Ragging on Ritchie

Now, where did Wes Streeting get this idea from? And where, come to that, did his estimate of the tax that it might raise come from?

It so happens that the £12 billion figure that he refers to is exactly the sum that I proposed might be raised as a result of the equalisation of income tax and capital gains tax rates in the Taxing Wealth Report.

Might it be that Wes Streeting’s advisers have been reading my work?

It’s from Advani and Summers at CenTax. Shitty, horrible, work but that’s the source.

But that said, the index has fallen. I cannot deny that this is the reported data. However, I should draw attention to three things.

The first is that this is backwards-looking information. It records what has supposedly happened (and I use the word supposedly very wisely, because these things are subject to revision), and it does not imply what will happen.

So recorded past inflation is to be noted as recorded past inflation is it?

Well I never.

Trump’s attack on the ICC is really an attack on the rule of law
Posted on May 19 2026

The Financial Times has reported that during discussions with Xi Jinping, Donald Trump suggested that the US, China and Russia should effectively collaborate against the International Criminal Court (ICC). As the paper put it:

During his summit with Xi, Trump also suggested that the US, China and Russia should join forces to combat the ICC, saying their interests were aligned, according to the people familiar with the talks.

The same report noted that the Trump administration has described the ICC as engaging in “politicisation”, “abuse of power”, “disregard for US national sovereignty” and “illegitimate judicial over-reach”.

Whether or not Trump actually intended these comments to become public is almost beside the point. What matters is what they reveal about the worldview now shaping much of global politics. The hostility here is not simply towards one court. It is towards the idea that there should be laws capable of constraining power, whether exercised by politicians, states, corporations or military alliances.

Spud then chunters on about all of this and it’s terrible, break of international whatever and so on.

Without actually noting that the US, China nd Russia are not party to the ICC anyway. While they signed the relevant treatry they’ve since withdrawn or in the US casae the Senate never ratified it.

Sigh.

Few topics in contemporary British economic debate attract more sustained criticism from Richard Murphy than fiscal rules. For the better part of three decades, successive Chancellors of the Exchequer have reached for these self-imposed constraints as proof of their financial seriousness. Richard Murphy’s view is simple and consistent: fiscal rules are not laws of economics. They are political inventions, dressed up as economic necessities, and they have caused serious and ongoing harm to public services, living standards, and democratic accountability.

Hmmm

A defensible fiscal framework would also accept the monetary reality: that a sovereign government issuing its own currency is not revenue-constrained in the way a household or local authority is. It is resource-constrained. The question is not whether the government can afford to spend, but whether the real economy has the capacity to absorb that spending without generating inflation. That is the discipline that matters. Everything else is theatre.

That is, of course, a fiscal rule. When inflation appears either stop the spending or increase taxes. A fiscal rule.

The Financial Times has published remarkable data on inheritance tax in the UK. Just five London parliamentary constituencies paid more inheritance tax than the whole of Scotland and Wales combined. Ten London seats paid more than the entire north of England over five years.

But the FT then drew the wrong conclusion.

This video explains why the real story is not that Britain depends on wealthy Londoners to fund the state. A currency-issuing government does not depend on the rich for money. Instead, the data reveals something much bigger and more important, which is the catastrophic consequences of the concentration of wealth in London and the long-term failure of UK regional economic policy.

Rich peoples move to London. Woes, eh?

Everywhere, and without exception, traders are, utterly bizarrely, at a time of crisis when they should be heading for safety, selling bonds and buying shares. After all, the money to fund this mania has to come from somewhere, and this chart makes clear its source. When government bonds are sold, the effective interest rate increases. That is because, in practice, the amount of interest paid on bonds is fixed, meaning that if the price falls, as happens in a net selling market, that fixed interest payment appears to be more valuable in terms of the interest rate earned.
….
The likelihood that this might be as bad as 1929, with consequences at least as severe if governments do not take action to bail out many of those who will be impacted, is very high indeed. In that case, if you look at what is happening in financial markets, the only reasonable conclusion to reach is that those trading in them are giving themselves a massive dopamine hit at cost to the rest of the world before the crisis arrives.

I am angry because governments are going to have to bail out banks and even major corporations as a result of what is going to happen. We will be doing QE again, but this time we have to get it right.

Govts are going to print more money and piss it up the wall again. This will ignite inflation.

Bond prices should be falling in such a scenario, no?

UK government borrowing costs are rising fast, and the official explanation does not make sense. Britain is paying far more to borrow than France or Italy, despite having its own currency, a central bank, and no meaningful risk of default.

So what is really going on?

10 year gilts, 4.75% apparently. Core inflation 3.3%. Eurozone 10 year bonds, 3.47%, eurozone core inflation 2.2%. We’ve a real interest rate of 1.45%, they of 1.27%.

Guess what Spud doesn’t explain?

Quite.

As The Telegraph reports in an email this morning:

Britain’s economy expanded in the first three months of the year despite the outbreak of the Iran war at the end of February, official figures show.

The UK’s gross domestic product (GDP) grew by 0.6pc in the first quarter, according to the Office for National Statistics.

It was in line with analyst forecasts and up from 0.1pc in the final quarter of 2025.

Fairly straight reporting of what happened.

Maybe they will also have forgotten that by the end of March, almost no one in mainstream media had realised the full implications of this war, or the scale of the shortages it will create, or the economic mayhem it will cause. At the end of March, the general expectation was that the Strait of Hormuz might reopen again soon, even though there was no evidence of that, and some of us were saying that mayhem was likely. So, of course, this war had caused little economic damage by then.

It has now. Although mainstream media is still in denial about the mayhem heading our way very soon, there are reports of consumer confidence collapsing and business supply lines looking perilous.

The damage is happening now, and it is going to be very much worse, but the Telegraph has chosen to adopt the “so far, so good” line. That is their right. The only problem is that there is no evidence to back it.

The complaint is about what will happen. Even if the report was about what did happen. These are – unless The Pud exists in some sense of appearing across all time equally – different things, no?

…well, you know the rest:

Why does Britain keep ending up with weak Prime Ministers?

In this video, I argue that the problem is no longer simply about personalities or political parties. The deeper issue is that the UK political system now rewards the wrong qualities and filters out many of the people who might actually be capable of governing well.

The top 10% of wealth owners, who broadly coincide with the top 10% of income earners,

The vast majority of UK wealth is in housing equity and pensions. Wealth is this concentrated in an age cohort – those in their 10 years before retirement and a couple of years after it – and so doesn’t have all thgat much correlation with income.

Jus’ one of those things you’d hope a political economist would know.

The mere possibility that a future government might choose to improve public services, reduce poverty, invest in housing, or restore social security is enough to unsettle financial markets. The threat, from their perspective, is that the government might begin to work for ordinary people instead of primarily serving wealth.

And so the pressure begins. Gilt yields rise.

A believable promise to sensibly invest would probably bring gilts yields down. The usual Brit gov promise is to piss it all up the wall – which increases yields.

UK interest rates are too high, not because inflation requires them to be so, but because the City wishes to attract foreign money into London’s financial markets so that financial institutions can profit from managing it.

Err, most foreign money managed from London remains in foreign currencies – meaning the UK inflation and or interest rates are of no effect whatsoever.

Second, the base rate should be cut. UK rates should be much closer to those in the eurozone. A cut of at least one percentage point is justified by current economic conditions.

Base rate is 3.75%. Core CPIH (probably the policy relevant rate to use) is 3.3%. A real interest rate of just under half a percent hardly looks excessive now, does it? And given that we do have higher inflation than the eurozone then yes, it is logical that we have higher nominal rates.

Fourth, the government could refuse to issue new gilts at elevated rates if markets seek to impose punitive terms. Instead, it could borrow directly from the Bank of England if necessary. That would make an essential point. The government is not dependent on financial markets for money. The markets are dependent on the government for the supply of safe assets like gilts.

That one would – I posit – boost gilts rates nicely. Because it would be the govt printing to spend. It’s QE all over again, the monetisation of fiscal policy. Which is known to lead to inflation and so gilts rates would rise.

‘Mazin’ what ‘ee dunno, eh?

What happens when markets stop working?
That is the question at the core of this video, and it matters because we are entering a period in which shortages of essential goods may become impossible to ignore. Oil supplies are already being disrupted. Gas, fertilisers, industrial chemicals and food supply chains are under pressure. And when essentials become scarce, markets ration by price, not by need.

That is, of course, when markets work, when they ration by price.

But let me be clear, we do not need a new Labour Prime Minister. Even less do we need a new Conservative Prime Minister. And we most certainly do not need Nigel Farage in Number 10, not that I really think he has any ambition to get there, so keen has he been in the past to avoid responsibility, accountability and the loss of personal income that will go with both.

Instead, we need new politics. The rise of the Green Party of England and Wales reflects that fact, but so far the offering is flawed, potentially by policy incoherence, but also by entryism, which will always be a problem for a party in its position, where its popularity is rising so rapidly.

That is why the foundations matter. And it is to those foundations that I want to dedicate my time.

Cometh the Potato. Perhaps as Leader, perhaps in the more eminent position of eminence graisseux. But cometh all the same, eh?

I added the highlight in italics because that is the core question I am being asked, and it really did not take long to deal with this one, as the argument that politicians cannot be trusted with fiscal policy is, in my opinion, one of the strangest claims in modern economics.

We already trust politicians with:

Creating laws

Managing budgets of hundreds of billions of pounds or dollars, and maybe more

Managing;
education
health
setting taxes
broader fiscal policy
providing a social safety net, and more
Declaring war

But we are told they cannot be trusted to manage interest rates to supposedly manage demand within the economy to deliver agreed inflation targets,

Given the shite they manage with that list then no, they cannot manage interest rates to beat inflation. Obviously.

But there’s also one more point to be made. That central bank independence is said – by those who study it, of course – to have lowered the level of interest rates in the economy compared to the counterfactual, that politicians did directly control them. That is, the markets believe this to be true and thus, in a market based economic system it is true.

I accept her point. Something deeper is wrong if this many children are having behavioural problems in our society.

We’re then told the answer is neoliberalism – because of course it is. Rather than, say, locking every child into a house for a couple of years during their formative period.

But then Spud was in favour of more, harder and deeper, wasn’t he?

Being a Cassandra is never popular.

A reminder. Cassandra was right.

BP made $3.2 billion in the first three months of 2026, which was more than double its profit from the same period last year. It did not achieve this by finding new oil or selling more of it. It did it by trading oil contracts. In other words: by betting on war. And your energy bill paid for it.
What is actually happening:

In 2025, around 383 million oil trades were recorded in the UK, each covering roughly 1,000 barrels of oil at over $100 a barrel
The total value of those contracts runs into the tens of trillions of pounds, dwarfing the value of all UK share trading
The post-Ukraine energy price spike that devastated household budgets was not caused by a gas shortage; it was caused by financial speculation of this sort, and it is happening again

The futures – or option – price always declines, or rises, to the spot price at contract maturation. At which point his entire model collapses. Physical storage, hoarding, can indeed raise spot prices, but not futures.

Having reflected on this, I then came across this issue of capitalism running out of road in a different way. Since we started our YouTube channel, I have watched videos on cameras, video equipment, lenses, microphones, and all the things I had to learn about to reach an acceptable level of production quality. During that process, I came across the YouTube channel of a chap known as Gerald Undone. His videos were probably the most sophisticated analysis of camera equipment available on YouTube, and he was widely followed because he was just so good at spotting which products were good, explaining why, and what should, alternatively, be avoided.

And now he is giving up doing that. Why? That is because he says that all the fun has gone out of his job. His argument is that, whoever you now buy a camera from, whether it be Sony, Canon, Nikon, Leica, Panasonic, or anyone else, most probably including your phone, you will get a piece of equipment that is near enough perfect, and capable of delivering a photograph so far beyond the limits of your imagination that preparing technical analysis of them any more is becoming a waste of time.

As he has said, talking about the creative process, which is something he has never really done, remains relevant. Talking about the kit is not. It has reached the point where every reasonable demand that a human photographer can make of any such kit not only can be, but will always be, delivered. The rate of return on further investment in developing such equipment is now so small that it is hardly worthwhile to make it.

That summarises the neoliberal problem in a nutshell. We have reached the point where, when it comes to “stuff” of this sort, there is little further progress to be had, and any claims of difference will now come down to marketing spiel, and not to reality. What matters now is the capability of people, which is the very thing that neoliberalism wants to destroy.

This capitalism, global markets – neoliberalism, in effect – works so well that we must abandon its use.

Rather than, say, use this thing that works so well to go and work on the next human desire after decent camera lenses. Which is that next human desire that can be solved being something we can only discover from market processes, of course.

In this context, I am thinking a lot about how we need to reconsider GDP and related macroeconomic goals There is nothing to publish yet, but what I am finding, as a consequence of that thinking, is a whole new range of economic indicators on what is really happening in the world around us, which can provide better indications of how we can allocate the world’s resources,

We all bate our breaths, of course.

We saw two Met officers approach a man, stunned and lying on the ground, obviously unable to resist arrest and equally obviously unable to release the knife he held because the tasers used on him would have prevented his nervous system from reacting to that command (as the police should have known), then being kicked forcefully and with venom in the head (a targett that was clearly deliberately chosen) with all the possible injurious consequences of that.

Of course, of course. Also, having been kicked in the head he released the knife and the kicking stopped. So, erm….

Colin and I ceased working together in early 2025when out work was heading in differem directions, and Ann Pettifor took the opportunity of that to suggest I should no longer be involved in this rump of a group because she has always had an incomprehensible and visceral loathing of what she thinks modern monetary theory says, largely because she has never bothered to actually read what its major thinkers, including me, have had to say on the subject.

Didn’t the grant run out for him and Colin? And of course Anne’s off doing something else because of Anne, not Spud. As always just does seem to happen.

In this video, I explain why that is the case. The inflation we are facing is not driven by excess domestic demand. It is being driven by war, supply shortages, and speculation in global commodity markets. Interest rate rises cannot produce more oil or resolve supply disruption, but they can suppress demand further in an already weakening economy.

That is the risk we now face. Raising rates in these conditions could accelerate the move toward recession, increasing business costs, reducing investment, and undermining confidence. There is a real danger that central banks could turn a fragile situation into a much deeper economic crisis.

From the ONS:

The Consumer Prices Index (CPI) rose by 3.3% in the 12 months to March 2026, up from 3.0% in the 12 months to February.

On a monthly basis, CPI rose by 0.7% in March 2026, compared with a rise of 0.3% in March 2025.

Motor fuels made the largest upward contribution to the monthly change in both CPIH and CPI annual rates; clothing made the largest, partially offsetting, downward contribution.
Core CPIH (CPIH excluding energy, food, alcohol and tobacco) rose by 3.3% in the 12 months to March 2026, down from 3.4% in the 12 months to February; the CPIH goods annual rate rose from 1.6% to 2.1%, while the CPIH services annual rate rose from 4.2% to 4.3%.

It is core CPI that is the policy relevant rate. It’s still more than 50% over target. Without the price of fuels, note.