I am not Mark Wadsworth
There is growing realisation in the UK (and in Italy and Greece) as to just how unaccountable and out of control are the ‘technocrats’ and the bureaucratic quangos in which they serve. These nouveau institutions are beloved by politicians as a method of putting responsibility at arms length, and crucially outside the disciplines of the genuine Civil Service or the rule of law.
These nouveau institutions are the creation – in the main - of socialists (of both the right and left). Their purpose is to proto-nationalise by regulation all types of enterprise. The excuse used is that they are needed to ‘protect the consumer’. This is, of course, nonsense. The ‘consumer’ is best protected by a vibrant and competing business sector without special privileges for any sub sector (banking? Trades Unions?) and the firm application of the principles of ‘buyer beware’ and ‘professional responsibility’. You might also add that Baking must take its role as a fiduciary more seriously. No central planning bureaucracy, especially one without democratic accountability and whose funding is under no democratic or market control is never anything other than self serving.
I have quite a bit of experience of one set of these outfits, those that regulate financial services. There is a trio of these; the Failed Financial Services Authority, The Financial Ombudsman’s’ Service, and the Financial Services Compensation Scheme. They were all introduced under the now entirely discredited FSMA 2000. Brown’s, at the time much lauded, ‘tripartite regulatory system’, but now revealed as a ramshackle construct designed purely to proto-nationalise all financial services by sclerotic, inept, overweening tick box reg-yew-lay-shun and, by destroying all the existing checks and balances and entirely eliminating the necessary separation of powers and making every one of the new quangos utterly unaccountable, ensured that he, Brown, could do just what he liked with our wealth, the end game of which we saw in banking failures in 2008.
The Failed FSA is set to be replaced by the Financial Conduct Authority (FCA) in 2012/2014 and there is a special Commons committee looking into how the FCA should be best organised. You will not be surprised to learn that the Failed FSA’s submission is that the FCA, in order to function effectively, must be subject to less accountability and should not in any way be subject to sanction by the Courts. It should be entirely outside the common law legal system of the UK. Considering that the regulatory and financial failures are entirely due to the predictable failure of technocrats (aka capricious bureaucrats with a self over-estimation of their skills and IQ) one might think that the Failed FSA evidence would be given very short shrift by the Committee. But, no, they are taking the Failed FSA seriously.
Whether or not you agree with me about financial services being full of a lot of good blokes, as well as not a few rotten ones (as it true of pretty well all trades and professions) you ought to take seriously this further erosion of freedom and the usurpation of power by capricious and unaccountable functionaries. This is the same mindset that puts approved European unelected Technocrats in charge of Greece and Italy.
It is not just me that thinks like this. You will see above a scanned image of the leader from one of the trade magazines.
In any event if any of you want to have your say and to halt the march of the bureaucratic state you can make your point to the Committee at:
http://www.parliament.uk/business/committees/committees-a-z/joint-select/draft-financial-services-bill/contact-us/
As they say in the charity ads on TV, please help, every contribution however small will help some disadvantaged native. The native in this case being your neighbour.
The Mirror Men
1 hour ago
14 comments:
The rot begins with the EU here. Given that our courts system is not emmulated elsewhere in the continent, such directives stipulate things like (2005/29/EC):
"Member States shall confer upon the courts or administrative authorities powers enabling them, in cases where they deem such measures to be necessary taking into account all the interests involved and in particular the public interest...
...even without proof of actual loss or damage or of intention or negligence on the part of the trader."
and
"The administrative authorities referred to in paragraph 1 must ... normally give reasons for their decisions.
EU directives are full of things like this that enable the 'administrative authorities' to behave in an entirely unreasonable and unaccountable manner.
All systems of government tend, over time, towards dictatorship, that is power without accountability, or "tyranny" as it is expressed in the US constitution. If you look globally and historically, you will find that dictatorship is by far the most common form of government. It is, sadly, the norm.
Democracy, capitalism and free markets had it's flaws but despite that it was a system that worked very well. We are now replacing that with socialism on the grand scale a new system we are told that will bring better prosperity and contentment for all than the previous one. Perhaps we should not condemn it till we have given it a chance. What's that you say, it has been tried before and it failed miserably and is still being tried elsewhere and it is still shown not to work. So why are we doing it?
Steven_L - have you a link to that please?
L, all this regulation makes things worse, that much is clear, so why don't the pol's just scrap it all? That's a semi-serious question by the way.
Capitalism and democracy does not work if one's action has not consequences (or only upside consequences).
A well designed system is a system well the fear, risk and incentives are appropriate (e.g. FSA directors who have major bank failures under their watch should go bankrupt/jail etc).
Rules which are not aligned to incentives/consequences are bound to be broken.
EBM
@ Anonymous
Capitalism has many flaws but the banking collapse was not one of them. The banking collapse was caused by governments manipulating capitalism for it's own ends and putting in socialist mechanisms as means of control. You will no doubt greet my statement with incredulity and believe that capitalism failed because of lack of proper regulation. Capitalism if left alone has in fact many checks and balances of it's own that it does not need regulation. Capitalism's major flaw is caused by the involvement of human beings some of who are not honest a few, some when the opportunity arises will act dishonestly most and some who will always be honest not many. The answer therefore is not regulation of capitalism but criminal laws to encourage honesty, never going to infallible and not put in place an environment that feeds temptation which only governments often do.
Anon/Aniisthenes.
Anon. 'A well designed system...'. That's the problem witht the Failed FSA - it thinks it is capable of 'designing a system well'. It isn't. It's the standard socialist/Fabian delusion as exemplified by the original cl4.4. in the Labour Party manifesto. The problem is that such systems as already exist are evolving all the time, second by second, and all central planning that tries to capture those market insights is (a) always behind the curve and (b) unable to continue to innovate. Capitalism (the wrong word, but hey, we know what we mean) is not an -ism at all . It just is. It is Mises Human Action. This, though is a total anathema to nearly all bureacrats and many politicians. Once they acknowledge the truths discovered by Mises they are largely redundant.
Antisthenes. Quite. What central planning and regulation brings about is cronyism along with the impossibility of economical calculation. The result? Bang go the banks.
@ EBM and Anti, didn't you both say the same thing but differently? Either way, i find myself agreeing with both statements, and with L.
To put it more simply...
Basel 2 changed the credit market from a market to a commons (with the inevitable tragedy of...).
I'm not sure what the volume of systematic credit that maximises real economic growth is or how you compute it, but a land value tax would at least tend to make sure credit is used for economic exchange instead of economically harmful rent seeking.
AC1
Lola, actually now I've thought about it, the FSA and all this tripartite nonsense was not a failure at all, it was a riotous success.
It achieved everything it was designed to do, enable bankers to enrich themselves and push up house prices, provide the intellectual cover for massive taxpayer funded bank bail outs etc.
MW - Ah, you've spotted it! Absolutely, what I have been saying for years.
Look at it this way. In 1997 Brown captures total control of cocaine supply to the UK. But he lacks distribution and the authorities are able to keep an eye on him. So he sets about destroying all the checks and balances in the system and establishes his own enforcement outfit. Their brief is to motivate the pushers (aka The Banks), which they do in spades. The Banks job is to make us all addicts.
As you say, this plan worked a treat. The really clever bit is that Brown was able to blame the banks.
@Lola
Do you have your own blog I am sure I would become addicted to reading it if you do.
Antisthenes. Yeah but no but. More impact if I am privilidged to post on MW's blog. So I do that. And I restrict myself to what I think I know about. I am of the opinion that blogging 2.0 will be more a joint enterprise. Even Guido now employs Harry Cole. And Iain Dale has gone this way. Together we are better. Anyway I am not a skilled writer. But I can write a bloody good business letter or report.
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