Skip to content

April 2013

Today\’s Glorious Ritchie Report!

Dear Lord you\’ve got to hand it to hte man. His stupidity knows no bounds. His latest report.

Since 2009, HSBC and Barclays bank may well have underpaid UK corporation tax to the tune of £2.6 billion. This figure represents the difference between the tax the banks actually paid and what would have been due had they been taxed under what’s called a unitary taxation system. The data’s in a new report I have written with Meesha Nehru for the Tax Justice Network. As we argue, year on year, this is an extra £650 million that just two banks could be contributing to the Exchequer if we had a fairer corporate tax system in the UK. To put this amount into perspective, according to HMRC the total contribution of the banking sector in corporation tax (on income as opposed to the separate bank levy on debt) in 2011-12 was £1.3 billion.

And then they go on to look at profits and taxes in the 2009 to 2012 tax years. And they try to break out the UK paid taxes from the total global taxes. And amazingly they end up demanding that the two banks must pay much more in the UK. And they propose unitary taxation to make them do so.

Sigh.

At which three points occur.

1) The total effective tax rates don\’t look out of line. Indeed, Barclays appears to have paid 44% and 315% of total profits in tax in the past two years. Their figures not mine note. This means that any greater amount of tax paid in hte UK is only going to come from some smaller amount of tax paid elsewhere. This isn\’t about the banks being made to pay more. It\’s nationalism about who the tax is paid too.

2) They really are whazzocks though. What happened in 1007/8? Ah, yes, that\’s right, the greatest financial collapse since the 1930s, wasn\’t it. Banks made losses, humoungous great stinking losses. But not actually worldwide. HSBC did not make vast losses in its Singapore, Hong Kong or China business, did it? But it did in the UK. And yes, we can indeed carry forward losses: there\’s no possibility of a sensible tax system if you cannot. So comparing UK tax paid to size of UK business in a period when the UK business can use previous losses to offset UK tax bill is going to be, well, somewhere between a little odd and being a complete whazzock.

3) But if unitary taxation is the way to go then we absolutely do not need Ritchie\’s beloved country by country reporting, do we? For the whole point of that is to tax profits where profits are made. Which we don\’t do with unitary taxation. The fool.

It also rather amuses me that global tax paid is the current year charge to the accounts. Whereas with Barclays it is current year tax actually paid for the UK revenues. Corporation tax is paid in arrears lads……

You\’ll be surprised that Unite and Ritchie have double standards then, right?

Obviously fraud is wrong, but many people seem to think lots of people claiming benefits do so illegally.

When the TUC did a poll on this people thought that 37% of welfare was claimed fraudulently. The facts couldn’t be more different.

Just 0.7% of the welfare budget is claimed fraudulently
….

Compare this to the total amount lost through tax evasion and avoidance…

Hmm.

My own estimate of the tax gap is, of course, much higher.

Is there a double standard here? I think there is you know.

On the one hand we have only that which is actively illegal. On the other hand we have all of that which is illegal and a further, vast, amount which is legal but these bozos think should not be.

Or, as Margaret Hodge has been known to say:

We\’re not accusing you of being illegal, we\’re accusing you of being immoral

And when we start talking about morals then it\’s every moralist for himself, isn\’t it? I doubt we\’d have to dig far to find some dingbat who thought that able bodied males should not receive benefits. Or slightly more sensible people who think that perhaps endless amounts for ever more children are all that good an idea.

Or even Ritchie himself in fact. He certainly makes the point that housing benefit is immoral because it\’s just a subsidy to landlords. Controlling rents and or building social housing would be morally better. And there\’s any number who call in work benefits immoral: they\’re subsidies to employers who should be forced to pay living wages instead.

And if housing benefit and in work benefits like tax credits are immoral then surely they must be added in as with tax avoidance? Things that are indeed legal but shouldn\’t be, in the opinion of the LHTD?

Or do double standards rule here?

Bath\’s a very expensive city you know

The son of a Chinese government official was jailed yesterday for trying to bribe a British university professor with £5,000 to pass his degree.

Yang Li also took an imitation firearm into the meeting with the don and another senior academic at Bath University.

A court heard that Li, 26, was studying a masters degree in innovation and technology management and feared failure.

He was dismayed to learn he had been given just 37 per cent for his dissertation which was a fail – and would have meant him spending an extra year at the university.

That would have affected Li’s visa which he was hoping to upgrade from a student visa to a tier 1 visa.

Li, who was born and educated in China, asked to meet Professor Andrew Graves and Dr Stephen Shepherd to discuss his options.

Bristol Crown Court heard he told the pair ‘I am a businessman’ before placing £5,000 in cash on the table.

£5k just doesn\’t cut it I\’m afraid.

I\’m also amused by the Mail\’s photo. It\’s of a student dorm in the centre of town rather than of the uni itself. And no, it\’s not the student dorm the bloke lived in either.

Do fuck off Mr. Cameron

David Cameron is considering a temporary withdrawal from the European human rights convention in order to finally remove Abu Qatada from Britain.

The Prime Minister held a ‘council of war’ with senior ministers yesterday to find a way of deporting the hate preacher to his native Jordan to face terror charges, according to sources.

Home Secretary Theresa May, Justice Secretary Chris Grayling and Attorney General Dominic Grieve were summoned for talks at Downing Street shortly before the Government discovered it had lost the latest round in an interminable legal battle to remove the terror suspect.

Sources said Mr Cameron had declared Qatada’s continued presence in Britain ‘intolerable’ and insisted even the most controversial options must be considered.

We have this thing called the law, see? And Mr. Qatada has the same rights under this rule of law as you or I do. And quite rightly so: it is one of the great boasts of our country that none are too mighty to be above the law. So too should it be that none are to be denied it.

One of the reasons we have this system is so that people who are declared bad \’uns by some Old Etonian claiming to run the country cannot be railroaded. If the law states that Mr. Qatada cannot be sent off to face charges bolstered by evidence perhaps gained under torture then Mr. Qatada cannot be so sent off. And that\’s it really.

Cue More and Roeper from A Man For All Seasons please.

The Guardian does economics with Heidi Moore

Through the person of its US \”finance and economics editor\”, Heidi Moore.

Would you believe it she\’s even worse than the Guardian\’s UK economics nutters?

For the first time, the US is changing the way it measures its economic growth, the measure we call our gross domestic product. Starting in July, the keepers of US economic data at the Bureau of Economic Analysis will stand over the usual cauldron of GDP – a stew that includes how much Americans consume, government spending, investment, exports and imports. They\’ll begin to add new ingredients that, in a puff of smoke, will create a more favorable, higher gross domestic product.

The new ingredients include Hollywood royalties from TV, movies and songs – some Tinseltown magic, really – as well as revenues from scientific research and development. Like a feelgood movie, this will make us feel positive, briefly – boosting our GDP by as much as 3% from its currently anemic level of 0.4%.

I think you can see where this is going, can\’t you? She\’s confused between the level of GDP (what we produce) and changes in GDP (how fast or slowly the amount we produce is changing). And you might think that that\’s just clumsy editing or something, but I\’m afraid it isn\’t:

For one, it will be harder for us to know when we\’re in a recession. Right now, a recession means several quarters of negative GDP.

No, no it doesn\’t.

Getting to negative from where we are now isn\’t hard; getting there when we\’re 3% higher will be. While it may seem useful to avoid recession right now, that is actually a bad thing: it means that in periods when we do get negative GDP, we\’ll be in truly terrible shape.

Dear Lord. A recession is several (actually two) quarters of negative *growth* in GDP. Thus whatever our actual level is, 100, or 103, makes no difference at all to our ability to either declare a recession nor our ability to be in one. And what in fuck is negative GDP?

In theory I suppose you could have it. No value was added in the economy at all. In fact, output was worth less at final market prices than the raw materials used to produce it at market prices would do it I suppose. But it\’s very difficult indeed to think of anywhere that has ever done this. Even in the glorious days of Soviet tractor statistics there were only a few factories that managed this prestigious feat.

Hollywood royalties, for instance, are not secure measures of investment.

Well of course they\’re not. They\’re income from past investments.

That\’s because, even in Hollywood, it\’s hard to measure what royalties are, or should be. Studios rely on notoriously tricksy accounting. Four major studios were hit with lawsuits this year over their accounting of royalties dating all the way back to the 1970s. \”Hollywood accounting\” is a shorthand for the obscure methods the industry has of turning profit into loss, or losses into hidden profits.

This chaotic mess of financial reporting will now be part of our national measure of economic health. What could possibly go wrong?

Err, no. Because we can measure what royalties actually are. Which is the number we plug into the GDP one.

She\’s simply not got the first clue about the subject under discussion, does she? Wonder what Larry Elliott thinks of this?

But let\’s not bne too, too, hard on The Guardian here. I reveal one of the things that is wrong with the world:

Heidi Moore is the Guardian\’s US finance and economics editor. Formerly, she was New York bureau chief and Wall Street correspondent for Marketplace, from American Public Media

APM is, I think at least, something like PBS, or their equivalent of the BBC sorta thing. And when you\’ve got \”Wall Street Correspndents\” who really have no clue about the subject under discussion then the public conversation about said matters is not going to be all that good, is it?

I wouldn\’t mind so much if they employed people with different views, different arguments about the way the world should work. But can\’t we at least start with people understanding the basics of the subject they are supposedly covering?

There\’s a problem with this though Dave

The Prime Minister is to announce a Government-backed code of conduct which will mean that pornography is blocked in public spaces such as cafes and railway stations where children are likely to be present.

Mr Cameron said that he wanted “good, clean WiFi” in public spaces which would give parents confidence that their children cannot access illicit websites on smart phones or mobile computers.

The Prime Minister said: “We are promoting good, clean, WiFi in local cafes and elsewhere to make sure that people have confidence in public WiFi systems so that they are not going to see things they shouldn’t.”

It\’s over defining what porn is.

For example, this blog is blocked by Vodafone Mobile for being \”adult\” in content (I assume a euphemism for porn) because I have a penchant for calling politicians cunts.

Similarly, someone who sets up a grumble flick site will only be defined as porn once someone gets around to doing so. So porn will be available, whatever you do, and not porn will be banned, similarly, whatever you do.

But never mind, you\’ve got the headline now, everyone know\’s you\’re going to strive mightily to protect the kiddies. However ineffectively, you cunt.

Ritchie on utility in economics

Dear Lord this is a stupid one from the Lord High Tax Denouncer:

Third, that utility is a useful economic concept. It isn’t. Distribution matters.

Utility is how we fucking discuss the important of distribution!

Take, for example, how we justify the extraction of money from the rich to give it to the poor. This is, BTW, something that just about everyone other than the most rigid of Randian Objectivists agrees with. The discussions revolve only around how much, not whether.

So, the marginal utility of an extra £ to a rich man is less than the marginal utility of an extra £ to a poor one. Thus we can increase the total utility experienced by all by taking a £ from a rich man to give it to a poor one. We might want to keep doing this until we come to a Pareto Efficient distribution. One in which we cannot increase the utility experienced by any one member of the society without reducing that of another one. Or, we\’ve maximised total utility.

So to say that utility isn\’t a useful economic concept is entirely nonsense: if you\’re in the business of reordering society through taxation and benefits that is. Because utility is the intellectual foundation of your entire structure of distribution!

The whole damn point of reducing inequality depends upon the usefulness of utility as an economic concept.

At which point we might open a little competition. Is there actually any economic concept at all that Murphy has managed to get right?

Off you go matey. Have fun

History suggests that the current crisis requires the immediate creation of an Anglo-American style fiscal and military union of the eurozone – a \”democratic union\”. This would involve the creation of a European parliament with legislative powers; a one-off federalising of all state debt through the issue of union bonds to be backed by the entire tax revenue of the common currency zone (with a debt ceiling for member states thereafter); the supervised dissolution of insolvent private-sector financial institutions; and a single European army, with a monopoly on external force projection.

This is the only solution that will enable Europeans to mobilise in pursuit of their collective interest rather than against each other, and integrate Germany economically and militarily into the larger whole, without disenfranchising the German people or any other population of the union.

The British and the American unions made history. If we eurozoners do not act quickly and create a single state on Anglo-American lines, we will be history too – but not in the way we had hoped.

No, really, best of luck to you too.

Note that German tax revenues will now support Italian, French, Spanish etc debt. Which will be nice for Germany.

Note also that it\’s eurozone, not EU. Which means that we\’ve got that multi-speed Europe thing, which is also fine. And note also that there\’s absolutely no fucking way that Britain would ever join such a monstrosity. So, really, do, have fun.

Polly visits a school and Polly on statistics

This is great fun. All is well in our schools because:

I was assigned to Chris Brolly, a Teach First-er in his third year. His 12- and 13-year-olds have been inventing a product – bottled water – and it\’s my task to help them write a press release. Can they create their own USP, write a grabby headline, hold the fleeting attention of a journalist, persuade with seductive language?

Yes, because 12 year olds are being taught how to write a press release.

Then there\’s Polly\’s famed connection with statistics:

But only a third of pupils who get good GCSE grades are on free school meals. A YouGov poll finds most voters don\’t think poorer children will ever get an equal education. Gove, calling for payment by results, cited Singapore\’s high-achieving school system, \”where expectations are higher\”. What he didn\’t say is that Singapore, like top performer Finland, is one of the most equal of developed nations. As his government drives up inequality, his schools face an ever tougher task compensating for the society they inhabit.

We generally measure inequality by Gini. 0.25 or so is Scandinavian style lots of equality (I am using the figures after the impact of the tax and benefit systems, of course). Above 0.35 or so is about the US and worse than the UK, 0.45, there\’s only one OECD country that bad, Chile, above 0.50 or so is Brazilian style oligarchy.

Singapore? 0.473.

Finland is in there with Scandi style 0.26 or so.

So, we seem to have one of the most equal and one of the most unequal countries managing to provide a very fine education to the kiddies. We might thererfore conclude that inequality is not the determinant of providing a fine education. Death of Polly\’s point, eh?

North Korea does have a point here

About giving up nuclear weapons:

The North\’s Rodong Sinmun newspaper rejected as groundless and unacceptable the US and South Korean condition that it agree to dismantle its nuclear weapons and suspend missile launches.

\”If the DPRK sits at a table with the US it has to be a dialogue between nuclear weapons states, not one side forcing the other to dismantle nuclear weapons,\” the newspaper said, referring to the North by its official name, the Democratic People\’s Republic of Korea.

The point being that it has never signed the non-proliferation treaty thus is not bound by its provisions. Iran has and therefore is. But it\’s a fairly basic idea in international law that a State is not bound by treaties that it hasn\’t signed.

No, not really Lord Browne, not really

\’Tis always the same, isn\’t it? To an engineer everything is engineering. To a politician all is politics, to a Marxist all is class.

Thus we find ourselves with Lord Browne telling us how the economy works:

The state of a nation is no more and no less than a function of what its people create. Creation begins in the laboratory, with research that unravels the processes which shape the world around us. It is then the job of engineers to turn scientific discovery into practical application, applying the fruits of the laboratory safely and productively to solve the problems of human existence.

The problem is that this is true of parts of the economy but not of all parts of it. That it is true of parts of it makes it important: that it is not true of all of it means that it is not a sole solution. For there are many more technologies (to use the word in its most expansive sense) that have absolutely nothing at all to do with engineering than there are that do.

Take, for example, the financial transactions tax. This is, as even the EU itself has reported, going to mean more expensive capital for companies. This will reduce the size of the total economy. No engineers were used or hurt in doing this: but the amount the people of the nation will create in the future is reduced by this method of taxation. This makes the FTT an undersirable technology, to be sure, but it\’s still a technology that affects production.

Or supply chain management, or just in time stocking of goods (both of which have had a large, much larger than generally acknowledged, impact on the larger economy). Or one I\’ve heard about, the stocking of fashion shops. There\’s a trade off between getting the stuff made in Spain or Portugal and doing it in China. China\’s cheaper, but with longer lead times. The correct blend of technologies seems to be to get the basic stock from China and then top up the best selling lines with goods from Spain and Portugal.

And yes, this is indeed a technology. Just as with David Friedman\’s point about turning wheat into cars. Some decades ago when he made the point the US did indeed use a factory in the Pacific to do this. The factory called Japan. So it is with the rag trade: Portugal and China are simply different technologies to make bikinis, each with their own costs and benefits.

So, no, I\’m afraid that not all will be cured simply if we have more engineering. Yes, creativity is indeed the root of all advance, but engineers aren\’t the only source of that.

Then there are two really bad errors……

The government\’s science budget, worth around five billion pounds a year, is recognition of the public good which results from these activities.

Puiblic goods eh? (Given that he is attempting to make an economic argument it must be public goods, not the public good.) You mean those non-rivalrous, non-excludable things like knowledge?

But we are in danger of being left behind. Science spending in China rose at a rate of 20 per cent per year in the first decade of this century, while Brazil tripled its research and development spending between 2000 and 2008. Scandinavian countries spend nearly four per cent of their GDP on research and development. In contrast, the UK devotes just 1.8 per cent of its GDP to R&D, and the science budget has been frozen since 2010.

Ah, excellent, those non-excludable and non-rivalrous things like knowledge that we can all benefit from wherever the original work might have been performed. You know, they spend more on science and thus there\’s more science for us all to enjoy?

And then this:

Second, we need to take meaningful steps to attract and retain the most talented individuals and teams, whether they are from the UK or abroad. We need 50 per cent more university graduates to go into STEM jobs every year if we are to fill the shortfall in scientists, engineers and technicians which the UK is likely to face by the end of the decade.

That\’s easy enough. We\’re in a market economy after all. You fuckers employing engineers have to pay them more. Problem solved.

How does this work then?

From the usual numpties telling us that renewables don\’t cause a problem for grids.

\”could meet or exceed demand in 99.4 percent of hours, with load being met without imports from other regions and without turning to reserve storage. In addition, surplus power would be available to export in 8.6 percent of all hours, providing an ample safety net where needed from one region of the U.S. to the next.\”

Via email.

Err, so if other regions only need outside the region power 0.6% of the time then where and how are they going to dump the excess power which is available 8.6% of the time?

Haven\’t we just said that a renewables heavy system will need to dump near 10% of all the energy it generates?

But we know that fat birds do

Strange little piece today:

Young mothers are often thought to be at an advantage when it comes to getting back in shape after pregnancy.

But in fact women who have babies in their teens are significantly more likely than older mothers to become obese later in life, research shows.

Those who had their first child aged 19 or younger were a third more likely to be very overweight, it found.

Significantly fewer women who gave birth in their teens were of normal weight than those who had babies later.

Yes, they do correct for background and income (ie, class). However, what they don\’t seem to correct for is heft at the time of getting pregnant. Which is something of a mistake. For as everyone who has ever been out on the pull knows a few extra pounds on her vastly increases your chaces of a legover. The reason being that this mating game really is a market and you\’ve got to play a market by purveying your asseets as best you can. Some slim little knockout is able to insist on certain male behaviour before rumpy pumpy. The fat bird with spots has less to negotiate with: therefore we know (and it has indeed been proven) that the fat birds are more likely to be having sex without condoms. This can indeed lead to preggoness but I wouldn\’t argue that that is what is driving these numbers. Rather that this less to negotiate with is going to lead to earlier pregnancy.

Clearly we can\’t do this because Ritchie would not approve

Current circumstances require a combination of carrot and stick. The government should announce a temporary increase in corporation tax, putting it up to a punishing 50% for a strictly limited period, say three years. Then it should announce that 150% of all investment within those three years can be written off against tax.

But this would increase tax avoidance so it cannot be allowed to happen.

Recall The Murph\’s analysis of nPower? The bastards invested a lot of money in new plant and then had the temerity to claim the investment allowances. This resulted in no tax being paid upon their operating profits: tax avoidance, clear as day, obviously.

Tsk, doesn\’t everyone know that the retired accountant from Wandsworth is the ultimate arbiter of how much tax should be paid?

On writing for Forbes.com

The Big Cheese is interviewd in The Guardian.

It all started in 2010 when Forbes threw its website open to bloggers, academics and experts from all sorts of areas relating to investing and entrepreneurship.

In total DVorkin now has 1,000 contributors – he hates the word \”bloggers\” – alongside a core staff team of 100, of whom about 50 are reporters.

And here\’s where the difference starts – not only do contributors self-publish, but they are paid according to the size of the audience they attract. He declines to reveal exact rates, but each contributor gets paid a certain number of cents for every visitor per month. There is a clear incentive for them to get repeat custom, as they get paid 20 times that amount if the same person reads another of their posts during that month.

The beauty of the arrangement for Forbes is that it encourages contributors to increase their traffic through social media and whatever other self-promotional outlets they have. In 2012 two contributors made more than $100,000, several made $75,000 and 25 made $35,000. One of the most popular individual blogs last week was a piece on the world\’s most valuable football teams, starting with Real Madrid.

Newspaper editors in the UK would be aghast at the prospect of 1,000 unedited journalists roaming freely on their websites with access to the internal editing and publishing tools

It\’s not unedited. Rather, it\’s post-publication edited. It is entirely possible to publish the wrong thing and get unceremoniously dumped (as I believe Ritchie did). And there are most certainly editorial staff who cast an eye over what has been published.

But those earnings numbers look about right. It\’s a good gig. Indeed, given what freelancers usually earn it\’s an extremely good gig.

Which leads to the fun about how I got the gig. I saw that Richard Murphy had got hired to do this. And he noted that he was going to get paid to do this. So I scratched around to find Mr. DVorkin\’s number and made a call. \”Given that you\’re hiring the UK\’s number 1 economics blogger shouldn\’t you also be thinking about hiring the UK\’s number 2 economics blogger?\”

\”Err, yes, OK then\”.

In fact, if memory serves me right, it was Arnauld telling me that Murphy was streets ahead of me because he had just been hired to write for Forbes that prompted the call. So thanks for that Arnauld. I\’m not quite one of the several so many tens of thousands of thanks in fact.

David Graeber\’s debt solution

There\’s good bits in his analysis: he makes the same point I\’ve been making for years (thus it is obviously a good bit agreeing with my prejudices as it does) that the debt dynamics are entirely different in a country that prints its own money and in one that does not. Sadly he seems to think this is a revelation rather than a generally accepted truth.

However, he rather goes off the rails here:

Warren Mosler and Philip Pilkington are two economists who dare to think beyond the shackles of Rogoff-style austerity economics. They belong to the modern money theory school, which starts by looking at how money actually works, rather than at how it should work. On this basis, they have made a powerful case that if we just get back to that basic problem of money-creation, we may well discover that none of this is ever necessary to begin with. In conjunction with the Levy Institute at Bard College, they propose an ingenious, yet elegant solution to the eurobond crisis. Why not simply add a bit of legal language to, say, Irish bonds, declaring that, in the event of default, those bonds could themselves be used to pay Irish taxes? Investors would be reassured the bonds would remain \”money good\” even in the worst of crises – since even if they weren\’t doing business in Ireland, and didn\’t have to pay Irish taxes, it would be easy enough to sell them at a slight discount to someone who does. Once potential investors understood the new arrangement, interest rates would fall back from 4-5% to a manageable 1-2%, and the cycle of austerity would be broken.

Well, yes. This is based on the idea that fiat currency really only has a value because the state demands that taxes be paid in it. Very MMT that is.

But the value of the bonds will depend on the volume of bonds as opposed to the taxes that have to be paid with them. Which brings us right back to the same old problem: the volume of debt available to pay those taxes.

If debt were, say, 30% of GDP, then one can imagine, again just as an example, 10% of outstanding bonds being used to pay taxes each year. Say, 3% of GDP. Somewhere around the yield from corporation tax say: that would be a likely source of such redemptions. If corporate treasurers could see a discount on hte bonds then they might well buy them to feed back to the taxman.

Now think that the debt is 120% of GDP and the interest rate on the bonds is high (or, same point, that the discount on the bonds is high, yields moving inversely to price). Everybody sees that they can save 15% on their tax bill by buying the bonds and tendering them. The State can only take in 50% of GDP in tax in any one year (ish, ish). Now it gets all of that in olds bonds being tendered and none at all in cash. In extremis of course.

At whioch point the government is still fucked, isn\’t it? It\’s received no cash at all in taxes that year, only managed to retire some of its debt. To actually pay for anything it must therefore…..print more money or issue more bonds. It can\’t print more money because it\’s in the euro. If it issues more bonds to cover the bonds that are being submitted then the stock of bonds hasn\’t changed and nor has the ability to finance that debt stock over time.

So nothing, in the end, has really changed, has it? They\’re still fucked because they\’re in the euro with a very large debt to GDP ratio.

The Posties threat

Renationalise Royal Mail or lose millions in donations, CWU tells Ed Miliband
Labour must agree to renationalise Royal Mail within three years of coming to power or lose millions in donations, postal unions say.

Bit of a bugger, eh?

Billy Hayes, the CWU’s general secretary, said: “Privatisation is an old-fashioned idea. We’ve seen it fail in areas such as the rail industry where prices have soared and safety standards and services to customers were left in disarray.

“Our conference will be re-stating the CWU’s opposition to the planned privatisation of Royal Mail which we don\’t believe is in the interests of customers, the workforce or the wider industry.

“We want a modern Royal Mail in full public ownership and able to deliver the universal service six days a week to all parts of the UK. We’ve had the full support of the Labour Party in that desire in the past and have no reason to believe that will not be so again.”

Here\’s the problem with this desire: the EU won\’t let you do that.

Oh, the Mail can be publicly owned, that\’s not a problem. But it must be possible for others to compete with it on an entirely level playing field. Something which obviously precludes any form of public subsidy to the Mail.

And the Royal Mail cannot operate as is without public subsidy. Thus it must be privatised in order to be able to raise the capital to modernise.

What the CWU or the Labour Party want doesn\’t really come into it.