Flawed capitalism - lobbying and corporatocracy

Capitalism, which allows money to flow and be used without constraint, has led bankers to put money into where they get the 'greatest apparent return' ...

and unfortunately these places turn out to be ones where a community with any real moral code/values would not want it to go  ... e.g. 'money for nothing' schemes/scams ... and places where people can be exploited the most.

One might think in a capitalist system that any 'money for nothing' scam would quickly and naturally collapse, but this does not happen when the excessive profits generated are 're-invested' into lobbying Governments and policy makers to gain support/favour and put them into a position where their scam can continue to flourish and/or 'cannot' fail (e.g. as the Banksters did, and continue to do, hence the bailouts and continual pressure to water down any regulation).

The problem with capitalism is that money/wealth is naturally directed towards influencing those in power, to maintain/ further their position to exploit markets. For instance this occurred with banks persuading the Government to remove house prices from UK inflation figures, which created the house price boom (as interest rates would not longer have to increase due to a rise in inflation) and saw house prices triple in a decade.  

Some people argue that the problems we are now seeing are more to do with having a Corporatocracy rather than Capitalism, as corporations use money to unduly influence and control politicians in order to introduce/change rules in their favour (e.g. by relaxing financial regulations, changing food, health and energy policies ...).

Indeed before entering office David Cameron himself highlighted that Lobbying would be the next big scandal (post the scandal relating to politicians and the media), but on entering office he decided not just ignore it but to ensure that he benefited from it!

Lobbying is indeed a big scandal (e.g. banks 'invested' £100m into lobbying last year), but Capitalism creates an environment where a Corporatocracy can thrive, and creates many more problems besides (e.g. the movement of money to exploit people to the maximum, and the ability to move any wealth to tax havens in order to avoid paying any tax etc). 

Corporatocracy is indeed a big problem, but it only thrives due to the flawed and corrupt nature of capitalism.

Accounting loopholes used by bankers to 'inflate profits' (and their bonuses)!

Following on from my recent post about the locusts, leeches and vultures in our society (i.e. financial services companies and lawyers) a report has been published today by the Adam Smith Institute showing how banks (the locusts) use outdated/flawed accounting rules to fictitiously boost profits in order to maximise their bonuses.

The report highlights how technically insolvent banks are using IRFS accounting rule annomalies to report massive profits by using expectations of future values when calculating/reporting profits ... to make it look as if they are not insolvent and to make it look as if the bankers are making lots of money (in order to boost their own individual bonuses).  Yet many of these assets, contrary to increasing in value can easily, and in fact do (as we have seen!), become worthless.
  

The report highlights how the 'financial engineering' going on in banks is no more than a legalized scam/ponzi scheme (e.g. Credit Default Swaps) and how it's effectively fraud (which compliments/augments the legalized counterfeiting they also undertake)! It also highlights how politicians and regulators are doing nothing to tackle the anomalies in the accounting procedures to stop them from doing this in the future.  

The report also exposes how the ratings systems not only allow, but positively support, them making up and using 'fraudulent' financial vehicles to fictitiously drive up profits (by giving scam 'products' triple AAA ratings),  whilst making it very difficult for hard-working small/medium enterprises to get a loan (due to not giving them triple AAA ratings and/or no rating at all). This makes it easy, and much more lucrative, for banks to 'manufacture profits' from 'financial products' (or 'vehicles'), rather than generate profit by lending money to an enterprise working hard to manufacture 'real products' (e.g. real 'vehicles')!

So what are the Government doing? ... Well rather than tackling the problem at its source (e.g. by starting to address the flawed rules/systems that allow such scams to go on), they have instead said they are going to set a little bit of taxpayers money aside (i.e. your money!) for small/medium businesses (whipppeee)! ... and at the same time they are preparing for the next bank bailout - which will occur when the value of all these fictitious financially engineered products actually prove to be worthless (and when the current commodity boom they are currently pushing also goes bust). With 'ring-fencing' effectively put into the long grass by politicians*, nothing of any substance will have been implemented to protect the taxpayer before the next collapse (currently being driven by the bankers).

The end result ... mega-rich bankers/speculators ... bankrupt nations/taxpayers. 

The process ... legalized fraud, robbery and counterfeiting ... endorsed by corrupt politicians and law makers (n.b. lobby groups such the CBI also lobby heavily on behalf of banks, claiming they are the 'Voice of Business', when due to the vast amounts of money given to them by the banks, they are really the 'Voice of Banks').

In China such people would be tried for economic sabotage ... and, if guilty, hanged ...

So when will people in the Western World realize what is happening and start to demand action ... a couple more years perhaps? ... when the next bailout is required?

Well, whatever the timescale, the bankers are clearly looking to make hay while the sun shines (i.e. taking a shedload of your future wages - i.e. the taxes they will take from you in the future to pay for previous/future bailouts) ... whilst the politicians/lawyers try to put up barriers, blow up bridges, and get their lifeboats ready ... so when people do finally realise what's actually been going on they won't be able to reach them ... or their corrupt bank friends!

* David Cameron has put plans for any ring-fencing at least 5-10 years away, and he also put aside our national interests last week when trying to protect his banking friends in the City from any regulatory changes taking place in Europe.

Irradicating the "Economics of Exploitation"

A great blog from the Renegade Economist ... which makes the case for a new economics ...

"While unearned wealth is both a symptom and a driver of economic injustice, the objective of transformative social change is not to soak the rich, but to create an environment in which economic opportunities are more widely distributed among the population ...

The recent riots and looting in London and other English cities are symptomatic of deep economic dysfunction. The social fabric is straining under the weight of an economics unable to offer any possibility of a different, better future.  The social contract is under greater pressure than at any time since the 1930s. But there is a crucial difference between the world then and the world today: a transformation in our collective moral aspirations that offers a spark of hope for the future, the kind of spark that in the dark days of the mid-20th century it took a world war, and the horrors of the holocaust, to ignite.

A just economy will not emerge from the tired debate between left and right, or endless arguments over whether free markets or state control of the economy deliver the best outcome. Justice requires that we transcend these stale and failed dialectics. Neither the contemporary vision of a free-market economy, nor a state-socialist or Keynes-inspired social democratic model can deliver a just economy; each is too riven by conflicts and compromises to get anywhere close.

Nothing short of fundamental reforms to the three pivotal institutions of the modern economy will do. Without substantial changes to the tax system; the financial system and the monetary system, a just economy will remain beyond reach.

Foundations of a New Social Contract

While a smaller, less expensive, state is perfectly achievable once everyone is permitted a viable stake in the economy, the state will still have an important function for which it will need to raise revenue through taxation. But it should tax the use of land and natural resources, things that are limited supply, rather than wages and profits. Taxing the output of economic activity discourages entrepreneurship and penalises hard work.

Financial markets must be reformed so that their sole purpose becomes the channelling of investment capital to the real, productive economy; activities that create the goods, services and experiences that people need to live decent lives, and the extras that promise the possibility of fulfilment and happiness.

Alongside these changes we need a new system of money creation; one that ensures stability in the money supply and that sufficient credit is available to fund every viable new business start up, or sustainable plan for expansion. Money should no longer be created as debt, as this places an unnecessary and counterproductive burden on both business and the economy as a whole.

Economic Renaissance for the Majority

These measures would curtail the minority enjoyment of unearned wealth and bring the benefits of a dynamic, opportunity-rich economy within reach of many more people. It’s perhaps not easy to imagine such a future economy, and it’s probably impossible to model the precise impact of these changes in terms that conventional economics demands, but such modelling is not necessary. These reforms would have to be implemented gradually so they can be fine-tuned as their impact becomes evident. And a great deal more research is required, especially into the impact that changes in each of these spheres will have on the other two: the mechanisms of the tax, financial and monetary systems are complex and interdependent.

If such changes are to be successfully implemented, they will have to be coordinated internationally. This may seem an impossible goal, but it’s not so very different in scale or complexity to the changes unleashed by the process of economic globalisation over the last thirty or so years; it’s just better motivated.

Over to You…

But none of this can happen without the commitment of a critical mass of people. Where that tipping point lies is impossible to know but it is out there. What we need now is the most successful marketing campaign in history. Central to that campaign should be the message that transformative change to economic structures and institutions is possible, and if such change were achieved, the life experience of the vast majority of human beings would be dramatically improved.

Next week, in the final article in this series, I shall look at the prospects for this campaign, and at the importance of established democratic structures in the process of revolutionary economic change"

"Nothing in the world... not all the armies... is as powerful as an idea whose time has come." Victor Hugo 

... This is a great article. IMHO the current form of 'economics' is a mixture of Poweromics (the 'economics' of exploitation, self interest and greed) and little will change until Ignoromics reduces (as suggested in the last paragraph ... 'over to you').

For instance over the last few days the banks have made a conserted and co-ordinated effort (with the CBI - the "Voice of Banks" - not the "Voice of Business" - as they are most bankrolled by the Banks) to strike fear in the public and threaten the Government not to split retail banking away from investment banking (nb which is being brought in to stop taxpayers having to bailout reckless bankers again). Creating fear is a common tactic used by those in Power (remember the Iraq war and those 'weapons of mass destruction'?) ... and the banks are using the 'destruction of the economy' as their 'weapon of choice' (even though it is they that destroyed the economy in the first place)! 

The Liberal Democrats say the want to press ahead with reform, but David Cameron and George Osborne are taking the opportunity (i.e. comments about the threats to the economy) to say they would like to 'park the reforms in the long grass' until the economy is stronger (anything to do with the 'backhanders', lobbying and their ultra-rich friends perhaps?) Just have a guess where these guys are likely to go after they leave Politics ... and I am sure it will be, just like Tony Blair before them, to lucrative jobs in the City!

The problem with the current economics is that it is not just the financial system that is corrupt, but it is all the other essential pillars of society too ... such as Government, the Media (remember Murdoch and the News of the World) and the Judiciary.

The move away from taxing jobs/profit to taxing unearned income/wealth (e.g. land values, gambling, financial transactions etc) is IMHO a 'no brainer' ... as is taxing the extraction of limited natural resources ... and making illegal the electronic counterfeiting of money (which the legal system allows the banks to do every day - i.e. creating money out of thin air, loaning it out and charging interest on it!) as well as the reckless and deliberate destabilising activities of banks (e.g. shorting, and the creation of 'toxic products' such as credit default swaps).

Current economics is unfortunately proving itself to be more about the movement of money/resources to wherever Governments allow them to exploit/profit from people the most ... a form of 'economics' contrary to 'growth' and 'well-being' ... and more about the "Economics of Exploitation". 

Business 'Gurus' are still way out of date ... but are slowly catching on!

Gary Hamel, a supposed well-known 'business guru' (from the United States) recently dropped in and talked to Peter Day's "World of Business" programme on his latest UK trip to visit to the London Business School.

Peter Day started by referring to all the soul-searching going on following the credit crunch... e.g. with regard to the ways banks work, markets work, and the kind of values/purposes of companies operating in such markets ..."

Day then went on to highlight how people are starting to challenge conventional wisdom on how businesses operate ... and suggested 'behaviour' currently appeared rather 'shabby' ... referring to a lack of trust ... 

Hamel started by discussing the 'values crisis' ... and the fact that most CEO's focus almost "exclusively on shareholders and making the numbers, with everything else going to hell". 

He went on to highlight how the web is starting to bring transparency and accountability, and said "we have to call them to account for the underlying values they bring to business ... particularly the banks ..." and said "we cannot have leaders of institutions whose primary motive is greed ..."

What we are now seeing (e.g. Egypt) is how people can mobilise ... if they choose to ... but Hamel noted how people are currently too complacent (i.e. apathetic) ... he said "people need to call leaders to account ... demand more transparency ... and demand more from them as consumers ..."

Peter Day referred to the need to address the lack of trust in business, and the fact that efforts currently focus too heavily on quarterly reports and short term profits. Hamel went on to describe the challenges ahead ... e.g. the need for honor and courage ... and the need to refocus on innovation and the production of value (looking beyond short-term profit) ... as well as a business environment where people become accountable for how they treat others, the environment etc ... (i.e. the role of enterprise in the wider world).

Hamel also referred to the lack of responsiveness in organisations, and the fact that innovation often involves taking money away from traditional activities, in order to invest in the future (which top-down organisational structures fail to support)! He said alternative approaches are becoming "clearer now" ... ones which involve empowering people, allowing people to collaborate and innovate, with all the data (and decision making powers) they need, and with everyone accountable (and rewarded) for their actions ... but he said we are being held hostage by 100 year old beliefs.

Most of the leaders of very progressive organisations, if they went to business school (and most of them didn't), have thrown most of what they learnt out! Hamel went on to say "There comes a point time in human endeavour, and I believe we are there in management now, when we have to go back and challenge first principles ... and old models" ... as such models had not had to face up to challenges such as ... changing very fast, being socially accountable, or innovating systematically ... 

Hamel referred to the need for a paradigm shift, siting fundamental shifts in understanding within other disciplines in the past. For instance, Hamel highlighted how "there was no way of understanding the sub-atomic world by starting with Newtonian Physics, and it had had to go through a fundamental paradigm shift" ... and he concluded "that this is also going to have to happen in business" ... (NB the shift in understanding will not come from business schools themselves, as they are 'wedded' to existing doctrine, which is also 20-30 years out of date)!

He referred to the need for a new management model and governance model, and said most people teaching in business schools now know that "what they're teaching in business schools isn't relevant now". Hamel also said that they are trying to find out "where to go next", and went on to say that they may not lead the next revolution ... "it might come from managers themselves, and/or from people in social sciences and biology, who have a lot more to say on this [than business schools]" ... (indeed ... it has, and will continue to be, developed by forward-looking people who are commonly referred to as "creative outsiders", and whose ideas are almost always initially ignored/rejected)! 

Hamel said new models are still kind of fuzzy ... but Peter Day quizzed him about the bankers and the "perils they are leading people into" ... Hamel said he was still "amazed at their state of denial", with groups such as Goldman Sachs being pulled up in front of US Congress, "for selling toxic products to their customers, whilst betting against these products on the other side"!

He said "people can't be passive anymore" ... and made it clear that current leaders/executives are "living on borrowed time" ... 

Hamel is beginning to catch on ... but this knowledge (and much more besides) was uncovered (and made available to the world) a number of years ago (21st Century Management in a Lean World) ... and the World of Economics is also heading for a similar paradigm shift too (i.e. towards Leanomics) ... though a small, greedy (and power hungry) minority, who currently exploit (and profiteer from) the existing (and failing) system, will fight tooth and nail to resist such paradigm shifts ... and in this way Hamel is actually right ... people can't afford to be passive (i.e. ignorant or apathetic) anymore ...

The banks are to blame ... and King's surprised people aren't more angry!

In an interview with the Daily Telegraph, Mervyn King has urged high street banks to take a better, longer term view towards their customers and to stop focusing on the need to “simply maximise profits next week”.

He accused them of routinely exploiting their millions of customers, stating “If it’s possible for them to make money out of gullible or unsuspecting customers, particularly institutional customers, they think that is perfectly acceptable.” [More evidence highlighting that ignorance is not bliss, and that those misusing power think it's perfectly acceptable to exploit it!]

The Governor also criticised the “weight put on the importance and value of takeovers” and raises concerns that companies with good reputations have been “destroyed” in the search for short-term profits.

Mr King expressed regret for not sounding a louder warning over his concerns before the last banking crisis [NB Is this an apology? IMHO he should have been sacked for this!]. The Governor’s remarks are a warning to George Osborne, the Chancellor, as a government commission considers whether to force high street banks to sell off their investment banking arms [NB IMHO this is a must and a no-brainer!]

Mr Osborne is thought to be against such a plan [NB as he's trying to look after his friends in the City!], but Mr King is due to ultimately become responsible for banking regulation and his views are, therefore, critical. In the interview, the Bank Governor said: “We allowed a banking system to build up which contained the seeds of its own destruction. We’ve not yet solved the 'too big to fail’ or, as I prefer to call it, the 'too important to fail’ problem. The concept of being too important to fail should have no place in a market economy.”

When asked whether there could be a repeat of the financial crisis, Mr King said: “Yes. The problem is still there. The search for yield goes on. Imbalances are beginning to grow again.”

Mr King suggested that the culture of short-term profits and bonuses within the banks may ultimately be responsible for the problems. He says that traditional manufacturing industries have a more “moral” way of operating [i.e. banks have few(er) morals!] They care deeply about their workforce, about their customers and, above all, are proud of their products. With the banks there isn’t that sense of longer term relationships. There’s a different attitude towards customers. Small and medium firms really notice this: they miss the people they know”.

The Governor added that good businesses “keep a clear vision of who their customers are, and are run by people who don’t think they should simply maximise profits next week.” He said that the payment of bonuses is part of this cultural problem. “Why do banks in general want to pay bonuses? It’s because they live in a 'too big to fail’ world in which the state will bail them out on the downside.”

Over the past 30 years, he says, “we changed Britain away from a sclerotic economy with inefficiencies and problems in labour relations. Everyone got to the point where we no longer expected government to bail us out. Everyone bought in to market discipline. We were all better off. It was working very successfully.” But now, people have every right to be angry, because “out of what seems to them a clear blue sky”, the crisis comes, they find they lose their jobs and there’s the sharpest fall in world trade since the 1930s. “But, surprise, surprise, the institutions bailed out were those at the heart of the crisis. Hedge funds were allowed to fail, 3,000 of them have gone, but banks weren’t”.

The comments will embarrass the Chancellor, who recently concluded a deal with the banks under which they would be able to resume the payment of bonuses in return for boosting lending [IMHO this is yet another act of treachery, from a Tory millionaire looking after his friends in the City, and who also fund his party].

So why aren't people more angry? ... well there's Ignorance of course ... but there's also a great deal of Apathy! Apathy is a disease in Britain ... a disease that will result in millions of lives being blighted!

Taxing times ... but not for everyone

Extracts of an article written by George Monbiot,  and published in the Guardian 8th February 2011.

In David Cameron we have a leader whose job is to quietly legitimise a semi-criminal, money-laundering economy.

“I would love to see tax reductions” David Cameron told an interviewer at the weekend, “but when you’re borrowing 11 per cent of your GDP, it’s not possible to make significant net tax cuts. It just isn’t.”

Oh no? Then how come he’s planning the biggest and crudest corporate tax cut in living memory?

If you’ve heard nothing of it, you’re in good company. The obscure adjustments the government is planning to the tax acts of 1988 and 2009 have been missed by almost everyone. They are, anyway, almost impossible to understand without expert help. But as soon as you grasp the implications, you realise that a kind of corporate coup d’etat is taking place. Like the dismantling of the NHS and the sale of public forests, no one voted for these measures, as they weren’t in the manifestos. While Cameron insists that he occupies the centre ground of British politics, that he shares our burdens and feels our pain, he has quietly been plotting with banks and businesses to engineer the greatest transfer of wealth from the poor and middle to the ultra-rich that this country has seen in a century. Here’s how it works.

At the moment tax law ensures that companies based here, with branches in other countries, don’t get taxed twice on the same money. They have to pay only the difference between our rate and that of the other country. If, for example, Dirty Oil PLC pays 10% corporation tax on its profits in Oblivia, then shifts the money over here, it should pay a further 18% in the UK, to match the corporate tax rate of 28%. But under the new proposals, companies will pay nothing at all in this country on money made by their foreign branches.

Foreign means anywhere. If these proposals go ahead, the UK will be only the second country in the world to allow money that has passed through tax havens to remain untaxed when it gets here. The other is Switzerland. The exemption applies solely to “large and medium companies”: it is not available for smaller firms. The government says it expects “large financial services companies to make the greatest use of the exemption regime”. The main beneficiaries, in other words, will be the banks.

But that’s not the end of it. While big business will be exempt from tax on its foreign branch earnings, it will, amazingly, still be able to claim the expense of funding its foreign branches against tax it pays in the UK. No other country does this. The new measures will, as we already know, accompany a rapid reduction in the official rate of corporation tax: from 28% to 24% by 2014. This, a Treasury minister has boasted, will be the lowest rate “of any major Western economy”. By the time this government is done, we’ll be lucky if the banks and corporations pay anything at all. 

David Cameron said “what I want is tax revenue from the banks into the Exchequer, so we can help rebuild this economy.” He’s doing just the opposite.

These measures will drain not only wealth but also jobs from the UK. The new legislation will create a powerful incentive to shift business out of this country and into nations with lower corporate tax rates. Any UK business which doesn’t outsource its staff or funnel its earnings through a tax haven will find itself with an extra competitive disadvantage. The new rules also threaten to degrade the tax base everywhere, as companies with headquarters in other countries will demand similar measures from their own governments.

So how did this happen? You don’t have to look far to find out. Almost all the members of the seven committees the government set up “to provide strategic oversight of the development of corporate tax policy” are corporate executives. Among them are representatives of Vodafone, Tesco, BP, British American Tobacco and several of the major banks: HSBC, Santander, Standard Chartered, Citigroup, Schroders, RBS and Barclays.

The world’s tax havens have not, as the OECD claims, been eliminated, but legitimised; with the City of London itself being a giant tax haven, which passes much of its business through its subsidiary havens in British dependencies, overseas territories and former colonies; its operations mesh with and are often indistinguishable from the laundering of the proceeds of crime; and the Corporation of the City of London effectively dictates to the government, while remaining exempt from democratic control. 

Tony Blair came to power after assuring the City of his benign intentions. He then deregulated it and cut its taxes. Cameron didn’t have to assure it of anything: his party exists to turn its demands into public policy. Our ministers are not public servants. They work for the people who fund their parties, run the banks and own the newspapers, insulating them from democratic challenge.

Our political system protects and enriches a fantastically-wealthy elite, much of whose money is, as a result of their interesting tax and transfer arrangements, effectively stolen from poorer countries and poorer citizens of their own countries. Ours is a semi-criminal money-laundering economy, legitimised by the pomp of the Lord Mayor’s show and multiple layers of defence in government. Politically irrelevant, economically invisible, the rest of us inhabit the margins of the system. Governments ensure that we are thrown enough scraps to keep us quiet, while the ultra-rich get on with the serious business of looting the global economy and crushing attempts to hold them to account.

And this government? It has learnt the lesson that Thatcher never grasped. If you want to turn this country into another Mexico, where the ruling elite wallows in unimaginable, state-facilitated wealth while the rest can go to hell, you don’t declare war on society, you don’t lambast single mothers or refuse to apologise for Bloody Sunday. You assuage, reassure, conciliate, emote. Then you shaft us.

Monbiot - another great web site uncovering the truth ... and more about how power is being misused ... for the benefit of the few (i.e. ultra-rich), and at the expense of everyone else.

Shock, Horror ... the economy is contracting

For all the shock/horror expressed by mainstream economists and pundits, such news comes as no surprise to the online blogger community (or most people in the street)! 

Mainstream economists were predicting GDP was going to RISE by between 0.2-0.6% (due in part to the poor weather in December), but the Office for National Statistics figures show that the economy actually CONTRACTED by 0.5% (and was at best flat, after stripping out the impact of the poor weather)!  Hence their complete shock at seeing the figures!

The economy is clearly 'heading south' and the fiscal tightening has hardly even begun (e.g. public sector cuts, VAT hike)! In fact many bloggers (including myself) have for some time been saying that the real economy has never actually recovered ... as all the measures introduced (e.g. bank bailouts, quantitative easing, near-zero interest rates), combined with excessive amounts of spin, served only to postpone the reality check ... and at great expense unfortunately too (e.g. the creation of a collossal public debt, the significant devaluation of the pound, rising commodity prices and imported inflation).

The Government saw the financial crisis as a green light to bring in swinging public sector cuts, and to introduce massive (and regressive) tax rises (e.g. VAT hike) for the vast majority of people (nb but not for the ultra-rich - who are quietly being given more opportunities to avoid tax altogether).  

The truth is, as in business, in the long run you cannot 'cut your way to success', and one needs to have a robust plan for creating sustainable growth and prosperity for all, by 'leading' in innovation and the adoption of best practice (a point emphasised from the outset in my book - "Lean World: The DNA of Success and the Path to Prosperity"). 'Leaders' have failed to do this in business, and political leaders have failed to do this in Government too ... and we're now suffering as a result (nb future generations will suffer too).

Sir Richard Lambert, outgoing Director General of the CBI, yesterday chose to attack the Coalition Government for its lack of vision, and a lack of a growth strategy to compliment its hardline plan to cut public expenditure.  Whilst this is true, I have to say there is a certain amount of hypocrisy in Sir Richard Lambert saying this (and particularly on leaving office) as whilst in post for 5 years he did very little (i.e. nothing) to help/support business adopt best practice and to put its own house in order, but he did a great deal to lobby Government on behalf of banks during the banking crisis, as the CBI proved itself to be the "Voice of Banks" rather than the "Voice of Business" - which the Government did not seem to realise at the time (NB the CBI is a predominantly a lobby group paid for by business in proportion to their size - and most of the largest UK companies are banks)! 

Smaller businesses are still not getting loans, despite the bailouts given to the banks, and 2 years on the government is still trying to press them hard to do this (and it appears they are failing).  Double dip - here we come - unless we see drastic change from our 'leaders' now ... and not just in the spin that's used!*

* NB The current 'leaders' have pressed home the need for drastic cuts for the last six months, which has not surprisingly raised concern about the security of people's jobs. The current spin (i.e. about the dip being mainly a result of 'the weather', and not the fundamentals in our economy) is IMHO a desperate attempt to stop consumer confidence falling even more ... and to stop the economy going into free-fall ... but will it work, and if it does, how long will it last?  Time is running out to do anything ... and all this does is buy a little more time (with even worse consequences further down the line if nothing is done)!

What's worse - Ignorance or Apathy?

As bankers pay themselves billions in bonuses for gambling, and everyone else suffers and pays the cost of bailing the banks out ... most people are living a life of ignorance or apathy ... with hardworking people/families losing their jobs and paying higher taxes, and with future generations being burdened with debt.

Meanwhile these legalised ponzi scheme fraudsters (banksters) are carrying on regardless and getting away with it ... they are lending very little to businesses but speculating a great deal on commodities (such as oil, precious metals, cotton and grain - pushing up raw material prices and thus inflation) and the collapse of economies (e.g. that have bailed them out, such as Ireland).

At the same time the medical profession (consultants and doctors) are busy ripping off the NHS, with consultants earning £100k's (e.g. taking £100k plus extra a year by charging £1000 for just 4 hours extra work) and with doctors quietly taking home 40% more pay (and for many much more than this) for doing less work (e.g. no out of hours cover) as a result of flawed GP contracts.  I raised these issues on BBC's Question Time at the time and they reluctantly admitted it ... nb people used to go into the medical profession with a passion for helping people, not to milk the system dry and use the proceeds to fund property portfolios ... the money they have taken out could have paid for MORE doctors/nurses and much better patient care ... but they clearly decided this was not in their own best interests and decided to take the money for themselves instead (nb as a result taxpayers now pay some of the most expensive doctor/consultant fees in Europe).

Can we expect the current wave of politicians to sort these things out properly ... Well I'm afraid the answer at the moment is 'no' as the truth is they do not have the interests of ordinary hard-working people at heart ... and their own self-interest/greed stops them from challenging others playing the same 'game' too ... so it's going to take far more than this I'm afraid.

Some argue that people get what they deserve ... and if they remain ignorant/apathetic they should not be surprised (or even complain) about being exploited (i.e. 'taken for a ride') by others ... but do you agree with this?  ... and what's worse in your view ... ignorance or apathy? (why not think about it, and avoid the obvious "I don't know and I don't care" answer!)

A sign of things to come (2) ... ?

As Christmas draws closer and the New Year fast approaches are we starting to see the writing on the wall ... and sign of things to come ...? 

Sterling devalued 25% (e.g. even against collapsing currencies like the dollar!), inflation running way above target (e.g. with petrol now heading towards £6/gallon!), interest rates set to go up, unemployment starting to increase again (before the real cuts start to bite), VAT set to rise to 20%, and the top civil servant (Sir Gus O'Donnell, Cabinet Secretary) quietly drawing up a "Plan B" for if/when the UK falls into recession again next year ...

Yet bankers (whose self interest/greed created this crisis) are celebrating and pocketing their Christmas 'bonuses', as a result of debt slavery (e.g. Fractional Reserve Banking) and corrupt profiteering/gambling using your money (where they take all the profit and you/taxpayers take all the losses) ... nb they are not focused on helping/investing in businesses, but continuing to speculate on the stock exchange, commodities, currencies and bonds instead ... forcing countries to the brink financially (e.g. Ireland) and pushing up food prices around the world so millions of people can no longer afford to eat (nb the same bankers also want to be able to speculate/trade in fresh water in the future too)!

Whilst the European Union is trying (and failing) to fiddle around with bankers pay (restricting bonuses will only elevate their basic pay), it has done nothing to stop Fractional Reserve Banking or Casino banks (investment banks) from speculating gambling using your/taxpayers money (commercial banks) ... much of this crisis was brought on by repealing the Glass-Steagall act (which was brought in after the last Great Depression) and nothing is being done to reverse this!

The banks have stolen the future from future generations, through high levels of tax needed to service (and eventually pay off) all the bailouts/debt, through the removal of EMA and the tripling of tuition fees, doubling of youth unemployment and further debt slavery as young people try to pay for a roof over their head (nb the bankers are aided and abetted here by a few very wealthy landowners who profit heavily from restricting the use of land ... instead of being taxed for the land they own)! 

If we really want to get out of this mess, we need to i) stop the corrupt practices of banks, ii) invest in education, innovation, enterprise and business, and iii) introduce a Land Value Tax, to replace the current Property Tax and to reduce the tax on jobs (income tax/national insurance) ... 

As the toxic mixture of ignorance and apathy continues to reduce ... Poweromics will be increasing exposed and challenged.

Wikileaks and the misuse of Power ... past, present and future

There are currently few stories exposing more Poweromics (i.e. the misuse of 'Power') than the saga surrounding Wikileaks ... from the leaked content itself ... through to the response of those in 'Power' ...

The hidden 'hands on power' have pressurised Governments to put in place international arrest/extradition warrants for its leader (Julian Assange) for an alleged and unrelated rape charge (nb not for releasing information), and subjected Wikileaks web sites/facilities to concerted cyber-attacks in an attempt to shut them down ... 

Assange has stated that website deserves protection and has not cost a single life despite the claims of critics.  Writing for The Australian newspaper, Mr Assange quoted its founder, Rupert Murdoch, as once saying the truth will inevitably win over secrecy.

He said: "Nearly a century later, WikiLeaks is also fearlessly publishing facts that need to be made public."  Mr Assange said WikiLeaks has coined "scientific journalism" that allows readers to study the original evidence for themselves.

He added: "Democratic societies need a strong media and WikiLeaks is part of that media. The media helps keep government honest.  "WikiLeaks has revealed some hard truths about the Iraq and Afghan wars, and broken stories about corporate corruption."

The campaigner denied he is anti-war, but said Governments must tell the truth about their reasons for fighting.  He claimed the United States, supported by its "acolytes", has attacked WikiLeaks instead of other media groups because it is "young and small".

Branding the website "underdogs", he accused Australia Prime Minister Julia Gillard of "disgraceful pandering" to the Americans.  He said: "The Gillard government is trying to shoot the messenger because it doesn't want the truth revealed, including information about its own diplomatic and political dealings."

Mr Assange highlighted some of the most high-profile revelations made by his website over the last week.  He added: "The swirling storm around WikiLeaks today reinforces the need to defend the right of all media to reveal the truth."

Wikileaks has been operational for some time ... so why is it only now that it is fighting for survival ... ?

Well the some leaks have exposed the misuse of Power, to the embarrassment of those who wield 'Power' (e.g. politicians, corrupt 'leaders', bankers, landowners) but a number of people have been quick to point towards a different event ... when, at the tail-end of last month, Assange indicated to a journalist that he had information about a major US bank that would cause a scandal to rival Enron ... now every financial institution is severing the ability to finance Wikileaks in an attempt to stop it doing this (nb such relevations could indeed start to expose the real 'hands of power', as well as all the corrupt/unethical banking practices still operating in banks today).

For all the mirrors around the internet replicating Wikileaks's content, the organisation is going to find it difficult to continue without the financial resources necessary to sift through its vast repository of documents.  Corporate America has swung into action against Wikileaks, acting swiftly and brutally. PayPal and MasterCard have now withdrawn their services and Assange's Swiss bank account has been frozen. The cost to Wikileaks in lost donations is already significant, and while this isn't the first time Wikileaks has had its income threatened (nb Moneybookers, a British payments company, shut down its account back in October), this time the financial services companies are acting as one, which makes survival more difficult for a site that operates on donations from the public.

... the small minority in Power (and who misuse Power) want this to continue, and don't want anyone to see (or interfere with) what they are doing ... however the vast majority of people would like to see more openness, honesty, transparency and facts, to make sure that those in 'Power' act honorably and responsibly, and in their collective best interests (and not simply their own).

... which is what "Scientific Journalism" should be about ... 

Indeed given this definition, the world arguably needs much more "Scientific Journalism" and far less ignorance, apathy and "Popularist Journalism" (which is what prevails right now)! 

... and thanks to the internet this will continue to be the case - the Genie's out the Bottle and it will not be put back ... i.e. the internet will change everything - including the balance/nature of Power ...