Not the most compelling logical statement

“Anyone who has ever seen a sonogram or has spent even an hour with a textbook on embryology knows” that pro-life women are on to something when they recoil at the idea of the “disposable fetus.” Hmmmm… that must be why most OB-GYNs are pro-choice…..

Ob/Gyn, in the modern world, involves performing abortions. It would be unlikely for someone to enter that profession without being in favour of their sometimes being performed.

Err, yes?

In the last 25 years we have allowed banks to balloon in size. Until the 1970s, banks\’ assets as a percentage of UK GDP remained steady at approximately 50%. By 2006, after decades of deregulation, banks\’ assets as a percentage of UK GDP were more than 500%.

We\’ve abolished capital controls you know. Finance has gone international. And as it happens, the City has become the centre of those international financial markets.

You would have thought that someone bright enough to get into Goldman Sachs would have known that. Or perhaps being stupid enough to leave there to go to the new economics foundation explains it.

For example love, we really don\’t give a shit about the size of the assets of UK domiciled banks. We\’re completely uninterested in the question in fact.

We do care about their liabilities, this is true, but not their assets.

Think for a moment, if those assets were entirely financed by capital we wouldn\’t care at all, would we?

Quite, it\’s the liabilities which are important, not the assets.

I wonder who they could have in mind?

The permanent secretary has already said he will retire, but the rot at the top reaches beyond one individual. The priority must be to bring in non-executive directors who can speak for taxpayers, workers and civil society and challenge those of the over-represented voice of the business world – and make sure it pays its dues.

Prem and Ritchie I think, don\’t you?

Actually, I think I\’d like to see that happen too. Reading the minutes (because of course they would all be terribly transparent, wouldn\’t they) would be a source of endless amusement.

What do you mean that the amount of tax I think they should pay isn\’t what the law says they should pay?

Dear Lord George, Dear Lord

Rightwing libertarianism recognises few legitimate constraints on the power to act, regardless of the impact on the lives of others. In the UK it is forcefully promoted by groups like the TaxPayers\’ Alliance, the Adam Smith Institute, the Institute of Economic Affairs, and Policy Exchange. Their concept of freedom looks to me like nothing but a justification for greed.

As I do/have written for two of the four I think it\’s safe to assume that I\’m one of those being talked about here.

And I\’m afraid that\’s a characterisation which makes me rather angry. For the reason that it\’s bollocks.

If you look through the tens of thousands (yes, it is that many, from the formal here to the informal on this blog etc) pieces I\’ve done over the years one of the major points I make is that there are rights that conflict and the question is how do we balance those conflicting rights?

Not whether we should, not an insistence that the rights of the powerful should trump those of the less so. But what mechanisms do we use to sort through which rights should prevail?

Monbiot is talking cock basically.

This isn\’t actually true

\”Wealth inequality is very much greater than income inequality, and widening,\” Clegg said. \”The bottom third of households hold just 3% of the nation\’s wealth. The top third hold three-quarters of it. This inequality of wealth then cascades down the generations, potentially widening the opportunity gap.\”

The specific piece that isn\’t is this:

The bottom third of households hold just 3% of the nation\’s wealth. The top third hold three-quarters of it.

It\’s a function of how wealth is calculated.

Sure, there\’s wealth inequality, but it isn\’t as stark as these numbers. Because we have something called the welfare state which attempts to balance these inequalities.

For example, private pension savings are counted as wealth. State pensions are not. Houses owned are counted as part of wealth. The right to live for life in subsidised housing is not.

Yes the state pension is indeed wealth, it\’s a right to an income flow. As is council or social housing wealth. That\’s why we subsidise it, so as to provide wealth to those who do not have it.

To ignore this is to commit, as Christie has called it, the Worstall Fallacy.

It\’s just fine to measure the wealth gap, or incomes, or disposable incomes, in fact measure anything you like, raw. It\’s also just fine to measure such things after whatever is done to remediate what is considered to be unacceptable.

But it isn\’t fine to use the raw measures to argue that more remediation must be done. You must measure after the remediation that is already done so that you can decide whether further is needed or desirable.

To use an entirely trivial example to make the point. Old folks feel the cold more than the younger. Die of it more often for example. Might be a good idea to ship a bit of extra money to the old folks each winter to pay for the heating bills that they incur in not dying.

So, do we measure how much should be sent by assuming that none is? Or do we measure future action by acknowledging that we already send £300 to each such oldie? Might be oldie household, dunno.

Quite. Only an idiot would measure how much more we should be sending without referring to how much we already do.

Yet, and it pains me to have to point this out, the wealth gap is approached as an idiot. It is measured without taking account of what is already done to mitigate it, policy is proposed without taking account of policies already in effect.

That is, from Danny Dorling through to Nick Clegg, they\’re idiots, lying or ignorant. Clegg as a politician is almost certainly guilty of a mix of one and three. Dorling\’s certainly not ignorant and it seems a bit much to be accusing a Professor of idiocy.

Markets are forward looking

So, 8 days ago, nine days ago, we had the announcement that the ECB would lend at 1% to any bank that could come up with even vaguely acceptable collateral.

And yes, eurozone sovereign debt would be most welcome collateral, why do you ask? Thus an attempt at a solution could be seen. Get the banks stuck into the greatest carry trade ever and she\’ll be right.

However, this doesn\’t actually start until the New Year. Yet bond yields have already been falling.

Global funds are gobbling up Spanish and Italian debt on bets that lenders will exploit the European Central Bank\’s offer of three-year credit at 1pc to buy sovereign debt, playing the \”carry trade\” on the yield spread.

Quite, markets are forward looking. Doesn\’t mean they\’re always right, heavens no, just that they do try to anticipate the future.

This shouldn\’t happen of course

Indeed, prison guards have a duty to make sure that it doesn\’t.

Young offenders jailed in the wake of the summer riots were attacked by fellow inmates who had seen their home towns targeted.

Criminals already in custody and worried about their families and friends being caught up in the disturbances turned on the perpetrators once behind bars, prison inspectors revealed.

And I would very definitely want to insist that the guards did their duty and made sure that no harm came to their charges.

But with that caveat, that no physical harm came to those in custody, it\’s rather satisfying, isn\’t it?

The PAC Report

Largely politicians grandstanding in ignorance.

I have particularly liked the way they go on about how HMRC must be independent, seen to be independent and impartial, then insist that HMRC shouldn\’t keep the tax matters of individuals (personal or corporate) confidential from politicians.

Politicians who would, never, ever, be anything less than entirely impartial when in possession of detailed information about the tax affairs of an individual (whether corporate or personal).

Imagine, as an example, what Chuka Baby would do if he had access to the details of bank taxation. Actually, no need, given the way he lied/dissembled/completely misunderstood for political grandstanding reasons when he was told about Barclay\’s corporate taxation payments.

From the PAC Report

We are particularly uneasy about the blanket confidentiality applied to cases raising governance concerns or where mistakes were made in reaching settlements, because we are unable to scrutinise what went wrong in these cases. Details of some of these cases only came to our attention because they appeared in the media. It is deplorable that we received more information from the media and from a whistleblower than from the Department itself.

With reference to the Vodafone case the only original media source was Private Eye. Everyone else (yes, Ritchie and I included) is a secondary source, trying to parse what the hell they meant.

And what they did do was simply ignore the impact of the Cadbury case on CFC laws. Vodafone provided for UK tax up to the decision in Cadbury. Cadbury made it quite clear that the then HMRC interpretation of CFC was not valid. Thus provisioning stopped.

The numbers the PAC are using, bandying about £6 billion, £ 8 billion, stem from this basic mistake of believing Private Eye. Not realising that the law was changed by that court decision. I have had confirmation directly from a member of the PAC on this point.

From the PAC report: Goldman Sachs

In one case, we sought information on the details of a settlement in which an error had been made with the effect that the company concerned did not have to pay interest due on its tax liability. The C&AG told us that this resulted in a loss of up to £8 million in interest forgone. We have since received evidence from a whistleblower that the total value of interest payable in respect of this particular settlement could be as high as £20 million.

Note the very precise wording there.

The admission that £8 million in interest was foregone as a result of the mistake.  The claim by Mba that the case shouls have entailed £20 million in total interest.

The way that paragraph has been constructed (and it is repeated elsewhere) makes you think, hey, they say that £ 8 million wasn\’t paid but the whistleblower says £20 million wasn\’t paid!

No, look more closely at the actual statement. The case involved £20 million in interest. £8 million in interest was not paid. Whatever the truth of the matter, that\’s actually what they are saying there. Norte what they have not said: that £20 million of interest should have been but was not paid.

From the PAC report: the £25 billion in tax unpaid

Tax disputes between HM Revenue & Customs (the Department) and large companies are a consequence of the complex and international nature of modern business. Disputes can arise about the facts of a particular case, about the interpretation and application of tax law, and about the legitimacy of tax avoidance schemes. At 31 March 2011, the Department was seeking to resolve over 2,700 issues with the biggest companies, including disputes over outstanding tax, with potential tax at stake of £25.5 billion.

No, there isn\’t £25 billion unpaid.

There is £25 billion that HMRC is claiming should be paid. This is a rather different statement.

For, as numerous court cases over the years have shown (Cadbury about CFC, M&S about foreign losses, M&S again about VAT once wasn\’t it?) what HMRC claims is payable is not always the same as what the law says, ultimately, is payable.

One of the complexities is that EU law trumps domestic as in the CFC rules.

And yes, it is true that where there is a possible conflict in the myriad of laws that govern us we do have access to the courts to try and resolve those conflicts. Whether as individuals or as those associations of people known as companies.

Just to try and make this point more strongly. Before the Cadbury decision the amount claimed by HMRC would have been part of that time period\’s equivalent of that £25 billion. But as we know, that money was not actually payable.

There is not £25 billion of unpaid tax. There is £25 billion in dispute over whether it is payable in tax or not.

To reduce this number you could do any one or all of three things.

1) Simplify tax law so that there are not such disputes. Certainly, more effort should be made to make sure that UK tax law agrees with EU tax law: that latter having primacy.

2) Speed up the legal system. People have been trying this for centuries but the lawyers will have their billing hours.

3) Deny people the right to appeal decisions. This can certainly be done but welcome to the dictatorship.

A handy guide to reading the news reports today. And the usual blogs. Anyone who says there is £25 billion in unpaid corporate tax is lying, ignorant or both.

This is the amount that is in dispute, including amounts being decided upon by the courts system. And as we\’ve seen time and again, what HMRC says is tax due just isn\’t always what the courts say is tax due.

The Murphmeister\’s Peoples\’ Pension Plan

Our favourite retired accountant from Wandsworth is all over the place shouting about his Peoples\’ Pension Plan.

And I\’ve just noticed a nice little oddity about it.

return the capital invested over the life of the asset, so that at the end of the period the sponsor would effectively own the asset, as is common with finance leases

Fair enough, this can definitely be done.

But then he tells us that the returns on these projects would be around gilts rates.


@RichardJMurphy Richard Murphy
@kentindell People\’s Pension would pay about gilt rate – which may not beat inflation last year but better than the stock mkt in last decade
Which is interesting because if you put £100 into a gilt then in 30 years you get £100 (nominal, to be sure) back. With the Peoples\’ Pension Plan you get the same interest as a gilt but don\’t get the £100 back.
It does take some effort to come up with an investment even worse than gilts, doesn\’t it?

@richardjmurphy: I hope this is ignorance, not lying

Second, the statement doesn’t note that Vodafone fought this for nine years and lost all the way.

No, they didn\’t.

They won all the way to the Court of Appeal.

They won at the Special Commissioners, they won in the High Court.

The essential question was: Do the CFC rules apply to EU subsidiaries?

Special Commissioners said \”No\”. High Court said \”No\”.

Court of Appeal said \”maybe\”.

And how do we know that Vodafone won? Because it was HMRC that appealed the two junior decisions.

Anyone and everyone is allowed their own opinions on whether CFC should or should not apply. But no one is allowed their own facts.

And we get a response!


@RichardJMurphy Richard Murphy
@worstall I don\’t do lying….they lost because the courts denied them the right to appeal their loss – that\’s losing all the way I think
Err, no, it isn\’t. Losing all the way is losing at each stage. Losing at the end is losing the last case.


Via, this:

Stray showers of mercury getting into food chain

Poisonous metal released as a vapour by burning fuel, then falls back to Earth and gets absorbed by the aquatic ecosystem

Given that this has been happening for a century or two and we\’re not all murdered in our beds by the pollution, should we conclude therefore that mercury isn\’t quite as poisonous as some would have us believe?

Lots of it does kill of course but a little bit spread through the environment not so much?

There\’s a reason the Welsh get paid peanuts

PRS for Music accepted that payments to many Welsh language musicians had declined. Mark Lawrence, the director of membership, said: \”Rates paid for radio station play and also for use in businesses around the country are reviewed constantly, based on audience, reach and sampling work our teams do.\”

The basic rate for a song on Radio Cymru is 59p a minutes, and 95p on Radio Wales. An additional element for plays in businesses takes the payments up to about £5.75 for Radio Cymru but almost £150 for Radio Wales. The basic rate on Radio 2 is about £22 a minute.

It\’s because no fucker listens to them.

As is right and proper of course.

Geography ain\’t what it was

More fundamentally, over centuries this country has made her living (and endured much of her dying) around the world. It is extraordinary that in the age of the internet she should believe that she must do the economic and political equivalent of marrying her next door neighbour. If ever there was a time when matters of language, culture, shared history, law and fellow feeling should trump geography surely this is it.


There was indeed a logic that we should trade with the people next door to us preferentially. A logic rather destroyed by the invention of the shipping container.

The first sailing of which was 6 months before the Treaty of Rome…….