Only the little people pay taxes

by Richard North
http://eureferendum.blogspot.com/2012/03/only-little-people-pay-taxes.html

Not content with ripping off their taxpayers big time, nearly a hundred senior local council employees are using tax avoidance schemes to minimise the amount they put back into the pot. Although these people are paid as employees of their respective authorities, they have been allowed to set up limited companies, as fronts into which their inflated salaries are paid.

(Sir) Fred Goodwin: Forever My Knight in Shining Armour!

by Percival Glyde

Several years ago, I bought a car on what I later discovered was an unfavourable leasing agreement. I’d normally have whined about this, but got on with the payments. Then I changed my bank, and forgot to carry over all my standing orders. The car finance company immediately registered that I was in default just as I was trying to arrange a new fix on my mortgage. I did call the finance company to explain, but found myself in an argument with a youngish Scotchman, who shouted me down, and gloated that my credit was ruined for life.

Which Side Are You On?

by Kevin Carson
http://c4ss.org/?p=8630

Occupy Wall Street has come under fire from some libertarians, on the grounds that it’s relatively silent about the role of big government, and its proposed remedies lean heavily toward increased government intervention.

Labour re-writes the past – their economic management

by Robert Henderson
http://livinginamadhouse.wordpress.com/?p=1097

The Labour hierarchy has worked out its narrative on the economic mess they created. It runs like this: NuLabour in power may have made some mistakes, but these were minor and apparent only with hindsight, while the real culprit is the global economy in general and the USA’s obsession with sub-prime mortgages in particular. This is not only a grotesque lie but a stupid one because it can be readily exposed.

Warren Buffett’s Financial Incentive to Push for Higher Taxes

http://amerpundit.com/2011/08/17/warren-buffetts-financial-incentive-to-push-for-higher-taxes/

by Stephan Tawney on August 17, 2011

Did I say “financial incentive”? Why yes, yes I did. It turns out that Mr. Buffett — new liberal hero thanks to his push for higher taxes on the “rich” — isn’t really a disinterested party:

Bitcoin: More Important Than You Realize

by Kevin Carson
http://c4ss.org/?p=7149

Neal Stephenson’s “The Diamond Age” was set some years after encrypted currencies and e-commerce removed most economic transactions into darknets beyond the government’s capability of monitoring and regulating, and thus caused tax bases around the world to implode. This followed, in short order, by the collapse of most nation-states.

Encrypted currencies and darknet economies have been promoted as a real-world model for resilient communities, in the impending age of hollow states, by such thinkers as Daniel de Ugarte and John Robb.

So you can imagine my reaction to recent news of Bitcoin, “a Peer-to-Peer Electronic Cash System.”

The EU Euro stability fund draft press release…

Christopher Houseman

Found in the memory hole.

In the wake of widespread pessimism and protests in Europe regarding the very existence of the Euro, the European Commission and the Council of Ministers have agreed that a permanent Euro stability fund will be established shortly.

All Eurozone members will be expected to pledge impressive sounding amounts of money, which won’t in fact be anywhere near enough to cover the gaping hole in the heart of our wonderful would-be global reserve currency. And we won’t actually expect them to pay anywhere near as much as they pledge – unless they urgently have to.

The existence of a permanent Euro stability fund will reassure the gullible citizens of our glorious Union that all is well – until they actually have to buy something more valuable than our promises about their future earnings and productivity. In fact, the very existence of the stability fund means that:

1) We have no intention of trying to turn the Euro into a sound currency, and we probably wouldn’t know how to do so anyway.

2) We won’t be able to stop Eurozone members overspending in the future. Why else do you think we need this fund? Besides, we know every such crisis provides the justification we need to centralize even more money and power in our hands, so why would we even bother to try?

3) We will pay no attention whatever to calls for repudiation of national debts and a return to national currencies by Eurozone members. Any politician who tries to do this had better have very good life insurance and first-class bodyguards. Our message to the little people is simple: Shut up, pay up, and trust us to spend more money than you can possibly imagine. We’re a government – what else do you expect?

We note that UK citizens have been assured that non-Eurozone countries won’t have to contribute to the fund. We’re glad you like the eyewash, and rest assured that we’re working hard to address this state of affairs.

FLC198, The Coalition and the Economy: A Fanning of Stale Air, Sean Gabb, 28th October 2010

FLC198, The Coalition and the Economy: A Fanning of Stale Air, Sean Gabb, 28th October 2010.

David Webb on Pension Reform

Doh – I sent this directly via e-mail. It was stripped out. Apologies to all, and here is the post as it should have been.

Dear Dr Gabb,

I am on holiday in China, but want to send you some comments on pension reform, but I couldn’t find a thread on the LA site to post it in. Would you consider opening a thread on this topic?

I am totally opposed to the government’s decision to force all companies with more than 50 employees to have a pension scheme and to auto-enroll all employees in it. While it is good for everyone to have a pension account, a scheme run by your company is not yours to manage and control – and in times of economic downturn it can leave companies nursing large pension deficits for people who no longer even  work for the company, requiring extra money to be put in just at the wrong time.

In Hong Kong, all employees contribute to their Mandatory Provident Funds, and I think their employers either can or have to contribute too. I would like to see a system whereby national insurance was totally scrapped, and everyone on PAYE (as long as it lasts, as libertarians would scrap income tax altogether) be required to contribute 10% of their monthly salary into their own SIPP, self-administered personal pensions. The company could also contribute more (but not be forced to), and all these SIPPs would be up to you yourself to manage. You could make the decision to invest in commodities, emerging markets or whatever yourself, and your pension scheme would be your own – and also your own problem. There would be no pension debts in company accounts (or only for already retired employees as the existing arrangements are phased out), and no public sector pension deficits either. Quite simply, all public servants would also pay 10% of their salaries into their SiPPs too.

There would be no 200k pension for ex-police chiefs – quite simply police chiefs would pay 10% of their existing salaries into their SIPPs and manage the assets themselves thereafter. For most people, the abolition of NI would largely cover this scheme, and it would eventually free up the population from total reliance on the state in their autumn years. I would not increase civil service pensions to cover the fact that they were now having to pay into their own SiPPs – the abolition of NI (which would require cuts elsewhere) would cover that – and existing pension monies, where they existed would be distributed to the pension members as contributions to their SIPPs. Quite simply there would be no pension assets other than the SiPPs, which everyone would hold.

I would then abolish the state retirement pension as an entitlement. Those after 65 whose SIPPs had not earned enough could apply for income support (a benefit, not an entitlement). Clearly we have to think about getting out of the whole social security arena, but that would be easier to do in the future when everyone had saved up a bit in their SIPPs.

I would also make pension assets fully inheritable with no inheritance tax. Currently that is only the case between spouses. I would also totally remove the requirement ever to buy an annuity, which is just one way of making sure there is nothing left of pension assets when you die. I would also look again at the 25% lump sum that can be taken out of your pension at 55. As long as the pension assets remaining after a lump sum was taken out were enough to finance a retirement, there would be no need to restrict the lump sums to 25%. Eg if you had 1 million in your pension, why should you only take out 250K as a lump sum? As 750k is more than is required to finance your retirement, assuming a 400K pension paid a 28K pension at a 7% annuity rate. In other words, I am saying anything over 400K should be available as a lump sum free of any tax. And some access to pension monies earlier than 55 years of age, eg to buy houses, should be facilitated, as long as there was enough left in the pension fund to reasonably expect to fund your retirement.

I know libertarians want to get the state out completely, but I think what I outlined above would be a good stepping stone. It would make it easier to fully get the state out later on, as people would have assets. The point about abolishing the trillion-plus public sector implicit pension debt at a stroke would be a huge improvement in our country’s finances.

Regards, DJW

Strategic Offence and Insecurity

Christopher Houseman

So, the great threats du jour are cyber-terrorism and international terrorism in the style of al-Qaida. Hmm… I can see why we’ll need a couple of new aircraft carriers to fend off those evil beasties, especially if HMG can’t afford to put any planes aboard them. Still, at least nobody’s talking about renting the (not yet completed) aircraft under a PFI scheme, along with the refueling tankers.

Meanwhile, in the name of “not giving in to the people who’ve been angered into action by our previous intrusions into their lives terrorists”, HMG has either got to carry on with business as usual (which means buying enough kit and posting enough troops in the right places abroad to placate the US government) or at least reassure everyone that’s what it intends to do as soon as it can print enough new money convince the markets it’s solvent again.

Personally, I doubt a mere 8pc cut in the MOD budget (while everyone else takes a hit of up to 25pc) will be enough to woo foreign creditors back in their droves. But at least as Remembrance Day draws near, we can all pause a while to give thanks for this country’s glorious victory over the evil Nazi supporters of “Guns before butter”, and encourage ourselves with the thought that the British people are far too noble and wise to fall for that old lie.

Those who do not learn from history…

…and you know the rest of that one.

David Davis

But this looks like it will be worth reading.

A quick response to Mr. Osborne’s Emergency Budget

Christopher Houseman

This tough austerity budget, in which everyone will bear the pain together, has everyone at the BBC prattling on about the projected 25pc departmental spending cuts.

Apparently, everyone’s forgotten George Osborne’s admission that, because of his refusal to cut capital spending projects, overall Government expenditure is set to rise from £637bn to £711bn over the five-year term – a mere £74bn increase (that’s well over 11.5pc).

Wow! What a sacrifice by the State. Imagine how much more Government would have awarded itself if we weren’t in a recession.

I further note that, as indicated beforehand by David Cameron, some Government departments are more equal than others. Spending at the Department of Health (doh!) and the Department for Overseas Bribery Development won’t be cut. I guess the coalition Government needs to keep renting votes in the North-East and the UN General Assembly, and Big Business needs some more taxpayer-oiled overseas contracts in the “Developing” World.

Clobbered: middle England (esp. those on household incomes of £40-60k), anyone on State “benefits”, anyone planning a big ticket purchase in the New Year (when VAT will rise from 17.5pc to 20pc)

Pseudo-clobbered: the rich (28pc CGT is still less than the top rate of 40pc income tax, so that loophole remains cost effective), the banks (surely the new bank tax won’t be passed on to customers in the form of higher charges – will it?)

Encouraged: Some small business owners (various breaks relating to entrepreneurs’ CGT, NI breaks for SME’s outside London and the South East).

Overall: Open for (Big) Business as Usual.

The New Barbarossa?

Christopher Houseman

George Osborne’s emergency budget tomorrow will coincide with the anniversary of Hitler’s decision to invade Stalin’s Soviet Union in 1941.

Those of us who, on the one hand, grieve “New” Labour’s sovietization of British society and the UK economy, wait with some trepidation on the other for the new Chancellor’s pronouncements.

The coalition government is reportedly keen to raise income allowances but will at the same time penalise any attempt to translate this extra income into investment capital by slashing non-business CGT exemptions and raising CGT rates. Meanwhile, the combined result of reported plans to raise VAT with recent cuts in the number of tax inspectors is a subsidy of the so-called “black” economy. No doubt, this subsidy will be further enhanced by the usual rises in taxes on petrol, diesel, alcohol and tobacco.

When combined with ongoing efforts to artificially depress interest rates, the unmistakable end result will be to encourage people to keep spending as much or more than they earn, but to try to do so “off the books”. And no doubt any future reversal of the proposed war on capital gains will involve encouraging capital formation under the control of large financial institutions. I can think of no outcome more likely to disillusion coalition members and the wider electorate alike in the longer term.

In 1941, some people hoped that Operation Barbarossa could somehow result in both sides losing. Sadly, until control of the money supply (at the very least) is wrested from the political system’s cold dead hand, such a hope will again be too much to ask for.

All in all, it sounds to me like a good time to go long on gold, silver and ferry companies (the booze cruise boost), and short on the FTSE in general and off licence chains in particular.

Libertarian Alliance Examination Board: a sample Science Paper

Fred Bloggs.

Here Is a newly issued paper from the LAEB (Libertarian Alliance Exams Board)

Appreciate or Die (Quote from Socialist art gallery).

Please only use a black ballpoint pen in this examination, as our exam marking                                                                                                                                                                                     monkeys are colour blind.

Time allowed : 3.278×10^-29 sec

• The maximum mark for this exam is 34.7
• Show some of your working, but not all, if you do so marks will be deducted.
• You will be awarded extra marks for answering these questions in a specific different language, but we’re not going to tell you which, if you answer in the wrong language you will automatically fail.

Any injuries sustained during this exam are the fault of the person taking the exam and not the LAEB (Libertarian Alliance Exams Board)

Sign Here: ________________________

Questions Start

1  Estimate the DC current, flowing in a one-turn copper coil which follows the earth’s equator, which would cancel the Earth’s magnetic field at either pole. (Horizontal component of field at lat 86^o 30` N = 0.18 gauss, vertical component = 0.9 gauss. I gauss = 1E-5 Tesla.)

Answer:_______________________

______________________________

______________________________

______________________________

Maximum Mark: 2.3

2   Calculate the cross-sectional area of a square copper turn, polished and unblacked, and fully suspended, whose surface temperature will not exceed 800 K in dry air temperature of 320 K.

Answer:_________________________

_______________________________

_______________________________

_______________________________

Maximum Mark: 6.1

3   Calculate the gravitational field strength existing between the Milky Way and a hypothetical galaxy 13 billion LY away. Use 2E42 Kg for the mass of the Milky Way and 9E41 for the other galaxy.

Answer:_______________________

_____________________________

_____________________________

_____________________________

Maximum Mark: 7

4   Estimate the cross-sectional area of each of two Duct-tape fixtures, of 48mm width and 0.5mm thickness, applied always parallel to the direction of force, which would be required to separate reliably two opposite charges of 1C each at a distance of one meter in free Space. (Young’s Modulus of Duck Tape is assumed to be 4E9 Pa.)

Answer:______________________

_____________________________

______________________________

______________________________

Maximum Mark:2.4

5   Estimate the number of moles of human DNA on the Earth as of now, its total estimated mass, and the molar mass of human DNA. (Assume that one haploid human genome, complete, = 1 molecule. Also assume that the mean volume of all human cells is about 1.9 picoLitres.

Ignore human gametes in this answer, but also estimate the total number of these present on the planet at any moment. Use your knowledge of human population trends and age-band-statistics to derive as accurate an estimate for this number as possible, differentiating male form female gametes.

Answer:_______________________

_____________________________

_____________________________

_____________________________

Maximum Mark: 0.6

6   Calculate the reduction in heat capacity of the Gulf Stream over a calendar year, caused by a wind farm of 10,000 turbines directly in the path of the airstreams above it at latitude 55^oN, each turbine having an installed generating output of 100Kw, at a height of 100M and operating at a 16% duty cycle. Use your own knowledge of geography, natural climate movements, astronomy, the heat capacities of water and moist air. The Sun’s radiated power output is about 3.92E26 Watts.

Estimate the extra mass, surface area and volume of North Polar ice that would build up in the Barents, Norwegian and Greenland Seas in one year, assuming that no other areas are affected, as a result of this set of turbines. (For quickness of solution, assume polar ice above latitude 65 radiates IR into space at 25 Watts/M² at all temperatures above 240K.)

Answer:_______________________

______________________________

______________________________

______________________________

Maximum Mark: 1.6

7   You are to deliver a shell weighing about 1.5 imperial tons, at a range of 60 miles, from a barrel of diameter 460mm, at a target at the same elevation as the emplacement. (g = 9.81m/s²) Devise a suitable mathematical model from which the answers could be derived, and then calculate, in no particular order:

(a)  The barrel length

(b)  The time of flight

(c)   The maximum height reached by the projectile

(d)  The required muzzle velocity at 40^o barrel elevation

(e)  The mean gas pressure (assume uniform)

(f)    The acceleration in the barrel

(g)  The muzzle velocity

Answer:___________________________

__________________________________

__________________________________

__________________________________

Maximum Mark: 4.7

8   Calculate the number of 25Kg sacks of rice that would be required, and the total volume of rice grains in cubic miles, if the Great King had been able to grant the wish of the Resident-Court-Mathematician who had invented Chess for him. The inventor asked for “one grain of rice on the first square, two on the second, four on the third, eight on the fourth, sixteen on the fifth…..”. Assume a grain of rice is a cylinder of length 6mm and diameter 1.25mm and that they pack approximately efficiently. State your packing density assumptions in your answer.

If the sacks used above are made of polythene, and must be 0.8mm thick, estimate the area of film to be manufactured, its mass, and the number of barrels of Saudi Heavy Crude that may have been used to make it. Use your knowledge of thermal cracking procedures and also of the average mass of a “barrel” and how much of this is realistically convertible into monomers for this question’s use. Density of polythene (MDPE type) is about 0.932 g/cm³.

Answer:____________________________________

___________________________________________

____________________________________________

____________________________________________

Maximum Mark:10

End Of Questions.

Are the non-Domiciled Rich and the City Good for England?

Sean Gabb

Free Life Commentary,
A Personal View from
The Director of the Libertarian Alliance
Issue Number 168
19th February 2008

Are the non-Domiciled Rich and the City
Good for England?
by Sean Gabb

On my way out of the house this morning, I was called by a BBC researcher to discuss my opinion of non-domiciled tax status. As my opinions were not the ones expected, our conversation did not lead to any broadcast. But I was rather pleased with what I said, and I might as well spend the rest of my railway journey writing it down.

For my readers who live abroad, I should explain that resident foreigners in this country enjoy significant tax privileges. I, as a British citizen resident in the United Kingdom, pay tax on my income earned here and elsewhere in the world. A foreigner living here, who can persuade the authorities that his permanent residence is outside the United Kingdom, pays tax only on what income he earns in this country and on what income he brings in from abroad. Whatever he earns abroad and leaves abroad attracts no tax. That is why so many rich people have moved to London.

This privilege is now under attack. During the past eleven years, the British State has almost doubled in size. The Ministers have justified this by an endless chant of “investment in essential public services”. In truth—whether to a few white proles, or to Shopping Coordinators for Bearded Men with HIV, or to the various Tarquins and Jaspers who get the contracts to redesign logos and headed paper every time a Ministry name is changed—our tax money has gone on raising up an army of Labour voters. So far, most of us have not paid attention to the systematic looting required for this. Some of it was cleverly disguised. Much of it was enabled by an expansion of the world economy that brought in more revenue without increases in the rates of tax.

This may now change. If we go into recession, the amount of tax paid will fall at current rates. At the same time, there is no room left for imposing taxes that will not be noticed and felt. Therefore, if the payroll vote is to be kept on, let alone expanded, the Government must now openly increase taxes or inflate or both.

That is why the non-domiciled are to be hit with a poll tax of £30,000 per year. This will not put off the fiscal crisis. At £800 million, the sum projected is barely a fifth of one per cent of total government spending. Nor will it last very long. The non-domiciled are already threatening to leave. That means a farewell to Madonna and to Roman Abramovich. More importantly, it means a farewell to some of the most dynamic people in the City of London. To raise barely enough cash to run the National Health Service for a week, the Government is prepared to lose people who contribute billions in employment and indirect tax, and to damage a vast financial machine that generates more than a third of the national income.

But when a state is hungry, every little extra can look tasty. That it may not last beyond the next election is not something at all likely to worry our present set of politicians.

I think the lady from the BBC expected me to run out of breath as I denounced the scheme. She had me listed on her database as Director of the Libertarian Alliance, and took it for granted that I opposed taxes and supported the rich in general and the City of London in particular.

Well, I did denounce the taxes. They were bad, I said, because they stole the produce of a man’s labour: taxing is enslaving. They were bad, I added, because they enabled government spending that, even when not obviously wasteful or oppressive, tended to corrupt both direct and indirect recipients.

Her problem started when I moved to the rich and all those City people. Good riddance to the lot of them, I said. If it needed a tax to get them out of England, I might almost find something nice to say about taxes.

That was the end of our conversation. The BBC lady made her excuses and rang off. I imagine she then did a search in her database for Tory Boy Intellectual, and was soon hearing a lecture about London as “the Jewel in the Crown of the British Economy”.

I suppose I should explain myself. There are those who think libertarianism involves a defence of riches and of the rich. Some libertarians seem to agree. I do not. A libertarian is someone who wants to be left alone, and who wants to leave others alone, and who wants others to be left alone. People must be taken as the owners of their bodies and of what they create in or appropriate from the external world.

Given that all exchange and other association needs therefore to be voluntary, we move to an endorsement of what is called the free market. If some people do better in life in others, so much the better for them. If they contrive to pass on some part of their success to their children, so much the better again.

This is not, however, an endorsement of actually existing capitalism. A free society is not Tesco minus the State. It is a place of small craftsmen and farmers and traders, of artists and of unlicensed doctors and lawyers, and of others needed if individuals and free associations of individuals are to live well. We cannot say much more than this about the arrangements of a free society. But we can be sure it would have no place for big business as it now is found.

Big business corporatism, I would never seek to deny, is the best economic model humanity has known in over a century. It does generate vast amounts of wealth, and does ensure that much of this is distributed with some approximation of justice. Give me a choice between what we have and any of the state socialisms tried or recommended since Plato, and there is no doubt what I should choose. Nor is there any doubt, though, that the civilised nations made a big collective mistake around the middle of the 19th century. A system of scientific and industrial progress that might have grown into an unmixed blessing was partly hobbled and made into a new instrument of class domination by laws that allowed firms to incorporate and that gave shareholders limited liability for the debts of firms.

The result was a channelling of investment into firms that would never have been trusted had investors continued to face the risk of joint and several liability for debt. As these firms grew to enormous size, they monopolised or cartellised whole markets. They accepted and often quietly called for schemes of tax and regulation that harmed them, but harmed them less than their smaller competitors. In Britain and America, they demanded the underwriting by the State of their foreign expansions.

To ask whether big business bought or were colonised by the political class is irrelevant. All that matters is that we live in a world where political power and corporate wealth are possessed by different wings of the same ruling class. It is a ruling class that presides over whole nations of people transformed by brainwashing and mild but continuous discipline from human beings to human resources.

More than any other financial centre, the City of London stands as the heart and mind of the global corporate system. Every statistic the BBC lady was hoping I might drool on air—that there are more American banks in London than in New York, that German banks employ more people in London than in Frankfurt, that over a third of all currency conversions take place in London, and so on and so forth—is further condemnation for me.

Anyone who regards the City as identical with free market liberalism is deceived or trying to deceive. It is a place where markets clear, and where profit comes from working out returns in fractions of one per cent. It is one of the few places where reality and the textbook world of perfect competition nearly merge. It is, however, a place maintained in being by the scheme of state-granted privilege that is limited liability. At the very best, its activities are useful to protect us from high taxes. But in a world of free societies, there would be no City of London or anything like it.

A further evil of the City brings me back to the non-domiciled rich. Whatever their immunity from income tax, these are people who pay large amounts of indirect tax. They hand this over without much resistance or complaint, and they hand over large amounts. Political quietism plus great wealth is always dangerous to freedom. When the quiet rich are also foreigners, or at least highly mobile, is still worse. They will not protest at any use of their tax money to oppress other people than themselves. The moment their own freedom is infringed, they will retreat to somewhere more congenial.

For all the airs and graces they try to assume, this is what makes the non-domiciled rich different from the old landed aristocracy. Though tiresome in their defence of legal privilege and unearned wealth, these latter were incidentally useful in slowing the rise of big business corporatism. Like the rest of us, they had nowhere to run to, and were by training and inclination the natural leaders of resistance. Roman Abramovich and Madonna are none of these things. They live among us, but are in no sense with us. The same is true for the more anonymous bankers and fund managers who have for the past generation found this country useful as a trading platform. The same is true of the rich in general. Unlike the workers, who may have little else, the rich have no country.

Just about the only very rich foreigner possessed of any public spirit is Mohammed al-Fayed. He expresses that spirit in what may seem an eccentric cause. But he certainly cares something about this country. He is also domiciled here and is subject to the same taxes as the rest of us. Not surprisingly, he is hated and reviled by the establishment media, and has failed to obtain a British passport in an age when these are handed out to any parasite who can hold his place on the underside of a lorry.

In closing, Gordon Brown and his Ministers do not intend to do well by us. They are traitors to us in their external policies, and rapacious tyrants in all their internal dealings. But their desire for short term gain may set us on the path to a better world. And if they are not to be thanked for this, I am not inclined to join in the chorus of disapproval.

NB—Sean Gabb’s book, Cultural Revolution, Culture War: How Conservatives Lost England, and How to Get It Back, can be downloaded free from http://tinyurl.com/34e2o3. You can help by contributing to publishing and distribution costs

Free Life Commentary No 168, 19th February 2008

Star Wars

Fred Bloggs

MP’s expences can now be seen from space. They realy can’t hide from the taxpayers any more.

They’ll be claiming for the satellites next.

Good Economics, Standard Theology

Bruce Porteus

WILL  THERE  BE  A  GLOBAL  ECONOMIC  COLLAPSE,   OR  RECOVERY?

Will there be a global economic collapse, or can the world’s economy be saved from a total
melt-down? Will the current stimulus packages work? Will there be an economic recovery?

These questions are now being asked by many business leaders, politicians and economists
around the world. There appears to be little agreement on what will happen as the unprecedented
economic crisis continues, in spite of optimistic forecasts from some world leaders. This article will
explain the causes of the current economic crisis, and what the outcome will be, in simple,
layman’s terms.

Firstly, let’s look at the causes of the current crisis. For over 30 years the Anglo-Saxon nations
(USA, Canada, Australia, UK, New Zealand) and a few other countries have been spending
considerably more money than they earned from exporting goods and services, accumulating large
current account deficits internally, and massive external debts internationally. To finance these
external debts they have borrowed money from creditor nations, in particular Japan and China. This
has allowed the Anglo-Saxon nation’s financial institutions to have the capital to continue growing
their economies, enabling them to finance costly wars and still import consumer goods to satisfy
their self-indulgent life-styles. They have continued to expand their currency supply in order to
maintain economic growth, but that caused an escalation of property prices, and growth in
borrowings to finance domestic consumption. Up to now they have been fortunate to avoid being
affected by the high inflation that normally follows an increase in the money supply, without a
corresponding increase in productivity. This was, in part, made possible by switching to the
purchase of imported goods and services produced by low-wage countries and paid for with the ever
increasing supply of US dollars.

The problem arises when Federal Reserve Notes (U.S. dollars) accumulate in foreign hands. A
Federal Reserve Note is an I.O.U. and rather unstable as it floats against the arbitrage basket of
international currencies. The only alternative for these nations to avoid being overexposed to
unbacked dollars which might tank at any moment, is to purchase United States Treasury
Certificates which are (so far) considered safer as they are rated (so far)”triple A.” Either way, other
nations are trusting that these I.O.U.’s will one day be useful for the purchase of goods, services or
other more stable currencies. The purchase of these Treasuries (loan certificates) by foreign nations
repatriates the dollars which are then spent domestically or overseas again.a vicious circle.

This inflow of money borrowed by the Anglo-Saxon nations has allowed them to maintain generous
state-funded welfare programs that have directly contributed towards undermining the role of the
family as the foundation of a successful society. This has encouraged people to look to the State
for their needs, rather than the extended family accepting responsibility for other family members,
sapping the drive and willingness of their people to compete in a competitive world. Socialism by
stealth in Western nations has done so much to destroy the family structure, the foundation from
which all successful societies are built. An increasing amount of Western Government revenues are
drained into providing expensive welfare programs such as health care, pensions, benefits for the
unemployed and inadvertently encouraging single parent families, but leaving little money for
investment into infrastructure and provide capital to develop their economies. Asians culture
encourages the extended family to accept responsibility of caring for other family members in times
of misfortune, paying for their education and health care, rather than the State. Most Asians accept
the premise that unless you work, you go hungry – sadly in the West it is expected by many that
the State will provide, regardless if one works or not.

One of the results of the current economic crisis is that the Anglo-Saxon Governments no longer
have revenue to support their expensive welfare programs; just at the time when there are the
greatest financial demands being placed on them. An aging population, escalating health-care
costs, growing unemployment is blowing out government budgets, causing unsustainable deficits.
Meanwhile the Asian countries, not burdened with such extravagant welfare programs, have been
able to use taxation revenue to invest into developing their domestic economies. As a result the
Anglo-Saxon nations have become less competitive in the global market-place than the Asian
economies. Added to this, the lack of domestic savings by the Anglo-Saxon nations has made
them dependent on borrowing from those countries that have large current account surpluses,
causing them to slip further behind in maintaining the standard of living that their people still expect
to enjoy.

The end result has been a gradual break-down of the social fabric of western society till today they
are crime-ridden, diseased, over-indulgent, debt-ridden and self-destructive. The Anglo-Saxon
nations are now so heavily indebted to their overseas creditors, that even an increased amount of
export revenues would not enable them to service their external debts. However with falling exports
and large current deficits, it is only a matter of time before they slide into bankruptcy, unless they
are able to operate with a current account to service and repay their international debts. The flow of
US dollars into Asia has enabled their economies to obtain the capital to finance their domestic
growth and accumulate overseas reserves. In turn, lending their surplus capital back to the
Anglo-Saxon nations has allowed these countries to obtain the financing to purchase more imports
from Asia. This arrangement has worked well up to now for all concerned, but is not sustainable.
However, it is proving very difficult for the Anglo nations to expand exports to the rest of the world
during a global economic recession which is causing a lack of overseas export markets for their
goods and services.

Up to now the USA has been in the fortunate position of having the US dollar as the world’s reserve
currency, and being able to print dollars to finance its deficits, avoiding the need to borrow in other
currencies. As long as the global demand for dollars to finance world trade remains, it has been in
everyone’s interest to continue with this arrangement and retain the US dollar as the world’s reserve
currency. Over the last decade surplus dollars have been recycled back to the American banking
system, creating surplus liquidity in the Anglo-Saxon nations, and encouraging their banks to adopt
loose lending practices to generate paper profits from loans to domestic customers.

The current economic crisis was triggered when American and UK banks accumulated bad debts
from reckless lending, as their customers began defaulting on their loans. This quickly led to a
chain-reaction of banks defaulting and the need for government intervention to bail them out. This
has led to the current global economic crisis we now have.

In an attempt to avoid a total economic collapse, the governments of UK and USA have created
trillions of dollars of credit to inject into their banking system to save their banks from collapsing, as
well as guaranteeing deposits. This was intended to allow the banks to continue lending to prevent
their economies from going into free-fall, and government revenues collapsing. It appears this may
be working, although the banks have still not written off trillions of credit card debts and real estate
loans. The real question is, where has all the money gone that was lent though the bank’s bad
debts which have been written off? This money is still in circulation, but much of it is not
recoverable from those who have defaulted on their loans. What has happened to this money? It
has not just vaporised. Much of this money remains in circulation outside the USA and is now
controlled by foreigners.

Another difficulty faced by the Anglo-Saxon nations is that trillions of dollars have been written off of
their equity and property markets, wiping out much of the collateral from their banking system. Still
not accounted for are the trillions (possibly quadrillions) of dollars involved in the derivatives markets
- a sleeping time bomb ready to explode at any moment. In effect this has resulted in much of the
wealth of Anglo-Saxon nations disappearing, lowering the standard of living, slashing government
revenues, and will inevitably result in widespread poverty.

The Federal Reserve policy of creating new currency to replace toxic bank loans is like putting fuel
on the fire. In the short-term it may prevent the US economy from unravelling, but in the long term it
will be disastrous. It will result in run-away inflation as money looses value. Admittedly the US does
not have much choice – if they had not propped up their financial institutions, the economy would
have unravelled already, collapsing government revenues, and dragging the world into a depression.
They would not have had the revenue to service their national debt. Either way, the economy
collapses. The option of printing currency to inflate the money supply in an effort to stimulate
consumer demand and maintain economic activity is a very risky one, and will eventually lead to
erosion of the fiat value of the currency and uncontrollable inflation. Governments flooding markets
with currency to revive economic growth without increasing goods and services will only result in the
collapse of the currency.

So what happens next? The flood of money that has been injected into global markets may lead to
temporally restoring consumer confidence and spending for a short period. Sadly, the imbalances
that have led to the current crisis have not been addressed. Nothing has been done to correct the
imbalance of global trade between the Anglo-Saxon nations and Asia. The Asian nations continue
to accumulate more and more US dollars from exports and income from their investments. The flow
of capital from the West into Asia to finance imports continues. The outcome can only result in one
thing – a total collapse in the value of the currencies of the Anglo-Saxon nations.

The coming collapse of the US dollar will result in significant readjustment of global economic and
military power. It will result in the end of the Anglo-Saxon nations’ dominance of the global
economy. They will be replaced by two significant economic power blocks (Asia and the EU) filling
the vacuum created by their collapse. It will also be a time of further economic turmoil, followed by
political upheaval. It will lead to the end of many of the democratic freedoms which we have today,
replaced by authoritarian regimes regulating the global economy. Not only will there be a denial of
political, economic and social freedom, but also religious freedom. These institutions will be
replaced by authoritarian institutions regulating how people live their lives, denying much of the
individual freedom that we have come to accept today.

There is general agreement amongst many world leaders that the free-market unregulated
economic model advocated by the USA can no longer continue. In its place they are advocating
what UK Prime Minister Gordon Brown calls a “new world economic order”. What is planned is to
have much greater controls on the movement of money, where and how capital is used – controls on
speculation in futures, derivatives, commodity trading, etc. Technology available today will enable a
single world currency supported by one global central bank, to control both the supply and
movement of money around the world. This is being advocated by Germany and France under the
pretence of controlling tax avoidance and regulating markets, in reality it will go much further than
this – controlling the movement of money and all commercial transactions, with a cashless society
where governments can monitor all commercial and personal transactions.

The Euro is the only currency large and strong enough to replace the US dollar as a world reserve
currency, or a new world currency. Germany is the one country which has sufficient currency
reserves to underpin the confidence in the Euro allowing it to become the new global reserve
currency, having been for years the world’s largest exporter. Increasingly German dominance is now
dictating the direction of Europe – all that is lacking is the leadership.

The EU lacks a leader who can unite the various competing political and nationalistic factions to
enable decisions to be reached to bring about a cohesive economic policy and revive the European
economies. As the economic crisis spreads throughout Europe, unemployment continues to grow,
and political unrest becomes more severe, the need for the appearance of a strong leader will
create a power vacuum into which someone will surely step. Europe now desperately needs a
modern-day Napoleon, Hitler or a revived Holy Roman Emperor who can save the continent from
economic and political disintegration – a strong and commanding personality who can unite the EU
and lead it to economic recovery. Yet unity cannot happen unless the present disparate political
structures that currently exist are reformed, and the proposed new constitution adopted. The
materialization of a single leader that can unite the various European nations into a unified United
States of Europe, who has the ability to revive their economies, and provide the decisive leadership
required to lead them out of this crisis is the obvious necessity.

The fate of the Anglo-Saxon nations now looks extremely bleak. The collapse of their currencies will
be followed by total economic collapse. They will be unable to repay their international debts. They
will slide into bankruptcy. There will be wide-spread poverty, starvation, great suffering of their
people as their nations slide into insolvency. Disease will become wide-spread. Many
drug-dependant people will perish. Crime will spiral out of control, as a total break-down in law and
order develops. Most jobs will disappear. Governments will have no revenue to continue functioning
or pay for public servants or services. They will no longer have the income to maintain their defence
forces.

Throughout history empires rise, declined and collapse. The coming collapse of the Anglo-Saxon
Empire will happen quickly – this group of nations will disintegrate, which will result in the reshaping
of the political and economic landscape of the world. Without the stabilising influence these nations
have had on the world, many of the freedoms we take for granted today will disappear. The
Anglo-Saxon nations originally had a value system based on the Bible, but as they have rejected
the teachings of the Bible and the Law of God, so has their influence in the world declined. Now
these nations are facing total economic collapse, not economic recovery as many hope. They are
now being cursed for rejecting the teachings of the Bible and the Law of God.

Bruce Porteous

Bruceporteous50@yahoo.co.nz

1 May, 2009

Thought it was a bit quiet.

Mummylonglegs

The start of this week was very quiet, it was hard to find anything decent to blog out, Politics wise. Obviously Dan Hannan was a hot topic but apart from that, not a lot appeared to be happening. I reckon I have figured out why.

The Government and Gordo have been drip feeding the MSM lots of scaremongering stories about possible riots at this week ends marches. As the week went on more and more time was devoted to covering and speculating what was going to happen in London. The MSM have been willing poodles in this propoganda, only because there wasn’t much else to write about.

Gordo sat in some country (not sure where) and rubbed his hands with glee. As far as Gordo was concerned he couldn’t lose. Riots, civil unrest etc was just what he needed. He could use it to invoke the Civil Contingencies Act if it got too bad, but more importantly he could use it to slip a whole wedge of bad news. Another Banking Bailout, JaqBoots hubby claiming porn on expenses, UK’s debt increasing at a F1 type speed,G20 Countries appearing to be doing a whole lot better that the UK etc, etc, etc.

Only there were no riots. 35,000 people from quango’s, fake charities and wagons of Righteousness decended upon London and only 1 person was arrested. Leaving nothing for Gordo to hide behind. He has had to hastily retract the Banking Bailout and hope for a sale on Monday (I still reckon the Bailout will go ahead – it will be announced on the 1st). Gordo should be presiding over the G20 summit next week from a position of authority, unfortunately, due to his and his Governments total incompetency he is going to be presiding over a very slow, prolonged, drawn out car crash of a summit.

I notice that after all the talk by the Police at the start of the week about how many thousands of officers had been drafted in to cover these protests, all the talk that intelligence led them to believe that some factions were planning violence and unrest, the Police are now changing their story a little. Now they are intimating that their presence was very low key. What a crock. And of course the propoganda is starting again.

But there are fears that trouble could flare when further protests take place as world leaders gather in the capital next week.

I for one am greatly relieved that yesterdays protests went off quietly. As we all know, The Righteous have no problem in turning to violence when the want to get their point across, and they could have easily given Gordo and The Government exactly what they were after. For once they kept a lid on it, which means next weeks real protest can go ahead. As one person said “We don’t think our protest will change the world, but if every unhappy person in Britain realises they are part of a larger group it gives the individual and the group much more power to try and effect change”. And that is the truth.

I hope next weeks protests are peaceful. Violence is not a solution to the troubles we face. It is easy to throw stones at a bankers house. It is easy to start a riot. It will not change anything. It will give more power to those we oppose. Gordo, The Government and the rest of the world must be shown how unhappy this country is. We cannot get The Government out any other way. Gordo will not call an early election. He has no need. He knows his party is doomed. All he can do is hang on long enough to ensure that who ever gets in after him, i.e David Cameron will have the most almighty struggle on their hands.

I don’t know too much about politics. I don’t know how a vote of no confidence in a Leader or a Party can be bought about. All I can hope is that next weeks protests demonstrate to all 646 members of Parliament how much this country wants Labour out. They will not be able to hide from the protests, they will not be able to ignore them. G20 is going to be a disaster for Gordo, and the press will be all over it, so all Gordo and Labour can hope for, is that the protests turn nasty. It will be very interesting to see what other Government disasters await us on the 1st.

To all those attending the protests I ask you, don’t give them what they want. Don’t give them something to hide behind. They need a riot more than anything else at the moment.

If in doubt….PAYRISE!

Fred Bloggs

In the face of the current economic crisis (some might say fiscal armageddon) the goverment has devised a plan, which consists of, briefly, giving themselves a 60% pay rise. No doubt this “plan” will solve all the economic problems in the world, feed all the starving Africans, raise Atlantis, and with all its well-crafted majesty, scare the Russians so shitless they’ll give Lenin a haircut. Or, well, maybe not.

Apart from the Atlantis bit.

Find out more Here.

Being the boss

Mummylonglegs

I’m a simple soul. I don’t want much from life and I’m pretty much happy with my lot. I have 3 lovely Squids and a comfortable life. I get’s a little rocky sometimes and money is always tight but on the whole it’s ok. I have achieved this lifestyle the hard way. Finding the balance I have now and ensuring the well being and safety of those I look after has been a learning curve to say the least.

My Hubby, bless him, was a bit of a muppet. He was the Boss as it were. Unfortuanately, he wasn’t very good at telling the truth, he wasn’t very good with money, and he wasn’t very good at being either a husband or a father. He constantly put his own wants and needs before the rest of us. No matter what he did, it was always some one else’s fault, from taking on debt he couldn’t repay to constantly being unfaithful. He never once said sorry. In May 2004 I left him. At the time he was in debt to the tune of £150,000.00. and had no job. As his wife I had to take a chunk of that with me. He kept the house I got the kids. And half the debt. But, I became the Boss. I became responsible for sorting out the mess that I had found myself in.

Here’s how I did it.

Slowly but surely I cleared my debts. I didn’t do this by consolidating them all and paying them off with another loan. I got good financial advice, some of the debts I wasn’t liable for, the rest, I spoke to the creditiors, told them the situation, made arrangements to pay them off, and stuck to those arrangements. I looked at what I could live with out, what I could reduce and by tightening my belt. It was hard, but I knew I had to do it. It has taken 5 years, but I have done it. I took on no new debt, and I ruthlessly cut back on all excess expenditure. Only spending what I had to.

When I started this the very first thing I did was talk to my Squids about it. I explained that things weren’t good and that we would all have to go with out some things. I promised that the essentials would always be there. Food, clothes, car etc. and assured them that although it was going to be a real change, if we all pulled together it would be ok. I promised them that certain thing would remain sacrosanct and would not be affected by the cut backs. Birthdays and Christmas would be the same as it always was. But no more Maccy D’s. No more Take aways. No more little toys every time we went shopping.

They were a little bit miffed at first but then I explained that we had a choice, carry on as we were for another 6 months and then watch everything go, or nip it in the bud, enjoy what we can have, and forget about what we can’t. I introduced the radical cut backs slowly, over a couple of months. The best thing I did was show them that I was prepared to go with out as well. No more new clothes for Mummy. No going out on a friday night. I am responsible for them and they know it. It would have been grossly unfair for them to be punished for my mistakes.

The other thing I did was include them in all my decisions. I explained the problem. Told them the solution that I wanted and between us we discussed how to get there. We all planned how we could cut back.When I go shopping on a Friday, in the morning I ask them what they would like. We barter over it, I explain the costings, we discount some stuff and add other stuff. Then we come to a general agreement and I go get it. They still get little treats but they are exactly that, treats. There are birthday parties to go to, costume days, fun days, school disco’s, school trips etc. They get to attend all of these because I feel they are important.

If we have a catastrophe, car breaks, washing maching blows up etc we have an emergency meeting. I try and keep money back to cover things as this but it is not possible to see into the future. We talk about where we can make further short term cuts to get through the crisis, with the assurance from me that once the situation has been sorted life will get back to normal. If I get a windfall (£70 on a scratch card my friend bought me) we sit down and discuss how we would like to blow this money. It’s not in our budget so it will be used on something that we can’t normally have. With the scratch card we went to the Cinema, bought loads of sweets, then had a meal at a local pub afterwards. We loved it.

5 yrs and we are sorted. Debts are cleared and our standard of living is more than adequate. How ever I am not about to use that as an excuse to start the cycle of again. I am happy with this stable life. And so are my Squids. We still have to go with out some times and there is always tears from some one if they can’t have something they have set their heart on.

We have learnt that although I am the boss, we work best as a team. I never blame their father, there is no point, Squids have short memories, they live in the here and now. I never lie to them, I never promise what I can’t deliver, I include them in all decisions from the tea time menu to where we go on holiday. If I cock up, I don’t blame some one else, I take it on the chin and apologise and it is me that goes with out, I do not punish them for my mistakes. They trust me to take care of the grown up stuff, paying bills etc but if something directly affects them we talk about it. I don’t keep them in the dark and they understand that although sometimes I have to do stuff that I don’t want to, it is done with all of us in mind, because we are all in this together.

As for the old Boss, well he’s out there somewhere, I don’t know where. We don’t have any real contact with him, and to be honest I actually think the Squids have forgotten he exists. Which is a little sad, but in all honesty, he only has himself to blame. My Squids respect me, trust me and look to me to keep them safe and well. It’s a job I do with relish and a job I do well.

It’s hard work being the Boss, if you do it wrong you stand to lose everything, but if you get it right the rewards are endless.

Mummy x