Bonuses and public service


Last week I wrote regarding public sector bonuses and the Lib Dem’s calls for more top private sector salaries to be disclosed. But, I think this issue runs deeper and is a symptom of a fundamental divide that that needs to be broken down.
This Government has created a gulf between the public and themselves with an ever increasing ‘them and us' attitude. If the fundamental aim of a government is to serve the people to the best of their ability, then this has firmly been flipped upside down. We are now serving politicians more than ever before.
The double standards we're subject to are illustrated by the public/private bonuses. Whilst the government is demonising bankers’ salaries, they are simultaneously awarding civil servants a total of £107.8m in bonuses. In truth, there is no reason as to why public sector workers should receive bonuses at all.
But this hypocritical divide is more widespread than this. Look at the ministerial expenses. Simply examin the examples set by Jacqui Smith, Michael Martin, Caroline Spelman and Derek Conway as indicators that we are now serving politicians.
Politicians need to be held to account more effectively in order to strengthen democracy and restore a culture of public service in Whitehall.

Blog Review 901


African undevelopment...the result of colonialism, the slave trade...or could it be that malaria is the major cause?

For those who would run the world financial system. Show how well you do at this game before we take you seriously.

On the AIG bailout and counterparty list. All financial bailouts are counterparty bailouts. More here.

Not all economists back the wider bailout.

What happens when the economic order is not based upon secure property rights.

Atlas Shrugged, the Guardian and Christian Socialism.

And finally, how to tell when your government is too big.

Cigarettes, now alcohol


At what point do we start making gin at home? Not too long if Sir Liam Donaldson has anything to do with it. The architect of the smoking ban is going to suggest that the government institutes a minimum price for alcohol. His plan: no drinks will be sold for less than 50 pence per unit of alcohol. It would of course fail to meet its aims and is a slippery slope towards prohibition.

Despite the BBC taking a clear line in favour of the move, the government it seems will not institute such an unpopular policy so close to a general election. James Purnell, Work and Pensions Secretary, has already come out in opposition, stating that ministers have no intention of going ahead with something that would punish the responsible majority of drinkers.

At some point though, cheap alcohol will be scrapped. As a Department of Health spokeswoman stated: "We have not ruled out taking action on very cheap alcohol - it's clearly linked to people drinking more and the subsequent harm to their health." The socialistic stance of the Department of Health will live on in the next government (no matter who wins) and alcohol will continue to be on the public health agenda, especially with Scotland's plans.

The most disturbing thing to come out of this nonsense is the fact the Liberal Democrat Culture, Media and Sport spokesman Don Foster has come out as a fan of plan, saying, “The Liberal Democrats have long argued that the ridiculously cheap below-cost price of alcohol in some of our supermarkets and off-licenses is a key contributor to the problem of binge drinking...We welcome Sir Liam’s intervention and hope that the Government will act." It is clearly time for Clegg to decide what it means to be a Liberal Democrat; he needs his ‘Clause IV’ moment, arguing for true liberalism in economic and social policy.

Defamation of religion


In the years to come it will not be hard to find yourself hauled in front of the Religious Inquisition Tribunal to evaluate the level of hate crime that you have committed due to expressing an opinion that you incorrectly held on a religion. That is surely the road that we are travelling along due to our own subservience to the ideology that is driving legislation and destroying long held liberties.

Throughout history peoples have wished to enshrine the right to freely express oneself: The Bill of Rights in the US, in the UN Declaration of Human Rights, Article 19 and even the EU have pronounced in their Charter of Fundamental Rights, Article 11. All hold free speech to be an inalienable right. This is a liberty that we hold dear in this country as seen last week when the police protected a number of British Muslims who had chosen to demonstrate at an homecoming parade of the Royal Anglians in Luton. They were invoking their right to speak freely. However, they are hypocrites if they also support the announcements from the Organization of the Islamic Conference in seeking to criminalize the ‘defamation’ of religion.

Instituting this type of legislation would be a stricture upon advancing our world away from the Dark Ages where heretics were burned at the stake. Practising a religion is by extension a form of freedom of expression; where religion seeks to curtail this freedom for others, they will in time also suffer. The state will use its legitimate violence to breach religious practices it sees as abhorrent to its own ideology, then they may understand that freedom is a mutually beneficial status.

Nanny state Britain is killing common sense

This think piece sees Dr Eamonn Butler decry the emergence of a ‘compensation culture’ in Britain, and point out that for fear of being sued, regulators have created a bubble to ensure there is no need to be compensated.

Regulators may have our best interests at heart but whatever happened to looking out for yourself?

Thank goodness. At last we live in a world committed to saving workers from industrial injuries. Like deafness resulting from working in noisy factories. The 2005 Control of Noise at Work regulations promised just that.

Trouble is, the crowd noise at Old Trafford quite often exceeds the regulations’ 90-decibel limit. So Sir Alex’s boys ought to be wearing earmuffs. And when the London Philharmonic strikes up the 1812 Overture, they should do the same.

But regulators are reasonable people, and have given the arts and entertainment sectors two years’ grace to solve their problem. Their problem? It’s the regulators’ problem. When bureaucrats in Whitehall dream up general rules that are just daft in particular circumstances, they should say sorry, and end the damage there and then.

The rules may be simple but simple rules don’t fit a complicated world

But they don’t. The Care Standards Act 2000 forced the closure of hundreds of care homes whose layout doesn’t match their pedantic standards. So if your granny’s room is only 14.0 square metres instead of the 14.1 specified, she’ll have to move – or go back to an NHS ward where she has no room at all.

The Childcare Act 2006 makes nursery providers sign up for a 148-page book of ‘education’ guidelines. All the staff need criminal record checks, of course – you can’t just leave your kids with people you trust. Student flats are now scarcer and costlier because landlords now have to fill out a 32-page form and cough up a £1,000 registration fee. Many find it easier not to bother.

How did we get into this mess? Our government authorities aren’t bad people. They want us to be safe. And they try to make the rules simple. But simple rules don’t fit a complicated world.

They also fear that they will be sued when accidents happen. You’d think firefighters would be pretty nifty with ladders, but they’re not allowed to use your stepladder to fit a fire alarm in your flat. That contravenes the working at height regulations. Don’t even suggest that they stand on a chair. So just put the alarm back in its box and hope you don’t have a fire.

But of course it’s us, the taxpayers, who have to pay for the compensation culture. Our education authorities shell out £2m a year in accident claims – like the £5,000 pay-out to a kid whose finger was hit by a cricket ball, £13,000 to one who tripped up, and even £6,000 to one who was injured while breaking into the school one night. And that’s chicken feed compared to the £600m paid out by the NHS in negligence claims.

It seems we all thing we have a right to act stupidly, while others bear the cost. A caretaker sued his school for £50,000 because he fell off a stepladder – although he’d been using stepladders for 30 years and had been given safety training. Whatever happened to looking out for yourself?

The determination not to be sued means that public bodies have no concept of what constitutes a reasonable risk these days. So the organisers of a Christmas party in Embsay village hall were told they needed a full risk assessment, and nut allergy warnings on the mince pies. Schools have banned playground football. Clowns in Zippo’s circus couldn’t use trumpets in a three-minute sketch because they’d need a music licence. Manchester taxi drivers cancelled their annual outing for needy kids because each cab would need a risk assessment, each child would have to be accompanied by an adult, and each adult would need a six-week criminal record check.

So in the cause of trying to make our lives 100 per cent safe, the regulators reduce our amenity, kill off village life, encourage us to take silly risks, and rob our kids of their childhood. Frankly, it’s the regulators who should be wearing earmuffs, because the rest of us should be shouting abuse at them as loudly as we can.

Blog Review 900


Remittances are thought to be the saviour of many a poor country. But what are they actually spent upon?

Why nationalised banks might not be all that good an idea. For when the politicians decide what gets subsidised, who would be surprised that it is the politicians who get subsidised?

It appears that the GMC operate in a similar manner. Those who run the doctoring side of the NHS get private health care coverage?

Transparency on government spending. Yes, of course we'd like it but that doesn't mean we're going to get it.

We know that Hugo Chavez knows no economics....but would it be too much to ask him to read a history book?

Berkshire Hathaway's lost it's AAA credit rating. Surprisingly, a good thing for shareholders.

And finally, perhaps this is the real problem with the banks?

From the Department of Excessively Stupid Ideas


Companies could face extra costs under Government plans to offer workers a guaranteed payment when they lose their jobs. Ministers are looking at a scheme to impose a legal minimum on how much employers have to pay employees who are dismissed.

Essentially this is a rearguard action. There are those who wish to raise the maximum statutory redundancy pay and those who think that this can be headed off at the pass by introducing a minimum amount payable.

Both are, of course, being fatuously stupid. We are pumping hundreds of billions of guarantees into the banks so that they will lend to companies. This is so that companies do not go bankrupt thus leading to soaring unemployment. The aim is to prevent that loss, not just of output but also of human effort and even the dignity that comes from productive labour. I might argue with specifics but the basic aim seems fine to me.

Then we have fools suggesting that now would be a good time to raise the amount that must be paid to workers who become redundant. These proposers seem to have missed a vital point: it is illegal to trade while your business is insolvent.  That is, that if you have insufficient funds to pay all your debts then you must close down and make all of your workforce redundant. One of the debts that you have to be able to cover is the statutory redundancy payments to that very workforce.

Soooo, if you raise the statutory redundancy payments then you'll raise the debts that companies have to be able to cover in these straightened times, these times of scarce capital and even scarcer bank loans, meaning that more of them will, by law, have to close thus throwing more of that precious labour onto the scrapheap of unemployment.

Could someone please remind me why it is that we are forced, at threat of prison, to pay for the people who come up with such ludicrous ideas?

Video games don't kill people


Much like the argument over gun control and the gun rights with assertion that "guns don't kill people, people kill people", video gamers are saying the same thing in the latest onslaught after a school massacre in Germany. Of course, meddling politicians are using the attack as to ban or severely restrict video games. Expect this event to help push further tightening of controls on "violent" video games all over Europe.

Daniel Finklestein has written an excellent retort to the claims about video games causing violence that is well worth reading.

One sometimes wonders if the anti-game/gun/etc. politicians have letters or statements pre-written in case something useful comes along in the news. Its amazing they can make a case for such legislation based on one awful occurance. One bad apple out of the millions of people who play video games does not make a case for anything in a sensible mind.

Video games don't kill people, deranged lunatics do.

FT vs. WSJ


The Financial Times has new analysis on its website under the title ‘The Future of Capitalism’.

The reason for this exposition is as follows:

The credit crunch has destroyed faith in the free market ideology that has dominated Western economic thinking for a generation. But what can – and should – replace it? Over the coming weeks we will conduct a wide-ranging debate on this dominant political issue of the day.

Most of the articles so far are as bad as you can imagine given the premise of this introduction.

Robert Shiller’s neo-Keynesian article on the need to control bankers’ ‘animal spirits’ entirely distracts from the true need to clamp down on the much more dangerous ‘animal spirits’ of politicians.

Martin Wolf’s apocalyptic look at capitalism is far too long given that it says practically nothing of any value. If he is looking for the seeds of destruction, try government, central banks and regulators.

Richard Layard’s call for less selfish capitalism does not just miss the wood for the trees, but fails to see beyond its own self-conceited happy-clappy pseudo-science.

The FT has been very poor in explaining the credit crunch, the financial crisis and recession to its readers. This latest feature is a reflection of their lack of leadership on the subject. In contrast the Wall Street Journal has been superb. Even if all the analysis has not been entirely convincing, at least it does not rely on sound bite driven analysis.