More glory from @RichardJMurphy

The finance sector was Cyprus’ number one income earner.

That\’s interesting.

But it was not its number one employer, by a long way.

That\’s even more interesting.

Having been a tax haven will prove to be a disaster fro the people of Cyprus. With all other economic activity squeezed into the background by an over-expanded finance sector the ripple effect will be enormous.

And that\’s nonsense of course.

Finance and insurance was, by Ritchie\’s own numbers, 4.8% of total employment (rather less than it is in our own dear UK, rather less than it is in most advanced countries in fact). Yet it was the largest earner? That shows that a) finance and insurance was vastly more productive than employment in any other sector and b) there wasn\’t much crowding out as the sector was a small, even underweight, percentage of total unemployment.

8 thoughts on “More glory from @RichardJMurphy”

  1. The Greeks must be thanking their lucky stars that they do not live in a tax haven, or the same thing could have happened to them

  2. Finance isn’t (or wasn’t) Cyprus’s largest income earner. The retail and property/construction sectors are both larger, retail substantially so.

    Not really surprising that retail is larger as it is in most “normal” economies. But finance was only ever about 10% of Cyprus GDP. Implying there is quite a bit of other economic activity going on.

  3. I thought Cyprus was a low-tax jurisdiction not a tax haven?.. though I guess Murphy would not distinguish between the two

  4. Surreptitious Evil

    Incorrectly posted on the previous thread …

    I think, in the LTHD schema, Cyprus would be categorised as a “tax secrecy jurisdiction”. Which it certainly has been with regard to funds emanating from Russia. Much to the annoyance of the Germans.

  5. KJ, Murphy and many other, even more moderate, folk who get upset about “havens” define them as any place that does not have extortionate taxes.

    The whole concept, along with “offshore”, needs to be junked. Even the Economist, which has been going lefty in recent years, had a pretty reasonable recent survey of the issue in which it accepted that a lot of “onshore” locations are fuller of dodgy money than places such as the Caymans, Channel Islands or Switzerland. Well quite.

    Of course, what Murphy cannot and will not accept, given his collectivistic ideology, is that there are legitimate reasons for keeping bank account details private from the prying eyes not just of private criminals, but also from governments as well, given the appalling history of the countries in which some bank depositors live. As we have seen, even democratically elected governments, can, when divorced from legal principles, steal from their own citizens. Tax havens provide at least some bulwark against that.

  6. Jonathan Pearce (#5)

    If you check out (I’m assuming you have a strong stomach) the appalling ‘Mapping Financial Secrecy’ site run by the Tax Justice Network, there are (apparently) 73 jurisdictions which are classified as ‘ secrecy jurisdictions’. As well as those that I might expect, I was surprised to find such well know tax havens as Germany, South Korea, Denmark and Japan on the list.
    When I asked Murphy who elected the ‘TJN’ to sit in judgement on this issue and whose authority they represented his response was the personal abuse that has become his hallmark. You are absolutely correct about the requirement for these jurisdictions, and Murphy’s increasingly ludicrous pronouncements that basically Cyprus ‘ has got its just desserts’ provide ample evidence of that. To be honest, I’d barely have trusted him with the petty cash in the days of my first job, let alone with having even the slightest influence over the UK economy.

  7. @Van_Patten -I’m reading the murphmeister’s latest witterings with increasing alarm. If these were just the frothing rantings of a small-town accountant blogging in his own capacity I wouldn’t care less but this is the man that Unite, bankrollers of the Labour Party, want to help decide national tax policy if they win the next election. As far as I can work out his latest piece of typing (I won’t describe it as “writing” or even “work”) proposes that the State’s role in defining and protecting private property gives the State an inalienable right to decide what one can do with said property and where you can take it, and an absolute right to confiscate chunks of it in the name of the public good (here defined by Ritchie and his mates). This is demented.

  8. Flatcap Army (#7)

    I was blocked by him on Twitter for describing him as ‘The most Dangerous Man in Britain’ – he originally took it as a compliment, until I started quoting links to this site and was quickly rumbled as a ‘Neo Liberal Sophist’

    It wasn’t a joke post, however – his work is some of the most seriously deranged I have seen anywhere of the Left, it is combined with hypersensitivity to dissenting opinion and an inability to admit error. As you rightly point out, there needs to be much more made of the fact that in the event of (as seems likely) a Labour Victory in 2015, this man may very well be in a key position to dictate tax policy.

    His latest witterings on Cyprus, brilliantly skewered here and by the superb Frances Coppola elsewhere basically amount to a notion that the state, wherever it is, has the absolute right to tax anyone and anything within its jurisdiction whatever they deem fit, even if it is close to total confiscation. It is but a short step from Capital Controls, to what the leading contemporary example of ‘The Courageous State’ the Korea DPR, has in practice – Absolute Control of people – there seems no evidence that he is aware of this linkage nor does he pay it any heed when pointed out to him.

    As Tim so brilliantly puts it ‘ the idea of an ideal society is one where Tim Worstall isn’t running it’ – With Murphy his hubris is such that he actually believes he would be good at running it: The Hayekian quote about ‘safely entrusted to no man whatsoever and would nowhere be more dangerous than by someone who was foolish enough to think himself fit to exercise it’ applies here more than with any other individual in the UK.

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