Don’t be poor
Strange times. China’s inflation rate zooms on through their own target range of 3 per cent to 3.6 per cent. The country’s growth rate slows from a first quarter rate of 11.9 per cent, a second quarter of 10.3 per cent, to today’s’ 9.6 per cent. It’s a result the ‘authorities’, wanted to see. But the inflation rate is not. It’s almost impossible to imagine what this set of financial circumstances heralds for us all in the future. If China catches a cold, a good number of us will die of flu, one senses.
But far from dying, Portugal, with one of the rockiest economies in Europe is seeing its borrowing costs falling rapidly. Even Spain and Greece are doing enough to bring their own bond issues in at lower costs. This is because they have been seen to taken dramatic and drastic domestic measures to sort their economies.
So its hard to see that the UK would have been wise to do yesterday much less than what it did.
That leaves the French on the streets over a pensionable age increase from 60 to 62. Mr Osborne yesterday brought forward to 2020 the time when women’s retirement age will rise six years to 66 , and men will come into line at the same age. In response, hardly a squeak from the Brits, a small straggle of demonstrators in Whitehall the only UK protest burp of any note.
The least emphasised consequence of the UK cuts is the effective demolition of Eric Pickles Communities Ministry(70%+ cut), which used to have responsibility for housing. The housing benefit cuts, and the active desire to force some social housing tenants to move out of some housing areas speak of the prospect of an escalating house building crisis. The Chancellor spoke of raising social housing rents and using the moneys to build 150,000 homes. It sounds a remote prospect. The UK is currently on track to build fewer than 100,000 homes this year. Higher up the housing chain the market is at a virtual standstill amid stalling bank lending.
The Bank of England has thrown £200 Billion into the ‘liquidity’ pool, where did it go?
It’s a very bumpy landscape. Make no mistake, we are living in some of the most uncertain economic times in half a century. It’s a particularly bad time to be poor. As yesterday’s Treasury graph shows, the poor are about to get a whole lot poorer.
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There are 106 comments on this post
You might have added, Jon, and the rich will hardly notice.
If the private sector gave a damn about all but the few at the top people like Philip Green wouldn’t stash his money away in his wife’s name where it attracts no tax, he would pay his staff a bit more, giving them more to spend and boost the economy.
If the markets were about anything but making a few people very rich, we wouldn’t need to charge the BBC with providing broadband access to rural areas where the private sector can’t make big bucks, or make the post office deliver to similar outlying areas on behalf of their competitors.
Yesterday Osborne trumpeted capital expenditure projects, most of which are there to please big business. It seems the government is ready to support what market forces can’t afford but not what ordinary people can’t afford
One final point, this government is urging us to take responsibility for our actions rather than rely on the state, but Osborne blamed the bank debacle on a lack of regulation not individual mistakes.
There’s only one group they care about
And you would replace the profit motive and the market economy with what exactly Saltaire?
Its easy to find fault with the morals of the market economy – it has no moral compass beyond profit whatsoever. But is this productive?
Profit is amoral, but every economy depends on it. Ignoring this to protect the needs of the few on moral grounds is specious, ultimately a greater harm is done and unemployment, hardship and suffering are made greater and more extensive.
Under Labour’s economic plans we would have to borrow our way out of recession. Sadly, and I do mean sadly, this doesn’t work: the market, regards lending to states who do not address balance sheet issues as risky and it downgrades credit ratings and increases interest rates. Borrowing becomes exponentially more expensive. For states that go the opposite route, borrowing costs improve, as they have here, in Greece and in Portugal.
Nice, soft word “market.” Brings to mind street barrows, striped canopies and fruit piled high…..Except of course capitalist markets are nothing of the sort. They are rigged and interlinked on an international scale, as the banking scam has demonstrated for the umpteenth time since the South Sea Bubble. How many more lessons are required?
Profit is not Amoral, it is IMmoral. It steals the lives and aspirations of ordinary, decent citizens and condemns millions of people to live in poverty and misery across the world. In that respect, the differences between East and West are only relative.
Nor should trade be mistaken for capitalism, which knows only profit. And the more profit capitalism gets at the expense of everybody else the more it needs. It will NEVER EVER change. It can only harden into larger and larger monopolies.
Creation of the NHS didn’t require capitalism or profit. It required only an understanding that we are all in this together and always have been, and that the wealth of ANY society belongs to us all and should be distributed accordingly.
The miseries of capitalism and profit are man-made and they can be solved by man. Greed will solve nothing.
Philip, you live in a world of make believe.Ofcourse the NHS needed profit.It couldnt exist without Capitalist profit and the means to pay for its existance , just as the whole public sector relies on the profit created by the private sector.
The Socialist ideal of all being equal, not profit making is a recipe for disaster.If it is such a brilliant system , why are Russia ,China and the emerging Eastern economies relying on capitalism to drive their way forward.
The question of which is right ,Socialism or Capitalism is academic.Socialism without profit can not work .The real question should be is how do you control and take the most out of capitalism to benefit the many
Where Sam has a very valid point is in the situation with regard to Philip Green.
Just because what he has done with his financial affairs is legal, doesn’t make it moral. That the coalition then decides to appoint him to advise becomes an act of supporting that state of creative accountancy. The fact that some Ministers also operate dubious management of their tax affairs merely adds to this.
If they wished to live up to the ‘we’re all in this together’, they would ensure that anyone with any influence over policy was not only obeying the letter of all our tax laws but also their spirit. True, that would exclude many in the Commons and the Lords, but if they’re not part of the solution, they are part of the problem.
Hypocrisy is an unpleasant charge, but a stronger whiff of it hangs over our rulers with each passing day.
Adrian, What nonsense. There isn’t a Socialist who claims ‘everybody is equal,’ not even Marx. There is no such thing either as Utopia, except in the mind of Thomas More.
Capitalist profit is immoral and evil and lives off the backs of society to the benefit of a tiny number. It creates wars and deprivation wherever it exists. You need only look around you in the world, including Russia, China and the Eastern nations.
Exchange of useful value is not the same thing as profiteering by a few. Even Milton Friedman and his Chicago Gang came to realise this, just as the noton of “trickle down” has been shown up for the lying propaganda it always was.
There is not, never has been, and never will be any such thing as a “fair” profit, as Victorian society found out to its cost.
Industrialisation and mass productivity created civilised possibilities, not capitalist profiteering. Eastern nations could not have modernised without it. Capitalist profiteering denies human society the full fruits and value of its work. Exchange of trade existed long before capitalism and will exist long after its welcome demise.
Capitalism is an evil creed and always will be.
“Capitalism is an evil creed and always will be”
I assume you didn’t use a capitalist provided pc to write your comment?
Did you use any capitalist provided electricity today?
Do expect to retire, stop work, or maybe even start work one day – then maybe access some capitalist provided pension fund maybe?
Capitalism doesn’t provide anything. It TAKES and never gives. That is the whole purpose of profit – for which see Ivan Boesky, Michael Milken, Enron et al.
Everything I have and will have is provided by industrialised society working in spite of, not because of, capitalism.
When Thatcher claimed, “There is no such thing as society,” she let the cat out of the Ayn Rand Objectivist bag. No surprise, then, when the Tories got rid of her post haste in the immediate aftermath. After all, you can’t have the tin pot Boadicea telling the truth, can you?
Which is why the ConDems are now trying the “Big Society” con trick via their monopoly owned media propaganda. The are trying to breach the hole in the dam left by the Thatcher years.
But you know what…….they’ll fail. Maybe not immediately, but it WILL happen just as surely as the great Labour reform government of 1945 happened. And it will happen for the same reason – the majority will say, “Enough is enough, this is a war too far.”
And for this democratic citizen it can’t come soon enough. The longer we leave it, the worse will be the misery and targeting of our most vulnerable citizens.
It looks like Philip Edwards has never had an idea, taken a risk, worked his socks off and given employment to others. Still seems to be living in dreamland by the sounds of it. Maybe you’d be better off Philip in a cave or a tent.
Still you’d need that broadband, provided by people looking to make a profit, if you wanted to reply to forums like this.
Philip Edwards – ‘nice soft word, market’. Nice, patronising, opening paragraph.
Philip you blame Capitalism for all the ills of society, yet without it there would be no modern society.Where would you take us? Back to the tribes of the Amazon or the African nomads.
Modern society is built on Capitalism , and yes we have to accept there are those profiteering Capitalists,and they need to be bought to justice.
Without Capitalism we would still be in the dark ages .There would be no public sector , no work that doesnt pay for itself as there is now .There would be no NHS ,No pensions.Until you have an alternative way to run a country . your critisism is not worth the Capitalist word processor on the Capitalist computer and the Capitalist internet you post your rediculous comments
I can’t speak for Philip but I am a left leaner who accepts that capitalism is here to stay.
But does it have to have no morality or even a slight bit of humility?
We are always being told that without capitalism we would be in the dark ages, yet it is to the state they turn when they want infrastructure, broadband to out of the way places and to get the banks out of a mess that would have put several extreme capitalists in the gutter if the tax payer hadn’t jumped in.
My main argument against capitalism is its attitude. Houses are for investment not for homes, and no matter how much money you make, it is perfectly moral to avoid paying your share towards the common weal.
I also happen to resent the thought that only people in the private sector work hard or contribute. In my recent experience of hospital the nursing staff worked tirelessly and the surgeon was a genius as far as I’m concerned.
We need both private and public and it would be good if the private showed a little less arrogance and stopped thinking they should have first pick of life’s goodies.
HavinALaugh & adrian clarke
You seem to be confusing capitalist economic structure with modernity. Facts are that people do everything, profit does nothing. It’s not in any way necessary to structure our world this way, simply advantageous to a few very powerful groups. Many of our best human advances are strangled by profit, not enhanced by it. See renewable energy technologies, availability of knowledge and eduction, cures for diseases prevalent in poorer countries for a few examples.
Anna Machell, what a load of rubbish. Profit is what makes people take risks rather than sit on their backsides on the dole or picking up a wage while someone else takes the risk of employing them. No risk no reward. Profit drives humanity to do more – no profit equals be lazy – see countries where profit was banned – poor farming, no one gave a d… introduce profit – output increases, people eat. Get real, profits works. Do you think drugs would be developed if there was no profit ! Renewable energy is just a dream, it cost nothing, no its cost capital and when you do the figs. it makes no sense. Of course people do anything but what they do is based on profit.
So, Mr Laugh, profit is the prime motivator of all. Well that kills off the Big Society for starters – no profit in volunteering.
You also claim, that those who ‘take the risks’ deserve the profit rather than those who are just ‘employed’ and you are right to this extent – with the banks, those who took the risks took the profit but it is others who paid the price.
No one I know is arguing that people who start a business or invest in that business shouldn’t benefit from its success. But I would argue that in most cases it would be impossible for that success to happen without the dedicated work of those employed in it and therefore they should share in the rewards. And the state educated those workers, so some cash should go there.
Where do you stand on someone who has not taken any risks but is just an employee at a higher level? The head of the post office (no risk taken) is paid more than £1m yet without the humble postie sticking letters through letter boxes, he would be completely impotent.
You seem to have great contempt for ordinary working men and women yet if they all down tools, the entrepreneurs would suffer just as much as the rest.
Saltaire Sam, I don’t have contempt for anyone who works. I was an employee for 25 years so I certainly do not think being an employee is a problem. I would be an employee now if it were not for profit. Without a profit I would not have risked everything to start a business. The people I employ are great, get paid very well and have shares so get some of the profit. Without me, those people would have still been working for the company I used to work for which shut down two years ago. Profit made me take a risk and that is what has given the people who work for me jobs.
As for the head of the post office getting x while a person who delivers post gets y. You only need to ask why the person who delivers the post does not apply next time for the top job. You and I both know that would be because he would not be able to do the job.
I might like Elton Johns salary but I can’t write songs, I might like Rooneys pay but I can’t kick a ball so in life we must face facts, if you can’t do the job stop complaining about the person who can.
HavinALaugh
I’d be careful about assuming that your motivations for doing are the rule. And you say your employees have shares so clearly profit isn’t king for you. I reckon if you asked most teachers and doctors most would say they valued the work over the money. Most inventors love to solve the puzzle and make the thing more than they love the sale. Profit may be a motivator for you but millions would prefer meaningful, stimulating work. They’re mutually exclusive for most.
Of course drugs would be developed if there was no profit, but only the ones we actually need, rather than tonnes of the same to fill patent surplus. As it is we live in a world with no cure for malaria because it wouldn’t pay to make one. Troubles with farming have to be looked at in a global context; if there was no global profit, people would still need to eat. Renewable energy exists now, the technology is there, but there is nowhere near enough research being done because oil commands the money.
My goodness Jon , you are well known to exagerate a little on many matters , but alas, I fear that you are not doing so in this respect.
As you bring out your little pink newspaper in the morning though, does it occur to you that the factual aspects of the FT are exageration also. Of course you do, sorry to be so damned patronising. I don’t understand all those indexes and things, so will have to trust.. what a responsibility..
For every problem there is a solution, so management would have it, although they fail to adhere to their own spoutings out.How can you help me NOT be poor , marriage is an option; although there are not a lot of well- healed single men around these days ( going back a couple of centuries here ..is that progress?)
I suppose advancing my career is a good step, but the more experience and degrees we have , the more they stamp on us and jobs are scarce.. too many people around .
Opening up my own business another plausible option , however with the public employees set to be de capitated , there will not be a lot of spare capital to build my business.
So .. who do I creep to .. who holds the purse strings and who can I agree with to survive…
I need a break so I’m forgetting politics for a couple of hours and going to my WEA course on the mediaeval church before the cuts in adult education grants mean I can’t afford it.
Interestinly, in the mediaeval church if you were rich enough to be able to build a chapel or pay a priest to pray for you, you could fasttrack your way through purgatory to heaven.
Plus ca change…
Jon, Your analysts on Channel 4 News last night were only marginally better than the whingers that we hear continuously on the radio.
It is a statement of the bleedin’ obvious that cuts will hurt and that deep cuts will hurt more. We do not need to be told that those on benefits will be poorer and that 500,000 redundant civil servants will increase the ranks of the unemployed! So why keep on ‘wheeling out’ punters who couldn’t tell an economic reality from a milkman’s horse?
Turkeys do not normally vote for Christmas (sorry, Winter Holiday!). So why would a Civil Servant or Fireman with his cushy shift patterns and possibly second job from Stoke think that cuts were a good idea.
It is truism that nobody knows for certain what is going to happen. But, everybody with a functioning brain cell agrees, including the opposition who largely allowed this mess to develop,that public expenditure and borrowing need to be cut.
By all means interview the ‘hand-ringing brigade’ but balance it up by trying to identify how worse off they would be if they were all protected.
I believe that Defence has not been cut enough and the bloated NHS should have been included.
‘So why would a Civil Servant or Fireman with his cushy shift patterns and possibly second job from Stoke think that cuts were a good idea.’
Even if firemen do enjoy ‘cushy shift patterns’ and even if they run a second job (implying they don’t earn enough from their main job?) I rather think you would be willing to pay them an enormous sum if it were your house on fire and your family trapped by the flames.
David Cameron can’t say the words servicemen and women without adding ‘our brave’, even when he’s being condescending to a pilot who may be about to lose his job. But someone going into a burning building that could collapse on top of them at any moment to save another person’s life is equally brave.
My main complaint about capitalism is that it feels there is nothing wrong with paying a banker millions of pounds but begrudges the money paid to people like firemen.
If it is ‘fair’ that no one on benefits should be paid more than the average wage in work, it must also be fair to say that no one in a business should be paid more than say ten times the lowest earner. The person at the top cannot do it on his/her own after all.
“So its hard to see that the UK would have been wise to do yesterday much less than what it did.”
Jon, that just about sums it up. Either that or saddle the next (and the next…) generation with an impossible debt burden. We’ve made a great big sh*t sandwidch and we’re going to have to start eating it, it’s only right. And read-all-about-it the poor are going to be a little bit poorer. As if we didn’t know, but let’s go and interview some of them anyway, plus thrown in some people who’d have you believe that they’re on the bread-line just for good measure.
It’ll take a year before we really see how all this pans out. Can you wait that long Jon ?
Moonbeach : Fabulous post
Saltaire where do you make up uyour ideals.I have read no one who doesn’t despise the bankers and their scandalous bonuses.Equally i have not read anyone who begrudges the amount paid to firemen .
We can not survive as the nation we are without profit , but within that system there are many people who are paid way beyond their worth to society ,and by the same measurement many not paid enough for their contribution.If you take a prime minister as the main person within the system , there is no excuse for anyone being paid more than him/her.Certainly not within the government hierachy, yet there are chief execs of councils , execs within the public sector paid more .That should be addressed before cuts are undertaken
Sam,
I really can’t disagree with anything you have written. Of course Firemen are brave when they enter horrific fires.
My point was that Krishna did not, in my view, give a context to the comments. We had no idea about the vested interests of the sample of Stoke’s Burgers except for the entrepreneur who was very sensible.
Hearing the same old twaddle from the media irritates me because their reporting is generally biased. They devote most of their ‘air time’ and print speculating about how bad things MIGHT get after the cuts.
Rarely do they offer an alternative practical solution or explain the Government’s reasoning.
Some bankers’ pay is an obscenity but which model of Socialism benefits more people than Capitalism? Please don’t say Sweden!
Rather than just ‘reining in’ Bankers’ pay, I would suggest charging a ‘windfall’ tax on companies that pay unjustified salaries. Paying a percentage of ‘profit’ to a Trader for taking a huge gamble with other people’s money and expecting the taxpayer to underwrite the losses is not gainful employment! It should not be rewarded as such.
It will, of course, never happen but any debtridden socialist alternative is worse.
Firemen are easy to recruit, require very little training, have one of the lowest staff turnovers of any job and have far less danger than many ( Lorry driving is far more dangerous ).
They are clearly massively overpaid.
You could advertise their jobs at £22k and have a queue around the block. There is only one reason why they are paid so well – strikes.
Our servicemen die for pay less than £20k when our Firemen are walking around buildings pointing out the b.. obvious like “you need to fit alarms here” or “remove those empty cardboard boxes they could catch fire”
We need firemen, we need them to put out fires and we need them to be brave but we don’t need to pay 60% more for them than we need to.
1/ It still is not clear to me WHY this programme will encourage the private sector to create new jobs.
2/ It’s difficult to see anything that will cause the private sector to create those jobs where the unemployed are, while the changes in housing benefit (particularly as related to the under 35′s) will make it much more difficult for them to “get on their bikes”.
3/ On a particular interest of mine, if the Science Budget was protected, why is it that posts funded by it have dried up?
eg jobs.ac.uk (where most PhD and Postdoc posts are advertised) now carries 30-40% fewer vacancies than this time last year. Could it be that Research Council funds aren’t being released, because the academics can’t find the contributing funds (from govt depts or the private sector) required to qualify for various programmes?
Spot on, Paul
Hear hear.
John, this will change the fabric of UK society perhaps irreversibly. I’m surprised at the timid response from the British public. Perhaps it reflects a state of collective shock.
Please continue to press this government on what it is doing to pursue the bankers, financiers, city institutions and individuals that caused this mess, many of whom have walked away with millions in tax payers money.
I agree
”Please continue to press this government on what it is doing to pursue the bankers, financiers, city institutions and individuals that caused this mess, many of whom have walked away with millions in tax payers money.”-
This will nevr happen – itas just not on to question the Big Money Men. This is only the beginning – the arrogance of the Super Rich is really brethtaking – the lies of their messenger boys / girls aslo takes some swallowing – but they get away with it- thats Capitalism .
Dear John Snow
The Conservatives are cheering over the world recession simply because it gives them the
leaver to do what always have seeing as their main political aim: to dismantle the welfare state. The old concept of a state that is a benigne protector and see as its role to protect and care for the less able or the vulnerable is not part of the philosiphy of the right. Darwinian survival is back!
Of course they are cheering – it is the second next best thing after 9/11 – which allowed them to wage wars of Terror on their poulations . The Recession for Capitalism is GREAT. It allows them to cut wages , increase working hours – and cut anything they fancy . It would appear that bit by bit people are waking up all over Europe and USA to the baltant robbery and life destroyer that capitalism is . I would also predict a rise in suicide rate .
I agree the poor will suffer most and it is important, both equitably and politically, that we all bear a reasonably even, pro rata cost for the irresponsible behaviour of bankers and the economic profligacy of the last labour government.
The hard facts are, and have been for decades, that this country, and the west generally, cannot afford a welfare system that subsidises low salaries and high costs of living in what is a shrinking relative wealth.
Apart from a misplaced theory that overseas aid to Yemen, Pakistan, even India and other tiger economies will somehow bribe the poor in those countries and eradicate terrorism, I cannot understand why we are borrowing money year on year to give in aid? It is mad.
It’s like running a credit card debt and giving £20 a week to charity. If you want to give a lot of money in charity (and many of us do), good on you, but if you’re using borrowed money to do it and you are borrowing it from me – stop it!
The idiocy of politicians on all sides astounds me. The hypocrisy of labour in this whole debacle is gobsmacking…
What worries me particularly is this socisl housing tenancy policy. As I understand it, only the poorest will in future qualify for social housing, BUT, if/when their circumstances improve, they will be expected to vacate the property/ be evicted, and told to rent /buy in the private sector. Who will check on their circumstances for signs of improvement? What level of improvement will render them no longer entitled to live in the property? Will they be allowed back into social housing/ on the waiting list, if their circumstances deteriorate later?
I can foresee all sorts of practical problems, not least being: What will motivate people to get themselves out of poverty if the result means losing their homes? Will there be whole estates where only society’s poorest live, for ever? Who will maintain this social housing, decorate it, keep the gardens tidy, if there are only the poorest living in them, unable to afford to?
This policy seems likely to produce far worse and more permanent ghettos than we already have. Is the idea to “make an example” of the poor?
The allegation is that the poor will be hit the hardest,though taking benefits out of the equation,percentage wise it will be the rich.Not that that is any consolation to those on low earnings,who are also more likely to lose their jobs.I do believe now was the opportunity to hit the rich harder.To tax incomes over £100,000 at least 60%.To tax bonuses ,for merely doing ones job, out of existance ,with a 100% tax.To introduce LVT and do away with council tax.To tax “tax avoidance” by the amount avoided.
Having said that if British men and women are to be hit , the Aid budget should have been reduced by the same amount and not increased.
Finally it is time the benefit culture was bought into line.Who can justify a family of 10 getting a free 4 bedroom house and the benefits equivalent to £90,000 per annum?If people choose to have children , they get progressively poorer ,the more they have ,why should the benefit system work in reverse and they get progressively richer? Why are there so many on incapacity benefit? With anything from bad backs, depression,addictions,or the slightest medical condition.There should be one basic amount.It is supposed to be a safety net for those out of work,not a way to live permanently off the state.
Despite Saltaire continually attackin the rich, the state sector is a bloated unaffordable monolith,where many in it believe we are at their beck and call and not they the servants of the people.
Excellent, Adrian. Thumbs Up!
There are few advantages to be gained from the coming decimation of decency.
One of them will be the final separation of that portion of the LibDems who go along with these disgusting, cowardly policies. Finally, they will end up with the Tories, which is where they have always belonged. Good riddance.
It will too see the end of the extreme right wing “New” Labour corruption. They have failed because they went along with 1980/90s financial and media spivs for short term power. The only thing we have to thank Kinnock and Blair for is a final demonstraton that betrayal of roots will always get what it deserves – political oblivion and contempt.
Nye Bevan’s famous speech of denunciation of the Tories in 1948 holds as good now as it did then.
Meantime, the ConDem gang have already formally admitted to a futre 500,000 increase in the jobless. Add that to the existing 2.45 million unemployed, and then add in too the forced addition of those who will be deprived of Incapacity Benefit (current total 2.1 million) and you begin to get a taste of where this is all going. All to a background noise attack on social housing.
Poll Tax riots in London? You have seen NOTHING yet.
“nothing” being the operative word aka don’t riot, just “stay-in” aka don’t go to work and stop using money.
Philip, double thumbs up.
Are there any constructive, pragmatic ideas from your planet?
I’m sick of news programmes covering government spending as though the money for it grew on trees – as though it could just be turned up without affecting ordinary people.
Working people who earn less than average are footing the bill – they pay income tax, council tax, national insurance, tax every time they put a gallon of petrol in the car, tax every time they buy a pint of beer, and so on. It’s not right to tax the working poor to pay for other to live in expensive housing or doss when they should be working. This government seems to understand and be prepared to do something about it.
1 Ending tax evasion and avoidance – legalised fraud – could bring in anything between an estimated £20bn-£100bn. It’s difficult to calculate precisely something as nefarious as tax-fiddling. (I note your scientist friend, Jon, planning his annual returns to the UK in order to avoid tax.)
Tax Justice Network’s excellent and informative website – http://www.taxjustice.net – is worth visiting by anyone interested in social justice (both TJN’s and Richard Murphy and John Christensen featured in last Monday’s Dispatches programme ‘How the rich beat the taxman’).
2 Introducing land-value tax (LVT) as a replacement for the wholly regressive council tax (CT) would also fill a huge hole in the government’s coffers and help end the iniquity of second/multiple homeownership with the latter’s lower CT, and obscene house prices.
You say, Jon, that ‘The housing benefit cuts, and the active desire to force some social housing tenants to move out of some housing areas speak of the prospect of an escalating house building crisis’. What they speak of is nothing less than social cleansing. Annie is correct to be concerned; so should all of us. This is no better than ethnic cleansing.
Mark: why do you assume that everyone who disapproves of the coalition’s CSR is a public-sector employee: ‘your gilt-edged pensions and guaranteed jobs for life’?
Re private sector and taxes: you fail to mention tax fraud (avoidance/evasion, estimated at anywhere between £20bn-£100bn). Cleaning this up would make a massive contribution to reducing the deficit.
Re ‘asset bubble’ (house price inflation): land is the biggest source of unearned income, alongside inheritance, share dividends etc. Do you support a tax on land – LVT, probably the fairest tax there could be and one supported by both Churchill, Adam Smith and Karl Marx? This would replace the regressive council tax, and help bring down property prices substantially. NB second/multiple homeowners pay a reduced level of CT. Do you consider this fair?
Re ‘ethnic cleansing’: I was making a comparison with the social cleansing that will result from the proposals re social housing. Let’s hope that UK citizens reject ethnic cleansing as the crime against humanity it is. Is forcing people to flee their homes any less heinous? Regulating rents chargeable in the private sector has been rejected by the coalition.
”This is no better than ethnic cleansing.”– I agree something else is afoot . Collecting 1Billion £ – is satistaclly insignificant compared to the £ 90 [ approx mentioned ]- so its basically just another part of the War on the less well off .
”It’s a particularly bad time to be poor” says Jon Snow. I cant remember any time when this was a good idea .
The idea seems to have taken root in many countries that the Public sector should pay for Private sector mistakes . This is thanks IMO to the propaganda of Murdoch et al .
No. No-one is saying the public sector should pay for private sector mistakes.
The fact is that brown, a labour prime minister and chancellor for 13 years, has spent too much money and funded it off a debt-driven asset bubble (ie house prices).
Well now the party is over, the banks have been saved by brown (probably rightly) at our expense (because no-one else can or will) and with what seems to be no conditionality !
The private sector is no more than responsible for this massive economic problem than the public sector. The difference is that the private sector, whose taxes pay for the costs of the public sector and associated services, took the pain two years ago. My salary is 30% of what it was two years ago. I’m living on fast-diminishing savings and a minimal salary. Many others in the private sector have taken salary cuts (that’s cuts, not freezes) and reductions in hours.
The public sector are no more to blame for this than the private sector, but your gilt-edged pensions and guaranteed jobs-for-life can no longer be afforded. Simple.
As for the ‘ethnic cleansing’ comment. What’s your point?
Mark
I’m also a private sector worker who has taken a big hit in income in recent years and I’m not against more reality in things like public sector pensions.
But, it is not the bloated heads of the civil service who are about to lose their jobs, it’s ordinary people with low incomes and a family to support.
And if you and I are typical of the private sector, the optimism that private enterprise will supply the new jobs for them, seems wildly over the top.
Just to make clear – if not already – re public sector pensions . They do not come for free here in ROI anway – and since just about everything in this country remained unchanged after ” indepedence ”- presume it is same in UK . I worked in Publc sector – and from Day One 5% of my gross salary was deducted for pension fund – so for over 40 years I contributed 5% of salry to the fund . This point is never made [ here at least ] . Public sector gifts are portrayed as gifts – ” freebies”. As for ” bloated ” – if anything is bloated – it is the amount that is spent on WMD worldwide . However now the big question is IMHO – — Are the cuts being implemnted in most countries going to lead in maybe 3-4 years or so – to a ” prosperous society ”- or at least a better off society as some believe . Again IMHO – not a chance . These cuts are the beginning of a process of making the whole popualtion uncertain , fearful – and poorer. Who decides this – people like Murdoch – who are the real enemy – not the pupppets like Obama , Cameron etc – who are only the hacks for the super Rich .
I am sick of this left wing crap.
The non-workers in this country need to understand that the workers no longer want to pay for you and are sick of having more of their pay taken to fund you.
You are paying nothing into the pot but still claim you have been badly treated!
Of course people who really can not work and those who work hard but get very little need our support but the rest, and they are the majority, have been taking the p.. for far too long.
There is NOTHING FAIR about taking money from workers and giving it to the work shy.
well said, yes we are sick of handing out our hard earned dosh to the dross who have no intention of contributing
Your example of the woman being assessed then going in for an operation then being assessed and then having another operation seems a common occurrence with ATOS. I had a similar experience but for a different medical situation – was deemed fit for work while lying in a hospital bed recovering from an operation – the medical examination that occurred before this op (and while recovering from a previous one) was a farce lasting only 20 minutes at most during which no physical examination took place – the examiner sat across a desk from me. The woman made up half of the answers on the examination notes and failed to record my medications etc as well. To return to work recovering from an op goes against all medical advice of those caring for me and includes many specialists, surgeons, gps etc. Still they force me to appeal – I have told them not to bother with the benefit as it was getting too stressful and to get me better and back to work the less stress possible while recovering the better – I am fortunate that I can say not to bother and my partner continues to work as much overtime and Saturdays on top of his normal working week to make ends meet instead.
Spain, Greece & Portugal are better off for now because the world bank needs to get consumers’ confidence back on track after near bankruptcy, especially Greece & Portugal if my memory serves me right.
With regards to China, they will soon in a matter of not so many years, be a force to reckoned with on the world’s financial markets. China is huge but has been away from trading due to internal political pressure.
The UK is now like never before is just a puppet state for the country that has and is dominating the world markets more or less since its independence from the UK.
The pensionable age in the UK should definately not go up by six years and the housing benefit/ construction market is dictated by wall street not Downing Street as we are made to believe.
adzmundo The Venus Project
No Adz, you are wrong: credit ratings are not handed out by the world bank. I understand your suspicion, and I have sypathy for it (lots actually).
Greece, Portugal and the UK have seen the cost of borrowing decrease because they have been seen to take firm action to address the balance sheet, they look, quite rightly, less risky to lend to. Had they not done so, they would have seen their credit ratings downgraded and the cost of payment increase, it really is that simple.
Borrowing is a vicious circle: the more you borrow the more it costs. The more it costs, the more you need to borrow.
Does that mean the cuts are ‘progressive’? Probably not. Could they have been made ‘progressive’. Again, probably not.
To quote the prime ministerial debates ‘I agree with Nick’. The IFS analysis assumes that all budgets for then next four years will be the same, ignores the pressing need for welfare reform, and ignores the Coalition’s committment to progressive tax reform at the bottom by raising the income tax threshold.
Last night, Ch4 got the story wrong: you focused on govt vs IFS, and in doing so undermine a policy that Jon concedes in this blog was unavoidable.
I appreciate you putting me right Tom.
My suspicions are not down to Jon’s story on C4N but down to the pure mess this world financial system finds itself in.
Again you are very right by saying the more you borrow the more it costs because you just have to keep borrowing to be able to repay your initial debt be it a nation or a single mother. The devastating yet invisible problem, is that you’ll never be able to repay the debt!
adzmundo TVP
It is not pleasant to lose one’s job; but the recovery cannot be led from the public sector it spends more than it generates.
I had hoped there would be further specific targetting of child benefit to attempt to reduce the number of teenage pregnancies, e.g. not being paid to single parents before they were 19 and out of education. This might go some way to reducing the shoals of young single mothers, on benefits, who gather in town centres with their state-of-the-art baby carriages.
Just the Tories trying to get us back to the Victorian age when the poor were poor and that was it. Another year or two and the kids will have to get jobs to help and support their families. I am of the opinion that the Tories love the current economic meltdown as they can just shove thru anything they want and blame it on that, seems to be a heaven sent crisis for Tory policy..Lets hope the British people get savy in the next few years and kick them out in the next election…but knowing the British they probably will not and we will be left in the same situation as we were before where a Labour(don’t even know why they call themselves that any more)government will have to invest in all the things that the Tories spent years not investing in and picking up the pieces as the Tories and their friends live it up in the Cayman Islands..
This post is insulting.
I did not vote Tory so that I could protect my massive offshore assets in the Cayman islands, and as I cast my ballot, I didn’t have to stifle my evil genius laugh. Nor was I overcome with schadenfreude as I thought of the poor.
What I was actually thinking was “Labour have really stuffed us this time, we’re going to have to take some painful medicine to put it right’.
I find it amazing that the same Lefties who are rushing to endorse the ruthless fratricidal Ed Milliband can cast aspersions on the opposite benches. Pot calls Kettle a Pogrom.
And not a word of ranting righties.
Then again, Kelvin McKenzie, the Sun and the Daily Mail never mention them either.
Funny, that.
Philip, you miss the point. In general, the Left regards the Right as evil. The right, in general regards the Left as misguided. That roughly speaking is the difference between pragmatists and ideologues.
Tom @ 540, I do not miss the point. I gve you a taste of your own medicine and plainly you didn’t like it.
As for your “general” comments……oh, PLEASE.
Similarly, “pragmatists” and “ideologues.” Funny how you right-wingers always hide behind that kind of slyness to avoid issues.
Nye Bevan had it right about the Tories, a tragic lesson about to be learned all over again.
I am saddened and angered by the focus of the cuts; I was lucky enough to be poor in the 1950′s when my family were housed in a prefab along with many others on our estate. No one lived on the streets. I was lucky enough to be a young person in the 70′s when I was the first of my family to go to University. I escaped debt free and with a degree. Now this generation of young people are facing a lack of affordable accommodation, education, and poor employment prospects. I would love it if the so called employment support allowance really supported people to find work, or the Job Centre lived up to its name. People who are disadvantaged by ill health, medical problems or learning difficulties don’t want to live off the state, but they are the last people who are offered employment, accommodation or education. Why take the money off them? Support the Robin Hood tax, get house building with apprenticeships in all areas especially renewables, real work for all those who desperately want to work.
Memo from: Conservative Party Central Office
To: constituency workers
Did you see it? OMG. Even I couldn’t believe it. They wheeled this Trojan Horse Deficit onto the floor of the Mother Of Parliaments, and they all fell for it – the media and the peasants!!! They really do think it’s about cash – what a triumph!!!???!!!We thought long and hard about this: could a 30ft-tall lump of pine, leaving masses of you-know-what steaming behind it, possibly fool anyone? We were wrong – it fooled everyone!!!
Between you and me, Dave told me: “it’s nothing-at-all-to-do-with-the-way-they-got-rid-of-Maggie – it’s-nothing-to-do-with-20yrs-of-frustration. It’s zero to do with Major-Blair-Br…”; at this point, his voice choked. I can totally understand that, can’t you??? He also told me to check-up ‘deficit’ in the dictionary, but I gave up after ‘abacus’. Dictionaries are more boring than economics, aren’t they???
Anyway, Dave’s got a message for you:”tell ‘em to keep on keepin’ on”. He is max-impressed by the way you’ve kept your faces straight over the past few months.
Central Office is such fun – it’s all Bolly and chortles. And then Clegg turns up. Yawn.
LOL.Mwah.
…this one’s better
“A dyslexic man walks into a bra”
T. Cooper 1921-1984
Apparently his dominate the list of best British jokes. Don’t give up your day job.
Richard: your attitude is bizarre. That piece may not have been funny, but people are allowed to try. Comic invention didn’t die in 1984, and Cooper was only a five-minute genius; his half-hour shows highlighted the limitations of his shtick.
If I give up my comedy day-job, I’ll expect you to give up your lit-crit pretensions.
Aren’t we all poor now in reality? Apart from those working in the media, banking and politics, of course. Or do I live in a different country from the UK?
Yep. You live in a different country. About time someone explained those average income figures, what does average mean – does it include part time workers? I simply don’t believe them. My firm, apparently, does not have a single employee earning less than the income average – indeedy we are all loaded. And that includes the cleaners. Admittedly we are a media firm. But then you guys should take a look at the outlook for business media firms dependent on advertising in a recession.
If you mean TV (especially the BBC), the broadsheets, and PR companies then I’d agree that we are all poor by comparison. It’s a poor reflection on our politicians that so many of them come/came from media backgrounds (Gordon Brown), and that so many of them go into media after achieving so little as a politician (Michael Portillo). As if they can impart some wisdom to us. My MP is an ex-luvvie .
Politicians are moving away from being able to empathise with the working man. They are a professional class in their own right. Ed Milliband is a perfect example of that. Wouldn’t it be great to have a home secretary who’d been a chief constable ? etc
But as Tom points out, if you’re a small media operation relying on advertising revenue then you’re at the sharp end on the stick.
Does anybody know exactly how many billions of pounds did the bankers’ recklessness cost the UK economy since 2007/8 to date? How much did the UK government/tax payers had to give/lend to the banks to prevent the total collapse of the banking system and the economy?
And…What was the cost of the welfare benefits paid to the most vulnerable members of our society before this lot of millionnaires in government decided to cut/abolish them?
Given that the “rescued” banks have obviously recovered sufficiently well to be able to pay billions of pounds in bonuses this year, to people who are already incredibly well paid, perhaps it is time this government demanded that they repay the taxpayers loans in full before they lavish yet more money on the greedy fools who got us in this terrible financial mess, the effects of which they will not even notice despite the devastating consequences in the lives of millions of blameless people. Let’s demand the £7M planned bonuses right now as proof that “we are all in this together”.
Does anybody know exactly how many billions of pounds did the bankers’ recklessness cost the UK economy since 2007/8 to date? How much did the UK government/tax payers had to give/lend to the banks to prevent the total collapse of the banking system and the economy?
And…What was the cost of the welfare benefits paid to the most vulnerable members of our society before this lot of millionnaires in government decided to cut/abolish them?
Given that the “rescued” banks have obviously recovered sufficiently well to be able to pay billions of pounds in bonuses this year, to people who are already incredibly well paid, perhaps it is time this government demanded that they repay the taxpayers loans in full before they lavish yet more money on those who got us in this terrible financial mess, the effects of which they will not even notice despite the devastating consequences of their actions in the lives of millions of blameless people. Let’s demand the £7M planned bonuses right now as proof that “we are all in this together”.
There is an episode in Friends where Joey, Phoebe and Rachel partake in a meal with the other three but have only a lettuce leaf between them. When the meal is over, the others suggest splitting the bill equally.
There is a suggestion in the tone of the prime minister that ‘equal’ approximates to ‘fair’. It is outrageous, in these hard times, that those who ate so sparsely at the feast during the last 15 years are now being asked by the government to pay an equal share of the bill.
I’m confused. Perhaps Jon or fellow bloggers could put me straight.
On one hand I keep hearing that GB is one of if not the leading country in banking, that banks are vital to our economy. Yet by their own admission they have had a difficult couple of years and are finding it hard to lend money for mortgages and to small businesses.
On the other hand one of Osborne’s reasons for the draconian cuts is that we are paying a fortune in interest ‘to foreign bankers’
So,
1 Who are these foreign bankers and do they have more money than the UK bankers?
2 If yes, is our banking really a world leader and so important?
3 If no, why didn’t we borrow from UK banks, many of which we own, and via which we could have negotiated ourselves better terms?
I’m serious, folks. I don’t understand how the world can be in an economic crisis, the fourth richest country in the world (us) is billions in debt but someone out there has trillions of pounds to lend.
Who really owns the world?
I’m cross posting on Faisal’s blog in case he has different bloggers
It would seem that both the richest and poorest are losing an extra 7 per cent by these cuts.
So that’s fair isn’t it, both being treated equally. All in it together.
But the reality is that if you clear £15,000 a year, your weekly income will fall to £268,27, a very modest amount to live on, while if you clear £50,000 you will still have £894.23pw.
I repeat, the poorest people in this country should not be asked to contribute to a deficit they did not cause. There is plenty of fat at the top that could be taken without the owners suffering any real loss in their standard of living.
” But the reality is that if you clear £15,000 a year, your weekly income will fall to £268,27, a very modest amount to live on, while if you clear £50,000 you will still have £894.23pw.”
Yes, I suppose the Coalition hope is that, in time and by putting Further Education beyond the means of all but the Haves, this won’t be worked out by the Havenots. It doesn’t do to educate the electorate!
Saltaire i do not think your figures are right , but your argument is .Those on benefits will lose the most , particularly where some on bloated benefits will be bought down to a level,not above the average wage.To me that is still far too high.As a pensioner i am nowhere near the minimum wage , yet there are those living off the state on far more than me.
I do believe that those on an income over £100,000 should be taxed by at least 60% over that amount.
As i have frequently said,if someone is paid a salary to do a job of work , there is no justification in a bonus(often nearly as much again) being paid.Such bonuses should be taxed at 100 % and the giver of same taxed by the same amount.
As for the poor not contributing, in a way i agree,but unfortunately there is a need for savings in the public sector.At this moment in time it is unaffordable,but i am sure that considerable savings can be made without affecting jobs,and then any savings should start at thr top.There are far too many chiefs and too few indians.
Finally the current public servant pensions are totally unaffordable and major changes need to be made
Kate there is sense in what you write,but i am afraid education has gone backwards over the last 13 years.When any pupil leaves primary school unable to read or write i am afraid the teachers there should be out of work.Yet there are more than ever in that situation and leAving the education system at sixteen still unable to.A very sad indictment of Tony’s,”Education, Education,Education”
It doesn’t need the coalition to put “FURTHER EDUCATION “beyond the haves. Labour succeeded in putting Education beyond them
Adrian – I ask yet again “Who Benefits?”. The main reason some claimants notionally get “bloated benefits” is that they qualify for housing benefit, and live in areas where housing costs are wildly out of line even for those in work. The actual claimant will still have “what the law says you need to live on” after the majority of the benefit has been passed on to the landlord. In effect the benefits system has been helping to pump up the property bubble. The solutions to this might involve:
1/ An effective regional policy that leads to private sector job creation where the unemployment is high, rather in the southeast which already bursting at the seams.
2/ Rent control, so that BTL landlords don’t have their income underwritten by the government.
3/ Maybe a “right to buy” for private sector tenants, as previously for council tenants.
The approach being taken – deliberately underfunding housing costs for claimants – can only make current problems with social housing even worse. How long before we see working families living in their cars, as already happens in the USA?
Paul i do not totally disagree with you,but it is not all down to rent.Often it is the benefit they manage to screw from the state.Take the £90,000 one.A woman on incapacity for curvature of the spine,still able to conceive yearly .A husband , supposedly a carer , a rent free 4 bedroom house in an expensive area or one where a landlord fleeces the tax payer,plus all the kiddies allowances.If it takes £90,000 a year to live as they do,what, where and how would they live without the state???
Is it right that the state should provide the means to live ,way above the average wage?I would maintain it isn’t.If that means moving , being unable to afford all the tv’s games consuls , holidays so be it.The state is a safety net not a panacea.
It’s a myth that the bankers ‘ran off with all the money’. Anyone who made a profit from the property bubble and didn’t ‘invest’ it back into buying property has also run off with the cash. Their profit has been at the cost of a sucker with a negative equity mortgage who now has less to spend on other things, including on propping up public services.
The profiteers include property developers and baby boomers who inherited and sold parents’ property. Some of the money is lying mouldering away in the form of derelict sub-prime properties in the US which were bought by the likes of Northern Rock in bundles of toxic assets. You can say the bankers made mistakes but in effect the money went from the UK into the pocket of an American who owned a house worth $15,000 and managed to sell it for $100,000 during the property bubble. Now it’s back to $15,000 or foreclosed and derelict.
I reckon you could take every penny off every banker in the UK and still it would barely make a dent in the national debt.
‘No cuts’ is far too broad a protest message and won’t be widely supported because many people think there need to be some cuts.
This is very fair comment GS – everyone who was pulling profit out of asset values pre-crash was in effect taking more than their investments had earned, because the whole market was hyped up, and based on pretending that dodgy products (eg sub-prime mortgages) were worth a lot more than they actually were. I leave you to form your own opinion as to whether those false valuations resulted from incompetence or fraud.
In common justice, one would like to see those who gained most by making the mess pay most towards clearing it up, but it’s not at all obvious what mechanisms would enable this.
Interesting that Ian Duncan ‘on yer bus’ Smoothy has claimed that the cuts would be right even without an economic crisis.
One of his reasons for not taking away winter fuel allowance from the wealthiest pensioners is that ‘David Cameron gave his word and a politician’s word should mean something’
Where does that leave cabinet colleagues Nick and Vince and their signed pledge on tuition fees?
Am I wrong or have we once again confused deficit with debt? The deficit-paying out more than you take in tax- was there before the recession, debt which includes bank bailouts is something else and won’t be repaid for over 20 years. Of course the added debt made everything more acute and showed up dodgy mortgages, house price inflation etc but isn’t it the deficit that this coalition are trying to cut??Therefore not all the bankers’ fault?
The lynchpin of our economic recovery (and very much the ‘elephant in the room’) is the question of WHERE the private sector jobs are going to come from?
Given that the gamble taken with spending cuts will live or die by this issue, I find it gob-smacking that Osborne seems unable to shed any light on this, or even hint at where the growth may come from.
I can only speak for the sector I work in – environment – where we are seeing large-scale redundancies in the public sector, coupled with huge losses in public sector contracts for private firms – a double whammy that will leave many experienced people jobless for the foreseeable future. It simple doesn’t add up.
Other sectors of the economy may be more healthy – my point is, nobody seems to know. And I can’t for the life of me understand why this isn’t deeply worrying for people on both sides of the political divide.
I am afraid you are missing the whole point of the ConDem attacks on society.
The cuts are not intended to improve our nation’s economy. They are intended to shift wealth even further into the hands of the undemocratic few who already control it, but they want even more. That is the whole purpose of capitalist profiteering. They have merely used the international banking scam to attack the whole notion of a co-operative society. Hence the “salami method” of outsourcing and privatisation. It is standard divide et impera in operation.
They would never dare to tell the truth because that would finally expose the whole rotten, corrupt system for what it is. This is why monopoly ownership of media outlets is crucial to them, just as it was to the nazis and othet totalitarian systems.
Don’t kid yourself we live in a true democracy. If we did, the international banking racket would be wel nigh impossible, as would the Western imperial wars in the East.
Now remind me once again…….Who are we at war with? Is it EastAsia or EurAsia?
Philip ,whilst i can admire your attack on Capitalism and the tory/Lib coalition,i have yet to see a plausible alternative from you.The Labour party who have gotten us in the appalling mess we are in financially are not Socialist .So what is your Socialist ideal for getting the country onto a secure financial footing??What do you mean by Socialism and how does it pay its way in the world??Do you want communism?Do you want a state run society where we are all downtrodden?You critisize but do not offer alternatives.All the current policies are not for the country but the few rich Capitalists,in your opinion.Is that a co operative society,like Russia and China have run for many generations ,or maybe even Cuba or N.Korea .
The Socialists cry over the cuts yet offer no alternative.What is yours?
I think we are stuck, until we look at some of the commonly held assumptions that led us to the current mess, and ask whether they’re a basis for an effective economy and tolerable society.
The first of these is “private good / public bad”. We’re told that “by definition” nothing in the public sector creates wealth, while everything in the private sector does. So, for example, teaching mathematics in a comprehensive imposes cost, while teaching judo in a private gym generates wealth. Plainly nonsensical. Quite a lot of the private sector is in the business of wealth redistribution (from everyone to a few). Until we can reward and encourage genuinely productive activity in both sectors, and limit wasteful activity in both, we’re perpetually on track either for 1970′s style stagnation, or for a market feeding frenzy, followed by a crash.
At present I think that a key part of the problem is the total denial by entrepreneurial advocates that publicly funded services (education, health, police etc) underpin their success, and need to be effective.
Adrian @ 6.20, The Socialist alternative to this mess will not happen in a capitalist system, so it is of course a moot point.
If we had an equitable system of any kind the so-called “public deficit” would not have happened in the first place. But we do not have such a system. Organised capitalism ensures a continuation of, “rich man’s war, poor man’s fight” at every level.
If we had a “fair” society – which of course we don’t – the so-called deficit would have been paid by those who stole our wealth in the first place, not forced onto those least able to pay.
The tragedy is there is absolutely nothing new in any of this. In modern history (others before) you can trace it through booms and slumps all the way back to FDR’s New Deal, which itself was calculated to do not much more than save capitalism. Even that drew hatred from the establishment.
An open Socialist form of government would prvide fairer distribution and control in whatever form people decided in open debate. The two places it wouldn’t be decided is in rich mens’ boardrooms and a stock exchange gambling casino.
Unlike you, apparently, I believe ultimately in freedom from the corruption of capitalism.
Please Jon,
Return to Haiti, surely it was more than just a media event, cholera has broken out, inevitable given the conditions in the camps and tents where 1.3 million exist but do not live. The death toll is reported at 200.
Please shine a light on this story.
Best wishes,
Gerard
Well-said, Paul. As to mechanism to ensure those who gained most pay most:
(i) taking creation of money away from the banks as the proposed Bank of England Act suggests:
‘This is a reform that could prevent a future financial crisis, clear the national debt, and restart the economy.
It cures the sickness in our economy and financial system by tackling the root cause of the problem, rather than just the symptoms.
It would make the “inevitable” cuts in public services completely unnecessary, reduce the tax burden by up to 30% and allow us to clear the national debt. It takes control over the UK’s money supply out of the hands of the commercial banking sector and restores it to the state, where it can be used to benefit the economy, rather than providing a £200 billion annual subsidy to the banking sector’.
A government that’s not in control of its nation’s money supply cannot be said to be in control of the country. For more information see http://www.bankofenglandact.co.uk.
(ii) a tax on land – LVT, or land-value tax. The unearned income from property-price inflation is rarely mentioned – the assumption being that we’re all bourgeois now with only the work-shy in our way.
Paul, Meg Saltaire and i hope sometimes myself ,are all in some way correct,It should not be “public” versus “private” as both have many beneficial attributes and public requirement.
I do not believe it should be Capitalism versus Socialism either.Both in their way are reliant on the other.Socialism on its own can only work if the state runs every aspect of our lives and controls all profits as is done in Cuba ,N.Korea and has been tried in Russia and China.It does not work for a number of reasons.Those in charge become Quasi Capitalists and the states do not get beyond the mediocre.Those in charge are not capable of enterprise or growth.
Similarly a total Capitalist state can not work.For there are no workers.There would be no public sector.There would be no affordable housing because it would become a market for profit.
In a vibrant sustainable economy both Public and Private have to live together.Private providing the growth and means to enjoy a livable lifestyle for all and public providing the very necessary jobs that the Private will not do because there is no profit.
The main problem is greed within the Private (Capitalist)sector.That needs rigorous control
cont/
There need to be controls on Capitalism.Controls that do not prejudice entrepeneur or invention , but where rewards above a certain level are redistributed by taxation to sustain a workable Public sector.
Unfortunately Governments are still incapable of running a robust,workable and effective Public sector.They (Labour in particular) stifle it by laws and regulation.Stupid restrictions ,on health and safety, Ethnicity and Diversity, Competition.Everything that prevents a vibrant and appealing area of work.They flood it with non jobs in an effort to control our lives,thereby making it unaffordable.A little competition within the Public sector would make it run much smoother and effectively.
The Private sector must be allowed to provide the growth and income to sustain the Public sector.That does not mean no controls , no punishments for wrong doing or non control of greed.It does mean higher taxes for greater income and redistribution of that wealth.It does mean monies earned in this country being taxed in this country and not avoided.Tax avoidance should be outlawed and severely punished to make it not worthwhile.There should also be a redistribution of wealth through LVT
A succinct and balanced contribution.
Who am I going to argue with now:-)
Check out the Bank of England Act proposal also, Adrian – http://www.bankofenglandact.co.uk. Suggest concerned snowbloggers ask their MP if s/he is intending to support the Early Day Motion introducing it (it’s a Tory MP that’s bitten the bullet on this you’ll be pleased to hear).
It was John Galbraith who said – in summary – that the public would be horrified if we realised how money was created (www.moneyreformparty.org.uk is an excellent and lucid site). Nothing whatsoever to do with wealth and workers but with the power of bankers.
We really must stop relying on the financial and economic hogwash and political divide-and-rule we’re currently being sold. If things are to get better, we need to educate ourselves economically and put our prejudices away, otherwise things can only get worse.
Meg,i haven’t completely digested it yet and need some time to do so as i did with LVT. I am all for anything that controls the power of the bankers.I have suggested on several occasions the state completely taking over the banks we own , on a mutual basis,and run by the Bank of England.All government monies should be used then,through those two banks,nullyfying the rest of the banks and merely taking tax from them .If they want to then gamble and bring about their own downfall , so be it
Clegg on R4: “I take the occasional cigarette”.
Gosh. He just is rock’n'roll, isn’t he? Clegg is the Jimi Hendrix of modern politics.
A stunned, awed populace rejoices!!! We lustily fling our cloth-caps towards the azure skies of hope. We are revivified. We sing: “For he’s a jolly goo…” (that’s enough sarcasm.Ed.)
If we’re lucky, and have a good wind behind us, we may be able to create a Pincer Trap: that singular-historical moment when the young think their leaders are naff-and-past-it, and the old think their leaders are naff-and-past-it.
Our crisis of doubt may turn out to be: whatever we will it…
“I take the occasional cigarette.” Worlds did not explode, stars did not collapse. It did not matter. So who was he talking to?
Newsflash: The future is non-radical.
Breaking News: The future has just gone from non-radical to anti-radical.
Reuters: anti-radical confirmed. Get over it.
In 2007, Pehr Gyllenhammar, the chairman of the Reuters Founders Share Company, said that the “future of Reuters takes precedence over the principles. If Reuters were not strong enough to continue on its own, the principles would have no meaning.”
Says it all, really. In these circumstances, “radicalism” doesn’t exist. And never will.
the UK had no option but to go down the path of spending cuts. If the UK had not done this then the cost of borrowing would have gone up and the vicious circle of deflation would have affected our economy in ways that would have made the banking crisis a minor blip.
If the government stimulates growth we will all benefit. If the government help the poor to be more to become self sufficient by changing the benefit system then this should be done.
Capitalism is, always has been, and always will be, based on fear – and control by fear.
It has little or nothing to do with “risk,” since all bills are eventually paid – one way or aother – by the joint wealth created by society. That is whee the banks get their money, and it is why they have transformed themselvesinto transnational operations.
Human advancement and civilisation has taken place because of invention and natural inclination to improve. Capitalism has merely battened onto the backs of human ingenuity and stolen as much of the gains as it can make off with. It contributes absolutely nothing. It steals lives as well as wealth.
Typical is the tax scam, where establishment propaganda tells you it is necessary to tax the rich less to encourage them, while it is necessary to pay the poor less to encourage them. All the time ensuring there is a pool of cheap labour for the rich to feed off. It would be laughable if it wasn’t so tragic and sickeningly hypocritical.
As the First World War demonstrated, there are no limits to establishment evil. Nuclear weapons threaten something even worse, for which see Robert McNamara’s DVD “The Fog of War.”
I slowly begin to see your warped view of society,Philip.Maybe it is true socialism.All Capitalists are evil,as is all profit.
Lets start with a new slate.
Rid the country of Capitalists.That is the banks gone to countries where they can earn .Perhaps you want to keep the two we almost own ,working on a non profit making basis .Everyone paid the same salary , because you do not believe any one should be making a profit at others expense.So why bother working , that is setting up companies or providing jobs.
Everything has to be state controlled,so we will all be paid by the state.It will of course help to reduce the population as entrepeneurs move abroad ,and immigrants see no point in coming.
It would suit me for we would have to leave the EU.I presume there would be no benefits for those who do not or can not work.If there is why should the rest of us work for the same reward.
The bills can be paid as in Zimbabwe , by printing money.
I wonder why it should work in this country when it didn’t in Russia or China?I believe you would be happier in N.Korea , but of course you would have no internet and no rights.
I think people should be able to become (very) rich if they use ideas and capital to produce something better, and employ other people at decent wages to do so. To that extent, I’m a capitalist too!
The problem is, that isn’t the typical route to riches, at least over my lifetime. There have really only been the following routes to wealth:
1/ Exploit scarcity (either property, or scarce commodities) by trading without using. ie Get rewarded for owning, not doing.
2/ “Improving efficiency”, which relies on a definition of efficiency which few of us would accept. When someone invented the tractor to replace horses, ploughing became more efficient. Nowadays, the route to “efficiency” involves paying the workers less (remove pension and redundancy rights, get the minions to pay for their own training, have the government subsidise pay rates through tax credits, move production to a place where it can be carried out at sweat-shop pay rates).
One of the more galling aspects of this is that rather a lot has been financed using our money – most recently through public funds underwriting the banks, previously by using pension funds.
totally true Paul.Whether we like it or not Capitalism makes the world go round. Unfortunately it has a lot of faults,and as you say many make money by exploitation and doing nothing.The bankers are the perfect example of that.I have no problem with people getting rich as long as it is worked for and not at the expense of others,but i do believe those that achieve riches should pay a tax take that puts much back into society.
Adrian, you are what we in the trade describe as a leftie
Saltaire i’m a hard right “hang em” brigade with feelings:)
Just heard David Cameron on PMQs saying it was unreasonable to expect hard working tax payers to pay more than £20,000pa in housing benefits for people to live in houses those workers could not afford.
I can see the sense of that but it would carry more credibility if it didn’t come from someone who according to the Daily Telegraph ‘claimed more than £1,700 a month in mortgage interest during two of the years covered by Parliamentary records. In total, Mr Cameron has claimed £82,450 towards the cost of his second home over the past four years.’
He, it appears should have the same for a second home as some poor sod in their only home.
Hang on there Saltaire.Why should he or any other MP have a second home allowance for doing their job??
Ok claim reasonable expenses if they have to stay away from home,but yes with a limit and i believe the £20,OOO limit would be very apt.If they do not like it let them stay in special commons apartments,without expenses.Then they could say “we are all in this together”Of course if they wish to buy a London home , that is their ptivilidge but not ours to pay for