Bank regulation 8 years on, why has next to nothing been done?

The real root probleBanking trade screensm with regulating the banks is that the politicians are hand in glove with them. The Tories don’t even want to regulate the finance sector so long as it provides them with half their annual income year after year, not just the banks themselves, but the hedge fund billionaires as well. Worse still, no attempt whatever has been made to deal with the fundamental point of corruption – that whatever the big 5 banks do, they will be protected by the ‘implicit guarantee’ that the government will save them from themselves and bail them out because they’re ‘too big to fail’, too valuable an asset to lose, too crucial a part of running the State, etc. Risk-taking at a bank that will always be saved is like playing Russian roulette, but with someone else’s head. Continue reading

Osborne stirs up more shit in which to bury himself in

Osborne digging a hole, based on original by by coljay72Quietly and surreptitiously Osborne is marking out his pitch for the leadership. The trouble is, it’s thoroughly bad pitch. By denigrating opponents of privatisation he has set his face against the 70% of the population who earnestly want rail re-nationalised, a proportion so large that it must include nearly half who’re Tories. Osborne must assume that the case for privatisation of rail, as for every other takeover or outsourcing of public assets, is done and dusted and nothing more now needs to be said. If so, that is a very arrogant assumption, easy to make if like Osborne you don’t listen to what people are really feeling. Rail privatisation in 1996-7 was an ideological exercise, never justified on the evidence. A former Tory MP described it as “the poll tax on wheels”. UK rail fares are now the most expensive in Europe by a measure of 40% and rail privatisation is now costing the UK taxpayer £4bn a year in subsidies, more than a third of the net cost of the EU to the UK. And half of the UK taxpayers most heavily hit are Tories! Well done, George. Continue reading

Despite claims of a recovery, UK productivity is stagnant

'Gideon' OsborneThe basic reason why UK wage growth has been virtually flat for a decade, at a level still 6% below pre-2008-9 levels, is Osborne’s relentless squeeze on benefits, tax credits, low pay and public expenditure. But there are two other very important contributory causes. One is that the proportion of our national income which we invest each year rather than consume is far too low. Since the onset of the crash in 2007 UK investment as a proportion of GDP (excluding R&D) has fallen from 18.2% to 14.5% now. Not only is this a drop of a fifth, which is a very serious shortfall, it is also barely half the world average which remained at 25.5%. As ONS figures show that depreciation of existing UK assets is running at about 11.5% per year, only 3% of the current total of 14.5% is left, which is not even enough to keep up with our population growth of at least 500,000 a year, let alone sufficient to build up our total assets per head of the population. Continue reading

Osborne is beginning to make some serious mistakes

George Osborne in China sqOsborne has always had an overweening arrogance as he plots his path to the premiership before 2020. But his calculation is beginning to desert him. It is extraordinary that he has spent a week sucking up to China, accompanied by six ministers in his retinue, when everyone else is fleeing the country as being in deep economic trouble. The idea that hooking up to China today puts Britain in prime economic position is absurd – what China is exporting is not the world’s manufactured products, but deflation risk – domino devaluations, layoffs and recession. Cosying up to China in today’s conditions is not a smart idea. Continue reading

Can Mandelson actively advocating ousting the new leader remain a Labour member?

mandelsonIt is one thing for those who opposed the election of Jeremy Corbyn as leader to make their concerns and objections known and to argue for them within the Big Tent which is the Labour Party. It is quite another thing, when a new leader has just been elected with 60% of the vote (higher than Blair’s 57% in 1994), for a well-known Labour public figure to openly incite insurrection to have him promptly overthrown. When the party has spoken with such unprecedented decisiveness, such behaviour is coming close to traitorous. The Labour party has a rule, introduced by Blair himself, that anyone who brings the party into disrepute can be expelled. Many would think that Mandelson, who no doubt was deeply involved in the machinations behind the new rule designed to get rid of inconvenient left-wing activists, has now put himself in a position to be hoist on his own petard. Continue reading