Fun for Bathonians

Sir Roger Bannister
Gentlemanly athlete and physician who was the first person to run a mile in under four minutes, but was prouder of his achievements in neurology
The family moved to Bath, Somerset, when the war broke out. His daily walk to the City of Bath Boys’ School ended with a sprint up 150ft of steps, and he soon broke the school’s cross-country record.

City Boys’ is now Beechen Cliff. So those steps are those leading up from the station/Widcombe to Alexandria Park. Yep, they’ll get the lungs and legs working. I’ve walked them.


Gone ’round the other way ever since.

Well, they probably will actually

It’s always worth reminding ourselves of the realities Rees-Mogg ignores. And let’s be clear: he can’t ignore them. If we are to trade with the EU after March 2019 we have to give them data. If we can’t, we won’t trade. It really may well be that simple. They are not going to break their law to do so.

It’s so quaint to think that the EU obeys the law all the time, isn’t it?

We’re looking for writers

Over at Continental Telegraph.

No, don’t get excited, it’s definitely unpaid.

But we would be interested in more people joining the roster. There is no commitment to regularity, you don’t need to sign up to do a regular column or anything.

Pieces should be unique tho’. We’re not going to become simply a place to reprint blog posts.

If you’ve an expertise, or a point of view, we’re interested. If you’ve specific books, records, video games you’d like to review and tell us all about that’s fine too. That second might well suit those who review stuff at Amazon for example.

Drop me a line at “” and we’ll get things moving.

Hmm, right

Now, don’t get me wrong. I happen to agree that we do need more government spending. But let me be clear. This is not a matter that need be decided upon on the basis of whether or not there is sufficient tax to pay for it. The decision criteria is simply is there need, and are there unused resources that could meet that need? If the answer to both is yes then the spend is necessary and a responsible government should undertake it, knowing that the boost to the economy that will result will return the spend to the Treasury by way of additional tax yield in due course: that’s what the multiplier does.

Those unused resources being, at full employment as we are, what?

Ritchie on Maplin

Maplin had almost no chance of meeting the expectations of its new owners. The chance
that it could ever pay a 15% return was remote in the extreme. The chance that it was overstressed
in an attempt to make such payments is highly likely. The result is its employees
losing their jobs and a valuable resource for many being lost to the High Street.

But there wasn’t any value,. was there? For consumers valued it at less than the cost of providing it to them.

Well, yes, it has

I have always argued that offshore is a mechanism created by capital to launch an assault on democracy. That is exactly what is written all over this suggestion. Macquarrie are making it clear that people’s choice to elect a government that might seek to take into public ownership the utilities that serve them should not matter: the ‘fiduciary duties’ of capitalism come first.

I would suggest Macquarrie are too late. First, saying it proves the public case against them. Second, the potential for this to happen is already foreseeable and so is not protected by treaties.

But the broader signalling is more important, and clear this morning. First we have Dyson demanding the UK behave like a tax haven. Now we have a warning that tax havens must be used to subvert the democratic choices of the UK population.

It feels as if class warfare has been declared.

The declaration was made by those like the Senior Lecturer who decided that anything owned by rich people should be nicked.


Much brain power is being overused in attempting to make the US tech giants contribute more to Her Majesty’s Revenue. The initial complaint, that the current international business taxation system doesn’t deal well with digital, is entirely correct – it doesn’t.

The problem is that almost all of the suggested solutions to this inconvenience run up against two rather harsh economic facts. One is that businesses never really pay any tax at all, and the other is that the problem of not paying any taxes at all is already largely solved.

If only Ritchie could grasp both points, eh?

In other news, am doing a piece for the Independent, writing my little fingers off at Continental Telegraph and how are you all?

Yes, things will happen here once we’ve got that running……

An interesting question for the Senior Lecturer

That said, this means that government bonds are an asset with very low inherent risk. As a consequence, gilts have the lowest interest rate paid in any market. Despite this they still have great appeal to pension fund trustees and insurance companies, both of which have an obligation to settle liabilities far into the future.

Despite isn’t the right word there, because might be. Assuming we leave aside the regulatory insistence that they hold gilts that is, a form of financial repression.

In particular, companies seeking to place millions and even billions of pounds on deposit overnight seek security for their cash. They achieve this security not by placing the funds in bank accounts, but by temporarily purchasing government bonds from banks. These they then sell back to government the following morning at a very marginally higher price to cover the interest earned. This is called the ‘repo’ market.

Repo involves purchasing from banks and selling back to the government, does it? Blimey, the things you find out in a policy briefing.

A growing economy requires general price increases, or inflation.

It does? Or perhaps this is to misunderstand the point, which is that a tad of inflation eases the relative price changes that come about from a growing economy. Need therefore being the wrong word.

Except under unusual circumstances, a general increase in prices requires an increasing money supply.

Not really, no.

A fiscal deficit is the only way in which money can be injected into an economy continuously.


It follows that governments must run a near perpetual deficit or face the risk of creating a liquidity crisis due to a shortage in the money supply, which would then create a risk of deflation.


And now the set up for our question:

A government can never default on a bond that it issues in its own currency because it can always instruct its central bank to create the money required to make repayment of a bond when redemption is due. As a consequence the owners of gilts have an absolute guarantee that their funds are safe. This is fundamental to the financial security of an economy.

If you bought a consol in 1945, just to give a date, then held it until Osborne bought them in a couple of years back, were your funds safe?

Show your workings and define your terms.

My own intuition, without looking anything up, is that you might have got back a thruppeny bit on your £. As capital that is, not going to try and headwork the interest received….

Ahhh, shit

This is the hardest post I have ever had to write. It’s nearly three in the morning and I can’t sleep, so I am putting my thoughts onto the page, because I need to.

On Friday, Mrs L, that anchor who travelled along side me as I navigated life, who was always there, with a quiet word, who shared my strange humour, died of the cancer that had made her so ill this past few months.


I noted yesterday that the suggestion that Google, Facebook and other tech companies should pay tax on their turnovers would give rise to all sorts of problems, almost certainly be regressive, and be a move in the wrong direction on corporation tax reform. I suggested an Alternative Minimum Corporation Tax as an alternative where, in effect, tax be charged at a reduced rate on the global weighted profits that would appear to arise in a country if the local tax paid appeared to be inappropriately small, probably because of the use of tax avoidance activities. Some people asked me for a worked example, so I have done one.

Ritchie takes revenue that Google says comes from a country to do his calculations. Hmm. When ticked off about this he says:

Richard Murphy says:
February 24 2018 at 11:25 am
You are ignoring the concept of permanent establishment (PE) for taxation. This is a complex area, especially for what are in effect digital companies. But in effect it says that if an activity is managed in a territory then even if it is owned elsewhere it is taxable in the territory on the profits arising there.

Google et al have to sell. They do not do all of this on line: they have significant numbers of people doing so on the ground. The whole argument is about whether or not these people are the PE for tax.

I think they are: selling ads is the whole raison d’etre of these companies. They make value no other way. Their IT is useless without sales and valueless without them. So the sale is all that matters. I accept a fee for back office services – to the place where they really occur – is fair. But the argument is that the destination of the sale is key here. And I would contend – as do many – that tax law needs to reinforce this.

That is the direction of travel around the world. Until it happens what I propose is an interim step.

Yes. lovely. But those PE rules are what Google operates under now, aren’t they? So those “UK” revenues aren’t in fact taxed in the UK. They’re not even legally recognised as UK source revenues. In law they’re Irish income, aren’t they?


Gissa job!

First I think think that the lack of experience Lady Stowell has makes her wholly unsuited for this task. If the supposed crisis at Oxfam suggests anything it is that the charity sector should no longer be the preserver of the enthusiastic but unskilled amateur and that appropriate skills are required. It is a failure of leadership to appoint someone without the required skills to the Charity Commission in that case.

Second, I do not believe that resigning your party membership when you have previously been appointed by that party to high political office breaks your association with a party or party politics and it is absolutely clear that party politics is not a part of UK charity activity. To have someone in charge of the sector who has been partisan to the date of their appointment and whose resignation is solely motivated by that appointment pushes the boundaries of credibility on this issue both for those who suspect that this is a political appointment and for those who want fair play to be seen to be done, as I do as someone who is very clearly interested in politics but who has very clearly not endorsed a party line and has been critical of all parties when I think it appropriate.

There is only one man with the skills necessary who has not been a member of a political party.

Step forward Richard Murphy, head of the Charity commission!

So, a new project and game for us all

I’m trying a new idea. therefore, pieces are going up elsewhere.

At Continental Telegraph. Yes, there is a comments section.

It’s all a bit new, most of the site is still cod pieces just to make spaces right and so on. But the general intention is to get this up and running as a truly Worstallian newspaper…..something a bit more than a blog, perhaps a little less than a newspaper in fact.

As a general layout, the usual ranting and shouting will be there. Then, added excitement of pieces aimed at search engines etc. The game to see whether sufficient traffic to support a lifestyle can be gained. There will obviously be the occasional pieces here as well. Stuff that even a Worstallian paper wouldn’t publish.

Lifestyle requires 20,000 page views a day once running properly. Can this be done?

A useful form of rationing

So it’s time to challenge the university shibboleth of the more the merrier. Using better data, we should decide on the right number and reintroduce a cap on student numbers in conjunction with social quotas for every university. These must ensure that places are reserved for young people from the most disadvantaged backgrounds.

Say, 10% of the age cohort and that’s your lot?

Erm, as we did 40 years ago?

The joy being that we get to sack 80% of the current professoriate.