DEATH & TAXES PART TWO – ITS THIS STUPID ECONOMY, STUPID!!!!

Last Sunday, The Observer newspaper did a service to the people of the world, although in a week when pointless metal-encased flames and uniformly branded sportswear are the biggest news in town, you would look hard in the rest of the British media to find out.

In a series of articles, and in conjunction with the campaign group Tax Justice Network, London’s most venerable liberal(ish) weekly exposed the true state of the world economy. It is not a pretty sight, but at last, we critics of trickle-down free market horseshit have some reasonably accurate figures to throw back at Adam Smith/Cato Institute blowhards. Not to mention third wayers like Progress…

The former Chief Economist at McKinsey, Mr James Henry has just produced the most detailed estimates of the offshore economy – you know, all that moolah stashed away in tax havens from the Caribbean to the Channel Islands, by way of Switzerland and Lichtenstein. This is forensic accounting at its best, echoing the work over the years of Mr “follow the money”, Greg Palast. 

To quote from the front page:

Their wealth’s, as Henry puts it, “protected by a highly paid, industrious bevy of professional enablers in the private banking, legal, accounting and investment industries taking advantage of the increasingly borderless, frictionless global economy.”

Helpfully, the report can quantify in numbers both the approximate number of individuals and what the probably keep hidden, although the report is careful not to attempt to put a price on the number of apartments in Chelsea, Canalettos on the wall, or Van Gogh sketches owned by this global elite. The figures are pretty instructive:

1. The Approximate amount of wealth held “offshore” in tax havens – £13 TRILLION to £20 TRILLION. Thats between $21 and $32 TRILLION.
2. The approximation number of people hiding money offshore around the globe – ten million. 
3. Estimated amount owned by just 92,000 of the above ten million – $9.8 TRILLION.

I suppose that we can now put a number on the size of our true global Ruling Class, and, as a result, we know have to radically rethink our idea of the gap between the rich and poor, as both the poor and the very rich are now palpably underrepresented. It also puts the supposed “death of class politics” (TM Mssrs P. Mandelson, W. Clinton, A.L.Blair) into its proper perspective.

Typically, the biggest losers in the period measured, from the 1970’s to 2010, have been Oil and Mineral rich developing nations and the former Soviet bloc. Russia lost $798 Billion since 1990, the Ukraine $167 Billion,  & the Kazakhs $138 Billion. Predictably, Africa has suffered badly, Nigeria bleeding $306 Billion and Ivory Coast $141 Billion respectively. 

But these are notorious Kleptocracies surely? This doesn’t happen in Democracies does it? Err, yup ‘fraud so – Mexico lost $417 Billion, Venezuela $406 Billion, Brazil a whopping $520 Billion. to name but three…

Fans of the Chinese model of free market dictatorship will be ashamed to learn that since the 1980’s, her economy has lost a staggering $1,189 Billion to offshore tax havens. The rest of us are not all that surprised…

To put this in perspective, if the Super Rich paid only 30% tax on their interest, it would amount to more than the rich economies spend in a year on aid – some $189 Billion. (That’s if they only “earned” 3% interest)

The figure of £13 Trillion is a sum that dwarfs the combined economies of the USA and Japan.

Under increased pressure to do at least something, the British Government recently entered into the mother of all sweetheart deals with Switzerland and its Bankers – UK residents are going to be able to make a one-time payment of between 21% and 41% to clear the slate on undeclared assets. This allows tax dodgers to still avoid both the current 50% top tax rate, and the future 45% rate.

One of the most industrious founders of the UK-based tax haven industry was reportedly one Ian Cameron, father of the Right Honourable David Cameron, our Prime Minister.

The Mayor of London, Boris Johnson, has repeatedly made statements to the effect that, since 2008, it is time to stop “bashing bankers” and let them get on with it, and his hopes to make the City of London some sort of “haven” for international finance. He also trousers £250,000 per annum for writing a column for Telegraph Newspapers, owned by the Barclay brothers, who are all registered offshore for tax purposes. This amount is somewhat more than his substantial salary for running our Capital City. There is, of course, no suggestion of any linkage here.

VOTE LABOUR TODAY

Today is polling day in local government across the UK.

Here in London, we elect our Mayor and the GLA, & across the country you get a say in how your local services are managed.

Please remember the awful example of Tory-run Suffolk, where the council is trying to destroy jobs, and make the council “virtual”. The former Chief Executive was payed more than the Prime Minister! In fact, you will find that amongst the unelected Chief Executives, those with huge pay-packets tend to be employed by Tory councils.

After a campaign best described as one huge dirty trick, Mr Johnson and Mr Livingstone will have to wait for the votes to be counted.

The choice is clear – vote Boris for ineffective, though amusing government. Cutting Police numbers, stockpiling Plastic Bullets, ignoring inner London, cutting transport projects. Rambling on in a funny way. Denying the importance of investigations into the corrupting influence of Murdoch. Denying growth. Pressing for tax cuts for his friends and masters. Earning £250,000 outside of his actual job – paid ultimately by tax exiles. His utter incompetence in dealing with the RMT – after all, we have had many more tube strikes under Johnson in 4 years than we had under Ken in 8.

Brian Paddick, Jenny Jones and Ms Benita cannot win, but they have all raised serious points along the way. Johnson will ignore everything they have said once in City Hall, and carry on with Coleman, Malthouse et al.

For Lib Dem, Green and independent voters, the second choice is clear – it must be Ken Livingstone.

– A vote for Ken Livingstone is a vote for fair fares on London Transport, investment in infrastructure, creating jobs. It is a vote for a City Hall that will strive to unite Londoners, not divide them. It is a vote for substance over style. Restoring the EMA Londonwide, a lifelong dedication to London, a proven track record spanning over thirty years.

Of course, the national issues matter – Economic mismanagement, making us pay for the Bankers’ mistakes, pasty taxes, the amazing inability to read a calendar. Cutting too far, too fast, leading us back into recession. Gutting the armed forces, trussing up the NHS to sell off to their mates. Student Fees.Oh, and should I mention Murdoch???

Today you get a voice. Today, just for once, shout “ENOUGH!!!” And vote Labour.

 

Is Cameron up to the job?

So, Jeremy Hunt is still in his job tonight, loyally deflecting the press from going for the PM and Chancellor, who, if the evidence presented yesterday is even partly true, are in the ordure up to their eyeballs. 

The much bigger question should really be whether David Cameron is actually up to the job of being PM. We know he likes it, and that it leaves him enough time for a spot of tennis. We know that he likes looking important, that as a practised PR professional he enjoys trying to sell British products (mainly weapons) around the world. Like Peter Cook’s TVPM skit, he is very good at travelling around the world on our behalf, and at our expense.

Yet whenever things go wrong, as they seem to do so often with this bunch, David Cameron at first denies any culpability, then blames Labour, then promises to stick by whichever minister has messed up, then relies on Nick Robinson to explain a way out of it. If caught out at PMQs, as he was once again today, it is the same old story – bluster, shrill and loud blaming of Labour, followed by turning puce and shouting some more. This is pretty much the only response that any Coalition politician these days, now that their magic cloak of economic competence is torn to shreds.

A one-time PR man for Carlton Television, you would be justified in believing that Cameron should be adept at selling the odd shit sandwich now and again, but the frequency of blunders leads me to think that there is a much deeper problem at the heart of the Coalition.

Along with the assessment of Barak Obama that he is an intellectual lightweight, I think we need to add some other facets that David seems to lack:

Firstly, he relies upon loyalty, yet, outside his own little group, shows none to anyone else. That goes even within his Party, let alone the Cabinet.

Secondly, he is not ruthless enough. Having given Ministers a seemingly free reign and watch them stuff up – on Forests, Jeremy Hunt, Pasty Tax and a whole host of issues, he simply cannot move quickly and decisively. In fact, the only time he has done so was in the taking away of responsibility for adjudicating the BSKYB deal from vince Cable.

Thirdly, he is lazy. Really man, stop wittering about your work-life balance, and pay attention to your job.

Fourthly, he simply does not seem to be able to act quickly, nor does he seem to have the mental capacity to deal with mistakes of his own making.

Fifthly, it is increasingly clear that Gideon Osborne is the brains of the outfit, which is disturbing, given the mess he made of the Budget.

Simply put, the time has come for both Conservatives and Liberal Democrats to consider who really should be PM, because Cameron surely is not working…

 

 

The Return of Mr C

It seems that 2012 is the year of Olympic Omnishambles for the Coalition, and it keeps on coming.

Yesterday James Murdoch exploded a truth bomb at the Leveson Inquiry, and Vince Cable found out exactly how he was shafted, apparently by not only Jeremy (C)Hunt, but also George Osborne, David Cameron and Alex Salmond, to name but three.

It is highly likely that Jeremy will not be Culture Secretary for much longer. Yet it must not stop there, the documents implicate both George Osborne  and his advisor in secretly lobbying on behalf of News International, and against his own Cabinet colleague. Alex Salmond also rallied to the Murdoch standard, and unsurprisingly the Scottish edition of The Sun backs the SNP slavishly.

Many would also like to know the name of the “Libdem MP, a former Sky employee” mentioned as also lobbying for his former masters. I bet it isn’t Simon Hughes, but apart from that, all bets are off…

Throughout this scandal, Ed Miliband has played his hand well, acting on principle as well as with good instincts. His backing of Tom Watson does him and The Labour Party credit. He compares very favourably with, say the Mayor of London, who firstly called the hacking allegations “a Labour plot”, and has consistently sought to downgrade Operation Weeting and the associated corruption investigations. He and Kit Malthouse have behaved with naked self interest throughout.

…NEWS FROM SOMEWHERE…

By: Our Staff Liar –

In a shock outburst this week, a fictitious source close to Nick Clegg announced that he was “unavailable” for comment, for discussion, or indeed for anything other than helping Samantha Cameron around the house.

Sources close to the Prime Monster’s other partner mentioned “doing the ironing, cleaning the bathroom, oh, and we need more Hobnobs.” as a fair summation of Mr Cleggs’ enhanced role.

Meanwhile, fibbers close to Danny Alexander, the Scottish Annoyance at The Treasury declared  him to be “pleased” on being declared “More annoying than Alex Salmond” by a leading made-up focus group…*

In other party of my imagination, Chris Huhne has been spotted doing a merry jig to the demise of Silvio Berlusconi. This long awaited retirement places the dull Huhne at last in the top ten of Western Europes’ leading political philanderers, ahead of that bearded LibDem who likes Eastern European assistants for their brains. ” For years everyone thought I was the dull one” said Huhne, “Well now I’m the dull one who left his wife by text.”

* One source from the group was quoted – “Its not that he’s Scottish, or that he’s ginger, its because he is Danny Alexander – he just stands there, two feet behind George Osborne with a slight smirk on his pasty face.” Said the anonymous Mr Kennedy.

 

So, what would Theresa May do about Paddington?

Yes, I am wasting an afternoon, but I just do not care:

In the light of her past comments over the issue of, should we worry about some of our best loved children’s TV characters?

Seriously, Paddington Bear for example – an illegal immigrant from darkest Peru, frequently in trouble with the authorities. Must be a bad ‘un.

The Wombles? Eco squatters the lot of them. Baton rounds at dawn, led by London’s Mayor and Sheriff…

Bagpuss ? Well he is safely ensconced in the Treasury, under the watchful eye of young Gideon… just be careful he doesn’t wake up.

Ivor the Engine? Probably on strike, we all prefer cars anyway.

Beaker from the Muppets? Say, where is Danny Alexander anyway?

The Thompson Twins? Busy running the country – badly…

 

I promise to find something else to do, honest…

 

 

 

 

 

 

Zombie Economics.

Back in 1980, when George Bush Snr. was competing with Ronnie Reagan for the Republican nomination, he decried dear Ronalds free market mantra as “Voodoo Economics”. Oops, as thats what we have endured, by-and-large since then, with increasing amounts of deregulation until the system crashed in 2009.

Having crashed and burned, you would think that any Government that had to get out of such a mess would think twice before repeating the old Small State Monetarist dogma...

How wrong could you possibly be? With few exceptions, under EU and IMF pressure, what we are seeing in Greece, Portugal, Ireland, Spain and in the UK is a dull, unthinking march into the future. The Chicago School hordes are ravenous for the flesh of the State, and have only one thing on their minds…

“Deficit…Deficit” they groan as they shuffle onwards, no other thought in those otherwise lifeless brainpans.

There is still hope though, and it comes in the form of the economic figures coming out of the USA, where, schooled in Zombie Movies since 1968, an Heroic Black Man is courageously, and intelligently keeping the undead  Tea Party mob at bay…

…just like Night of The Living Dead, when you think about it…

Consider this: In every country where Austerity measures have been implemented, economic conditions have got worse- economies have shrunk, wages have fallen, the cost of living has gone up, jobs have been lost and inequality is on the rise. In Ireland, emmigration, is massively on the rise – something that the “Celtic Tiger” thought was a thing of their underdeveloped past.  The only people to gain from Austerity in every case have been the Super-rich.

So, are we doing all this for the benefit of Lichtenstein?

In the United States, growth is up, unemployment is falling, and the economy is moving in the right direction.

In Austerity Britain, where the economy needs to grow by more than 3% every year until at least 2015 for Gideons plans to work, the OECD has predicted a sluggish rate of 1.5% this year, and 2% in 2012. Even I can see a problem here, one that will be made much worse by having to fork out huge amounts of unemployment benefit, and consequently take much less in tax revenues.

Little Nicky and the Tribalists.

So today, after keeping schtumm for the whole campaign, Nick Clegg wades in with a fairly coherent op-ed article in The Telegraph. So far, so good – a reasonable, reasoned argument for reform, in Britains’ most august Tory daily.

Sadly, he followed this up with a massively partisan and mendacious attack  on the Labour Party with his follow-up speech at the Institute for Public Policy Research. Little Nicky simply repeated Osborns canard that Labour would have cut only £2bn less than The Coalition is doing. This would be fine if we were still fighting the May 2010 election, but that was a year ago. It completely ignores the changes made on economic policy by both Ed Miliband and Ed Balls. It also ignores the economic facts of life.

Unemployment – In the last quarter of 2010, this fell by just 12,000 (0.1%). At the same time, our GDP fell by 0.5%, apparently this was caused by snow in December – a previously unheard of event. In Barak Obamas USA, under a radically different economic regime to the austerity we suffer, unemployment fell by 1 Million (1%), and in the last quarter of 2010, their GDP ROSE by 0.8%.

YEAR-ON- YEAR, OUR ECONOMY HAS SHRUNK BY 1.5% UP UNTIL MARCH 2011! WELL DONE GIDEON!!!

The OECD, which Osborn so often quotes as supporting him, has issued the following economic forescasts for GDP over the next two years:

                               USA            UK

2011                      2.2%          1.5%

2012                     3.1%           2.0%

So, in the midst of a Referendum Campaign, when it is imperative that ALL Party members who support change work together, why has Clegg thrown such a massive spanner in the works? The cynical answer could be that he is intent on sabotaging his own cause, on the basis that he doesn’t really want it, and it was only a sop to his activists anyway.

Could it be Coalition loyalty? Possibly,but for the life of me, I cannot credit the Cabinet Office stipulating that he preface a call for electoral reform with an attack on a party who’s supporters need to be won over.

No, I believe that in essence, for Nick, this is simply politics as usual. For all the guff about “new politics”, up and down the country, anyone involved in local politics knows just how nasty the Lib Dems can play. From personal insults to pretend innocence, the centre party of British debate plays rough, whilst appearing doe-eyed before us.

“Who me?” They cry, whilst dressed like a harlot in a Wedding Dress. Not only this, but certainly the Orange Bookers have swallowed whole the economic nonsense that passes for thought in the pages of the Daily Mail.

Let me state this as clearly and simply as I can; Austerity following the kind of recession we have seen leads to more unemployment. Higher unemployment leads to lower wages for those in work, to smaller tax receipts, and more austerity. It is a downward spiral leading to a car boot sale economy. And Nick Clegg thinks this is a good idea. 

A BUDGET FOR WHO???

This weeks’ Budget, courtesy of the 14th Earl of Whyborne, has been lauded to the skies by the hard of understanding…

…Or as I like to think of them, Monetarists. The lack of imagination, and of any long-term goals other than dismantling the NHS, do not give me any confidence in Gideons’ old Maths Tutor. Then again, what should we expect from a man who dodges £1.6 million in tax whilst telling the rest of us to “pull together”?

Lets just examine a few measures here, for the sake of general interest…

1. “The Sun Says Yippee! – 1p off fuel duty!” Yes, and there will be a rise of 5p in 2012.
2. Tobacco duty up by 2% above inflation. Giving a welcome shot in the arm to the smuggling industry.
3. An increase in Premiums Tax means that the cost of insurance rises – just as the Government wants us to take out private health insurance.
4. A three year freeze in Child Benefit – so thats a decrease in light of inflation.
5. The tax on Beer now exceeds £1.00 per pint. Britain’s vibrant Pub and Brewing industries salute you – not.
6. National Insurance up 1% for us, but not for Employers.
7. Personal Tax allowance up by £50 per month in April 2012. With the rises in the cost of living over the last twelve months, let alone the next year, this will at best give you £5 extra a month in your pocket.
8. Council Tax frozen or reduced in EVERY English Council – regardless of the real needs of those communities.
9. A return of the Enterprise Zone. Thatchers great sticking-plaster of the 1980s, that made little long-term difference to the areas blighted by her recession of the early 1980s. Anyone off to see Liverpool Garden Festival?

For this budget to work, the UK economy has to grow by around three percent each year until at least 2015. This is quite a lot, if we look at our history over he last forty years. It could happen, as the worldwide economy is tenuously starting to revive. Yet massive public spending cuts and redundancies will cost the exchequer dear, and reduce income from taxation – it could lead us into another recession, rather than digging us out of one.

And there is another point. Gideon and his gofer Danny Alexander have done precious little to curb the outrageous levels of  speculation in The City, nor have they come up with the kind of regulation needed to prevent, or at least limit the kind of crash we saw in 2008.

Long term, our economy is seriously unbalanced – with finance far too prevalent, and industry seen as a poor relation. Yet if we look at Germany, a country that actually still makes things and sells them, their recession is ending rather quicker than ours. This Budget does nothing to address this imbalance, nor do the Coalition partners seek to do so. Unsurprising really, when you think of all the ex-City men in the Cabinet…

 

So thats why I urge you all to march on Saturday for an alternative to this ill-considered schoolboy essay masquerading as a Budget.

Death And Taxes – Part One…

It used to be said that you could avoid everything in life except these two constants. Since Margaret Thatcher came to power however, the situation has become a little different…

In the 32 years since Margaret Thatcher came to power, and more spectacularly since the “Big Bang” in The City in 1987, what was once a shady corner of Finance has become a major activity worldwide – “Tax Optimisation”, or Tax Avoidance to you and me.

Simply put, the rich and big businesses, whether Barclays Bank, TopShop or Tesco use legal loopholes and financial skulduggery to avoid paying taxes that you or I cannot avoid. If you run a small business, or manage an outlet for a large company, please be warned that the following may lead you to never voting Tory again…

Historically, the Thatcher/Lawson years were a watershed, with the burden of taxation moved from  progressive Income Tax with more paid the more you earn to consumption-based taxes such as VAT, which had its scope moved from” luxury” goods to more and more of the basics of life. Now taxes on consumption may not always be a bad thing, but as a proportion of income, they hit those on middle and poorer incomes at a greater rate than they do the rich. Simply put, you can only consume so much. By 1987, according to statistics released by The Treasury, the burden of taxation was exactly the same as it had been in 1979 – 33%, but it had been shifted down to the lower earning brackets.

It took John Majors’ Government to further reduce the Income Tax bands, so that the higher rate of tax was only 40%. Even under Lawson, there had been a marginal rate of 60% for the very rich corporation tax was also lowered throughout the period, to make Britain a “haven for foreign investment”, along with plenty of our money paid as sweeteners to multinationals to come here. And there it has stayed. One of the major failures of New Labour was its insistence on following Conservative economic policies that hurt those in the middle and below, whilst fawning over those in clover. For all the good done over the past thirteen years reducing Child Poverty, refunding the NHS and Education, our party could, and should have done more.

One of the worst areas of inaction was over closing tax loopholes used by the wealthy to avoid even low rates of tax. So in awe of the rich were Blair, Brown and Mandleson, that they gave peerages to people such as Fred Goodwin, then Head of RBS, Philip Green at TopShop and their international guru, Alan Greenspan.

The international super-rich flocked to Mayfair, Kensington and Chelsea, much to the chagrin of the merely very rich City types, who moaned loudly that they could now “only” afford to live in Richmond or Barnes; oh how we did not weep for them. But in spite of  everything done for them, they wanted more. The Billionaires from India, Russia, and China had moved here because their “non-dom” status meant that they could pay almost no tax whatsoever, and homegrown tycoons followed suit. as Robert Peston mentioned in his book about the crash, TopShops boss, Sir Philip Green gets his salary paid to his wife, who for tax purposes is based in Monaco. He is not alone. More worryingly, he is an advisor to the present Government on Business Affairs. This is not just an economic outlook, but also a moral one, as ex-City millionaire David Laws, who was sacked for fiddling £40,000 out of the public purse last year, looks set to rejoin the Government in some position this April.

Yet the Government is unlikely to do much without outside pressure, as a Cabinet with a high proportion of ex-City types, such as Chris Huhne, and sons of stockbrokers such as David Cameron make all the right noises to placate the rich, whilst telling us that “we are all in this together”. Recently it came to light that since 2005, donations to the Tory Party from City sources had reached over fifty percent of its total funding – many from the very hedge fund managers who got us in this mess whilst avoiding taxes here. In January, at the annual Black and White party ( they daren’t call it a ball anymore), secure in Battersea Park, City Internships were auctioned-off to the highest bidder, in aid off Tory Party funds. Perhaps this is the “Big Society”? A short walk away are some of the roughest and most deprived estates in London.

The Mayor of London, Boris Johnson was also in attendance, and as many have noted, has spent much of the past year or so loudly protesting that we must stop “bashing Bankers” over the billions of our money we had to throw at them to save the system. Let us not forget that in 2009 he publicly decried his £250,000 per year stipend from The Daily Telegraph as mere “chickenfeed”. It seems we have not a Mayor for all of London, but TWO Lord Mayors of The City of London…

(Part Two to follow soon…)