #2 imposes a total ban on any local developments/extensions etc. Local property owners thereby enhance the value of their land with existing buildings(scarcity value), so they pay more in Land Value Tax and they are paying for the artifical scarcity value that they themselves have created (and the cost of those public amenities like railway stations etc. is shared between a smaller number of people), and also compensating owners of those un- or underimproved sites for the fact that their land is rendered nigh worthless (and who thus would pay much less LVT).
Letter in today's FT:
Sir, You reported ("Taxing time for Lisbon's supporters", June 12) that "Ireland's corporate tax take was €6.4bn last year, representing a little less than half total tax revenues".
This would be rather remarkable if it were true. Corporate tax take in Ireland was indeed €6.4bn last year, but total Exchequer tax revenues were €47.2bn, rising to about €56bn with social security taxes included.
Colm McCarthy, Department of Economics, University College, Dublin.
My letter to the FT of five days ago:
Sir, Your article "Taxing time for Lisbon's supporters" (12 June) includes the statement "Ireland's corporate tax take was €6.4bn last year, representing a little less than half total tax revenues".
The Irish Revenue Commissioners' Statisical Report 2006, Table TR1 shows that corporation tax receipts were €6.7bn, which is just under fifteen per cent of total revenues of €45.5bn.
*stamps foot petulantly, walks away grumbling*
Monday, 16 June 2008
Three little snippets on the aid we pay to India:
Mark Williams in the comments at St John of Redwood: If Mr Brown wants to know how we can pay for a cut in duty the answer is simple. The Indian and Chinese governments pay billions to subsidise the price of oil in their own countries - i.e. to maintain/stimulate demand. Yet we, who pay billions in taxes supposed to reduce demand here, are sending £1 billion a year in aid to India.
Remittance Man: While doing a bit of Wiki-surfing I discover that India has provided Afghanistan with quite a sizeable chunk of development aid since 2001. $650-750 million worth to be precise... But it does beg the question: If India can afford to give her neighbours international aid on this sort of scale, why is India listed as one of the biggest recipients of British aid on the DfID website? Just asking.
Snafu: Why should Britain commit £252m to save the lives of 1 million Indian children each year when India would rather spend $3.3bn on its space programme?
As an accountant, once I've netted all this off and done the contra entries, it strikes me that the amount of aid we should be sending to India, should be in the order of ... er ... zero.
The seven year old swearblogger sat down recently, and, unprompted, drew the vase of flowers on the kitchen table.
It's been six years since the alleged offences, plenty of time for the Yanks to sort out their data security and reassure themselves that Gary McKinnon didn't do anything malicious!
So why didn't the 'Law Lords' just tell the Yanks to f*** off?
Bastards, the lot of them.
From the weekend FT:
Grant Shapps, shadow housing minister, said it was time for the government to take measures to help consumers buy homes ... The most urgent need was to scrap stamp duty for most first-time buyers purchasing homes worth less than £250,000, Mr Shapps said in an interview with the FT...
F***ing hellski, it's almost as if they've been taking advice from Krusty Allsop ... oh ... they have!
As Fred Makepeace explains in the comments to that last link "...if you scrap stamp duty it will simply lead to an increase in the price of housing. Therefore the first time buyer is no better off and our Government loses an income stream. It's very basic economics surely!!!". Secondly, as spiteful as Stamp Duty (more correctly, 'Stamp Duty Land Tax') is, it is only 1% up to £250,000, so with prices falling at nearly 1% a month, is that problem not sort of ... er ... dealt with? Finally, mucking about with SDLT will do bugger all help to those poor mugs who have overstretched themselves and are looking at unaffordable interest-rate hikes.
Ministers could also help the market by scrapping home information packs and by removing the density targets that made housebuilders produce flats instead of family homes, he said.
Sure, HIPs are a load of rubbish, but it's only a few hundred quid wasted, they cost a fraction of what the vendor has to pay the estate agent. We shouldn't have 'density targets' anyway, if you leave it to the markets (rather than politicians, Greenies and NIMBYs), we'd probably get the right number of the right-sized homes being built in the right places. So half-marks for that last bit.
Similar measures were demanded several weeks ago by the Home Builders Federation as it warned that many of the industry’s 300,000 jobs were at risk from the freeze in the market.
Dear Homebuilders! Wake up and smell the coffee! If you can't shift your homes, then drop the prices! If you wrote down your land-banks to market value, then you would notice that you could still build and sell houses at a profit!
It appears the homebuilders have got their heads firmly stuck in the sand. Instead of dropping headline prices, they are coming up with all sorts of gimmicks - the latest being an interest-free loan for a quarter of the price, as perpetrated by Taylor Wimpey and Persimmon.
Last Friday: Mr Miliband said the Irish result should be respected but there should also be a "British view" on the treaty. "I think it is right that we follow the view that each country must see the ratification process to a conclusion," he said, "I believe it is right that we continue with our process and take up the Irish offer of further discussions about the next steps forward."
Yesterday:The fate of the Lisbon Treaty is hanging by a thread and the Irish prime minister should decide whether to read it the last rites, David Miliband said yesterday. Although a 'no' vote at the referendum stopped the legislation in its tracks, prime minister Brian Cowen must move - if he chooses - to kill it off, the foreign secretary added. Mr Miliband, who called the treaty Europe's 'old agenda', stressed leaders might have to accept all was lost and continue under old rules.
Sunday, 15 June 2008
There has been a lot of speculation on this topic. All sorts of ulterior motives have been imputed, and all sorts of guesses made.
If you watch the interview that was on the Andrew Marr show this morning (transcript here), it must be quite clear, David David does not really exactly know himself why he did it. He just did!
Let us not forget, that DD has long spoken out in favour of downright sensible things, see for example an article he had published in the Yorkshire Post just a week before his resignation.
And what is Plan DD?
- allow use of phone tap evidence in terrorism trials;
- allow the police to question terrorist suspects after they have been charged with an offence;
- take a zero-tolerance approach to those who foment hatred and violence against Britain;
- implement proper visa controls to prevent anyone entering this country to incite violence in the first place.
Hardly radical, is it? Not headline-grabbing, but sort-of-sensible. Shouldn't we just try Plan DD first and see what happens?
Heaven knows what it was that finally made him snap, but something did, and maybe he'll never know himself, even if he still doing the rounds and being asked the same daft question in ten or twenty years' time. But I am quite sure, that in some small way, he has made the world a slightly better place*.
* Of course he has made the world a slightly more awkward place for UKIP. Rather embarrassingly, our sole MP voted in favour 42 day detention, in direct conflict with para 7.9 of our law'n'order manifesto: UKIP would abolish Control Orders, as we regard detention without trial as an improper state of affairs. UKIP would also allow the use of phone tap evidence in terrorist cases unless the security forces or police have overriding objections.
Which is pretty close to Plan DD anyway.
Now, read on in the Andrew Marr transcript; DD talks about "the sort of snooping on our people, even by local governments, a thousand surveillance operations by, not by MI5, but by local government. Snooping on people's bins, snooping on their, the way they take their kids to school. All those issues have led to a sort of corrosion of freedom in this country. "
Right. let's talk bins. This whole bin-snooping all goes back to the EU with their lunatic recycling and anti-landfill targets. UKIP could, if they had the nerve, outflank him on that.
Let's talk schools. For sure, some people bend the truth about where they live in order to get their kids into a good State school. If we had education vouchers (see UKIP's education manifesto, top of page 7) - which would allow more parents to get their kids into a good school, whether State or private - there'd be no need to snoop on the route they take...
That's a rather promising headline in The Sunday Times, but read on a bit, and it says 'In the short term, Brown will press ahead with Britain’s own ratification process.'
As ever, It's Vaclav Klaus who gets it spot on '... the Czech president ... declared the entire project “finished”. “Ratification cannot be continued,” he said.'
Saturday, 14 June 2008
From The Times:
Morgan Stanley, the investment bank, believes that a further two million households are at risk of owing more than the value of their property if house prices fall 20 per cent by 2010
So that's about 100,000 borrowers in NequityTM for every 1% fall in prices; Citigroup reckoned about 70,000; and my more pessimistic fag packet said about 120,000.
So let's go with 100,000 in NequityTM for every 1% fall in house prices as a nice round mid-figure.
Friday, 13 June 2008
That means metrics linked to a common definition of relevant success at the top end of effect, i.e. sustainable sustainability across the region and not simply reflect incremental increases in bottom-up stove-piped efforts by the nations engaged...
Via Christina Speight.
From The Irish Times*:
Asked where things went wrong[sic], Mr Martin, director of Fianna Fáil’s referendum campaign, said: "People on the doorstep were saying 'I still don't know enough about this treaty'." This was a "significant" factor, the Minister claimed.
Er ... haven't you had about four years since the Constitution was first put to the vote to re-educate the masses as to the joys of 'government by international treaty'? And billions of taxpayers' hard-earned to spend?
As St John of Redwood suggested this morning, how about a statement along these lines...
“The EU is grateful to the Irish people, and to the French and Dutch people before them, for voting No to this Treaty. It understands that if the British people and others had been allowed a vote they too would have voted it down. The Constitution will be abandoned, the EU will make no further demands for the transfer of powers, and it will look at ways to make itself less intrusive and less annoying to the people it wants to serve and who pay its wages”
* Via Tim Almond.
Well, according to early results uncovered by The Sun, at least.
We live in hope ...
Bill Quango MP's 'researcher' was up all night crunching the numbers.
Well, obviously. First thing on your mind, isn't it?
There doesn't seem to be any news yet, he said, clicking here frantically.
Thursday, 12 June 2008
In the cosy world of The City of London, the top boys just shovel piles of (shareholders') cash at each other, e.g. when banks are issuing shares, they even appoint other banks as 'advisors'. There is a practice called 'underwriting new issues', whereby Big Investment Bank is promised oodles of issuing shareholders' readies in exchange for a vague promise to pick up any shares than the issuer can't sell in the market. And Big Investment Bank uses that cash to pay eye-watering boni to its senior employees; shareholders in Big Investment Bank don't see much of it.
Without going into technicalities, it looks as if Morgan Stanley and Dresdner Kleinwort have finally been hoodwinked by HBOS. For the first time in ages, underwriters might actually made a loss on a deal. In which case, the shareholders in Morgan Stanley and Dresdner Kleinwort's parent, Dresdner Bank AG are the ones being robbed.
Nice one, Andy Hornby!
H/t Fubar at HPC.
Denis Cooper's letter in today's FT:
"Sir, Donal O’Brolchain (Letters, June 11) quotes Pericles and Swift to support a dangerous idea: that ordinary people should be able to understand how they are governed. It is easy to see where that kind of thinking could lead.
Unfortunately, it proved impossible to stop the spread of universal suffrage to most countries around the world, but is Mr O’Brolchain seriously suggesting that hoi polloi should be allowed to assume a real, rather than a notional but almost entirely fictitious, control over public affairs?
If that was seen as acceptable, surely our wise political leaders would not have worked so hard to establish this new and incomprehensible system of government, “government by international treaty”, which has been specifically designed to neutralise the harmful effects of excess national democracy?"
This is up to his usual high standards, I particularly like the phrase "government by international treaty", which is TM Denis Cooper.
David Davis, you rock!
Per Barratt's 2007 interims:
Net debt = £1,738.5 million
Number of building plots = 113,500
Add on market capitalisation of £232.3 million (based on share price as at this morning of 67p), total enterprise value = £1,970.8 million
£1,970.8 million ÷ 113,500 = £17,364.
I had calculated that a typical plot was 'worth' about £100,000* at the end of 2007.
£17,364 is less than one-fifth of the value of six months ago! It's a multiple of less than one-times-average-earnings, so, on the basis that a house is worth bricks'n'mortar plus land, this means the stock market is pricing in a house-price-crash down to mid-1990s price levels (adjusted for earnings).
I think I'll give it a couple of years before I buy again!
* i.e. mid-figure from the graph 4.5 x £457 per week x 52 = £106,938. Or £2,910,000/hectare ÷ 2.47 acres/hectare ÷ 12 homes/acre = £98,178. Or use the rough and ready approach, i.e. average house price £180,000 minus typical rebuild costs £80,000.
Wednesday, 11 June 2008
When the EU's anti-money laundering regulations were gold-plated into UK law back in 2003, a wise and experienced VAT barrister told me that the definition of a police state was a state in which "it is a crime not to report a crime".
Under the anti-money laundering regulations, if the authorities are too lazy or incompetent to actually catch the baddies, they can simply imprison any accountant, solicitor or banker who had anything to do with the 'proceeds of crime'. So they want to turn us all into informants; anybody who "knows or suspects or has reasonable grounds for knowing or suspecting that a person is engaged in money laundering must, as soon as is practicable after the information or other matter comes to him, disclose it to the nominated officer or a person authorised for the purposes of these Regulations by the Director General of the National Criminal Intelligence Service" (para. 7(1)(b)
I only did one or two units of criminal law, but I do remember that even if you are not directly involved in a crime, under the rules on inchoate offences (i.e. aiding and abetting; incitement; conspiracy; or attempt) you can be punished just as severely as if you had committed the actual crime. This all seemed perfectly fair to me. And we've also always had the offences of perverting the course of justice and concealment for payment under s5 Criminal Law Act 1967.
Failing to report that somebody else was about to, or had committed a crime was not an offence IIRC*.
In the post 9/11 hysteria, the gummint's "Anti terror laws" included a rule that said that failing to report knowledge that somebody was planning an atrocity was also a crime, thus leading us one step closer to being a proper Police State.
The law had its first proper outing today.
Now, I despise Islam and terrorism as much as the next man, but it seems that under the old law, she couldn't have been punished for "assisting with the escape plan"** or even for the fact that she "removed and destroyed evidence".
Just saying, is all.
* It appears that the right to remain silent does not necessarily extend to a spouse in England & Wales, but that's by-the-by.
** I assume that she only helped with the escape plan after the crime had taken place - as he was intending to blow himself up, it seems unlikely they had planned it beforehand. If they had planned the escape beforehand, then of course she would be an accomplice, but by the same token, that would prove that he was doing this as a stunt and not intending to kill anybody. So he clearly was intending to kill people, a rather chilling thought, but hey.
The paper version of this article contains a classic quote:
Liberal Democrat work and pensions spokeswoman Jenny Wilson said: 'It is impossible to understand why, as one of the wealthiest countries in the world, Britain should have one in five of its children living in poverty.
Er, look love, it's because people with incomes below a fairly arbitrary poverty line choose to have children.
Having a welfare/tax system that encourages such people to have children and then discourages them from getting married or starting a job is of course largely to blame. So how about flat-rate universal benefits that alleviate poverty without discouraging work or marriage? How about reducing means-testing to no more than the basic rate of tax?
How about scrapping Employer's National Insurance, stupid employment regulations and the National Minimum Wage to increase the number of jobs? How about getting rid of VAT, that would make everybody's money stretch further? How about having education vouchers to ensure that children get the best (i.e. most appropriate) education possible at the lowest cost to the taxpayer? Continued page 94.
Yes, they are very dangerous. In fact, you wouldn't see me dead on one of those things. Dead underneath one, perhaps ... But this is going too far.
Continuing my occasional series, which is based on the thesis that the three main parties' policies are in fact more-or-less identical. In a perverse way, this explains why they do not defend themselves against the smears of the other parties - it is called double-negative advertising.
Take for example, George Osborne's speech to the BCC, which included this gem: ... our Prime Minister was also warned in the fat years to prepare for the lean years – but he set nothing aside. Now most say the lean years are here, the cupboard is bare and is vulnerable.
(Now, the simple truth, as revealed by St John of Redwood is far more reassuring than that: [we could] contain the public debt, gain much better value for money from each pound spent by government, and leave sufficient of the proceeds of growth for tax reductions. Technically it is not difficult to do all three, as the waste and undesirable spending is so large.)
However, he is a lone voice crying in the wilderness, people listen to the Shadow Chancellor. And what do they hear?
To potential Tory voters, this sounds like "Labour are the high tax'n'spend party; by reverse logic we are the party that would like to cut taxes, but we can't for the time being because the 'cupboard is bare'. But we will do one day, honest." So they are encouraged to vote Tory
To potential Labour voters, this sounds like "Tories are the Nasty Party who want to 'slash public spending'. If we vote Labour, then at least we'll get our schools'n'hospitals and benefits. Or keep our jobs administering benefits and running endless quangoes."
Which is why Labour have no interest in pointing out that the Tories have promised to 'match Labour's spending plans'*, or to point out that the cupboard is not actually bare at all; despite the massive % tax burden, over-regulation and waste, total tax receipts are colossal, the public debt-to-GDP isn't that terrible by historical standards (if you exclude public sector pensions) and there is plenty of scope for reductions in wasteful public spending, as much as £100 billion per annum (i.e. about one-fifth of all spending!), because that would either:
a) make potential Labour voters more likely to vote Tory; or
b) show Labour up for the greedy, inefficient crooks that they are.
* Or point out that the welfare system is not much different from what they inherited in 1997. Benefits have been renamed and repackaged, but it's the same old crap with the same old perverse incentives, poverty trap and anti-marriage bias.
Tuesday, 10 June 2008
While perusing the IFS site for the original press release on which this story was based, I stumbled across a fine piece of f***wittery entitled "Globalisation demands reform of UK corporation tax".
*Sigh* let's look at a few basic facts, first:
1. Globalisation is a good thing, it has been around since the globe was invented, whatever rules you invent, 'globalisation' (aka free markets) will adapt and work its way round them.
2. If you can choose from different countries where to set up a business, tax is not top of the list. Depending on the type of business, you ask: Does it have a stable legal system, rule of law, security, honest government officials? Then you look at costs - what are wages, rents and raw material prices? How good are transport links (for people or finished goods)? How reliable are banks, telephones, power supplies? If a country ticks all those boxes, only then do you worry about the tax system - and its not just the headline rates that matter, simplicity and stability is just as important. For example, corporation tax is higher in India and China than in most of Europe and they don't much adhere to the 'rule of law', but the wage differential is so huge, that doesn't matter much. Similarly, corporation tax is higher in the USA than in most of Europe, but their Sales Tax is much lower than European VAT (the worst tax of all).
3. Before we worry about 'encouraging FDI', let's worry about existing UK businesses. If the UK is an attractive place to do business, then we don't need to worry so much about FDI - there'll be plenty of UK businesses expanding here, rather than relocating abroad. If they locate manufacturing in the Far East, there's not much you can (or should) do to stop them. If you're worried about UK businesses relocating largely for tax reasons, then I've got a list of the main changes that would make the UK more attractive here.
4. There's one tax I missed off that list - and which the IFS press release doesn't even mention - Business Rates. Let's assume that we stripped out the buildings element from the valuations and harmonised the rates for occupied and unoccupied sites and allowed local councils to keep all the proceeds (rather than it being pooled nationally). Let's bung in Stamp Duty Land Tax and corporation tax on capital gains for good measure and rename it 'Site Value Rating'.
5. Now, there are plenty of things on a business' checklist (see point 2 above) that local councils can influence. Let's take for example Crossrail. Let's imagine that Bill Gates, in a moment of generosity, stumps up the £12 billion it will cost to build, and off we go. Who benefits? Will businesses benefit? Well, yes, of course, but by the same token, their rents (actual or notional) will go up. So who benefits most? People who own land and buildings around where the stations are, as they'll be able to charge higher rents (or sell their land for higher prices).
6. So why not do a proper cost-benefit analysis. Assuming an annual running cost (operating losses, interest payments and amortisation) of £1 billion, would the rental value of properties in the Crossrail 'catchment area' go up by more than £1 billion? If yes, it's worth building, if no then it isn't. If the potential increase in rental values seems low, then assume that planning permission will be more generous and re-run the exercise.
7. Let's assume that it is worth building, then as long as Site Value Rating (and Land Value Tax on residential land) collects the bulk of the increase in rental values, the project is self-financing! And if the extra proceeds exceed the cost, they can be used to reduce other, more damaging taxes (VAT and National Insurance).
8. Now, going back to a business thinking of setting up in the Crossrail catchment area. Has the area got good tranport links? Yes, obviously. Are the rents value for money? Well, they probably are, as they are market rents . How about taxes on production? Well, they've just been reduced and simplified (the landlord has to absorb the SVR - he can't charge more than market rent, can he?), so that makes the area more attractive as well. (and yes of course, gummint spending and the corresponding tax burden is far too high, but I'm trying to explain why Site Value Rating is the least-bad tax).
Trebles all round!
But, getting back to the IFS press release, it kicks off by saying "Corporation tax should be reformed or replaced by a higher VAT rate (offset by lower National Insurance contributions) to reduce disincentives to invest in the UK..."
There are a couple of bright ideas, like harmonising tax rates between corporate and personal income, but this is cancelled out by the other dross, a lot of which is self-contradictory anyway.
PS, I did find the press release on the education funding story, but apart from giving a wonderful opportunity for the inevitable sarcastic remark, it wasn't particularly interesting.
Under another misleading headline "Credit crunch leaves thousands facing negative equity", The Telegraph write:
A leading City bank has warned that a quarter of a million homeowners have slipped into negative equity since the start of 2008 and more than a million could suffer the same fate by the end of next year...Michael Saunders, head economist at Citigroup ... has warned that house prices could fall by 15 per cent or more by the end of 2009, taking the number of households in negative equity over the million mark, but now says the drop could be even greater.
So he's working on the basis of 70,000 going into NequityTM for every one per cent fall in prices, rather than my estimate of 120,000, but we're not far off.
I, personally, am against nuclear power, as it only seems to work with massive explicit or implicit taxpayer-funded subsidies. But whether I am right or wrong, this idea is nuts.
As the critics in the article point out, "it is expensive, creates radioactive waste and could become a target for terrorists", given this gummint's incompetence, no doubt the terrorists will all be offered jobs in the nuclear power stations, just to make things nice and easy for them.
And anything that involves us handing over huge sums of dosh to "French firm EDF" has got to be a shit idea.
Yet another stupid and misleading headline, *sigh*.
Alice's negative-equity-o-meter shows that there are several hundred thousand in NequityTM already. Her chart shows that LTV's are fairly evenly distributed between 1% (nearly paid off) and 100% (or more!):Ergo, as there are just under twelve million outstanding mortgages, every 1% fall in prices means another 120,000 in NequityTM.
Property prices have been falling at 0.9% per month compound* since last August, so that's about one million in NequityTM so far already, plus the mugs who took out mortgages of more than 100% in the first place.
So a more accurate headline would be "Millions facing negative equity".
* Per Halifax May figures August 2007 average price £199,600, May 2008 £184,111;
£184,111 ÷ £199,600 = 0.9224;
+0.9224^(1/9) = 0.991;
1 - 0.991 = 0.009 = 0.9%.
Interestingly enough, the fall in the five years 1990 to 1995 was only 0.2% per month compound, again, per Halifax Historical Data, (Tab: AllMonSA) December 1990 average price £68,708, December 1995 £60,901;
£60,901 ÷ £68,708 = 0.886;
1 - 0.998 = 0.002 = 0.2%.
Monday, 9 June 2008
Longrider's post reminded me that I have been meaning to cover this topic for ages (apart from a comment here). In short, there are two types of dictatorship; those who nationalise or collectivise assets (in particular land) and put them under the control of The Party or the dictator's cronies ('left wing'); and those who don't ('right wing').
In the former category, we have e.g. USSR, Eastern Europe, China, many Middle Eastern countries, North Korea, Cuba, Burma, Zimbabwe, Venezuala etc; and in the latter we have the Nazis, Japan (before WW2), Franco, Mussolini, whoever was in charge in Portugal and Greece after WW2, South Korea, Pinochet, Galtieri etc. I can't think of many current examples of the latter category.
Most dictatorships come to an end, whether violently or otherwise. The striking difference is that once a right-wing dictatorship disappears, it only takes civil society a couple of years to re-establish itself and for the economy to pick up where it left off (assuming that the economy suffered in the first place, which is not always a given, unlike with 'left wing' dictatorships), whereas with 'left wing' dictatorships, misery is guaranteed for decades (or centuries) to come while people bicker over who owns what; the bickering can cause as much damage as the original dictatorship.
Somebody got murdered in the tunnel at the Tube station where I used to live on Friday/Saturday night. The tunnel was cordoned off all day Saturday. On Sunday it was opened again - the police had sawn off large sections of the handrail in the middle, presumably to search for fingerprints in the peace and quiet of the lab.
The paper edition has an extra article about a "£460 rubbish tax proposal", again, bastards. For sure, there are costs associated with getting rid of waste, and if councils can reduce the cost by asking people to separate their rubbish, then they should do so, but this is a question of education and relying on people's better nature, stupid fines and taxes on waste disposal will just lead to fly-tipping.
... and those costs could and should be covered by adding a small charge to the selling price of new goods* - half a penny per bottle or battery, a pound or two per pound avoirdupois for electronic stuff and so on. Which, for most new goods will be a heck of a lot less than VAT currently is, which will of course be scrapped in the MW manifesto.
* Which I explained in the second half of this post.
As to landfill, I'm even less worried about landfill, having read this.
Sunday, 8 June 2008
Asked by Andrew Marr whether he would run for a second term as London Mayor, Boris 'Bansturbator' Johnson said that he would be judged on many things - crime, transport etc (fair enough) and whether we had had "a successful Olympics".
Somebody buy this man a calendar! The next Mayoral elections will be in May 2012, a month or two before the London Olympics (or possibly a year-and-a-bit).
While we're on the subject, can I report this poster:to the Advertising Standards Authority? The ban has made my journey home marginally less pleasant, so the slogan clearly fails the test of "truthfulness".
"The latest Ipsos Mori poll for the Independent Schools Council* shows that 57% of parents would leave the state system if they could afford to do so. That is the highest figure since these polls began in 1997 [51%]".
Vindico, quite rightly, takes the opportunity to call for vouchers, as do I, and most people with more than one brain cell.
To be fair to the BBC, though, they did end the article with this ..."Meanwhile, this is probably best news for those running the "no-frills" chains of independent schools and for advocates of Swedish-style voucher schemes offering subsidised places in the private sector".
* So the results probably overstate enthusiasm for private education, but so what?