Category Archives: economics

09 May

Worse than the U-boats

Theresa May is turning out to be a Red Tory who takes her economic policies from Ed Miliband. When Labour pledged a cap on energy prices at the 2015 general election, this policy was rightly rubbished by the Tories – because such manipulations of the market always end up in higher prices in the long run. Anyone but a blockhead, or a Red Tory, would be able to see this at once.  Competition among the energy producers would diminish. For the energy firms would get together and agree to charge similar prices – to create a “cost cluster” just below the level of the cap.

The best way to reduce the cost of power for householders and for industry is to resource energy supplies from  cheaper and more readily available fuels.

But the Conservative government refuses to do this – having made the absurd promise to reduce Britain’s carbon footprint to zero by 2050. Incidentally, we are the only country to make this pledge.

Our present energy policy is an act of criminal insanity.

What economic sense is there in offering massive subsidies – at the taxpayers’ expense – to wind and solar power, especially when these sources are unreliable? The Red Toryism of Mrs May is hardly achieved by giving huge handouts to rich landowners to erect thousands of inefficient windmills.

Odd that fanatical environmentalists should so conspire to ruin the landscape.

A few years ago, new advances in technology enabled our mines to produce increasing supplies of “clean” and cheap coal. Now we have closed down the coal mines and the huge power station at Drax is importing, at colossal cost, massive amounts of biomass from the other side of the Atlantic – incidentally destroying whole areas of woodland

Such an absurd policy amounts to both economic profligacy and environmental vandalism at the same time.

In the USA there has been achieved, through the spectacularly successful fracking industry, a revolution in energy production and supply which in little more than a decade has changed America from being an oil-importing nation – dependent on the greed and chicanery of the Gulf States – to become a net exporter of energy. This bloodless revolution has resulted not only in gigantic economic benefits but in shifting the strategic geo-political balance to favour the western nations.  For the first time we are freed from Saudi Arabia’s economic blackmail.

To favour western nations? Well, at least to favour those western  countries which go in for fracking: Poland and Hungary come to mind.

Mrs May says she is the champion of those “just about managing.”  Given sensible energy policies the country would enjoy economic boom years and a considerable reduction in the cost of living – especially for those described by the new Red Tories as “vulnerable.”

With fuel prices constantly on the rise – the only possible result of our insane energy policies – those currently just about managing will be able to manage no longer.

Meanwhile, Britain is sitting on vast resources of shale gas and yet production has barely begun.

By these follies and by gross neglect, Mrs May’s government is imposing the sort of hardship on our people that would have been the envy of the German U-boat commanders.

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30 Mar

Lies, damned lies and democracy

I am getting fed up with the misuse of the word “democracy.”

Last week all the papers screamed that the atrocity in Westminster was “an attack on our democracy.” This week the same papers are screaming that Mrs May’s signing of the letter to tell the EU that we’re leaving was “the reclaiming of our democracy.”

Democracy – demos, the people and cracy, rule – implies that voters have genuine choices. But this is not so, and that’s why the word is being misused. Of course, we have all these party labels: Con, Lab, Lib and Loony, but they all implement the same policies. And these policies all add up to socialism. We are forever being told by the politicians and the media (and especially our intellectually-challenged bishops) that we live under a capitalist system, but this is very far from the truth.

Nearly 50% of Britain’s GDP goes to the public sector. In so called communist China it is only 17%. At the height of their totalitarian tyranny, the Soviets were only spending 10% more than we do today. Never mind the anti-capitalist rhetoric, examine the facts…

You are taxed on your wages. Then you pay 20% VAT on nearly everything you buy with the money on which you have already been taxed.

Scandalously we are taxed even on our meagre pensions.

Fuel taxes are at an outrageously high level. If we have a car we pay road tax. If we drink or smoke, the price of our pints and fags is artificially inflated by taxation. Governments ask people to save, so to reduce the burden of taxation. But the prudent who do save are paid little or no interest. In fact, with rates as they are, savers – especially among the older generation – are actually losing money by their thrift. If we do save, we are taxed again on the minuscule interest

If we do our bit by buying shares in British companies, we are taxed on our dividends. There are further taxes on share dealing. The state broadcasting propaganda department fiercely polices an annual tax called the TV licence. The industrial, commercial, financial and manufacturing companies which generate income for the country pay large sums in Corporation Tax and other business taxes. And, in the form of Inheritance Tax, we have to pay up again even when we’re dead. British businesses which ought to be leading our economic recovery are prevented by labyrinthine corporate and state regulation.

Is this what the bishops condemn as “capitalism”? These levels of taxation and regulation are combining to hinder economic recovery. And such taxes are required only because the government needs them to pay for its massively expanded army of civil servants, its quango mountain, its legions of useless box-tickers, its lousy education system, the failing and disgracefully corrupt NHS, and its bloated state welfarism. Then there are the bishops’ hysterical protests against “the cuts.” The truth is that this government will be borrowing and spending more when it leaves office than it did when it came in. Whatever economic and social system is currently being operated in our country, it is not by any shadow of meaning capitalist.

It is socialism through and through. And it’s what you’ll get whichever way you vote – for our prized “democracy” is a lie and a sham

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23 Sep

The Holy Stuntman

How’s this for a slice of ostentatious humility? When Pope Francis arrived in the USA yesterday, he declined a limousine and opted for a modest Fiat saloon. Mind you the number plate was SCV-1 – that’s Status Civitatis Vaticanae which, being translated, means, “I’m Number One.”

I forgot to mention that, before he left Cuba, he treated us to a Lady Diana moment when he called for “A revolution of tenderness.”

Will it be a universal revolution, though? I don’t think so. It presumably won’t include successful businessmen, for earlier the Pope referred to capitalism as t”the dung of the devil” – thus showing us something of the dung of historical reflection: for it is the dung of capitalism which has raised more people out of poverty than any other economic system in history.

But back to the stuntman.

Isn’t there something in the Gospels about the sin of parading one’s self-denial? I was thinking of the Pharisee who said, “I am not as other men. I fast twice in the week. I give tithes of all I possess.”

And then those words of Our Lord to his disciples:

“When ye fast, be not as the hypocrites…” He was criticising those who make a show of their good works.

This Holy Stuntman Pope resembles Uriah Heep. I can just hear him saying, “Oh do look – there is none so ‘umble as me!”

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19 Aug

Is the social engineer here?

When you notice two items side by side, do you get the urge to join them together?

A report on the BBC’s Today Programme this morning told us that Tony Blair’s 1999 ambition – “Educashun, Educashun, Educashun,” remember – to have 50% of all youngsters attend university has been achieved. But the reporter confessed that this is not quite the roaring success it appears to be. For many graduates are going into jobs which don’t require a university degree.

This item was followed immediately by the announcement that the number of houses being built in Britain is a lot lower than the country’s needs. The main reason given for this was that building companies can’t find the carpenters, electricians and other skilled tradesmen they require.

I’m not normally fond of Americanisms, but their pithy phrase, “Go figure” seems apt here.

For when we’ve gone and figured, we understand that youngsters who might, better advised, have been inclined to learn a trade, instead found themselves saddled with a government loan in order to waste three years “reading” Golf Studies with Tourism or, as it might be Applied Social Policy and Hairdressing.

Quite apart from the important point that our higher education system is not producing the numbers of people to do the work that the country requires, Blair’s impudent piece of social engineering guarantees that many young people are not fulfilling their vocations, exercising their aptitudes and settling into suitable and rewarding work.

Square pegs and round holes. Lives are being spoilt – and all for Blair’s arrogant obsession.

We are now told, of course, that universities shouldn’t be elitist. What should they be, then mediocritist?

For centuries the university was a place where that minority of people interested in such things – and who perhaps experienced a calling to study them – devoted themselves to philosophy, theology, literature and the theoretical sciences. Most people were neither interested in these subjects nor called to study them. Fine – there are many other noble and respectable ways of spending one’s life. You could be an electrical engineer, a plumber, a joiner or any one of a hundred different trades.

Proficiency in a trade such as engineering or carpentry is not inferior to theoretical activity; only it is different. Wittgenstein was an engineer. Jesus was a carpenter.

Now we are living in the mess caused by Blair’s perverse desire to send half our youngsters to waste their time in universities

And what, pray, is Tony Blair? Is he an intellectual? Is he a practical man? No, he is that most arrogant and destructive of creatures: a social engineer.  

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17 Aug

Capitalism, wot capitalism?

A report claims that, under our unfair capitalist economic system, the wages of senior executives are 183 times those of their workers. But now here’s a funny thing:

“in the second half of the nineteenth century, when Marx’s dreaded capitalism was at its peak, robber barons were at their most oppressive and, according to Freedom House, democracy did not exist, the average ratio of income earned by US corporate directors and their employees was 28:1. Yet in 2005, when history had ended, democracy was in full bloom and egalitarianism proudly reigned supreme, this ratio stood at 158:1 (a study jointly conducted by MIT and the Federal Reserve). – Democracy as a Neocon Trick by Alexander Boot.

In other words, western economies are much more socialised than they were a hundred and fifty years ago. Today governments control the economy to a degree undreamt of in Victorian times. Taxes are higher and there is considerably more public spending – and yet the pay ratios between the top and the bottom are more extreme.

How much capitalism do we actually have?

50% of Britain’s GDP goes to the public sector. In so called communist China it is only 17%. At the height of their totalitarian tyranny, the Soviets were only spending 10% more than we do today. Never mind the anti-capitalist rhetoric, examine the facts. You are taxed on your wages. Then you pay 20% VAT on nearly everything you buy with the money on which you have already been taxed.

Fuel taxes are at an outrageously high level. If we have a car we pay road tax. If we drink or smoke, the price of our pints and fags are artificially inflated by taxation. Governments ask people to save, so to reduce the burden of taxation. But the prudent who do save are paid little or no interest. In fact, with rates as they are, savers – especially among the older generation – are actually losing money by their thrift. If we do save, we are taxed again on the meagre interest

If we do our bit by buying shares in British companies, we are taxed on our dividends. There are further taxes on share dealing. The state broadcasting propaganda department fiercely polices an annual tax called the TV licence. The industrial, commercial, financial and manufacturing companies which generate income for the country pay large sums in Corporation Tax and other business taxes. And, in the form of Inheritance Tax, we have to pay up again even when we’re dead. British businesses which ought to be leading our economic recovery are prevented by labyrinthine corporate and state regulation.

Is this what today’s report calls “capitalism”? These levels of taxation and regulation are combining to hinder economic recovery. And such taxes are required only because the government needs them to pay for its massively expanded army of civil servants, its quango mountain, its legions of useless box-tickers, its lousy education system, the failing and scandalously corrupt NHS, and its bloated state welfarism. Then there are the orchestrated protests against “the cuts.” The truth is that this government will be borrowing and spending more when it leaves office than it did when it came in. Whatever economic and social system is currently being operated in our country, it is not by any shadow of meaning capitalist.

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13 Jul

Equality is bad for you

The so called agreement just announced between Greece and the EU will have a devastating impact on poor people in Greece. This agreement effectually confiscates Greek assets and imposes the most severe austerity on the Greek people. It was concluded in order to preserve the Euro – the instrument for ensuring the survival of the EU’s centrally-planned, one size fits all, European economy.

Socialists try to create a more equal society. They believe in levelling. Unfortunately, owing to the nature of socialism itself, that philosophy always ends up achieving the opposite of its aims. The other day, Alexander Boot put this in a nutshell in his persistently enlightening blog where he says we must not confuse the socialists’ slogans with their practical policies:

“All socialist economies (which is to say all modern economies) have the widest gap between the rich and the poor. And, the less developed the socialist economy, the greater the gap, the harder the poor are hit. For example, in the 19th century, the era of dog-eat-dog capitalism, the average ratio of income earned by US corporate directors and their employees was 28:1. Yet in 2005, when socialism had made heavy inroads into the post-New-Deal US economy, this ratio stood at 158:1.”

There are comparable figures for Britain

In other words, the less money there is around, the more of it will be grabbed by the rich and the poor will consequently get poorer.

This is the truth expressed by Friedrich Hayek in his classic The Road to Serfdom (1944)

In fact, all socialist roads lead to serfdom. When socialism is practised moderately, the poverty of those in the lower reaches of the social scale is quite moderate. Where socialism is practised more thoroughly, poverty consequentially becomes more severe. Where socialism is practised absolutely – one might say ideally – the poverty of the poorest is absolute too. Moreover, extreme socialism always ends up in dictatorship, the oppression of the people and, in the most notorious cases such as the USSR under Stalin and China under Mao, the socialist experiment culminates in gulags and mass slaughter: by Stalin at least twenty millions and by Mao around sixty millions.

But socialism sounds so promising, so nice, kind and humanitarian. So what goes wrong? It is always the same thing which goes wrong: the replacement of the free market by the planned economy.

The free market has raised more people out of poverty than any other economic system in the history of the world. So why are such notable humanitarians as the Pope and the Archbishop of Canterbury so down on it?

I described socialism as an experiment. Why do we keep on repeating an experiment which always fails?

As Einstein said, “To keep on doing the same thing while expecting different results is the first sign of madness.”

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