Leave Us Alone!

They promised it would stop, they promised that they’d leave us be – the big society – “we’ll not meddle anymore…” – But no. Only today this was rammed through my door. “Just a postcard” you say, but you’d be wrong, this was just one item of five – which included a letter, a stapled, folded 8 page questionaire, a trifold leaflet and a prepaid envelope. It hit the doormat like a veritable lead weight.

Tower Hamlets... Groan

We're not *just* being nosy.

What Tower Hamlets council wanted to know in their New Housing Development Survey 2010 was innocently, what I think of the new housing development I live in, oh and what my income is, and how many people live here, and where I work, and whether I’m employed, and what ethnic group I belong to, and whether i’m registered with a Doctor… the list went on and on and on. All of this on a form designed to be electronically collated, and all given a unique code number printed on the front page to track where it ended up.

This is on top of 3 demands this year to re-register to vote (despite being registered) all coming with threatening demands of £1000 fines if I refuse to send the detail back (again… and again…). Tower Hamlets council sure seem very keen to know every single persons details in triplicate.

For clarity, I am registered to vote, and I don’t live in property owned by the council. I live in a private new development run and maintained by a private company and built by a private company, and yet the council want to nose in – they want to know what I think of it, and everything else they can dig about me and anyone else that lives in the flat. It smacks of clumsy data-mining.

What’s worse is that nowhere in this huge pack were there any details of how the information would be used, or who the information commissioner for the research was, or your rights over the data if you chose to send it back. I can’t help but feel that the seemingly  relentless march to make us all numbered citizens is carrying on regardless.

it’s snow joke… (boom boom)

As if by magic winter has come along and it’s brought cold weather and snow – how unusual, that never happens! Well that’s what you might believe if you look at any of our media; so in the glorious cause of re-hashing articles and passing it off as news, I’m embarking on my yearly rant about the British media making a mountain out of a molehill. The British obsession with shutting down everything the second it looks a little bit snowy outside and the bizarre preoccupation with the weather that seemingly overlooks the fact that ten years ago our papers were screaming that snow was a thing of the past, that climate change nee global warming had consigned the idea of snow filled winters to the history books and fantastical Christmases inspired by Dickens.

So in the spirit of posting random stories about Snow, let’s revisit this classic article from the year 2000.

The Indie reports the death of Winter

Feel free to browse the whole article in The Independent archive

So there we are, rant complete: personally I hope it’s below zero and snowy until march – Climate change or not, I rather like the weather like this… I’m not convinced by the cries from both extremes that we’re heading to oblivion, sure we must have had an impact on the weather, but as we’re so rarely able to predict the weather more than 24 hours ahead (and even then with questionable accuracy) I’m buggered to see how we can say what it’ll be like in 100 years.

The EU is not funding Elton John.

Eurosceptics across the media have been up in arms recently, touting yet another inaccurate story that our taxpayer contributions to the EU had directly paid for an Elton John concert held in Italy – “gross wastage”, they screamed – “just another example of how ‘european’ funds are wasted” they grumbled, almost all of them wrapped up with “get us out of this union”.

So I noted with some glee this morning that the organisers of said concert have been ordered to pay back the 720,000 € (£613,000) they used to stage the event without delay. The money was reported as having come from the European Union as finance for the regional development of Campania… a good example of EU waste you might say, but that’s not quite the whole story.

You see the funds don’t come directly from the EU: funds for regional development are distributed first to the individual nation states – it’s a cludged system, and one that is almost solely responsible for the commission’s auditors not being able to sign off the accounts for so many years. The Commission simply signs off on the gross national amount, after which the responsibility for distribution is entirely driven nationally.

Indeed, this waste of funds, and the following demand for repayment only followed a complaint by Mario Borghezio, an Italian MEP from the Northern League party, who brought the attention of the commission onto this issue, describing the use of the funds [as a waste of EU cash which was] “shameful“.

This wastage is currently under debate both within the Parliament and the Commission as it’s been acknowledged for some time that certain national governments were fiddling the books. You’re probably also thinking, well we all know where to point the finger, Greece, Spain, Itally… well yes, at least two those have been highlighted, but so is the UK. In fact the UK is being used in the same sentence as Greece and Spain as being one of the worst offenders!

The UK government defends the improper distribution and poor accounting of EU funds by pointing out that the huge amount which is now being demanded back by the EU “had been accrued over six years“.

In case you missed that, it’s a tacit admission by the UK Government that they have been holding on to money that they shouldn’t have for six years. Money that was either not spent or spent incorrectly on regional development, the common agricultural policy, infrastructure and energy projects, cultural activities and a thousand other areas of supranational interest funding by the European Union.

MEPs are now calling for a need to get tough with nation states and the european bodies that don’t follow the rules: the EU needs to get it’s books in order if it is to have any mandate for future projects which are underway – the most obvious way of doing this would be to make national commissioners directly responsible for the funds which their country takes: it ensures that another ‘super-agency’ does not need to be created to distribute funds directly, and the whole european machine would have someone to hold directly accountable should the funds not tally. So far only  Sweden and the Netherlands have shown the political will to do this, having their commissioners sign off directly on received funds each year.

If you’re not lobbying your MEP yet – make sure you do: the wastage of EU funds is one of the most pressing issues facing the union, doubly so as national and international budgets tighten.

It’s not all bad news though. There was some good financial news for the EU in the recent budget report, with a statement from the auditors that the individual European organisations had finally got their their act together, and that individually the accounts of each organisation made sense and could be approved. If we can now get the national distribution correct, we’ll be well on our way to being able to approve the global accounts, which will no doubt do great good in being able to approve year on year spending for the union as a whole.

Is Ireland tilting at Windmills?

As a business owner in two countries I’m of course of the opinion that corporation taxes should be kept as low as possible wherever possible, low and simple tax schemes give businesses incentives to grow, to take on new projects, staff, materials and property: but that tax break shouldn’t ever be at the detriment of the overall economy – it should always generate revenue within the medium term.

It looked like Ireland’s gamble paid off – their ultra low tax regime attracted international brands, times were good, a lot of money was splashed about and everyone felt the benefit. Unfortunately in this time of plenty, the powers that be in Ireland didn’t have the political courage to begin to move their tax regime from one of rapid growth to one of sustained continuance.

Corporations wouldn’t have abandoned the Emerald Isle, they might have grumbled; but ultimately where would they have gone? Many of the inbound countries chose Ireland strategically as well as economically – English language being native, good gateway to Europe, not landlocked – it had so much going for it. All it needed was politicians that could accept that the ‘boom’ would have to transition to equilibrium. Yet they didn’t do that: Ireland’s politicians lived in a fantasy world of never-ending boom, maybe they took Gordon Brown’s claim at face value?

Whatever the case, it’s backfired miserably – the IMF are now assisting the EU with their audit of the Irish books and time is now running out for Ireland to accept a suitable bailout to help them balance their books while their spending cuts take full effect. This is the only way to maintain sovereignty long term: if they wait now, they’ll find themselves selling bonds in the untouchable bucket alongside crackpot banana republics.

Ireland are insistent that the low corporate tax rate brings in more than similar tax regimes in other European states, this may be the case – but with a deficit so high, unemployment rising and the housing market collapsing, taxes are going to have to rise across the board, and most importantly in places where the tax will actively bring in revenue. If unemployment is rising as sharply as the figures suggest, taxing the working citizen significantly more simply doesn’t make sense in knocking back the deficit, so Ireland are going to have to be pragmatic and look at their other streams of tax revenue.

So – all this being said. It’s shocking, although depressingly not surprising that the Indie is reporting that Ireland is now trying to ransom the people coming to bail it out with a demand that it shouldn’t have to lower it’s corporate tax rate. In characteristically brusque style Irish ministers are publicly stating that the low corporate tax rate is “certainly not up for negotiation”. With the unexpectedly early arrival of a party from the IMF, one thing we can be certain of, The big european & eurozone economies are being very patient, that patience won’t last forever – and ultimatums from politicians in Ireland are going to rapidly start to look very ridiculous.

ConHome’s comments go behind a Moderation Wall

Conservative Home has never been my favourite political site: I’ve always considered it to be a mixture of useful news and solid, well researched opinion; mixed schizophrenically with overtly biased tosh that the Daily Mail would be ashamed of. This often results in ConHome feeling like a throwback to the “nasty party” of 20 years ago, a party that didn’t give a toss about liberalism, the future, international cooperation (beyond America) or society – preferring instead to champion the cause of ‘I’m alright Jack’. In part because of that ConHome does seem to have become somewhat of a rallying point for the exact people that made the ‘Tories’ unelectable for a generation.

This slant in direction, is of course, defended by a vocal group who take over the comments with disparaging comments about ‘Cameroons’ and ‘Europhiles’ – all seemingly intent on dragging the party back to ‘values’ that won it so many elections in the last 15 years. Online they portray themselves as the political majority, the screaming cry of the great ignored – offline this group are virtually silent in all the political debates I’ve ever attended; quite often I’ve mused that this might be because the views expressed by some commentators are of the sort that you’d have to be quite brave (or quite stupid) to try and defend face to face.

Whatever you thought about it though, the ferocity of the debate did often prove that the party is in flux; that there are more sides to the argument than the actual editorial often portrayed and that there are plenty of Conservatives out there that aren’t swivel-eyed crackpots stereotyped so often in the wider media, all harking back to a bygone age of Empire, Imperialism and Britain as a global economic force to be feared. This is great. Conservatives should be a split bunch, that’s the point of freedom of thought, and love it or loath it ConHome has given some of these debates a place to flourish.

Those days however might now be over.

Today ConHome published a statement that from now on, all comments will be moderated. And whilst the statement is filled with semi-reasonable excuses as to why they’re beginning to moderate. Not once does it adequately answer my question about why moderation couldn’t be done post rather than pre publication, at least that way the users views are always transparent. They promise to maintain ‘fair’ comment – whether that remains the case we’ll wait and see. I’m not sure that ConHome will be able to resist shaping the conversation to their agenda; it’s certainly been my experience that debate in the comments is often stifled by inconsistent moderation.

My biggest problem though is that a pre-comment moderation will inevitably slow the pace of discussion – politics can move fast, sometimes blisteringly so… one of the joys of ConHome is that this pace has always been reflected in the user comments: now it looks like those days might be over. I personally think that’s a sad day for the Right’s online community – I know I’m a hypocrite in having pre-comment moderation on my own site, but I’ve never claimed that this is a voice of a group, nor have I made a media career out of it. I think Tim and friends will find that this is a step backwards for ConHome, and I hope they will reconsider the distinctly retrograde step of moderating all comment pre-publication, and I hope they do this before it becomes a ghost site with all the good stuff hidden behind a wall of moderation or payment.

Whoops

Fixed the photos on the site now so the shots on the food pages and within the blog should now be looking – overlooked changing local references that wordpress inserted when I first set the blog up. Schoolboy Error I’m afraid.

The real cost of the ‘public’ sector.

In a moment of hilarious irony, The Guardian, king of the non-job advertisement market, has posted a map with accompanying figures showing the public sector workforce as a percentage of the total workforce throughout the UK, broken down by electoral region.

It just goes to prove what many have suspected for years – that certain areas of the country where Labour were ‘slashing’ unemployment were simply transferring the unemployed from benefits to a job that provides benefits: in some areas the public sector workforce is above 30% with Castle Morpeth’s public sector accounting for a staggering 48.7% of the total workforce.

It’s no wonder the UK is broke, not just broke though, broken is closer to the mark. Our politicians have created a generation that sees it as the state’s duty to employ them. The public sector doesn’t generate wealth, it simply leaches – and while there are services that clearly the state should pay for – there are many more it shouldn’t. These millions of jobs paid for solely at taxpayers expense aren’t putting teachers in schools, or policemen on the beat, they’re instead giving us ‘community street football organisers’, ‘regional diversity cohesion coordinators’ and a whole host of other non-jobs making people ‘feel happy’, ‘play safe’ or ‘integrate’.

The fact is that we’ve seen an explosion of bureaucracy in the last 10 years. Councils with ‘CEOs’ demanding money with menaces through debt collection agencies, community spies photographing your rubbish, a veritable sheaf of paperwork to even consider working near a child – I could go on and on.

While it’s unfair to tar all public sector workers with the same brush, many people’s experiences (often unfairly dismissed as ‘just opinions’) are that the public sector works to slowly, doesn’t communicate internally, wastes huge amounts of money, and doesn’t deliver to the man in the street – who it shouldn’t be forgotten is the embodiment of who the whole sector is supposed to serve.

This wasn’t job creation, this was block vote buying – pure and simple, and now it’s time to pay for that. Except I don’t think we’re going to slash anywhere near as much as we need to. Cameron promised the small-state, but the truth is he can’t afford it – he simply can’t afford the political price of making most of the North East unemployed again, and he can’t afford the economic reality of some of these people sitting on benefits claiming their is no work.

It made the Conservatives toxic for a whole generation after Thatcher dispatched the over-productive, state-supported job creation that was the coal mines, they formed powerful unions that chose who you voted for, they bankrupt businesses up and down the country, and they’ve proved to be a rallying call for the left ever since. Reinforcing the view that the state will provide come hell or highwater. Except it shouldn’t be like that.

Coal miners are the classic example; many to this day claim they never found work again – they were coal miners and that was that – but much of the real life experience of those that worked in these communities after Thatcher shut the mines proved that these men had learnt skills in the mines that could be easily transferred to construction, highway maintenance, machinery and automotive repair and a thousand other trades… many however chose to ignore this, bitter that they would have to consider a different ‘trade’ while others claimed that they were ‘incapable’ of travelling to find work.

They were dragged into a mentality that it was the state’s duty to employ them at any cost, and now we have a new generation of miners in our inefficient overly expensive public services.

The argument often used about public sector workers is that they’re contributing to the tax coffers: except they aren’t. It doesn’t matter how you spin the maths it doesn’t work – it’s black magic taxation that offsets incoming money against outgoing money and never looks at a correlation between where the outgoing money pays for the incoming money.

If we consider it using magic beans (which let’s face it may be all we have left soon) it looks like this.

I decide I’m going to be a magician. I work hard. I make and sell magic beans in a country which has 100 people in it.

In year one I make 10 beans and I sell all ten to people.

I’m taxed at 20% so that’s equivalent to giving 2 beans back to the state in year 1.

The state provides me with magical lanterns, giant killing services and so on that cost  50 beans a year so I have paid 4% of what it has cost to provide. That means that clearly not everyone has to pay meaning the state can afford healthcare, looking after old warlocks and saving unicorns.

However…

In year 2 the state decides that it’ll start providing a community street quidditch coordinator. This person costs 2 beans, the total cost of the state is now 52 beans. This means my contribution is now worth less. The total amount of incoming tax has reduced. The state justifies this with the fact that the community street quidditch coordinator pays 1 bean a year in tax. But the state now puts 1 bean away as well to pay for HR, insurance and an end salary pension scheme so the community street quidditch coordinator can retire fifteen years before I do to look after Mandrakes.

This means…

That the state now has 2 beans a year unpaid for, the community street quidditch coordinator will never actually generate new beans. The beans he is taxed never actually cover the full cost of his employment.

So eventually…

The state begins to run a deficit of beans. We have to borrow beans, and the more beans we borrow the more they cost to pay back. They have to take more of people’s beans, people with businesses leave the country – So eventually evil wizards from the IMF have to devalue our beans meaning that we’re all poorer, these wizards will make the community street quidditch coordinator unemployed whether the state likes it or not, and eventually someone will have to pay for looking after the ex-community street quidditch coordinator which eventually comes back to me.

Ultimately this means…

My beans are worth less, the state is taking more of them, and I’m looking at the border to a country where my beans aren’t wasted meaning that when I do move to a far-away land the state won’t get my 2 beans at all.

It’s a vicious cycle and what’s more it’s one that is unjustifiable however you look at it. But it’s one we’re currently stuck in. We’ve got to balance the books, we can’t afford to be stuck paying for people to be employed by the state simply so they have jobs. The private sector will eventually cover unemployment – Germany proved this with an affordable tax and spend plan that encouraged companies to train employees, generate wealth and exports and make it easier for the country to run without running a dangerous overdraft on the international bond market.

It’s not ‘nice’ – Cameron and Clegg know this. Whether they’ve got the political balls to be ‘nasty’ is yet to be seen. What’s clear is that the current cuts where nowhere near deep enough.

Press reactions to Ireland & The Eurozone

Well, it appears that there is now a series of options on the table for Ireland after talks continued late into the night – more on that later today – but you’d be hard pressed to find much detail of these discussions in the UK press as the majority of newspapers seem to be rejoicing in the possibility of a cataclysm, including a particularly moronic piece from Ambrose Evans-Pritchard in The Telegraph, full of half-true hindsight and distinctly dodgy future predictions.

What’s interesting is how almost all commentators seem to be foaming at the mouth with glee about the imminent ‘collapse’ of the euro and the european project, ignoring the impact that any potential failure would have on Britain, both politically and economically.

Let’s be blunt, the failure of the Euro would cause a financial firestorm, it would rock markets worldwide, and the blast-wave that would roll over the City of London, and then onto the wider economy of the UK would huge. Just consider there are more Euros traded in London on a weekly basis than exist in the rest of the Eurozone put together: The City contributes 14% of the total tax coffers; a significant proportion of which is earned on Euro investments and trades and the last time I looked this inward trade to the The City alone made the amount that every anti-europe commentator drags up about how much we pay into the EU every year look like pocket change.

Tea Party-esq ramblings from Little Englanders’ are horrifically ignorant. The idea that we are not inextricably linked to Europe in finance and trade and that we’d ‘do just fine’ alone on our little island against the might of China, the USA and Russia (all of whom it should be noted employ protectionist policies whenever it suits) is naive in the extreme.

It’s funny really because the view in the press is not the view I hear in my daily life. I should say I’m not surrounded by europhiles, quite often it’s quite the opposite – but none of the people I meet in my personal and business dealings have the rabid anti-europe sentiment that the press portray the British public as having. That said – one thing is clear: whether we agree with it or not, we will pay to bail out Ireland one way or another – and what’s patently clear is that if we stand by and watch the eurozone fall apart we’ll pay even more dearly than any of the Little Englander’s could ever imagine.

Ireland needs to act, now.

Basil comes a cropper. © BBC.

Basil comes a cropper. © BBC.

Many commentators are reacting to the news that Ireland and the European Union are talking about economic support as some sort of great shock – I’m really not sure why: Ireland’s recent austerity budget should have been a sure sign that they were in deep trouble. The cuts they made were not those of economy, rather they were those of widespread panic.

Of course the admission from Dick Roche that Irish banks were facing “serious liquidity problems”, and his almost flippant statement that “[I don’t think] the appropriate response to that would be for the European finance ministers to panic.” has of course had the exact opposite effect. With a ring of Mr O’Reilly promising Basil Fawlty that all will be well; the Irish economy looks set to firmly hit the buffers when it finally uses up the money it has presently loaned at some point midway through next Spring.

Media outlets are of course fanning the flames, with the meeting today between European Union finance ministers in Brussels being described as ‘crunch talks’; and while undoubtedly the first agenda item will be the state of Dublin’s finances, it shouldn’t be forgotten that this is actually a regular monthly meeting – not an extraordinary quorum specifically called to negotiate bailing out Ireland.

But while it’s sure to be the star item on the agenda, quite what they’re say about Ireland remains a mystery: elements of the finance committee are sure to push for early action in the form of a bailout with the stability of the Euro being the key focus. Over the weekend a story filed by Reuters appeared to justify this assumption, with reports of a deal to shore-up that stability of the Irish economy [for the good of the euro] valued at an amount between 45€ billion and 90€ billion already underway.

With the ultimate bailout fund entirely dependent on how much trouble the Irish banks are really in yet to be revealed, it’s no real wonder that panic both political and on the markets is setting in – as it’s that ultimate amount that’s likely to be the figure that either scuppers or saves the Irish economy. A combined French, German & British dislike for taxpayers funding Ireland’s ludicrous bank assurance guarantee (which fully covered all losses, and not just those of the private citizen), is set to cause friction for the European finance committee bearing in mind Angela Merkel & Nicolas Sarkozy’s agreement a month ago for a new mechanism for securing sovereign debt, restructuring this debt in a way which would place private investors (most notably international bond holders) at risk for investing in countries that were heavily indebted or fiscally unbalanced.

The whole story though, is not yet on the table. It should not be forgotten that British and German banks are massively exposed to the Irish economy. Der Spiegel reported that during the European bank stress tests this summer, some of Germany’s biggest banks were revealed to be holding an estimated 101 billion euro ($138 billion) in Irish bonds. while British banks are exposed to a further 110 billion euro ($150 billion or £93.7 billion). Worryingly for both Britain and Germany a significant amount of that exposure is in taxpayer supported banks including RBS and the struggling Hypo Real Estate (which Frankfurter Allgemeine Zeitung reported as holding an estimated €10.3 billion portfolio in Irish debt).

Stuck between a rock and a hard place, the financial powerhouses of Europe may have to swallow any plan for letting Ireland take the pain, the exposure closer to home most likely being seen to be too damaging economically and politically, but mark my words: any bailout will come with a litany of caveats. David Cameron will have nowhere to hide as under the noses of the coalition talks that followed this year’s election, then Chancellor Alastair Darling committed Britain to any future European bailout. He won’t however be alone, Angela Merkel is already leading the battle cry, and won’t be likely to stop if German taxpayers take yet another hit for bailing out a profligate nation to ensure the long term stability of the Euro.

This story is developing… as and when details come in I’ll write more.

Migrating over to WordPress

Finally over to wordpress – so here we are, rough edges a plenty, but the blog itself is up, running and up to date.