Ragging on Ritchie

What then are the modern evils that threaten social well-being in the UK, it’s constituent nations and , of course, elsewhere? I tentatively (because I think this list by no means definitive) suggest the following:

Populist politics, for undermining the principle of truth in politics, and so threatening political narratives of progress;

It’s the obliviousness there that’s so wondrous. What is a political narrative other than an attempt to tell a populist story? It’s fiddling with the facts to get them into the narrative which then gains public support. Populism.

Press barons who control the political agenda and the messaging many people receive in ways that distort political truth;

Note the qualifier there. “Political” truth. You know, the stuff that runs contrary to the populist narratives.

Police not willing to hold politicians to account for their breaches of the law, making them believe any abuse acceptable, so undermining democracy

Umm, OK, although I struggle to think of all that many criminal – rather than civil – offences done by politicians. Or is he suggesting that Hancock should be arrested for that snog – as also would be true of Ferguson, necessarily?

Political patronage that seeks to control and limit those from amongst whom the appointments to positions of influence in public offices are made, so undermining any vestige of impartiality in their operation;

Gissa job, go on, gissa!

Or, alternatively, isn’t this rather what we expect a democracy to do? Elect people and then ask them to do government as they were elected to do?

Public underfunding fed by a narrative of austerity that seeks to deny opportunity.

Both government spending and government revenue are above long term averages. What austerity?

But what’s really fun. These five are put forward as the equivalents of Beveridge’s five evils. And if what’s left descends to being no quango appointment for the P³ then I think we’ve probably solved the biggies….

Sajid Javid is now the Health Secretary. As this press release shows, his prior experience was in trading the financial instruments that crashed the world economy in 2008.

And he was not a minor player. He was a major player at a major bank, worthy of having press releases issued about his career progression. In 2008 he helped bring down the world economy: no one else but bankers did that. Deutsche in London was right in the middle of that.

Javid was also running the Far East business out of Singapore.

How badly was Singapore hit? How badly was Deutsche Singapore hit?

Given that Singapore actually managed a rise in GDP that year – marginal but still there – perhaps not very much. Which might be useful evidence as to whether Javid is good in a crisis or not, eh?

Javid made his money in banking during the 2008 period. That says most that needs to be known.

Well, no, not really, that’s when he left banking.

Javid had an 18-year City career where he rose to become a Board member of Deutsche Bank International.[20] Javid joined Chase Manhattan Bank in New York City immediately after graduation, working mostly in South America. Aged 25,[a] he became a vice president.[21][24]A 2012 article says he was actually vice-chairman.[25] He returned to London in 1997, and later joined Deutsche Bank as a director in 2000. In 2004, he became a managing director at Deutsche Bank and, the following year, global head of Emerging Markets Structuring.[26]

In 2007, he relocated to Singapore as head of Deutsche Bank’s credit trading, equity convertibles, commodities and private equity businesses in Asia,[27] and was appointed a board member of Deutsche Bank International Limited.

He left Deutsche Bank in 2009 to pursue a career in politics. His earnings at Deutsche Bank would have been roughly £3,000,000 a year at the time he left[28] and the Evening Standard once estimated his career change would have required him to take a 98% pay cut.

Second, Covid rules were broken.

Hugely, wholly, important I think we all agree.

That modeller Ferguson should have been hanged dried and quartered.

Sung Taek Jang says:
June 24 2021 at 7:40 am
How do you square including QE in the borrowing figures in these tables.
You can’t repay debt you don’t owe.

I suggest finding another word for borrowing here. Or alternatively stop criticising those who call all deficit spending borrowing.

Reply
Richard Murphy says:
June 24 2021 at 8:27 am
They say it is borrowing

I am challenging their narrative

And given that the 500 year history of interest rates has been downward the current near zero is inevitable and sustainable

A failure to distinguish between nominal and real interest rates has been the death of many a policy and plan. Real interest rates today are substantially negative. Nominal rates are rather different and have been over time as well.

Many governments and central banks in more advanced economies, anxious to avoid the mistakes made during the global financial crisis, have taken pre-emptive action in two primary ways: first, by organizing massive income transfer programs to support the individuals and businesses most adversely affected by the pandemic, and second, by lowering interest rates – often to levels close to zero – and making it clear that interest rates will stay low for some time.

To which, apparently, the solution is more tax:

Third, to address the issues arising from this we need an urgent programme to increase the taxes on wealth – not because the government needs the money, which it does not – but because this inequality is deeply harmful to society. I have set out such a programme, here.

Hmm. Well, if low interest rates increase wealth – which they do, those assets which produce higher yields rise in value – then why not reverse this by increasing interest rates?

Something we’re likely to have to do soon enough given rising inflation. We’ve even got a simple way of doing this, just sell the QE bonds back into the markets and cancel the extra money that QE created. This is, after all, why we did the stimulus as QE in the first place.

True, this fails the test of a righteous policy, which is always MOAR TAX, but then the correct answer in real economics is not always MOAR TAX.

The campaign to tackle tax haven abuse, in which I think it fair to say I have played a part, has always been about sovereignty, or rather the abuse of the sovereignty that a country should have to choose its own tax system that tax havens have always deliberately and knowingly undermined.

Johnny Foreigner cannot tax as he wishes because it will undermine my ability to rook my citizenry. Thus Johnny Foreigner can only have the sort of sovereignty that I will allow him.

to effectively be part of a direct attack on the democratic freedom of countries to tax as they will.

I am not exaggerating his views.

Try it on free speech to test the logic. France has a law against insulting a person in public office (no, really, criminal offence). This is a democratic freedom, in the sense that it has been passed by a democratically elected legislature.

So, Britain must also make it an offence to insult a French public servant in order not to undermine the democratic decision of the French government?

Hmm, there comes a point, doesn’t there?

Richard Murphy says:
June 21 2021 at 3:40 pm
On Twitter he makes clear he does believe it – citing Krugman, Summers and Rogoff against MMT

Very worrying

I have invited him to engage

Charles Pooter was actually documentary, just a bit ahead of time, right?

Pilgrim Slight Return says:
June 21 2021 at 10:00 am
Agreed.

It would also be necessary in order to curb their extra -curricula activities like funding low tax parties

Stephanie Mcloud says:
June 20 2021 at 10:50 pm
It looks like both Richard Murphy and John Lewis don’t understand what ‘in real terms’ means.

Never mind.

Reply
Richard Murphy says:
June 21 2021 at 7:28 am
We did

Real terms means end delivery to real peiopole

The rest is just error

Reply

Sigh.

Westminster council is acting for all 32 London boroughs.

£6 million is being spent on having emergency body storage.

Of course you could just say this is wise contingency planning. But not in mid-June 2021 is it. In mid-June 2021 it looks like panic in the face of an anticipated Covid wave.

Amazingly, yes, it is contingency planning.

The Authority seeks to procure a framework agreement for temporary body storage in the event of an excess deaths situation ………This will be a contingency contract, only called upon in the event that an excess deaths situation arises…..This will be a contingency cover framework and as such there is no minimum guarantee of any level of spend or call-off

So when the Bastard Tories don;t plan for perchances then they’re Tory Bastards and when the Bastard Tories do plan for perchances then they’re Tory Bastards.

Amazing how the Curajus State isn’t supposed to be Curajus if it’s not P³’s friends running it.

Brexit also hangs heavy. We face labour shortages,

Of course, he’d only claim he meant another form of full employment is necessary before inflation arrives.

And deep down many people know unemployment is going up soon.

It’s to snigger, right?

The article is from the Sunday Times. The suggestion she makes is, in my opinion, deeply racist. It is to end the dependence of the NHS on those she thinks to be ‘foreigners’. One in seven NHS staff identify themselves as not being British at present. But since many who now use the NHS think that all those British people who come from ethnic minorities who work for it are foreign, and all too often demand not to be seen by them, what this really amounts to is nothing short of a racist dog whistle to remove anyone not white or with what might appear to be a non-British name from the NHS.

Harding’s platform for the leadership of the NHS is in that case not just racist, it will also put very large numbers of its staff at risk of very real discrimination in the course of their employment. That, of course, is illegal. And it is the inevitable consequence of what she is saying. The floodgates for litigation would open up, and wholly reasonably so.

What she actually says:

Harding, 53, would challenge the “prevailing orthodoxy” in government that it is better to import medical professionals from overseas and benefit from the investment of other countries because of the huge cost of training a doctor.

You’d think that someone who works in academia would be in favour of UK academia training more British workers….

Starbucks is without doubt a Public Interest Entity in the UK.

Eh?

‘public-interest entities’ means: … Entities designated by Member States as public-interest entities, for instance undertakings that are of significant public relevance because of the nature of their business, their size or the number of their employees.”

£370 million turnover? 0.019% of GDP as turnover – note, turnover and GDP are not the same thing at all. 7,000 employees? 0.02% of labour force?

That’s what is required to be a PIE?

Twat.

As to this:

Richard Murphy, director of Tax Research, said: “The accounts offer no clear insight as to what is going on. And that is the problem. Starbucks still needs to put all their cards face up on the table in a spirit of transparency and openness and it is still not clear that they are.”

The P³ accountant, superhero, cannot work out what’s happening in a set of accounts?

There are numerous ambiguities in the accounts, including a reported £16 million transfer pricing adjustment that increases UK profits but which Starbucks says has nothing to do with tax, plus significant prior year tax adjustments meaning there is a current tax charge when a significant loss was made. Starbucks, I am told, say there is nothing to see in any of this.

Well, gosh, perhaps cash taxes paid aren’t a good guide to the tax bill concerning any one year then?

Odd thing for an economist to do, confuse exports with wealth generation:

I quote this from the Guardian news summary email this morning:

British food and drink exports to the EU fell by £2bn in the first three months of 2021, with sales of dairy products plummeting by 90%, according to an analysis of HMRC data.

Overall food and drink exports to Ireland fell by 70.8% year on year, to Spain by 63%, Italy 61% and Germany 55%. The HMRC figures show dairy products down more than 90% and exports of cheese down by two-thirds compared with 2020. Whisky fell 32%, chocolate 37% and lamb and mutton 14%.

Please don’t tell me that Brexit is a success.

And please don’t tell me that these losses can be recovered from new trade deals. That is impossible.

Brexit is a simple act of economic sabotage in pursuit of racist goals.

If we don’t export it then we eat it ourselves. And imports have dropped over the same period too. So, umm, on balance not a great deal has happened.

It being important to recall that exports are our hard work that goes off to be enjoyed by Johnny Foreigner, they’re not the benefit of trade at all.

The result is we get almost (I use the word with care, because I am not talking absolutes here) universally hopeless, helpless and useless politicians who fail to offer hope to the country. We can all nominate some exceptions. They do exist. But they are rare. And that must be because of systemic failings in our political system because I meet competent people with political opinions on a day to day basis, many of whom would more than ably rise to the challenges that government presents.

So says the man who insists that government must have much more power. So also says the man who is incapable of seeing the illogic of believing both things at the same time.

Work is, then, about status. It occurs to me as I begin to see my generation retire that this loss of status is a big issue for many of them. Appending the word ‘retired’ to whatever their former work role might have been appears a way of clinging to that status. That they might be liberated from it takes getting used to.

But suppose we could do that? Suppose we could identify ourselves beyond our work? Why can’t we identify ourselves by our passions? That thought occurred to me when noting a young trainee doctor win The Sewing Bee this week. ‘Doctor’ will remain her chosen identity, I am sure. ‘Phenomenally good sewer’ will always be sidelined, I suspect. And yet in the hobbies I have I see people with skills that probably far surpass those that they take to their workplaces, so good are they at what they have chosen to do. Why can’t we recognise that?

Hmm, right.

Do we need to rethink work? Surely Covid has taught us that in a way few other disruptions might have? My sincere hope is that work will not go back to normal. Whilst wanting work for all who want it, work need not be the absolute that for too long it has been.

I am not suggesting I have all the answers on this. I don’t, and nor am I saying my own experience is one to replicate as it clearly won’t suit all. But nor does work as it is suit a great many people. For something so important we require better models than we have which can still be sufficient to maintain life as we want it.

Beating rentier capitalism is a necessary condition for better work. The yoke of debt burdens have to be reduced to make better work possible. But it’s not a sufficient condition. The rest is down to us to reimagine the processes. Indeed, that task might come first so that we have a goal to achieve. It seems to me that this is critical to our path to a better future.

And yes, this has been thought about:

For as soon as the distribution of labour comes into being, each man has a particular, exclusive sphere of activity, which is forced upon him and from which he cannot escape. He is a hunter, a fisherman, a herdsman, or a critical critic, and must remain so if he does not want to lose his means of livelihood; while in communist society, where nobody has one exclusive sphere of activity but each can become accomplished in any branch he wishes, society regulates the general production and thus makes it possible for me to do one thing today and another tomorrow, to hunt in the morning, fish in the afternoon, rear cattle in the evening, criticise after dinner, just as I have a mind, without ever becoming hunter, fisherman, herdsman or critic.

The thing being that communist society does not come about through the destruction of rentier capitalism. It comes about through its maturation. A necessary – please note, necessary – precondition is that capitalism carries on until the problem of economic scarcity is solved. It is only then that true communism is even possible.

It’s the usual P³. Too ignorant to know that peeps have thought about the same concepts before. Some of them even came up with answers.

Hanton joined RTZ (now Rio Tinto) in 1964, analysing investment opportunities for proposed mines in South America and using discounted cash flow (DCF) techniques to predict future revenue from the asset over time. He had helped to develop these analytical methods with his friends AJ Merritt and Allen Sykes, contributing ideas to their seminal book, The Finance and Analysis of Capital Projects. Today DCF techniques are a fundamental tool of the investment community.

In retirement Hanton became deputy chairman of Christian Aid as well as chairman of Living Streets and the London Cycling Campaign. He turned a Quaker-led trade justice group into the Fairtrade Foundation, involving Christian Aid, Oxfam and Cafod, effectively inventing a process by which, in exchange for using the Fairtrade label on coffee, tea and bananas, supermarkets would guarantee a fairer price to producers as well as paying a small royalty.

The P³ is resolutely against the use of discounting. Despite that source……

At the same time there is a very obvious and growing demand from the investment community for data on climate change that is not being met. It is easy to see why. I attended an Institute of Chartered Accountants seminar on climate change accounting yesterday. 35% of those attending made no climate related disclosures. 51% only made them in the narrative part of the accounts. That left 14% at most making any reference to climate in their figures. The biggest economic issue on the planet is not being accounted for, as yet

This is, of course, untrue.

The fuel duty escalator was imposed in order to meet “our Rio commitments”. It has added 25p a litre to petrol prices. The Stern Review amount for a carbon tax is 11p a litre.

So, the costs of climate change are there in every piece of accounting to do with transport in the UK. It’s in refinery accounts, as volume purchased has fallen as a result of the higher taxation. It’s in the accounts of every company that transports something, in the prices they pay for fuel. It’s in the accounts of every company that deals with something that has been transported, in the price they must pay for transport.

Climate change is, via those fuel duties, embedded in every price faced by anyone in the economy. And yes, accounts are made up with respect to market prices.

This is also true of all that greenery in the electricity supply system. It’s in prices, accounts are made up of prices, therefore climate change is in accounts.

The P³ wants more climate change to be in accounts. OK. So, he should want the carbon tax to apply to more things so that it is all reflected in accounts via the price mechanism.

The only problem with this is that it doesn’t provide a job for the P³ and let’s face it, grifters gotta grift.