The way out of a recession is to borrow and invest. It’s text book

Fee, KJ and Chris get confused by Tory and Labour economic policy...

OUR RELATED STORIES:

Spending our property wealth faked 30yrs of growth. Next up, Osborne’s pension cash-in

Graphs at a glance: Budget 2014 document shows we’re growing through borrowing. Again. That's why Britain needs a pay rise

Is your Cost of Living crisis over?! Average wages are still back where they were 10 years ago

Workers driven from full to part time work is the only reason employment is holding up

The incomes of the bottom 90% have hardly risen in 20 years, whilst the top 1%’s has doubled

The Top 1% pay more income tax? ‘cos their income’s doubled since 1995 whilst the bottom 90%'s has stagnated

How re-mortgaging covered up the theft of Britain's growing wealth in the boom, and helped cause the bust

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Now it’s Rifkind and Straw: How many of our “cash for access” legislators are selling out the national interest?

SOURCE DAILY MAIL: MPs' salary of £67,000 is not enough for the standard of living I'm ENTITLED to, says Tory Sir Malcolm Rifkind as he defends his second jobs after 'cash for access' sting

Labour’s Jack Straw and the Tories’ Sir Malcolm Rifkind were secretly filmed discussing how they could use their contacts to benefit a private Chinese company and both boasted about charging at least £5,000-a-day. In the conversation with the undercover reporters Sir Malcolm was filmed discussing that his usual fee was 'somewhere in the region of £5,000 to £8,000' for half a day's work. Straw told undercover reporters he would expect £5,000 per day. MPs earn £67,060-a-year, but Sir Malcolm claimed this was not enough for someone of his professional background. Challenged about why he does not do voluntary work to provide experience of the world outside politics, Sir Malcolm told BBC Two's Daily Politics: 'I have two objectives, I have to have that broader hinterland as you so nicely describe it, but I do also want to have the standard of living that my professional background would normally entitle me to have.' Defending his position, Sir Malcolm said there were 'about 200' MPs who had business interests and insisted many members of the public did not want 'full-time politicians'. He said that 'many ex-ministers, former chancellors, home secretaries, prime ministers, as well as other people, have served on advisory boards' and insisted it was 'entirely proper'. Jack Straw, the Blackburn MP, told how he had used his influence to change EU rules on behalf of a private company he already works for and declares an interest in. He also claimed to have used 'charm and menace' to persuade the Ukrainian prime minister to change laws on behalf of the commodity firm, which pays him £60,000 a year. Mr Straw, 68, said he would not take on the role while he remained an MP, but could be more helpful if he were to become a peer in the House of Lords after the election.

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Both Cameron and Miliband promise to stop billions in corporate rip-offs. Oh yeah?

Fee, Chris and KJ try not to forget the oldest marketing trick in the book...

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Doctors pile on the pressure against NHS reforms

Cameron and Osborne can see the bright side...

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Top business leaders' pay packets up by 10% to £4.3m on average, while rest of UK gets 1%

Can Ed Milliband and Cameron agree on something?...

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The campaign for a living wage gains momentum

Both Cameron and Miliband have voiced support in the past. All it needs is the political will...

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What will Labour really do to save the economy?

Ed Miliband isn't telling...

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Key political fibs, and some tips on how to refute them

Money has been devalued. I do not refer to inflation here. Money has been devalued because people don't value the things they can get too easily. 

The people who control our economy - the top politicians and businessmen - have served themselves extremely generously over the last few decades, and now for them money is commonplace. Because it is of little value they carelessly give it to some (themselves and their associates) and thoughtlessly take it away from others (the rest of us Britons). They do this with no more concern than casting a shadow.

People with vast amounts of money think people with merely lots of money are poor. In a campaign speech Mitt Romney, an American presidential candidate, said he thought the average American earned a quarter of a million dollars. Presumably he regards $250,000 a year as a very modest amount. Thus he and his ilk blindfold themselves to the consequences of their actions with the assumption that the poor only have lots of money, rather than pots of it, allowing their consciences to let them rip off an extra few hundred pounds with an increase in ticket prices and utility bills. And rip off another extra few hundred pounds with freezes in pay and cuts in benefits and pensions. Money isn’t important, they tell themselves, therefore it isn’t important if I help myself to some more of it.

http://g-mond.parisschoolofeconomics.eu/topincomes/#Database:

But just as people don’t value the things they have in plenty, they do value what they have little of. For 90% of Britons, whose income has stagnated in real terms for decades, money does have value. And when it goes, it hurts.

Britain is going through some painful changes. One of which is a public intolerance of lying and cheating. Vilification is everywhere: bankers (for a compendium of dodgy activities that have come to be known generically as ‘banking’); media moguls (phone hacking, bribing officials, etc.); suppliers ripping off the government (MOD paying £22 for 65p lightbulb, etc.); insurers (inflating repair costs to hike premiums, etc.); MPs (fiddling expenses; lying about anything including swearing at cops; providing commercial favours; complicity in kidnapping and rendition, etc.). Pity the banker/MP/mogul who now find themselves in deep doo-doo for doing precisely the same thing they were openly doing when they were fêted as ‘leading citizens’. Pity? Perhaps not.

Bankers have been manipulating LIBOR for years, an open secret that was shouted across trading floors with bankers offering one another a choice of rates like sweets from a tin of Quality Street. Strawberry Delight or Orange Crunch, up a little or down a lot? Fabulous profits tumbled in from the Payment Protection Insurance scam, insider trading, grotesque charges on pensions and investments. All these scams were hardly a secret to an insider or an insider’s friends or his friends’ friends, their spouses, paramours and personal trainers. The perpetrators of these scams were not just quietly indulged, but were proudly trumpeted as the jewels in the British industrial crown. To keep them, we are told, we must pay them generously and regulate them pusillanimously.

Unimpeded and celebrated dodgy behaviour became an open secret that spread like a flu virus infecting the upper echelons of Britain. Ripping off clients, customers and constituents was in order to harvest as much money as the bankers. Confusing rewards with merit, they proved their ‘excellence’ by the amount of money they could grab. And then justified the amount of money they could grab by their ‘excellence’. Even our sainted family doctors got in on the act with a 58% pay increase over 4 years for doing less work. British culture itself went through a sarcastic period, Sarc-Art, when unmade beds, stuffed sheep, lights going on and off, and crumpled pieces of paper were selling for ludicrous prices to people with too much money to value it. As soon as our Brit-Artists realised that their sarcasm was profitable, perhaps they too believed in their own excellence?

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The gang discuss ways to solve the issue of party funding

Gatecrashing the party... donations

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Chris and a monied chum debate revealing MPs' tax returns

Should he or shouldn't he...

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Britain's predatory companies gorging on your pension fund

Ed Milliband, the Labour Party leader, said in his speech to the Labour Party Conference in September 2011:

“Let me tell you what the 21st century choice is:  Are you on the side of the wealth creators or the asset strippers? The producers or the predators? Producers train, invest, invent, sell.  Things Britain does brilliantly. Predators are just interested in the fast buck”

Fast buck? What’s the speed limit on a buck? How can you tell a fast buck from one doing the statutory 30 miles per hour? The predators themselves know they have nothing to fear from yet another empty crowd-pleasing political promise. Promises made by Labour, Liberal, and Tory alike, all to pledge to the ordinary ripped-off British voter that they would do something if only they could. Predator and politician know there is always a commentator ready to say on air, online, and in print how hard it would be to separate the producers from the predators, and how it would never work, and that it would do more harm than good in any case, and regrettably it would be best to leave things as they are.

Of course these commentators aren’t speaking to Producers, Predators, or Politicians. They are speaking to us ripped-off Britons. They speak to convince us that nothing can be done, and we should allow ourselves to be preyed upon in the greater interests of the nation. Politicians and predators rely on this, to provide cover for political inaction and continuing predatory depredations.

It is of course true that many companies fall somewhere in between being clearly "good producers" and despicably "bad predators". However, using this fact to block any action is just a weak, though generally successful, attempt to disguise the fact that there are clear unambiguous villains out there. Just because the whole business world doesn’t need a mighty smack, doesn’t mean there aren’t specific rotten rip-offs that do need to be caned and expelled.

A perfect example of an unconstrained predator, a predator who for decades has paid protection money in the form of taxes and levies to successive governments for its licence to continue freely predating, is the pensions industry.

The key characteristic of a successful predator is the ability to sneak around unnoticed until it has got its prey by the throat. The Pensions Industry is master of this form of ambush-predation. With gentle sounding charges of 2.5%, much less than the 15% service charge you pay when you go for a restaurant meal, the pension funds can grab nearly half of a lifetime's savings. Something you may only realise when you get the letter announcing your pitifully disappointing pension, discovering too late the jaws of post-retirement poverty that have been tightening on your throat for the previous 40 years.

Bitter battles are being fought between public and private sector employers and their staff over reduced pensions, higher employee contributions and increased retirement ages. A battle fought in an attempt to:

a)      enlarge the size of the pension pot: by increasing the rate of contributions, and making people work and contribute longer.

b)      reduce the amount the pension pot has to pay the retiree: by scrapping ‘final salary’ schemes, moving the inflation link from RPI to CPI, and moving the remaining ‘final salary’ schemes to ‘career average salary’ linked payments

c)      reduce the number of years the pension has to be paid to the retiree: by making the employees work a few more years, thus spending a few less years collecting their pension in retirement before shuffling off to the next world/incarnation/ash-cloud/worm’s belly.

If politicians were actually serious about dealing with predatory companies then all the above can be solved with a stroke of a legislative nail-file, by blunting the claws of the predatory pension providers. As we will now demonstrate in an adult-friendly graph, people can get bigger pensions and retire years earlier if charges made by pension funds are slashed. After all, those charges go to pay the bumper bonuses – so this will not only alleviate pensioner poverty, but will also start to deal with excessive pay. 

So, how many extra years do you have to work to pay the fund management charges on your pension?

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Benefits Fraud: would the taxpayer save money by giving every citizen their due, not a penny more, not a penny less? Actually, it would cost £12.7 billion EXTRA!

[UPDATE OCT 2015: £13bn in benefits were unclaimed in 2013-14, according to employment minister Priti Patel. Charities say the main reasons are the complexity of the system, as well as pride and shame. The Joseph Rowntree Foundation has studied the low take up of benefits and found that lack of knowledge was often to blame. Even where people were aware that a benefit existed, often they did not know they were eligible - let alone how to claim it. Meanwhile, in communities with a strong work ethic and pride in self-reliance, people are particularly unwilling to claim benefits. And the demonisation of benefits claimants in Parliament and the media means people are too ashamed to claim the help they need - and are perfectly entitled to. A study of free school meals in Scotland, for example, found that when eligibility was briefly extended to all children in a particular age group, take-up also increased among those who had already been eligible for free school meals - because they no longer thought their children would be bullied for receiving school meals.]


Moral outrage is about something that doesn’t affect you personally. If someone pulls the leg off your teddy bear, it’s not moral outrage you are feeling – just rage. (No, really, I forgave you years ago. You know who you are!)

Moral outrage is all about the principal. And is magnified more by how close the offender is to you than by the magnitude of the offence.

• Morally Outrageous:            Someone who is about the same as us, same habits, same social group, doing something naughty. Outrageous because they are getting away with something we could get away with, if only we could be a bit more immoral:
• Jumping the queue
• Driving like an idiot
• Benefits fraud

  

• Just Damn Annoying:            Someone very different to us: e.g. a celebrity, top company executive, or banker. Less outrageous, because their naughtiness is something we could only aspire to in our dreams/nightmares:
• Getting let off by the police for extreme bad behaviour, including assault and substance abuse
• Taking multi-million bonuses while wrecking the world economy
• Asset stripping companies, and throwing pensioners onto the streets

When Ed Miliband, the leader of the UK Labour Party, wanted to give his outraged morals an airing in a speech earlier this month, he picked on two sets of bogeymen.

1)      A man he had met who “hadn’t been able to work since he was injured doing his job. It was a real injury, and he was obviously a good man who cared for his children. But I was convinced that there were other jobs he could do.”

2)      The executives of “Southern Cross care homes - where millions were plundered over the years leaving the business vulnerable, the elderly people in their care at risk and their families feeling betrayed.”

Miliband went on to say “We must be once again the party of the grafters” rather than, as before, of grifters. And continued “..there is a link between the man on incapacity benefit and those executives at Southern Cross. What is that link? That these are people who are just not taking responsibility - and the rest of us are left picking up the pieces.”

How did a “good man who cared for his children”, claiming £71.10 a week in incapacity benefit while looking pretty fit to Miliband, find himself in the whiffy company of unashamed slash-and-burn executives who pocketed an estimated £500million at the expense of pensioners?

The sad truth is the thought of some individual scamming us taxpayers out of £71.10 per week in incapacity benefit while actually being capable of flipping hamburgers for minimum wage is enough to blow all our other troubles away. We will soon forget about Southern Cross, but the bitterness for benefits cheats will stay with us.

No matter that we can’t afford a proper armed forces or a health service, we need to hand our schools to private companies, have to work until we are older and get less pension. Misfortunes caused by avaricious bankers who were let off the leash, self-serving politicians who got rid of the leash, and incompetent regulators who wouldn’t know how to use that tricky-dicky catch on the leash even if they had a leash and the inclination to use it.

What we need to do, we are told by politicians to the left and to the right, is tighten up on the benefits system. Make sure that everyone gets just what they are entitled to, not a penny more and not a penny less.

But would tightening up save us any money? The figures show that it would actually cost us billions.

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2011 budget repercussions (3 part series)

The country and economy are on a knife-edge as George Osborne prepares to deliver his budget. What will its impact be?

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Disillusioned with Labour

Chris suspects foul play after an email from Fee

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