We have had a gloomy couple of years with the financial crisis that is continuing to cause global concern and downturn in GDP. It is now even affecting China, India and Brazil. They may still be growing but the rate of growth is slowing down all the same.
This goes to show that the economic policies and strategies that are being used are not really working. Let's not be too cheered up with the minimal growth that appears as bumps in the road because we are nowhere on the way to recovery. However, with the appropriate policies we can be. Let's not continue to only feed the banks that caused the problems but let us support consumers to achieve growth.
It can be done and the sooner we support consumers the sooner growth will return. WE can spend our way out of this recession regardless of the current belief that we cannot. Strong consumer effect can get industry working again; without it industry will continue to struggle. We, therefore need to increase consumers spending power. This can be done in several ways; a reduction in purchase or value added tax, an increase in wages and job creation in the service industry and public sectors as well as promoting growth in private industry. This can be easily achieved by quantitatively easing consumers instead of the banks and financial institutions. Consumers in their turn can and will quantitatively ease industry, the banks and the financial institutions.
A farming analogy is apt at this point. Your land is not going to give you a good harvest if you just throw tons of seeds on arid land. By clearing weeds, and giving your plants, sufficient room to grow in with adequate amounts of water and fertiliser, they will give you a more abundant harvest. Unfortunately our modern politicians no longer come from a solid industry or work related background. Their life experience consists of nothing but a protected upbringing having only experienced theories about life and economics during their academic years and their friendship with financial institutions or their financial supporters. Alas poor us and we have voted them in.
There is only one solution out of this economic downturn and that is
SPENDING OUR WAY OUT OF IT and IT WILL WORK.
Best Wishes.
Good luck and Good Bye until the next time.
Knight Owl.
Sunday, 25 December 2011
Tuesday, 13 December 2011
Solving the Euro Crisis
The meeting of leaders of European Economic Community went ahead last Thursday night, 26 countries joining forces to tackle the problem and the United Kingdom, or Mr David Cameron, decided to stand on the sidelines. Does this, therefore, mean that the Euro is going to survive or is it heading for its demise; particularly as the rumours in the British press is suggesting that the German government is printing Deutsche Marks as a precaution.
In my opinion, the Euro can survive and is likely to become stronger as a result of the current crisis. However, to make this happen, the 26 countries need to explore some policy changes alongside harmonising taxation and regulation of the finance industry. In the main, for the benefit of all the Eurozone countries, the Euro needs to be devalued by 10%. There is likely to be some disadvantages of taking this approach, but the benefits will be much greater, and far outweigh the disadvantages.
The advantages of devaluing the Euro will benefit all the 17 Eurozone countries and also the remaining 9 or 10 if the United Kingdom decides to join the club. It will help enhance growth by making it easier to export goods produced in the Eurozone as it will be cheaper for none Eurozone countries to import these goods. It may increase the cost of imports but if played well home produced goods will become more attractive to consumers. It will also be enjoyed by local and Eurozone consumers. Therefore, growth will increase further adding to GDP. More demand will create more jobs, and more people working will increase tax revenue. There has been a decline in industries producing white goods in Europe, this can be rectified and these goods can be rolled out locally at a competitive price. Europe will once again take pride of place in the world markets.
France and Germany has already got an industrial base and so has some of the newer countries that have joined the European Economic Community. Some countries have allowed there industries to collapse; it will be an opportunity to redevelop them. The Eurozone governments can also harmonise corporation tax to enable varied and appropriate industries develop in all areas of the Eurozone and European Economic Community as long as they all co operate to make this work. The corporation tax can also be tailored to be competitive with other industrial nations. The Eurozone countries should also assist poorer former dependencies to participate with them in making this plan work. They can create additional jobs is these former dependencies and also agree favourable trade deals.
The world as a whole will benefit. However, we need someone to have sufficient courage and conviction to make this happen. Someone to be prepared to take the risk and have the authority and wherewithal to make it happen. It can work and will work; action speaks louder than words. Meetings on their own are not going to solve the problem, action will. Let's hope somebody is brave enough to take the steering wheel and guide this train in the right direction. ACTION is needed now not next year or the year after, if we do not want to look back at at the next ten years as a lost decade.
Good Luck and Good Bye until the next time.
Knight Owl
In my opinion, the Euro can survive and is likely to become stronger as a result of the current crisis. However, to make this happen, the 26 countries need to explore some policy changes alongside harmonising taxation and regulation of the finance industry. In the main, for the benefit of all the Eurozone countries, the Euro needs to be devalued by 10%. There is likely to be some disadvantages of taking this approach, but the benefits will be much greater, and far outweigh the disadvantages.
The advantages of devaluing the Euro will benefit all the 17 Eurozone countries and also the remaining 9 or 10 if the United Kingdom decides to join the club. It will help enhance growth by making it easier to export goods produced in the Eurozone as it will be cheaper for none Eurozone countries to import these goods. It may increase the cost of imports but if played well home produced goods will become more attractive to consumers. It will also be enjoyed by local and Eurozone consumers. Therefore, growth will increase further adding to GDP. More demand will create more jobs, and more people working will increase tax revenue. There has been a decline in industries producing white goods in Europe, this can be rectified and these goods can be rolled out locally at a competitive price. Europe will once again take pride of place in the world markets.
France and Germany has already got an industrial base and so has some of the newer countries that have joined the European Economic Community. Some countries have allowed there industries to collapse; it will be an opportunity to redevelop them. The Eurozone governments can also harmonise corporation tax to enable varied and appropriate industries develop in all areas of the Eurozone and European Economic Community as long as they all co operate to make this work. The corporation tax can also be tailored to be competitive with other industrial nations. The Eurozone countries should also assist poorer former dependencies to participate with them in making this plan work. They can create additional jobs is these former dependencies and also agree favourable trade deals.
The world as a whole will benefit. However, we need someone to have sufficient courage and conviction to make this happen. Someone to be prepared to take the risk and have the authority and wherewithal to make it happen. It can work and will work; action speaks louder than words. Meetings on their own are not going to solve the problem, action will. Let's hope somebody is brave enough to take the steering wheel and guide this train in the right direction. ACTION is needed now not next year or the year after, if we do not want to look back at at the next ten years as a lost decade.
Good Luck and Good Bye until the next time.
Knight Owl
Friday, 9 December 2011
Euro Zone Crisis
Although this is referred as a Eurozone crisis, it is a Global Economic crisis but some nations are trying to see themselves as being out of it. Even Europe, particularly the countries in the European Economic Community who do not have the Euro as their Currency are seeing themselves as being separate from this crisis. This being so, the Eurozone countries should work to protect themselves and their interests and let Europe and and the rest of the world flounder.
The crisis in the European Economic Community, particularly the Euro zone is getting worse. The politicians are trying to stop the Euro crashing down the cliff and disappearing like Atlantis. Hence the meeting yesterday in Marseille and last night and today in Brussels. The problem is solvable but how likely are to solve it? It depends on whether they work in the interest of the European Economic Community or National (Self) interest. When I refer to interest of the European Economic Community, I mean the all the people that form that community and not individual nations, the politicians or their masters the financiers.
The peculiar set up of the European Economic Community into Euro and none Euro zones is also adding to the problem because the none Euro zone countries are trying to protect their own currency and markets thus adding extra pressure to the Euro and the Euro zone countries. The English Media and Euro-sceptic members of the conservative party are acting as doom mongers and praying for the Euro to fail. They have asked David Cameron, a financier by birth and upbringing, to protect the financiers and stab the Merkozy plan to death so that they can dance round the funeral pyre of the Euro as a result.
In my opinion, if all the countries in the European Economic Community cannot agree to a consensual agreement, then the 17 Eurozone countries should work together as a Eurozone Community to defeat this crisis and save the Euro. It is going to make them and the Euro a lot stronger in years to come. The none Eurozone countries of the European Economic Community should remain on the fringe and stop interfering in the progress of the rest. If it means a two tier European Economic Community, an inner sanctum and an outer sanctum, so be it.
The Eurozone Community should start by working together by creating a level field where all 17 nations can work and play under the same rules. The referees should also come from the Eurozone Community and not from the none Eurozone Community for fear of undue interference. They should start by halving the European Commission Budget. The European Economic Community (and the nations in it) and the people are more important than a bunch of overpaid, over-privileged, bureaucrats who spend their time giving the impression that they are members of a special cosy gentleman's club instead of a bunch of civil servants serving the European Economic Community. After all most of the people are having to contribute towards the deficit and are subject to austerity measures. They are facing higher taxes, lower wages and increasing living costs.
The bankers and financiers should also be treated in the same way. They are the ones who got us in this mess and they are still walking with their heads in the air and their hands in their reinforced pockets, jingling their lose change, and whistling "what a happy day". They will also have to contribute to the deficits, but all we have done is lined their reinforced pockets with quantitative easings and taxed the nation a bit more. Do not be taken in by and give in to their threats. Whether it is Standard and Poor or David Cameron, they are just a bunch of financiers protecting their own interests.
The Eurozone problem is solvable and it can be solved. As a Community let us stand together and fight the predators whoever they may be and wherever they may come from. Let us work together, share the pain together and we can then savour the joy together. Also remember, we are all in together, everybody including the financiers, the politicians, the privileged bureaucrats and the people that is the community (and the nations). For now we must all suffer the austerity in equal measures and later as a result of our hard work share the gains equally.
Good luck and good bye until the next time
Knight Owl.
The crisis in the European Economic Community, particularly the Euro zone is getting worse. The politicians are trying to stop the Euro crashing down the cliff and disappearing like Atlantis. Hence the meeting yesterday in Marseille and last night and today in Brussels. The problem is solvable but how likely are to solve it? It depends on whether they work in the interest of the European Economic Community or National (Self) interest. When I refer to interest of the European Economic Community, I mean the all the people that form that community and not individual nations, the politicians or their masters the financiers.
The peculiar set up of the European Economic Community into Euro and none Euro zones is also adding to the problem because the none Euro zone countries are trying to protect their own currency and markets thus adding extra pressure to the Euro and the Euro zone countries. The English Media and Euro-sceptic members of the conservative party are acting as doom mongers and praying for the Euro to fail. They have asked David Cameron, a financier by birth and upbringing, to protect the financiers and stab the Merkozy plan to death so that they can dance round the funeral pyre of the Euro as a result.
In my opinion, if all the countries in the European Economic Community cannot agree to a consensual agreement, then the 17 Eurozone countries should work together as a Eurozone Community to defeat this crisis and save the Euro. It is going to make them and the Euro a lot stronger in years to come. The none Eurozone countries of the European Economic Community should remain on the fringe and stop interfering in the progress of the rest. If it means a two tier European Economic Community, an inner sanctum and an outer sanctum, so be it.
The Eurozone Community should start by working together by creating a level field where all 17 nations can work and play under the same rules. The referees should also come from the Eurozone Community and not from the none Eurozone Community for fear of undue interference. They should start by halving the European Commission Budget. The European Economic Community (and the nations in it) and the people are more important than a bunch of overpaid, over-privileged, bureaucrats who spend their time giving the impression that they are members of a special cosy gentleman's club instead of a bunch of civil servants serving the European Economic Community. After all most of the people are having to contribute towards the deficit and are subject to austerity measures. They are facing higher taxes, lower wages and increasing living costs.
The bankers and financiers should also be treated in the same way. They are the ones who got us in this mess and they are still walking with their heads in the air and their hands in their reinforced pockets, jingling their lose change, and whistling "what a happy day". They will also have to contribute to the deficits, but all we have done is lined their reinforced pockets with quantitative easings and taxed the nation a bit more. Do not be taken in by and give in to their threats. Whether it is Standard and Poor or David Cameron, they are just a bunch of financiers protecting their own interests.
The Eurozone problem is solvable and it can be solved. As a Community let us stand together and fight the predators whoever they may be and wherever they may come from. Let us work together, share the pain together and we can then savour the joy together. Also remember, we are all in together, everybody including the financiers, the politicians, the privileged bureaucrats and the people that is the community (and the nations). For now we must all suffer the austerity in equal measures and later as a result of our hard work share the gains equally.
Good luck and good bye until the next time
Knight Owl.
Thursday, 24 November 2011
Work Related Pensions
Public Service Unions have called for and a majority of their members have voted to strike on the 30th of November 2011. This is in response to the UK government's plan to increase public sector workers contributions towards their employment pensions, the age at which they can retire and reduce the value of their pensions. The government argues that this is already the case in the private sector and they are creating a level playing field.
This is true to a certain extent but is this right? There is already a discrepancy between employees pensions in both the public and private sectors. Management staff have better pension arrangements in both sectors, as well as, having bigger pay packets and higher annual pay increases. They can also retire earlier. In the private sector the gap between management pensions and employees pensions is even more pronounced.
In my opinion, all employees have a right to decent employment pension. They should not rely on or expect the state to subsidise their pensions through "old age pensions". They should also not have to wait to receive their pensions until they are to old to enjoy the fruit of their labour. Otherwise, any pension they receive will only go towards paying their "care home bills".
Employment pensions, particularly in the private sector, have in the main failed because of abuse of pension funds by some private sector companies and pension fund managers. During the 1980s and 1990s many private companies misused pension funds as capital investments or used it as loans to bail themselves out during financial difficulties. Very often they were not able to put the funds and interests back in the pension pot. Even now, pension fund managers are not only earning extremely large sums but also taking increasingly larger sums in bonuses regardless of the performance of pension funds being managed. [One such person appearing on UK television, this week, claimed she is worth more than the pension fund contributors.] They are, therefore, receiving proportionally higher returns on the investments than the people contributing toward their pensions. Pension contributors have lost out in the past and they are still losing out; and this, particularly, include public sector workers and lower to middle earners in the private sector. They are subsidising the state through taxes, subsidising pension fund managers luxurious lifestyles and disproportionately boosting private sector profits and entrepreneurs and shareholders dividends.
The current proposed system of employment pensions, whether in the private or public sector is both unjust and highly regressive. There is a rational solution, but it is unlikely to be adopted as most governments have and share monetarist views and are supported in their position of power by capitalist funds. The solution is simple. Employment pensions and pension funds for both the private and the public sectors should be managed and regulated by the state. There should also be a truly independent audit system in place. It should not be abused or misused and fund managers should only receive adequate, not exorbitant, remunerations. Employees should contribute an agreed percentage of their salaries, with a similar arrangement for employers. The retirement age should be the same for managers and other employees. The pension to salary ratio should also be comparable.
To put it simply, there should be a universal employment pension system for all. It should be a right and enshrined in law. And similarly everyone should have a right to employment. However, this is unlikely to happen in the UK. The UK government is hell bent on punishing public sector workers for the financial problem created by greedy bankers who are going scot free and still enjoying huge wages and bonuses. This is lunacy. Is it because senior politicians in the UK government come from banking and financial institution background? Readers you can be the judge.
Good luck and good bye until the next time.
Knight Owl
Tuesday, 15 November 2011
Eurozone Crisis; What Crisis?
The so called economic and financial demise of several European countries continues on a downhill trend like a motorcars with faulty brakes. It started with the Republic of Ireland, then Spain and Portugal were threatened. However, Greece and Italy seems to have slipped even further. Quantitative easing and bale-outs are being pledged by the governments but the economy is slip sliding regardless.
However, in the UK it is difficult to accept that their is an economic downturn especially if you live in London or the South-East. Some Londoners are still buying second home as the two home lifestyle continues to grow. Luxury goods traders, such as Burberry, are also seeing increasing profits as the sales in luxury goods is increasing. I am sure the same applies in other European countries and the USA and the rest of the world that has been affected by the economic crisis. This suggests that the wealth is there but it is not being distributed in a fair and equitable manner. Some have most of the world resources and riches and most have very little. Even the bankers who contributed to the economic disaster are still enjoying a lucrative lifestyle and huge bonuses.
The austerity measures that are being legislated by the governments are in the main hitting the less well off and reducing their meagre income. The greedy rich however, continue to amass wealth by raising commodity prices and playing monopoly with the world's economy. Will the governments even dare take a penny off them? Wait and see! The governments have not legislated to regulate the banks or reform the banking system as proposed at the height of the banking crisis and that was over 3 years ago. Many wealthy people continue to avoid paying taxes and they are legally allowed and encouraged to do so. At the time of writing our British Chancellor of the Exchequer is reported to be contemplating cutting the top rate of tax. Therefore those who even feel guilty enough to pay their taxes will be helped to pay even less.
It is difficult to judge whether we are having an economic crisis or not. The wealth is still there; few have most of it, some have have just enough, the majority have very little or nothing. So what is this crisis about? What are the austerity measures about? Upon the requirement of the International Monetary Fund (the wealthy), the governments (the instruments of the wealthy) are directed to pawn off or hand over public services (public sector industries) to the wealthy. To what effect? To reduce public funding of these services or increase private profiteering? I'll let the readers be the judge of that.
Good luck and good bye until the next time.
Knight Owl
However, in the UK it is difficult to accept that their is an economic downturn especially if you live in London or the South-East. Some Londoners are still buying second home as the two home lifestyle continues to grow. Luxury goods traders, such as Burberry, are also seeing increasing profits as the sales in luxury goods is increasing. I am sure the same applies in other European countries and the USA and the rest of the world that has been affected by the economic crisis. This suggests that the wealth is there but it is not being distributed in a fair and equitable manner. Some have most of the world resources and riches and most have very little. Even the bankers who contributed to the economic disaster are still enjoying a lucrative lifestyle and huge bonuses.
The austerity measures that are being legislated by the governments are in the main hitting the less well off and reducing their meagre income. The greedy rich however, continue to amass wealth by raising commodity prices and playing monopoly with the world's economy. Will the governments even dare take a penny off them? Wait and see! The governments have not legislated to regulate the banks or reform the banking system as proposed at the height of the banking crisis and that was over 3 years ago. Many wealthy people continue to avoid paying taxes and they are legally allowed and encouraged to do so. At the time of writing our British Chancellor of the Exchequer is reported to be contemplating cutting the top rate of tax. Therefore those who even feel guilty enough to pay their taxes will be helped to pay even less.
It is difficult to judge whether we are having an economic crisis or not. The wealth is still there; few have most of it, some have have just enough, the majority have very little or nothing. So what is this crisis about? What are the austerity measures about? Upon the requirement of the International Monetary Fund (the wealthy), the governments (the instruments of the wealthy) are directed to pawn off or hand over public services (public sector industries) to the wealthy. To what effect? To reduce public funding of these services or increase private profiteering? I'll let the readers be the judge of that.
Good luck and good bye until the next time.
Knight Owl
Rights and Responsibilities
Do people have a right to protest and are they responsible enough to do so. In Europe and the USA this does not seem to be the case, although some protest is tolerated. However, Europe and the USA not only condone this form of action in the Middle East but overtly support it. Why is there one right for the Middle East and another for Europe and the USA. In Europe and the USA, the governments are taking forceful action to stop and discourage any such expression of dissatisfaction with the state or the creators of the economic doom.
Is this because in Europe and the USA, the governments legislate in favour of the rich against the "plebeians"? Of course, the rich fund their election campaigns and gets them the seats in parliament and the senates and the voters do not matter. May be that is a way of repaying their dues. Let the Masters rule the governments. The "plebeians" are no more than slaves to the demands of the Masters. The governments are instruments used by the Masters to control the "plebeians" and keep them in check. In the UK, the government is even considering legislations against the right of workers to strike. Soon workers will have no rights at all, "and they will be no better than slaves".
"Plebeians" beware! During election times think; do you votes really count?
Good Luck and good bye until the next time.
Knight Owl
Is this because in Europe and the USA, the governments legislate in favour of the rich against the "plebeians"? Of course, the rich fund their election campaigns and gets them the seats in parliament and the senates and the voters do not matter. May be that is a way of repaying their dues. Let the Masters rule the governments. The "plebeians" are no more than slaves to the demands of the Masters. The governments are instruments used by the Masters to control the "plebeians" and keep them in check. In the UK, the government is even considering legislations against the right of workers to strike. Soon workers will have no rights at all, "and they will be no better than slaves".
"Plebeians" beware! During election times think; do you votes really count?
Good Luck and good bye until the next time.
Knight Owl
Friday, 14 October 2011
Politics and Politicians
There is a lot going on in politics at present and it is difficult to choose a specific topic to write about. However, with the goings on with secretary of states in the UK, I thought that might be one topic of interest.
Dr Liam Fox, secretary of state for defence, or now ex-secretary of state for defence, fell foul of his friend's involvement with his official position. Dr Fox's friend had posted himself as his advisor although he had not been officially appointed as such. He was photographed attending various official meetings with him. It was reported in the press that he had also arranged some of these meetings. Pecuniary arrangements for this friend was rather dubious. It was claimed that Dr Fox's political sponsors were supporting him financially. Dr Fox's friend claimed to have special interest in the arms trade. The unanswered question remains whether these sponsors were arm traders or not? Dr Fox has now resigned his government position but will this stop the speculations or further revelations. We shall have to wait and see.
Today, it has also been revealed that another Cabinet Minister has been photographed on several occasions dumping official government papers in public litter bins in St James's Park in London. I am not going to speculate, he may have just been offloading himself of the weight. I shall leave the speculating or revealing the true reasons, if there is one, to the media.
Going back to politicians, governance and political influence. There was a time when politicians and politics was about national interests. However, this has long gone and no politicians or political parties are immune to it. And this is not only a UK position, it is a worldwide issue. Although governing a country is about working in the interest of the whole nation, this is no longer the case. The governments only really work in the interest of about 20% of the nations and these are the plutocratic investors and industrialists. Legislations are always in favour of these minority groups, and this include TAX avoidance legislations. Whereas legislations for the remaining 80% is punitive and negatively weighted. The current austerity measures of high taxes, low wages, increasing living costs and pension changes also only apply to the majority 80%. Whilst this 80% are sweating Calories turning the wheels of industry, the other 20% are putting on Calories and increasing their wealth enjoying the fruit of the former's labour.
I suppose the duties of governments and politicians nowadays are about helping their financial sponsors who bankroll their prospects of getting elected and political careers and not the nations. There is also this principle that trade and industry is the heart of the modern world. This being the case, may be politicians are delivering the goods that their wealthy clients have paid for and not acting in the interest of their voters. How this applies to the labour party in the UK is a bit confusing. This political party is financially supported by both trade unions and wealthy plutocrats. The trade unions and trade unionists do not get anything in return but the plutocrats do. Are the plutocrats support more important, and/or are the trade unions and the trade unionists just taken for granted?
This whole process calls into question the belief related to elections and democracy in electing politicians and governments, particularly in the western world that boasts about its democratic principles. Does this reflect the diminishing number of voters who actually turn up at the polling stations? Do the voters feel that no matter who they vote for the elected representatives do not work in favour the majority voters anyway?
Good bye and good luck until the next time.
Knight Owl
Knight Owl
Friday, 23 September 2011
Recent English Public Disturbance; Rhyme or Reason?
The recent public disturbance in England has calmed down. Perpetrators are being sought and punished. The victim are trying to come to terms and rebuilding their lives. The politicians, however, continue to pussy foot around trying to address the situation. Prime Minister Cameron has moved from describing the society as a broken society to a sick society. He is busy prescribing remedies without adequately diagnosing the problem.
The problem underlying the uncalled for disturbance in England and the unrest and economic mayhem around the world is a social and economic catastrophe. The heart of the problem lies with the rigid interpretation and application of the Monetarist Economic Policy. In the same way as the Keynesian policy failed in the 1970s, we have to admit and agree that the Monetarist policy has failed now. The Monetarist perspective that money [and property] is all that matters is the core of the current problem. It has created a few who has money and masses who haven't. As a result it has also created selfishness and greed. The masses who still aspire and are encouraged to persevere to acquire money find all kind of obstacles put in their way. First and foremost the people who control the money also control the employment and manipulate the market. The market creates the perception that everyone are entitled to and have a right to own goods no matter the cost. It creates envy and some people use fair and foul means to have these goods. This allows crime to enter the equation.
The masses are also disadvantaged by a failure of governments to promote social well being in the form of good social policy. Society may be broken but we are not instituting social policies to mend this breach. Instead we are creating policies to worsen this breach, and blame people for not being self sufficient. We thus promote a criminal underclass which also live by the monetarist perspective that money is all that matters. Ethics, morals and the law are all ignored or take a secondary position. This is as true in the world of business, for example, the nature of banking and hedge-fund management, and the behaviour of the criminal underclass.
This was summed up by Reginald D Hunter, a US comedian on the BBC "This Week" programme when he said "You cannot tell people who are broke, don't feel hard done by". We care more about money and property than people and so do our politicians.
I am led to believe that politicians regardless of the parties they belong to ignore the masses in society and side with the few rich who funds their respective political parties and their bid to get elected. The masses are the naive majority who continue to trust and believe in their politicians just as gang members do with their gang leaders who continue to manipulate them for personal gain.
Good bye and Good Luck until the next time.
Knight Owl
The problem underlying the uncalled for disturbance in England and the unrest and economic mayhem around the world is a social and economic catastrophe. The heart of the problem lies with the rigid interpretation and application of the Monetarist Economic Policy. In the same way as the Keynesian policy failed in the 1970s, we have to admit and agree that the Monetarist policy has failed now. The Monetarist perspective that money [and property] is all that matters is the core of the current problem. It has created a few who has money and masses who haven't. As a result it has also created selfishness and greed. The masses who still aspire and are encouraged to persevere to acquire money find all kind of obstacles put in their way. First and foremost the people who control the money also control the employment and manipulate the market. The market creates the perception that everyone are entitled to and have a right to own goods no matter the cost. It creates envy and some people use fair and foul means to have these goods. This allows crime to enter the equation.
The masses are also disadvantaged by a failure of governments to promote social well being in the form of good social policy. Society may be broken but we are not instituting social policies to mend this breach. Instead we are creating policies to worsen this breach, and blame people for not being self sufficient. We thus promote a criminal underclass which also live by the monetarist perspective that money is all that matters. Ethics, morals and the law are all ignored or take a secondary position. This is as true in the world of business, for example, the nature of banking and hedge-fund management, and the behaviour of the criminal underclass.
This was summed up by Reginald D Hunter, a US comedian on the BBC "This Week" programme when he said "You cannot tell people who are broke, don't feel hard done by". We care more about money and property than people and so do our politicians.
I am led to believe that politicians regardless of the parties they belong to ignore the masses in society and side with the few rich who funds their respective political parties and their bid to get elected. The masses are the naive majority who continue to trust and believe in their politicians just as gang members do with their gang leaders who continue to manipulate them for personal gain.
Good bye and Good Luck until the next time.
Knight Owl
Friday, 12 August 2011
Appraisal of the Public Disturbance in England, United Kingdom
Parliament was recalled from the summer recess yesterday to discuss the disturbance that took place over the last four nights in some major English cities. The police and other emergency services were rightly praised, by both sides of the house, for the admirable and effective way in which they dealt with the situation and restored order. They were also rightly critical of the criminals who perpetrated the disturbance and the looting and vandalism that took place. Series of measures were announced to help the police and the justice system to do their job more effectively in dealing with the problem. Measures were also announced to deal with the criminals. Various proposals were suggested to understand the underlying reasons for the disturbance but these were not considered at the time. These will hopefully be appropriately and fully discussed, debated and appraised in the weeks and months to come and addressed accordingly. Praise was also given to the communities for their help in clearing the mess and restoring a sense of normality. Unfortunately the vigilante stance some communities adopted was not condemned.
It is important to understand the underlying causes whether simple or not to be able to avert similar situations in future, and to restore and instil public confidence. I believe that the Rabbi who was on Chris Evans BBC Radio 2 show yesterday morning hit the nail on the head with the explanation that he gave for the kind of disturbances that we are experiencing. And I think what he said explains the situation globally, whether it is in Britain, the Middle East, Africa or anywhere else in the world. His explanation is that the [ultimate] value society places on possessions accounts for many of the antisocial, disruptive and criminal behaviours that we endure on a daily basis. This was reflected by a conservative Member of Parliament, during the parliamentary session today, when he referred to consumerism as the root cause of the ills of society that David Cameron, the prime minister alludes to. But, Mr Cameron was more concerned about punishing the culprits of the latest disorder rather than underlying reasons for their criminal behaviour.
There has been an intense emphasis and importance on values that involves money and possessions since the 1970s; and this emphasis has been above and beyond all other values. This has led to consumerism and greed. The latter being defined by most dictionaries as:
"An excessive desire to acquire or possess more than what one needs or deserves, especially with respect to material wealth".
Read my next post for some suggestions to remedy these ills.
Good Bye and Good Luck until the next time
Knight Owl
It is important to understand the underlying causes whether simple or not to be able to avert similar situations in future, and to restore and instil public confidence. I believe that the Rabbi who was on Chris Evans BBC Radio 2 show yesterday morning hit the nail on the head with the explanation that he gave for the kind of disturbances that we are experiencing. And I think what he said explains the situation globally, whether it is in Britain, the Middle East, Africa or anywhere else in the world. His explanation is that the [ultimate] value society places on possessions accounts for many of the antisocial, disruptive and criminal behaviours that we endure on a daily basis. This was reflected by a conservative Member of Parliament, during the parliamentary session today, when he referred to consumerism as the root cause of the ills of society that David Cameron, the prime minister alludes to. But, Mr Cameron was more concerned about punishing the culprits of the latest disorder rather than underlying reasons for their criminal behaviour.
There has been an intense emphasis and importance on values that involves money and possessions since the 1970s; and this emphasis has been above and beyond all other values. This has led to consumerism and greed. The latter being defined by most dictionaries as:
"An excessive desire to acquire or possess more than what one needs or deserves, especially with respect to material wealth".
There are many examples of this in everyday life globally. The parliamentary expenses problems that we faced recently can be attributed to greed. Many of our sportsmen and women, people in music and film industry and industry in general use this as their modus operandi. The bank crisis of 2008 and the global economic crisis, including the fragile and fluctuating stock markets, the recent News International debacle and the pressure put on Prime Minister Cameron to curtail the BBC as per James Murdoch's 2009 MacTagart lecture are all examples and the effects of greed. The disturbances in the Middle East and the continent of Africa is also highly likely to be influenced by the same emphasis on greed as an important value of humanity. People, therefore, are using all means available to them to achieve possessions whether foul or fair. There are also plenty of examples where this kind of behaviour is reinforced and rewarded. These include bonuses, national honours and awards and public adoration. However, the rewards depend on the social and economic background of the recipients and the context in which it has been achieved. Some people fall foul of living up to these values and they engage in criminal activities from petty crime all the way up the criminal spectrum including the illegal drug industry. Criminals obviously have to be punished but should we not attempt to change society by revising the values we give so much importance to and may be in future avert these problems that has been created.
Read my next post for some suggestions to remedy these ills.
Good Bye and Good Luck until the next time
Knight Owl
Tuesday, 9 August 2011
London Burning
It is very disheartening, disturbing and distressing to see many areas of London ablaze. Rioting and looting has also been taking place in many areas of London, Birmingham, Bristol, Nottingham and Liverpool. The last time such disturbance took place was the early to mid 1980s. Whether these activities are a result of the politics of the day, political grievance or not, it certainly isn't pleasant and it is not a way of protesting. These are criminal activities in whatever way they are described. Although, it is understandable that many sectors of the community feel disenchanted with the austerity measures, and job prospects being extremely poor, particularly for young people. These activities cannot be condoned and it is highly unlikely that it has anything to do with the shooting of Mark Duggan by the police in London.
It is also distressing to see how inadequate the police and particularly the fire service is. In Croydon, a very large fire was being tackled by three fire engines. Under normal circumstances there would have been at least a dozen fire engines if not more. Many areas report lack of police and fire services. There has been cutbacks in these services because of the austerity measures. One hopes that the thin spread of services is due to the number of incidents rather that a lack in service personnel.
The political leaders are all returning back cutting short their summer holidays and emergency meetings are taking place across relevant ministerial departments to assess the extent of the problem and how best to resolve it. Whatever has triggered these uprisings is not as simple as it seems. Underlying all the discontent and the despicable behaviour lies predictors and precipitants that are complex and highly likely to be fuelled by the general economic downturn that is affecting most of society. There is also a gap developing between the rich and poor. While most middle and low earners and the unemployed are being squeezed, there are some whose affluence is increasing beyond belief. This is evidenced by the profits of some major companies but even more so by publication of the rich list in the national papers. Prominent politicians may have also inflamed the situation by stating that multicultural society in Britain has failed. However, these cannot be used to promote crime.
Whatever the predictors and precipitants, we all have a responsibility. First and foremost we must utterly condemn these act of criminality. All of us rich and poor, affected and disaffected should work to resolve the problem together. Let us not posture and threaten each other. Let us communicate our grievances in a lawful and responsible manner. This applies to all of us including the rioters, the communities, the businesses and the politicians. We are all in some way responsible and we must act in a responsible way. It is bad enough for the global economy to be spiralling into decline. It does affect all of us not only the investors. We are literally in it together and we all have to unite to get out this mess. Divisions and subdivisions will only create acrimony, disrepair and despair. If you wish to protest, remember Mahatma Gandhi, peaceful protest is much more powerful than violence.
Good Bye and Good Luck until the next time and may peace and serenity be with you.
Knight Owl
It is also distressing to see how inadequate the police and particularly the fire service is. In Croydon, a very large fire was being tackled by three fire engines. Under normal circumstances there would have been at least a dozen fire engines if not more. Many areas report lack of police and fire services. There has been cutbacks in these services because of the austerity measures. One hopes that the thin spread of services is due to the number of incidents rather that a lack in service personnel.
The political leaders are all returning back cutting short their summer holidays and emergency meetings are taking place across relevant ministerial departments to assess the extent of the problem and how best to resolve it. Whatever has triggered these uprisings is not as simple as it seems. Underlying all the discontent and the despicable behaviour lies predictors and precipitants that are complex and highly likely to be fuelled by the general economic downturn that is affecting most of society. There is also a gap developing between the rich and poor. While most middle and low earners and the unemployed are being squeezed, there are some whose affluence is increasing beyond belief. This is evidenced by the profits of some major companies but even more so by publication of the rich list in the national papers. Prominent politicians may have also inflamed the situation by stating that multicultural society in Britain has failed. However, these cannot be used to promote crime.
Whatever the predictors and precipitants, we all have a responsibility. First and foremost we must utterly condemn these act of criminality. All of us rich and poor, affected and disaffected should work to resolve the problem together. Let us not posture and threaten each other. Let us communicate our grievances in a lawful and responsible manner. This applies to all of us including the rioters, the communities, the businesses and the politicians. We are all in some way responsible and we must act in a responsible way. It is bad enough for the global economy to be spiralling into decline. It does affect all of us not only the investors. We are literally in it together and we all have to unite to get out this mess. Divisions and subdivisions will only create acrimony, disrepair and despair. If you wish to protest, remember Mahatma Gandhi, peaceful protest is much more powerful than violence.
Good Bye and Good Luck until the next time and may peace and serenity be with you.
Knight Owl
Saturday, 6 August 2011
Double Dip Recession or Depression?
The global economy continues on a downhill trend despite two years of severe austerity measures, increased taxation and low interest rates. European countries such as Italy, Greece and Spain are relying heavily on being bailed out or face bankruptcy. In the UK, we blamed the snow last December and April's Royal wedding for our GDP nosedive, although the Royal wedding was meant to boost our economy. The US indecisiveness last week in agreeing an economic policy and now the stock market turmoil. Added to that we have the US rating downgrade by Standard and Poor from AAA to AA+. Economists are calling for more austerity measures and further reduction in government spendings.
Jeff Macke, citing Peter Schiff, writes "The Depression [in the wake of the financial crisis] was temporarily interrupted by a bunch of stimulus which ultimately weakened the economy further," He further suggests that the government's response of stimulating is, probably going to lead to "a complete economic collapse." I would agree that this was a knee jerk reaction in the sense that while the governments were trying to stimulate the recovery they were also stifling and strangling it by severe cutbacks in the public sector and tax increases.
We blame the governments for interrupting the economic growth because they are borrowing more. We make lame excuses that there are no jobs because there is no recovery. The problem is that there is no recovery because there are excessive job losses both in the private sector and the public sector. In the private sector because there is insufficient stimulus, lack of funds or lack of investments because the investors are being encouraged to invest in China (as per Todd Schoenberger) and India. In the public sector the belief is to improve the economy, as per eminent economists, we have to reduce public spending. In addition, we are paying higher taxes either directly or indirectly.
The pitfall is no jobs, no jobs and no jobs, therefore, no recovery, no recovery and no recovery. And down in the dark hole of depression we disappear unless somebody is brave enough to take the bull by the horn and stop the rut. Europe is in disarray; the European Union is not working as one. Each country forming the EU is trying to protect itself. Germany and Angela Merkel is strong but for how long? One person needs to stand out and let's hope it's OBAMA. Go Obama go, let's see what you are made of?
Good Bye and Good Luck until the next time.
Jeff Macke, citing Peter Schiff, writes "The Depression [in the wake of the financial crisis] was temporarily interrupted by a bunch of stimulus which ultimately weakened the economy further," He further suggests that the government's response of stimulating is, probably going to lead to "a complete economic collapse." I would agree that this was a knee jerk reaction in the sense that while the governments were trying to stimulate the recovery they were also stifling and strangling it by severe cutbacks in the public sector and tax increases.
We blame the governments for interrupting the economic growth because they are borrowing more. We make lame excuses that there are no jobs because there is no recovery. The problem is that there is no recovery because there are excessive job losses both in the private sector and the public sector. In the private sector because there is insufficient stimulus, lack of funds or lack of investments because the investors are being encouraged to invest in China (as per Todd Schoenberger) and India. In the public sector the belief is to improve the economy, as per eminent economists, we have to reduce public spending. In addition, we are paying higher taxes either directly or indirectly.
The pitfall is no jobs, no jobs and no jobs, therefore, no recovery, no recovery and no recovery. And down in the dark hole of depression we disappear unless somebody is brave enough to take the bull by the horn and stop the rut. Europe is in disarray; the European Union is not working as one. Each country forming the EU is trying to protect itself. Germany and Angela Merkel is strong but for how long? One person needs to stand out and let's hope it's OBAMA. Go Obama go, let's see what you are made of?
Good Bye and Good Luck until the next time.
Thursday, 4 August 2011
Double Dip Recession?
Global stock markets take a nosedive again and its reported to be the worst for over two years or since the banking crisis of October 2008. The blame is apportioned to the European debt crisis and the faltering US economy. May it also just be an economic reality of modern stock market manipulation?
Over recent weeks price of gold has surged, and many companies have announced massive profits. Share prices have also been steadily going up and the markets have been bullish. There are rumours from the investment world that hedge funders have sold heavily to make a quick return on their recent investments. No fear, therefore, that they will be buying cheap again soon with a view to the next recessive dip when they take their profits.
Whether it is the European debt crisis and the faltering US economy or the hedge funders, the global governments are following economic policies that are bound to inhibit economic growth. In a time of excessive economic growth and increased affluence among the lower and middle earners this type of policy may be appropriate to stop the economic bubble from bursting. However, in a time of recession this type of policy is wholly inappropriate. It will not only retain the current recession but also promote further dips along the way. The few rich will get richer and the majority low and middle earners will become poorer.
The policy must change and governments must take control of the situation. Quantitative easing in real terms needs to be applied and spending power for the majority must be facilitated to promote growth. State expenditure must grow instead of being retracted. The State should be investing more in public services and at this moment in time we need big States instead of big societies. The private sector must also be helped to invest more through government support. Mr Gordon Brown, former Prime Minister of the UK was nearer the mark than what is currently happening.
What is needed is spending power for the vast majority instead of the few. For every dollar spent by the few rich people, at least a, million is spent by the majority lower/middle income earners; but they have to have it to spend it. They are the people who keep the wheels of industry turning by working in it and buying from it. The others just oil the wheels.
What needs to be done, therefore, are tax incentives for the lower and middle earners and a reduction in value added tax for everyone, rich an poor, to promote spending. What is needed is not a reduction in spending but an increase. This was evidenced by the last British Government's reduction in VAT to 15%; the economy was actually growing in Britain. The current Government policy has actually reversed that trend and the next set of figures are likely to show a negative growth factor. Wages also need to be going up to promote spending and fall when the economy starts to boom. These can be achieved by increased government borrowings during this period of recession.
The economic policy must be reversed. In times of recession we need higher wages and lower taxes and in times of economic boom we need lower wages and higher taxes, and not vice versa. By doing so we shall prevent this continuous boom and bust trend.
Good Bye and Good Luck until the next time.
Knight Owl
Over recent weeks price of gold has surged, and many companies have announced massive profits. Share prices have also been steadily going up and the markets have been bullish. There are rumours from the investment world that hedge funders have sold heavily to make a quick return on their recent investments. No fear, therefore, that they will be buying cheap again soon with a view to the next recessive dip when they take their profits.
Whether it is the European debt crisis and the faltering US economy or the hedge funders, the global governments are following economic policies that are bound to inhibit economic growth. In a time of excessive economic growth and increased affluence among the lower and middle earners this type of policy may be appropriate to stop the economic bubble from bursting. However, in a time of recession this type of policy is wholly inappropriate. It will not only retain the current recession but also promote further dips along the way. The few rich will get richer and the majority low and middle earners will become poorer.
The policy must change and governments must take control of the situation. Quantitative easing in real terms needs to be applied and spending power for the majority must be facilitated to promote growth. State expenditure must grow instead of being retracted. The State should be investing more in public services and at this moment in time we need big States instead of big societies. The private sector must also be helped to invest more through government support. Mr Gordon Brown, former Prime Minister of the UK was nearer the mark than what is currently happening.
What is needed is spending power for the vast majority instead of the few. For every dollar spent by the few rich people, at least a, million is spent by the majority lower/middle income earners; but they have to have it to spend it. They are the people who keep the wheels of industry turning by working in it and buying from it. The others just oil the wheels.
What needs to be done, therefore, are tax incentives for the lower and middle earners and a reduction in value added tax for everyone, rich an poor, to promote spending. What is needed is not a reduction in spending but an increase. This was evidenced by the last British Government's reduction in VAT to 15%; the economy was actually growing in Britain. The current Government policy has actually reversed that trend and the next set of figures are likely to show a negative growth factor. Wages also need to be going up to promote spending and fall when the economy starts to boom. These can be achieved by increased government borrowings during this period of recession.
The economic policy must be reversed. In times of recession we need higher wages and lower taxes and in times of economic boom we need lower wages and higher taxes, and not vice versa. By doing so we shall prevent this continuous boom and bust trend.
Good Bye and Good Luck until the next time.
Knight Owl
Thursday, 7 July 2011
News International Saga
The News International saga and accusations of criminal activities continue to fill the British Media. Blame is being tossed like custard pies involving News International, the journalists involved and the Metropolitan Police Officers who helped to cover up the extent of the intrusions in the private lives of all the people concerned. It has also been the main topic in the political arena where past and present governments and ministers are being accused of inaction in the face of allegations and evidence that has been brought to their attention. Various actions are being proposed from wholesale police investigations to judicial and public inquiries. The Metropolitan Police Force are making inquiries to investigate, gather evidence and bring the culprit to bear the force of the judicial system. Unfortunately, although there is general agreement that abuse of power has taken place resulting in criminal activities and offences has likely been committed, there still does not seem to be an agreement on the necessary and appropriate action that needs to be taken. The approach continues to appear softly softly. Are we British soft on such issues compared to let's say the United States or Australia, for example? Can we be accused of dragging our feet rather than taking decisive action?
News International certainly has been decisive in axing the newspaper involved, namely, the News of the World. The paper will see it's last publication on Sunday, July the 10, 2011. However, credit to News International, phoenix like rising from the ashes of the demise of the News Of The World, another British News International's newspapers, The Sun will now have a Sunday issue. Decisive action or what? The question remain, however, that was it the newspaper that was to blame for the scandals or was it the personnel involved in bringing the newspaper and its journalistic approach into disrepute? The latter being the case, should the personnel concerned not be axed or sacked as the case may be and not the newspaper?
Keep you ears to the ground and your eyes open, there may yet be more episodes to this saga.
Good Bye and Good Luck until the next time.
Knight Owl.
News International certainly has been decisive in axing the newspaper involved, namely, the News of the World. The paper will see it's last publication on Sunday, July the 10, 2011. However, credit to News International, phoenix like rising from the ashes of the demise of the News Of The World, another British News International's newspapers, The Sun will now have a Sunday issue. Decisive action or what? The question remain, however, that was it the newspaper that was to blame for the scandals or was it the personnel involved in bringing the newspaper and its journalistic approach into disrepute? The latter being the case, should the personnel concerned not be axed or sacked as the case may be and not the newspaper?
Keep you ears to the ground and your eyes open, there may yet be more episodes to this saga.
Good Bye and Good Luck until the next time.
Knight Owl.
Wednesday, 6 July 2011
Telephone Hacking
The revelations concerning News International's involvement in telephone hacking continue to grow by the day. Initially, it was revealed that famous people such as celebrities and prominent political figures had their telephones hacked and a legal battle ensued. It has now become evident that many common people had their phones hacked as well. Among these people were victims of serious crimes, for example, the late Millie Dowler, and families and victims of the 7/7 bombing incidents among others. Where does this stop or how widely has this perpetration spread? How many other people in the United Kingdom had their phones hacked ? Is it endemic? Is it just a British problem or has it a wider international issue? Will the whole truth ever come out? It is also surprising that the British Police has been implicated to have participated in this practice by selling private telephone numbers to the hackers involved.
The matter is now in the hand of the police force who are investigating the seriousness of this "offensive" practice. The outcome and consequences will follow. Eminent legal professionals have suggested that serious criminal offences have been committed and criminal proceedings and appropriate actions should be taken. Offenders will be punished through imprisonment and fines. Members of the police force involved will be sacked and face imprisonment if found guilty of misconduct.
How will this affect the standing of News International as a powerful media and broadcasting corporation, and the strong influence it has on the political parties in the UK and elsewhere? News International may even be subjected to a hefty fine that they can easily recoup by putting the price of their newspapers up by one pence a copy. Will this, however, have an effect on press freedom? Will all this make a difference in the way the press and the media operate? If we look back to this infringement in ten years time, will the press and media, and News International in particular be a different and better behaved beast?
We shall just have to wait and see.
Good Bye and Good Luck until the next time.
Knight Owl.
The matter is now in the hand of the police force who are investigating the seriousness of this "offensive" practice. The outcome and consequences will follow. Eminent legal professionals have suggested that serious criminal offences have been committed and criminal proceedings and appropriate actions should be taken. Offenders will be punished through imprisonment and fines. Members of the police force involved will be sacked and face imprisonment if found guilty of misconduct.
How will this affect the standing of News International as a powerful media and broadcasting corporation, and the strong influence it has on the political parties in the UK and elsewhere? News International may even be subjected to a hefty fine that they can easily recoup by putting the price of their newspapers up by one pence a copy. Will this, however, have an effect on press freedom? Will all this make a difference in the way the press and the media operate? If we look back to this infringement in ten years time, will the press and media, and News International in particular be a different and better behaved beast?
We shall just have to wait and see.
Good Bye and Good Luck until the next time.
Knight Owl.
Thursday, 30 June 2011
Public Sector Pensions
Some public sectors workers in England have been protesting today because of changes to their pensions. Despite increasing their pensions contributions by 3% and increasing their retirement age from 60 to 65 years, the UK government plans to reduce their pensions when they retire. The government initially claimed that the current arrangement was not affordable. However, when it was pointed out that affordability was not a problem, the government changed its tune and stated that they wanted to bring parity between public and private sector.
What does this really mean and what are the issues?
The private sector has been gradually eroding or eradicating pensions for workers in that sector and in cahoot with the government increasing retirement age. (Senior managers and directors in the private sector, however, continue to enjoy lucrative subsidised pensions and retire early.) The government argue that because of pension changes in the private sector it has to change pensions in the public sector. This only make sense in that the government can reduce public expenditure, and in the private sector companies can increase their profits and in doing so give generous dividends to their shareholders. In doing so the rich gets richer even in this time of economic downturn and the less well off becomes poorer, the economic disparity widens. The consequences of these profit orientated greedy approaches will surely have an effect on national economies in future as poverty expands in the rich and developed world. Sufferings in old age for many hard workers will increase. Will it then be resolved through public expenditure and at a high cost? Does it really make economic sense on the whole?
Instead of reducing workers pensions in both the private and public sectors and increasing poverty in old age, would it not make more sense for these governments in the rich and developed world to have a truly fair poverty eradicating pensions policy across the board that would apply equally to both the public and private sectors including senior managers and directors? These policies would need to be properly administered and regulated unlike the banks. However, I believe that such a system would create a happier, more fulfilling, harder-working and stronger society and nation and would benefit globally. Let's work towards a happier and fairer world.
This is obviously one view. I would very much welcome comments from readers to ensure a fair debate.
Good Bye and Good Luck until the next time.
Knight Owl
What does this really mean and what are the issues?
The private sector has been gradually eroding or eradicating pensions for workers in that sector and in cahoot with the government increasing retirement age. (Senior managers and directors in the private sector, however, continue to enjoy lucrative subsidised pensions and retire early.) The government argue that because of pension changes in the private sector it has to change pensions in the public sector. This only make sense in that the government can reduce public expenditure, and in the private sector companies can increase their profits and in doing so give generous dividends to their shareholders. In doing so the rich gets richer even in this time of economic downturn and the less well off becomes poorer, the economic disparity widens. The consequences of these profit orientated greedy approaches will surely have an effect on national economies in future as poverty expands in the rich and developed world. Sufferings in old age for many hard workers will increase. Will it then be resolved through public expenditure and at a high cost? Does it really make economic sense on the whole?
Instead of reducing workers pensions in both the private and public sectors and increasing poverty in old age, would it not make more sense for these governments in the rich and developed world to have a truly fair poverty eradicating pensions policy across the board that would apply equally to both the public and private sectors including senior managers and directors? These policies would need to be properly administered and regulated unlike the banks. However, I believe that such a system would create a happier, more fulfilling, harder-working and stronger society and nation and would benefit globally. Let's work towards a happier and fairer world.
This is obviously one view. I would very much welcome comments from readers to ensure a fair debate.
Good Bye and Good Luck until the next time.
Knight Owl
Saturday, 19 February 2011
"The Big Society?"
The UK government, particularly the Prime Minister is passionate about and determined to create "The Big Society" in the United Kingdom. Among the many debates with regards to the subject, the first is the meaning of the term. What does "big society" really means. Nobody seems to be clear about it. Everybody including the Prime Minister and his cabinet have got their personal reality and interpretation but are unable to clearly communicate it. It appears though that "The Big Society" is about people volunteering to help others.
I would agree that over the years people have become selfish and society has as a whole become more disintegrated and self-centred. This has worsened in the last twenty years or so where an emphasis has been on individual achievement whether as a person or an organisation. This emphasis has been promoted by governments in most developed and developing countries. Therefore, selfishness and greed has flourished, and society and individuals caring for each other has diminished. Care or caring as such has become a commodity based on market economy. If you are rich or can afford it, you can buy the care or caring you or your loved ones need. If you can't afford it you may do the best you can and tough luck be your friend.
In the UK up to now, the state has some statutory responsibility for caring for people in need. This has been available through national and/or local organisations. These organisations have been funded and managed by the state. The funding has come from tax revenue raised by the state. For example, the National Health Service has been responsible for providing health care to those who needed it free at the point of delivery. National Insurance provides towards unemployment benefits, sickness benefits and state pension. Revenue from taxation also help local authorities make social and welfare provisions at a local level. Although these are state funded and managed services, in the last twenty years, the private and voluntary sectors have also benefited by being contracted to provide some of these services.
However, because of the fiscal deficit the state has accrued in the last few years and the government's haste in reducing this deficit, the government is drastically cutting back the funding that these state run services and organisations have had in the past. This means that these services have to be trimmed accordingly. At the same time, the government is also reforming some of the national institutions, the main one being the National Health Service. Whatever happens, the needy will still be there. It was initially envisaged that the private sector will be able to fill this gap. However, as there is very little money and some services are not profitable for the private sector, it is highly likely that they will only take on the profitable services. A big chunk of unprofitable services will be left unattended.
In my opinion, this is where the "Big Society" comes in. The idea is that those people who have lost their jobs and those who haven't, volunteer to to fill the gap created by the state reforms and state withdrawal from public services as a result of the funding crisis. The services that get rejected by the private sector and can't be run by the state sector because of lack of funding will hopefully be taken on by the voluntary sector. In principle the idea is very good. However, the process of getting it implemented is very poor because it is ill defined and generally lacking in coherence. There is also a misguided expectation that it will be adopted willingly by the voluntary sector despite the fact that there are no funding or support identified for this process.
Another problem is that it appears to be dividing society in two separate groups. There is a rich well to do group who continues to enjoy their riches and lead a jolly carefree life. Tax loopholes are created so they can get away with paying as little tax as possible. Whilst they contribute little, they continue to benefit from universal goods and services. The other poorer group in comparison is taxed to the hilt, their services curtailed and they are asked to form a "big society" and take care of themselves. And while they do so the state distances itself from them whilst aligning with the rich.
The "Big Society" can work but only if we are all in together. The poorer group doing the work whilst the richer group hand over some of their monies to fund the projects.
WHAT WE NEED IS SOME GOOD OLD FASHIONED PHILANTHROPY not just empty rhetorics!
Good bye and good luck until the next time
I would agree that over the years people have become selfish and society has as a whole become more disintegrated and self-centred. This has worsened in the last twenty years or so where an emphasis has been on individual achievement whether as a person or an organisation. This emphasis has been promoted by governments in most developed and developing countries. Therefore, selfishness and greed has flourished, and society and individuals caring for each other has diminished. Care or caring as such has become a commodity based on market economy. If you are rich or can afford it, you can buy the care or caring you or your loved ones need. If you can't afford it you may do the best you can and tough luck be your friend.
In the UK up to now, the state has some statutory responsibility for caring for people in need. This has been available through national and/or local organisations. These organisations have been funded and managed by the state. The funding has come from tax revenue raised by the state. For example, the National Health Service has been responsible for providing health care to those who needed it free at the point of delivery. National Insurance provides towards unemployment benefits, sickness benefits and state pension. Revenue from taxation also help local authorities make social and welfare provisions at a local level. Although these are state funded and managed services, in the last twenty years, the private and voluntary sectors have also benefited by being contracted to provide some of these services.
However, because of the fiscal deficit the state has accrued in the last few years and the government's haste in reducing this deficit, the government is drastically cutting back the funding that these state run services and organisations have had in the past. This means that these services have to be trimmed accordingly. At the same time, the government is also reforming some of the national institutions, the main one being the National Health Service. Whatever happens, the needy will still be there. It was initially envisaged that the private sector will be able to fill this gap. However, as there is very little money and some services are not profitable for the private sector, it is highly likely that they will only take on the profitable services. A big chunk of unprofitable services will be left unattended.
In my opinion, this is where the "Big Society" comes in. The idea is that those people who have lost their jobs and those who haven't, volunteer to to fill the gap created by the state reforms and state withdrawal from public services as a result of the funding crisis. The services that get rejected by the private sector and can't be run by the state sector because of lack of funding will hopefully be taken on by the voluntary sector. In principle the idea is very good. However, the process of getting it implemented is very poor because it is ill defined and generally lacking in coherence. There is also a misguided expectation that it will be adopted willingly by the voluntary sector despite the fact that there are no funding or support identified for this process.
Another problem is that it appears to be dividing society in two separate groups. There is a rich well to do group who continues to enjoy their riches and lead a jolly carefree life. Tax loopholes are created so they can get away with paying as little tax as possible. Whilst they contribute little, they continue to benefit from universal goods and services. The other poorer group in comparison is taxed to the hilt, their services curtailed and they are asked to form a "big society" and take care of themselves. And while they do so the state distances itself from them whilst aligning with the rich.
The "Big Society" can work but only if we are all in together. The poorer group doing the work whilst the richer group hand over some of their monies to fund the projects.
WHAT WE NEED IS SOME GOOD OLD FASHIONED PHILANTHROPY not just empty rhetorics!
Good bye and good luck until the next time
Friday, 21 January 2011
Is the irresponsible banking system easing or worsening the economic crises?
Nearly every nation on our planet has been affected by the irresponsible bankers and the banking system. Many national governments used billions of ordinary taxpayers money to bail these banks out of their bankruptcy. Many ordinary people lost their homes, their jobs and their self-respect because of the governments and bankers lack of diligence. However, in a psychopathic manner, these bankers continue with their reckless behaviour. The bonus culture and some of the reckless trading continue as before.
The people of the countries that bailed the bank are still paying through a reduction in their standards of living by the fact that goods are services are dearer, taxes are higher and wages have been cut. The bankers, Oh No!, they continue to enjoy their luxuries. Government fiscal policies are leading to job cuts and higher unemployment which in turn will reduce growth and revenue. The consequences can only be a deep and long period of recession with increasing inflation and cost of living.
The reason for the banking crisis was attributed to the lack of banking regulations. It has remained an international rhetoric as no nation has taken any action to come up with any regulatory measures. Although previous governments are blamed for removing or easing regulations; governments voted in since, regularly complain about the lack of regulations but are doing nothing to rectify the situation.
Will it make a difference if alongside fiscal measures banking regulatory measures are also implemented?
Good bye and good luck until the next time.
Peter
The people of the countries that bailed the bank are still paying through a reduction in their standards of living by the fact that goods are services are dearer, taxes are higher and wages have been cut. The bankers, Oh No!, they continue to enjoy their luxuries. Government fiscal policies are leading to job cuts and higher unemployment which in turn will reduce growth and revenue. The consequences can only be a deep and long period of recession with increasing inflation and cost of living.
The reason for the banking crisis was attributed to the lack of banking regulations. It has remained an international rhetoric as no nation has taken any action to come up with any regulatory measures. Although previous governments are blamed for removing or easing regulations; governments voted in since, regularly complain about the lack of regulations but are doing nothing to rectify the situation.
Will it make a difference if alongside fiscal measures banking regulatory measures are also implemented?
Good bye and good luck until the next time.
Peter
Thursday, 6 January 2011
Is Current State Management of the Economy Fair or Foul?
Most governments are adopting austerity measures to address the worldwide economic downturn. The cause of the downturn is not being examined and rectified leaving the world to face another similar crisis in the future. Despite that, are the austerity measures fair on the nation or is it foul?
The people who are being made to pay for the downturn are those who had very little to do with the downturn. They are mainly hard-working people who are paying through their blood, sweat and tears. They are being forced to accept pay cuts and pay more for the essential goods and services they need. In the United Kingdom, mainly in England, even small companies are losing out. Many of them are going or likely to go out of business because public services are having to make huge savings. Many of these small companies have public services contracts that they are losing or likely to lose. Up to half a million people are also likely to lose their jobs in this upheaval.
One can understand why the British Government's thought that the best way of raking in tax was through an increase in VAT. This has gone up from 17.5 to 20% from the 4th of January 2011. If unemployment is likely to increase by half a million then income tax revenue from these people will also be lost. There was a Labour Party plan for increasing national insurance, a tax on jobs. Again one can understand that if half a million people are going to lose their jobs a tax on jobs is not going to be beneficial. The double hit of an increase in unemployment and a reduction in most working people's wages are both going to have a negative impact on income tax. Hence the attraction of increasing VAT. People will have no choice but pay this extra tax.
What I can't understand is how the adopted austerity measures are actually going to solve the current problems. All the measures being taken will reduce the money that goes around and drives industry. There is no point in industry producing goods that people can't afford. This is likely to cause a stagnation in the market and the economy and we are less likely to come out of the recession through these measures.
The British government suggests that by looking after the entrepreneurs, they are helping the entrepreneurs to create jobs and riches. This is only likely to happen in essential industries such as food productions, utilities, and energy, and essential travel. People will still need to eat and drink, use essential transport, and use gas, water and electricity. This will be more so in countries where heating is essential in winter. Some entrepreneurs are likely to get rich but most people and national coffers are going to get poorer. The Republic of Ireland is a prime example despite the fact that they only have a 12% corporation tax. It must also not be forgotten that rich entrepreneurs are the ones most adept at using tax avoidance loopholes to keep as much of the money they make for themselves. Several examples have recently been cited in reputable UK newspapers.
I am sure there are other convincing opinions on this issue.
Good Bye and Good Luck until the next time.
The people who are being made to pay for the downturn are those who had very little to do with the downturn. They are mainly hard-working people who are paying through their blood, sweat and tears. They are being forced to accept pay cuts and pay more for the essential goods and services they need. In the United Kingdom, mainly in England, even small companies are losing out. Many of them are going or likely to go out of business because public services are having to make huge savings. Many of these small companies have public services contracts that they are losing or likely to lose. Up to half a million people are also likely to lose their jobs in this upheaval.
One can understand why the British Government's thought that the best way of raking in tax was through an increase in VAT. This has gone up from 17.5 to 20% from the 4th of January 2011. If unemployment is likely to increase by half a million then income tax revenue from these people will also be lost. There was a Labour Party plan for increasing national insurance, a tax on jobs. Again one can understand that if half a million people are going to lose their jobs a tax on jobs is not going to be beneficial. The double hit of an increase in unemployment and a reduction in most working people's wages are both going to have a negative impact on income tax. Hence the attraction of increasing VAT. People will have no choice but pay this extra tax.
What I can't understand is how the adopted austerity measures are actually going to solve the current problems. All the measures being taken will reduce the money that goes around and drives industry. There is no point in industry producing goods that people can't afford. This is likely to cause a stagnation in the market and the economy and we are less likely to come out of the recession through these measures.
The British government suggests that by looking after the entrepreneurs, they are helping the entrepreneurs to create jobs and riches. This is only likely to happen in essential industries such as food productions, utilities, and energy, and essential travel. People will still need to eat and drink, use essential transport, and use gas, water and electricity. This will be more so in countries where heating is essential in winter. Some entrepreneurs are likely to get rich but most people and national coffers are going to get poorer. The Republic of Ireland is a prime example despite the fact that they only have a 12% corporation tax. It must also not be forgotten that rich entrepreneurs are the ones most adept at using tax avoidance loopholes to keep as much of the money they make for themselves. Several examples have recently been cited in reputable UK newspapers.
I am sure there are other convincing opinions on this issue.
Good Bye and Good Luck until the next time.
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