Challenging the flawed Financial, Insurance and Real-estate markets

Michael Hudson (said to be one of only 12 economists who predicted the crisis) strips away and challenges the flawed economics we're currently subjected to, as well as the progressive, deliberate and corrupt transfer of wealth/control to the rich unelected landowners and the bankers.

Taxes on property and land have been progressively reduced, whilst taxes on products, services and jobs have been steadily increased (and are set to increase much further in coming years).  The idea that wealth is generated via real estate asset price inflation is both niave and flawed - house price inflation is a result of failure ... i) the failure to build sufficient housing, ii) the failure and de-regulation of financial services/banking, and iii) the flawed/irresponsible levels of debt people were allowed/encouraged to take on. Given everyone needs a roof other their head, strategies/policies designed to deliberately inflate house prices and to encourage people to take on further debt (e.g. equity release to release more money back into the economy), were arguably not only short-sighted but immoral (e.g. the Government taking house prices out key inflation figures used by Bank  of England when setting interest rates).

Many people have for many years had to hand over high percentages of their salary (30-40%) straight to banks, in the form on interest payments, and this will worsen once more as interest rates start to rise again (due in part to future imported inflation). 

Land Value Tax would address this issue head on, and move the profits away from banks (and to the Government). In doing so the Government could drop taxes on products, services and jobs.  This would reverse the current trend of pricing manufacturing and jobs out the market, and move the economy towards a successful, sustainable and value added economy once again. It would also avoid the UK (and the rest of the world) becoming progressively governed by unelected officials and financial institutions; ruling over us via debt and driving poverty/serfdom with the imposition of more unfair/punitive taxes.

However the financial, insurance and real-estate markets (and their associated lobby groups) would fight such a move all the way (supported by the landowners, the media and politicians who have themselves been profiting from it with their expenses), as many of them do not actually know how to generate any real value or wealth (nb they focus/profit from transferring wealth).

Without such changes the crisis will continue to grow, and the UK will progressively shut down ... as more wealth is transferred (and pocketed) by those who provide no value and destroy net wealth.

The unelected keep pressing for global control

Following Climate-gate, and the leaked texts from the Dutch authorities ... "the con men behind the scenes looking to bag windfall profits from 'climate change' (whilst introducing and funding an unelected New World Order to control everyone & everything) are wincing, after carbon trading markets nose dived (following the failure to secure legally binding targets on restricting CO2 emissions).

Barclays Capital director Trevor Sikorski labeled the Copenhagen result “very disappointing” and said that the outlook for the global carbon market was bearish. European Union carbon markets dropped by nearly 9 percent this morning before stabilizing. One dealer described the market as like “a falling knife,” reports the Financial Times.

Maurice Strong, the person regularly credited as founding father of the modern environmental movement, serves on the board of directors of The Chicago Climate Exchange (CCX). Strong was a leading initiate of the Earth Summit in the early 90s, where the theory of global warming caused by CO2 generated by human activity was most notably advanced.

By using his considerable wealth and influence to lobby for cap and trade and a tax on CO2 emissions, Strong stood to enrich his company’s coffers to the tune of trillions if a binding agreement on carbon dioxide had been formulated in Copenhagen.

Strong and his close ally Al Gore come from a stable of elite groups that have long sought to use the environmental movement to advance their financial agenda. Strong, who was groomed by David Rockefeller to eventually serve as Director of the Rockefeller Foundation, is also a member of the Bilderberg Group, the Trilateral Commission, the Council on Foreign Relations and the Club of Rome, the organization who infamously proposed in their 1991 report, The First Global Revolution, that fears about the environment should be exploited in order to usher in a global government ... and these people are going to keep on trying ...

Controlling (and profiting from trading) water and food are also on the agenda (nb in fact they are already recommending, and trying, to do this too), and I highly recommend taking a look at the above video clip from Alex Jones at the end of the Copenhagen Summit ...

Ignorance is unfortunately not bliss, but it is very common ... and until this changes significantly challenging Poweromics will be a struggle. Ignoromics (Ignoromics: Type 1=Ignorance and Type 2=Apathy) is the partner in crime of Poweromics ... and despite the huge pressures exerted by the powerful, including all the manipulation of scientists, politicians, media, judiciary, banks (who are mostly working/profiting from the same corrupt agenda*) ... etc the forces of good (and truth) are growing by the day ... and to all those I applaud you ... support you (hence my links here to your work too) ... and wish you every success in the coming year (for the sake of civil liberties, humanity, and the well-being of mankind).

* Profiteering by the Dr Rajendra Pachauri (Head of the UN’s Climate Change Panel) is also being exposed by the Telegraph now too. The corruption and spin continues to be exposed, but the corrupt/unelected are still wielding their power behind the scenes to press for a New World Order**, which they can control (both everyone/everything) ...

** For those who still think Climate Change is in any way real, why not ask yourself why much simpler/effective methods are not being considered/pushed, which would be far simpler, cheaper and effective than all the proposals currently being pushed (whoops, I forgot - you wouldn't profit from 'carbon-trading' with them, or be able to introduce an unelected New World Order to restrict/control everyone either - silly me).

'For evil to flourish, all it needs is for good men to do nothing' [Edmund Burke 1729 - 1797]

Psychology and mind games

Another interesting post from a fellow blogger to ponder ... writingsonthewall today wrote:

"It's all about psychology and mind games.

Has anyone noticed that every piece of bad news is qualified by "better than Economists predicted" ?

It's no different today with the news that the PSBR in November was greater than since records began (and consequently at the greatest since the crisis started) ... The fact that Economists (who are not known for their prediction accuracy) got it wrong is not surprise really - and yet psychologically it makes us feel slightly more secure.

Now it might be that Economists are simply pessimists, but it's hard to believe that they always predict worse than expected for 'bad news' ... Start watching what you are being fed by the media and see what they are really up to ... It's all designed so that some time next autumn when we're told what the massive public sector cuts will be, they will be able to say how they are not as bad as expected and we will suffer them thinking that it's right, fair and neccessary and better than the alternative".

NB This supports and links very well with my previous post about BBC reporting ...

Adding Value or Destroying Value ?

A recent study by the New Economics Foundation (NEF) has examined the social value and financial cost of a number of professions ... with enlightening, but perhaps not surprising, results ... for instance they highlight how highly paid groups such as bankers and tax accountants systematically destroy value, rather than add value, to society ...

The Foundation applied a new form of job evaluation to calculate the total contribution various jobs make to society, including for the first time the impact on communities and environment. A spokesperson for the Foundation said: "Pay levels often don't reflect the true value that is being created. As a society, we need a pay structure which rewards those jobs that create most societal benefit rather than those that generate profits at the expense of society and the environment" ... and went on to say ... "there should be a relationship between what we are paid and the value our work generates for society".

A total of six different jobs were examined and their levels of pay, as well as the overall value they contribute to the society, were compared:

The elite banker - "Rather than being wealth creators bankers are being handsomely rewarded for bringing the global financial system to the brink of collapse. Paid between £500,000 and £80m a year, leading bankers destroy £7 of value for every pound they generate".

Childcare workers - "Both for families and society as a whole, looking after children could not be more important. As well as providing a valuable service for families, they release earnings potential by allowing parents to continue working. For every pound they are paid they generate up to £9.50 worth of benefits to society."

Hospital cleaners - "Play a vital role in the workings of healthcare facilities. They not only clean hospitals and maintain hygiene standards but also contribute to wider health outcomes. For every pound paid, over £10 in social value is created."

Advertising executives - The industry "encourages high spending and indebtedness. It can create insatiable aspirations, fuelling feelings of dissatisfaction, inadequacy and stress. For a salary of between £50,000 and £12m top advertising executives destroy £11 of value for every pound in value they generate".

Tax accountants - "Every pound that a tax accountant saves a client is a pound which otherwise would have gone to HM Revenue. For a salary of between £75,000 and £200,000, tax accountants destroy £47 in value, for every pound they generate."

Waste recycling workers - "Do a range of different jobs that relate to processing and preventing waste and promoting recycling. Carbon emissions are significantly reduced. There is also a value in reusing goods. For every pound of value spent on wages, £12 of value is generated for society."

The example professions chosen will certainly promote debate about this important (and philosophical) aspect of 21st century 'economics', and whilst such work is still clearly in its infancy, it already starting to highlight a number of potential ways pay (and taxation systems) are likely to evolve in the future ... e.g. becoming more closely aligned to the level of social (and environmental) value actually provided to the 'economy' ...

When places like the UK decide to progressively move towards becoming a 21st century 'economy' is a very different question however ... as the those currently in "Power" will resist it at all costs, and the level of failure/despair will have to become far worse before the majority of ordinary hard-working people (who are currently adding all the value!) decide to do something about it ... take a look at this post for instance - however, when they do decide to act ... change things will (e.g. take a look at another of my recent posts for instance, as well as this recent one from fellow blogger, writingsonthewall, too).

This post was referred to on Robert Peston's blog "New ice age for bankers" post 98.

Adding Value or Poverty - No-one owes the UK a living

Another interesting post from a fellow blogger to ponder ...

... this time referring to the 'fairy tale' we have lived in and the 'harsh reality' the UK now faces:

"I think some people are missing a big point ... the big point being that we're not just anybody, we're British.

Consequently, normal laws of economics don't apply to us. Hadn't you heard? For example, we're not subject to the economic cycle like lesser mortals - 'boom and bust' has been abolished by that Nobel economist of the future, his Holiness Gordon. The abolition of boom and bust was a great weight off my mind when I heard about it, I must say. Sorted. Well done, Gordon.

Being British exempts us from manufacturing - for goodness' sake, don't you realise that working in a factory can make your clothes grubby, and you could even get dirt under your fingernails? Certainly beneath our dignity as Brits.

We don't mind doing a little work, mind, but we feel much more comfortable in 'service' jobs - as far as manual labour is concerned, well, that's what foreigners are for, isn't it?

We're proud to be "a nation of shopkeepers"... and hairdressers, consultants, estate agents, civil servants, care professionals, and, er ... consultants. Obese, us? Never - we get plenty of exercise, walking down to the benefits office.

OTT, I know, but the British mentality has been painfully close to this caricature, unfortunately. Most people seemed perfectly happy living on North Sea oil revenues, financial services, and borrowing against artificial rises in housing equity.

Well, those gravy trains have hit the buffers. We can learn how to work, or we can get used to a new concept - poverty. As we're about to find out very soon, no-one owes the UK a living".

Are such insights misguided, or getting too close to the truth ? ... you decide!

Strictly Come Dancing in 'Jonestown'

Another interesting post from a fellow blogger to ponder ... referring to the ignorance and/or apathy of British people (Type 1 & Type 2 Ignoromics) and the types of challenges involved in addressing it.

"... I am quite happy building my boat. The advantage of an island is it is easy to leave it.

You are wasting your time with your rabble rousing, the rabble are sleepy and prepared to drink from the poisioned chalice, just like in Jonestown. Too much Strictly Come Dancing. The enormity of the problem is not the debt, solved by cuts, or the government, solved by a General Election, it is the decades of destruction of a wealth producing sector.

How do you think new wealth is to be created. Let me guess - by training. No. By a cultural shift. Do you know how hard it is to shift a culture, you have no idea, you are part of the culture, you are thinking within it. You have already lost because the culture has lost.

The only route for many is the decline cycle, a form of economic cannibalism. Enjoy. Oh, do you want to supersize that? Reality check time. What was Gordon's big idea, oh yeah, lets ask the Chinese to open factories here, 100s of them. What a lunatic. The Chinese will only buy strategically and will seek to develop their domestic scene, they have said as much by their actions.

And we have various bodies talking things up, like Lord Turner - 'When we get more affluent we will want to fly more' so lets develop air travel and punatively green tax those who dont fly. No oil has peaked already by some estimates. We should be seeking to reduce air travel.

The establishment is part of the culture. Members of the establishment support the culture because it rewards them individually ..."

Are such insights misguided, or getting too close to the truth ? ... you decide!

Removing the destructive target driven culture

In the blogosphere I often see posts from others which go a long way to explaining what's going on around us right now ... and what could also be done to change things for the better. Many are well worth sharing with you here too, as they chime very well with this blog; including the following one below (from a new blogger to the BBC):

At 2:32pm on 11 Dec 2009, Russell Branch posted:

"Wealth generation comes from adding value for which people are prepared to pay. At its most fundamental, this is indeed from making, growing or creating things - converting raw materials into something which has a perceived monetary value. This value can be found in intellect, objects and "things", or indeed services such as provision of health, safety or protection. It depends upon the kind of society we want to live in as to how we rate and value these various things.

However, the current society we live in is governed by a ruling class who have taken central control over so much of our life through a target driven culture that the values are being skewed, or lost, in the name of political dogma. In our working lives, it is a truism that "what gets measured, gets done" but this simple fact belies the cost of the measuring! As one example of this out of thousands, and its repercussions: -

(Note, I came to know know about this following a conversation down the pub :-) , and I am making no statement whatsoever about the validity or not of this particular target)

There are new minority recruitment targets for the fire and safety services (document is here). In itself, this is not necessarily a bad thing. But just think what this implies.

At some high level, this has been decided as a "target". It has necessitated the compilation of the figures as a first cost. But take this down to a local recruitment level. It is now necessary for someone to collect, collate and report on the outcome of every recruitment interview, and someone else to help make a decision on recruitment based not only on "the best person for the job" but also on their race, creed, colour or sexuality. This will also probably add in extra time in legal consultations to protect the service from accusations of bias from both the majority population and the minorities, plus additional training for the interviewer in removal of bias. Thus, two or three extra people are needed, all of who are taking away money from the ability to pay for front line service professionals.

As another example: my ex wife was an admin manager in a health trust. For every target handed down from a centralised decision making process, it was necessary to employ administrators just to prove that the targets were being met. In the NHS, there are hundreds of targets. For every three lower grade administrative assistants on £15K per year, count this as two young nurses on £22.5K per year, and just think a) how many more front line service providers could be employed or b) how much money could be saved, if the target culture was severely dismantled and local accountability handed back to local NHS services - plus all of the civil servants who collect all of these reports and collate them back into statistics for politicians to selectively quote as proof of their prowess.

Major savings are possible at the stroke of a pen ..."

And my comments to the above - "absolutely - I couldn't agree more ... what we need is 21st century management practice which would introduce "systematic & effective bureaucracy stripping" ... replacing league tables/targets, removing all the non-value added activities currently destroying the effectiveness of front line services, and redeploying resources to provide more front line services, as well as to supporting front line staff to systematically improve the level (and types) of services provided ... e.g. take a look my recent post here, as well as my book all about this too.

Tearing up the Rule Book ... and Challenging Self Interest

This blog is dedicated to exposing Poweromics - i.e. wherever and whenever people using position and power for their own personal gain, based on poor moral values, self-interest and greed. A number of bloggers also often refer to the future demise of the UK as a result of self-interest/greed, and I also often refer to their comments too ... for instance take a look at the following post below:

At 10:25am on 08 Dec 2009, writingsonthewall wrote on Robert Peston's blog:

'Robert said:

"In my wilder imaginings over the years about the future of the public sector, it never occurred to me that one day as a taxpayer I would be financially liable for the overdrafts on 3.2 million UK retail bank accounts, £10bn of loans to British small businesses and a further £10bn of UK residential mortgages provided to 70,000 home owners"

There you have it folks - from the BBC's business editor. We are no longer in the realms of 'financial reality' but in a world of fantasy finance and Government gullability.

It's time to tear up the 'rule book' and start to question the people who are trying to convince you that "everything will be alright - we are in control".

The sad facts are they never were in control, it's just the uncontrollable beast we had unleashed just happened to be going in the direction we wanted it to. Now that beast has turned and even the might of trillions of dollars cannot reverse it.

"Dubai is just a glitch" - well the 20% knocked of their stock market in 2 weeks doesn't make it look like a glitch.

"Recovery is imminent, recovery is underway" - based on the financial markets, not based on any evidence in the real economy - not based on anything which hasn't just had the 'bailout boot' up it's backside.

I mean seriously - why doesn anyone believe people who make statements like this: "Although the US economy is improving, it is too early to say that the recovery will last, Federal Reserve chairman Ben Bernanke has said"

Here's a weather forecast from me in the same vein - "although it is sunny, it may well rain later, or maybe stay the same, in any case there will be several different types of weather today - and it may not last for too long, although it might last all day"

....it's just like 1929 all over again - the politicians flounder on the beach of reality like washed up fish from the storm - the truth is that they were never in control of Capitalism - and now the public are angry because they have been fooled into thinking the beast had been mastered.

Most of the Economic theory of the last 20 years can be thrown in the bin, most of it merely analyses the symptoms of the problem, none of them analyse the cause. Modern Economists should be ashamed of themselves - they adorned their walls with certificates and yet not one of them can explain what is happening and why at the moment with any sort of clarity. They have made a classic mistake of mixing up 'pricing theory' with 'value theory' - and as most people have worked out the two are not synonymous.

They simply cannot face the harsh truth which is profit is scraped from the back of the working man or woman which is not sustainable and will eventually lead to collapse. Too many of us have been given a 'chip in the game' and consequently cannot face this fact either.

Self interest is unsustainable and our entire Economy is based on it - ergo the Economy is unsustainable ...'

A number of bloggers supported the comments made above ... with one saying "... it's just like 1929 all over again ... unfortunately this is all too true ... the parallels between the two are so obvious ... there is no way to reverse a £200 Billion deficit without job losses, public and private. When this kicks in proper, I predict the riots outside Tesco’s, the banker bailout was supposed to prevent, will happen anyway ... I really really hope I'm wrong".

However, one blogger said "Self interest is a fact - in a fundamental human flaw if you like - but a fact nonetheless ..."

which prompted the following response ...

'Maybe for you - but I can live without self interest, you just need to see 'self' as mankind and 'mine' as 'ours' ... Just because your mind is conditioned to act in a selfish manner - don't suggest it's a 'human flaw'.

Let me ask you - have you ever lived under a different system to Capitalism? I bet you 'fear you'd have us all working in a commune' - because lazy and feckless people would struggle in the face of 'real work'. You mention 'social mobility' - which is an admission that we live in a social pyramid - without inequality there is no need for social mobility - but don't confuse social mobility with inspiration and aspiration. Maybe it is in your world - but have you ever seen a scientific genius worried about what car he drives? Only the fickle and materialistic require the promise of riches to motivate themselves.

I meet people every day who are not self-interested, but you won't see them on TV, they are not politicians, they are not lauded around the city as being 'geniuses' - the unselfish are the ones who bare the brunt of this crisis.

In addition to the argument above - the desire to act violently may be a human flaw however the majority of people manage to control it - so why would self interest be any different ... If you have never lived in a system which does not promote self interest - how can you confidently suppose it is a 'natural phenomenon'?

"What you actually mean is "why should I stop being self interested - I mean no-one else bothers to" ... and there lies the foundations of a self interested society. Maybe you just need to meet a grown up before you realise that the world is not naturally self interested.

"We all feel detached from control at the moment" ... no, we were never in control the control was an illusion because the market just happened to be heading in the direction we were - we did not control it. I don't know if you noticed but 'we' didn't take on some blokes mortgage - it was a bank, which has since collapsed and passed the responsibility to us. They were never in control either.

"Yes what happened shouldn't have happened but if a prisoner escapes you don't blame the prisoner for developing 'a cunning plan'- you blame the prison service for not doing their job properly" ... Yes we do - unless you're only looking at the instance, the symptom and not the cause - just as the Economists do. The prisoner comitted the crime to put themselves in a position to make their escape - why would you blame those who are simply trying to do their best and not the true perpetrator (literally).

The old arguments still arise - "oh we can't help it we're all selfish" - and yet you want less Government (assuming you're a Libertarian) because you 'should be able to make your own decisions'.

"oh it was the regulators who failed us" - but have you ever considered why regulation never works. Using your own analogy, do you blame the policemen for the high crime rate - or is it actually the criminals?

The regulations get in the way of the fundamental principle of the market economy - i.e. we're all in this to make a profit. Therefore when the regulations intefere they will be circumvented or removed completely by market participants ...'

and in response to another comment ... 'self interest it at the heart of all human activity - from capitalist to eco-warrior, from politician to philanthropist. You act out of self interest, the fact you go on about how unselfish you are shows that your interest is in maintaining your ego-centric self image.' ... added the following:

'That's weak, so the only self interest I have is in maintaining an image? You must have me confused with someone else you know as self image is the last thing I am interested in. I suspect you base this assumption on your default starting positions of 'everyone is self interested'.

The truth is I do have self interest, but not in the way you describe. It's true it is a contradiction and one I have to live with every day.

However, what I have discovered is my self interest in my life is brought about by the society I live in - the fact that we all work most of our week for 'profit' reduces our free time and makes us more self interested in what little time we have left. The fact is I can live without self interest - it's not selfish to express this, and nor do I 'go on about how unselfish I am' - I merely express my disappointment at the extremes of selfishness there are around me (working in the city, it's worse than most)

In my free time I commit a lot to selfless activities and I am happy to do so, the profit from this is the joy it brings to others - which is why children and old people show a lot less self interest than the working population. They do not have such restrictions imposed on them and can take the time to consider the consequences of their actions on others.

The answer - don't judge others by your own standards - as I said previously there are many unselfish people in this world, but sadly only the self interested are promoted as being 'successful'. If everyone acts in their own self interest in a finite world the consequence is aggression and on a large scale that means WAR.

It's simple logic - undefeatable, undeniable'.

and went on to say ... 'I am growing irritated at those who complain a lot but never actually think about what the causes of their complaints are.

Too many people in society are happy to 'paper over the cracks' - trust me, I've seen inside a number of houses.

However most sensible people know that this policy is unsustainable - especially when they come to sell their property. It's no different in Economic society.

....plus I am desperately trying to warn about the impending disaster that our Government will not reveal because it fears a panic and ultimately awkward questions about it's ability to Govern.

Every time something bad happens the media and Government round the party line of "it's not too bad" - like Dubai for example....and people are still sucking it up like dry sponges ...'

I couldn't agree more ... and couldn't have put it better myself ... so I decided to post the comments they have made here too.

Taxing Times - Taxing Gambling ... Separating Gambling

Robert Peston appears to be one of the few BBC journalists prepared to probe what's going on and to question further what current leaders are doing. His recent blog eluded to the fact that the Government are considering ways to 'tax' Banks more ... partly to pay for the fact the taxpayer has had to bail them out ... but for me this does not go far enough ...

Following on from my previous post I decided to add the comment below to his blog too (Post 53):

"Tax gambling (i.e. investment banking) a lot more - absolutely ... for any Government and society, with any values/morals at all, taxing gambling heavily is a 'no brainer'.

What still makes this story more spin than substance however is that the Government is STILL avoiding the key issue ...

... We must NOT allow investment bankers to gamble with taxpayers and hard-working people's savings! ie. investment banking needs to be separated from retail/commercial banking (as well as being taxed more) so they can be allowed to fail when their gambles go wrong ...

http://poweromics.blogspot.com/2009/09/challenging-greed-and-creating-leaner.html

... We need a new Glass-Steagall type act introduced again, similar to the one brought in after the last great depression ... which the current set of clowns (with 'no brains' and/or 'no morals') in their 'wisdom' took it upon themselves to remove!

Keep up the pressure and can you challenge them on this please too Robert".

The writing's on the wall

A fellow blogger, called writingsonthewall, often posts on BBC web sites. Their insight is sharp, to the point and accurate, and many bloggers support (including myself) much of what they've said too (see 1, 2 ,3 for instance). Like many comments from bloggers, their comments/insights embarrass most of the BBC 'journalists' (and particularly Stephanie Flanders) who fail the address the issues faced (with Robert Peston perhaps providing one of the few exceptions).

Today they posted the following, and I've decided to publish his exact comments here too:

At 5:37pm on 04 Dec 2009, writingsonthewall wrote:

"Lets get a few things straight ...

a) The recession is going to last for much longer.

b) Small growth off the back of a £200Bn QE programme is not growth, nor is it a sign of recovery.

c) Throwing money into specific areas of the Economy merely creates short term bubbles - not sustained recovery.

d) The Government has given us all a huge pay cut - and nobody has even noticed.

e) 0.5% is the lowest rate by the BoE for a long time (if not forever). A clear indication that the situation is far worse than being admitted to by the Treasury and BoE.

f) Overproduction has occurred and as a result capital needs to be destroyed.

g) The Government will tell any bare faced lie in order to save it's own skin. It's not operating for you - it's operating for it's own success - to be elected. They don't care two hoots about the people.

h) We will not make any real and tangible profit from our banking stakes - not a penny.

I have been predicting a long recession since this started in 2008 - I also claimed the depression has started about a month ago, and I stick by it. I am not alone in these predictions either.

Don't forget, ministers and Government have been talking about recovery since the start of this year - so where is it? Not even a sign out there - despite the media's best attempts to 'make stuff look good'

So far I have not been too far off the mark with my predictions.

I am no genius, nor am I Nostrodamus - I have simply read a few Economic history books and Marx's Das Capital - far less than your average Economist - and yet my predictions are more accurate than theirs? - why is that?

They told you the war was for WMD's - and now it's clear it was for regime change.

They told you we were 45 minutes from Saddam's rocketry - and yet we weren't

They told you the cause of the crisis was from the US - and yet it wasn't.

They told you HBOS was passed to Lloyds as a 'going concern' - and yet we now know different.

They told you the crisis had been averted - and yet it's only just begun.

They told you there would be a return to growth - and yet there is none.

They told you they would kerb banking excesses - and yet they won't.

They told you they were in control and yet they never have been

You cannot lie your way out of recession.

I am clearly angry about the blatant lies from Government and a population which does not seem to be bothered about it. I won't get any satisfaction saying "I told you so" when I see poverty and disarray in Britain in the next 5-10 years....none whatsoever."

"I replied - I couldn't agree more" ... and added a link to all of his comments direct from this blog.

Taxing times

With all the discussion about the scale of the economic challenges ahead, there has been much debate about how cuts in public spending are going to occur and how taxes are going to have to be raised. I have commented on the former previously, and as debate on Stephanie Flanders' blog has gradually turned to the subject of taxes, I also posted the following:

"IMHO we need to immediately introduce 2 taxes:

1. Land Value Tax (which is NOT a Property tax) - this taxes the ultra-rich land-owners, who gain wealth as a consequence of what we put around that land. They cannot avoid it and they cannot pass it on (law of natural economics). This could then be used to subside tax reductions to the hard-working (e.g. through tax threshold increases, and basic rate of tax reductions). Take a look at http://www.urbantools.org for instance and this post for instance.

2. Gambling Tax - high percentage level of tax applied to investment banking, trading, hedge funds etc. This tax would at least create some value to society from such socially useless (and arguably morally corrupt) activities. It would also make profiteering from gambling much harder, and focus more attention on trying to create real wealth instead. See this post for instance.

These will deter profiteering from gambling as well as profiteering by simply owning land (whilst adding no value at all)"

In response a fellow blogger subsequently added ...

"I agree - why not tax land ownership more and useful and productive labour less? ... If the Lib Dems want real radical tax reform for a fairer system why not borrow some of James Robertson's ideas on shifting the tax burden onto land ownership and use of common resources?"

... and I would certainly recommend taking a look at James Robertson's web-site (nb it has a permanent link from this blog). Another blogger (ishkandar) also commented on the idea of gambling taxes:

"Gambling Tax ... Interesting !! Hong Kong has a gambling tax. On a 6% betting tax, the Hong Kong Jockey Club produces sufficient tax revenue to fund about 60-70% of the HK government expenditure, year after year after year !! Then again, the Chinese are well known to be inveterate gamblers !! ... As for casino banking and related activities, all they need is to be properly regulated and taxed !!"

To which I replied:

"Thanks for the insight about the effectiveness of gambling taxes in Hong Kong - interesting indeed ... Hong Kong also appears to be keen on Land Value Tax too ... funny how leading nations do, whilst those in the west don't even look. IMHO casino banking does need to properly regulated, but it needs to be taxed more than normal gambling too (e.g. to pay back taxpayers for previous bailouts)."

PS A few bloggers took me by surprise recently by 'putting me forward' for Prime Minister, and then starting to form a cabinet ... whilst posting about the moral values, or more specifically the lack of moral values apparent today, which others then commented upon. I struggled with the former (my attempted response is here), but I was able to comment a lot more on latter (1,2)!