Monthly Archives: May 2013

Marks and Sparks get their knickers in a twist

Not many political bloggers use their blogs to explain that they tend to live in briefs supplied by Marks and Spencer. Indeed, I hear a few voices saying, “enough already – too much information”. Stick with it, I have a serious point to make.

Confession number two: I am over-weight, not much but a bit. My waist measures just under 42 inches in the winter and rather less as summer progresses only to increase again as the weather gets colder. M & S size their briefs using letters: X Large is for those with 30 to 41 inch waists while XX Large covers those more rotund measuring from 42 to 44. No doubt you begin to see the problem. 

All briefs wear out in time – probably because of all that aggressive washing – and some of mine are now ready for retirement. So I wanted some more: ideally I wanted more of the same only, why am I surprised? – my knickers are a discontinued line. So I ordered what I thought would be the closest equivalent. These duly arrived and I sent them back with the following letter which is, I think, self-explanatory. 

Please find enclosed four pairs of trunks recently ordered and supplied as attached paperwork (copies have been kept). 

These are to replace old trunks which are nearing the end of their lives. The old style is no longer available – a 3 part set 6983 789. The size is XX Large. It seemed looking at your web site that the nearest equivalent was the 2 part set 07910227 and so these were ordered in the same size. 

Putting to one side that it is extremely irritating to have a 41½” waist when sizes come in X Large (39-41) and XX Large (42-44), what is astonishing is that the enclosed are so much larger than the ones they are to replace (see photograph). I cannot believe that the old ones have shrunk that much. 

This poses a problem: have they been wrongly labelled and I need XXL or should I have ordered XL? 

If the former, please replace with correctly labelled XXL – if the latter please replace with XL.”

This morning I received an email from M & S thanking me for being a customer and so on – and advising me that my account had been credited with a refund. Grrr. 

Now for the serious stuff. I have been talking about the need to employ more people and the fact that there are times and places when men are better than machines. This is just such a one. I assume that this is all the problem of computers driving people rather than the other way around. No doubt whoever unpacked the return parcel was forced to select one of a limited number of reasons for the return of the goods and the computer took over from then on. My guess is that two boxes were ticked: “wrong size” and “refund”. 

A person reading the letter would have dealt with this situation very differently and I am sure that many reading this would agree that the thought of having to contact “customer services” tends to send a shiver down the strongest of spines. 

We should not blame these companies: employing people to do things better is only acceptable if at the same time they more than cover their costs. In the final analysis, people are an indirect cost that hits the bottom line and should, therefore, be kept to a minimum. This, of course, impinges on the unemployment statistics. Lower the cost of employing people and you encourage employers to use more people: lower the administrative costs of employing people and you encourage employers to use more people. 

Thus there are two areas where the government could do something to help: scrap NI which is no longer a contributory insurance payment (much though politicians would have us believe otherwise) and scrap most of the employment laws leaving behind a general duty of care (which would work both ways: employers having a duty of care to their employees and employees having a duty of care to their employers). Note I say nothing against the minimum wage which should remain in force albeit perhaps with more steps. 

There is a third. Make it far far easier for people to slip into and out of unemployment benefits. Many will not take a temporary job because it is then almost impossible to get back onto benefit in a reasonable time scale. 

Yes, there would be less protection for employees – is that such a high price to pay for a more fluid employment market with less people unemployed? 

What about the loss of revenue caused by scrapping NI? Put it all on income tax: that way you begin to narrow the gap between the net income of poorest and richest (although in this context, many of the “rich” already think of themselves as “overtaxed”). 

 

More on men and machines

There are two headlines in the Guardian today which call for anybody in the business of political blogging tas does a bone to a dog. They are “Accountancy giant signs up ex-HMRC boss” and “May’s plans to tackle extremism face backlash”.

However tempting these are I have decided that both will attract a great deal of comment which I would like to read and brood upon before I add my mite (assuming that I do). So, putting temptation to one side I want to return to my theme in my last blog – the concept of a humanitarian revolution.

First I would like to pick up from the comment made by my friend Richard Curtis (which you will find under the last blog). He is, of course, quite right but . . . If you take what he says to an ultimate conclusion, I suspect that there is a real risk that this would widen the gap between those who find living in the UK society a rewarding experience and those who don’t. I know that I am walking into troubled waters – on the Times Online on this subject someone asked me what I would want to “uninvent” – and the answer is “think outside the box, that is not an option”. Clearly we would want to continue to use machines to take the drudgery out of life and, indeed, to carry out boring and repetitive work that they do better than we can do. However, there are many areas where that is not the case – and yet we still use machines.

Let’s start with something essentially easy – cleaning streets and civic spaces in urban areas. This can, and is, be dome using machines. Machines don’t do the job as well as people but the end cost is deemed to be cheaper. Here is a case where the answer to the question “can man do this instead of a machine?” must be “yes”. Do it, do it better and take pride in the result. Furthermore, bring observation and intelligence to bear and see things that need attention before they cause real trouble le (such as a drainage system that is not working properly). Some places still use people equipped with no more than a broom, shovel and barrow but others go for the machines of one sort or another.

The problem is that this is paid for by a local authority – an authority that is not really overly concerned with meeting the costs of the unemployed (although, of course, they will pick up some of them – housing benefit – and suffer from loss of rates).

Being an essentially rural animal I can only comment on the situation in the countryside. Years ago there was a lengthsman who, virtually single handed and with simple equipment, was responsible for a given length of roads and lanes. He (in those days it was always a ‘he’) was generally proud of his length and knew where all the problems would arise. I knew one who, in the autumn, would turn out in the middle of the night if it was raining especially hard in order to deal with a drain that he knew would become blocked by falling leaves. Some authorities awarded prizes for the best kept lengths and where that happened competition to win was keen. Another memory: there was to be an inspection of lengths and on one wide verge there was an area of grass that had not been cut. When the inspector arrived a very shy and embarrassed young girl approached him. It turned out she was the daughter of the lengthsman and it was her job to tell the inspector that there was a bird (I think a skylark but my memory may be at fault) nesting there and so her father had left the nest alone but, she assured the inspector earnestly, he would be cutting it down as soon as the young had left.

Could that also apply in urban areas? Perhaps one of you living in a city can provide the answer.

Could that be extended to other areas of life? Thinking outside the box: words such as ‘craftsman’ and ‘artist’ (a word derived from the Latin ars as is ‘artisan’) come to mind as does the intense satisfaction I have met with people who lay hedges, build dry stone walls, grow vegetables and so on.

Perhaps all we need to do is to change a few simple things. At the moment employing people is a costly and difficult affair – what if, instead of making it better NOT to employ if at all possible, we turned that on its head and actually provided a tax incentive to employ and reduced the burdensome regulations. Sure. If we scrapped some of the employees rights it would be hard on some people in employment. Is that too high a price to pay for others to be taken off the self and socially destructive dole queue?

Then there is self-employment. Try that if you are on benefit. Again we do everything possible to deter people when we should be doing everything we can to encourage them.

So, it’s a bit more than man versus machine but that is a good slogan so long as it is not taken too literally.

Man or machine?

Man versus machines – or should that be machines versus man? This thought comes from reading a piece in the Times Online or, more properly, the comments posted below the article. There was a thread bemoaning unemployment and seeking remedies: remedies which escaped all those writing since none of the suggestions were doable.

As usual, what people were recording were aspirations and that is a simple thing to do. Indeed, going off at a tangent for a moment, that neatly describes the UKIP policies as shown on their web site. The difficulty is the need to convert aspirations into action that will go some way towards meeting the objective without just causing a good deal of trouble and achieving nothing which, thanks in large part to the law of unintended consequences, is what tends to happen.

Back to unemployment: this is caused – obviously – by there being surplus of labour. This surplus will be caused for a number of reasons of which I suggest the one that matters most is a lack of demand for a given type of employee. Quite deliberately I am ignoring the unemployed who are quite capable of work but consider the work available to be beneath them or paid so badly that it is better to be on benefits.

Much unemployment has been thanks to the use of machines which carry out work more quickly and sometimes better than can man. The result is that our mindset tends to be, “what machines can we use to replace man?” whereas we could look at this a very different way and ask instead, “where could we use man to replace machinery?”

Taken out of context, that looks like a call to turn back the clock (and, indeed, it may come to that). However, I suggest the context is this (and please bear in mind I am talking here about the UK, not the world):

First was an agrarian revolution that completely changed the way we carried out husbandry on farms and reduced the need for farms to employ so many men.

Second was an industrial revolution which harnessed the power of steam and, later, electricity so enabling us to automate many processes. Again there was a reduction in the manpower required.

Thirdly there was (or even is) what I will call the electronic revolution which transformed almost all aspects of life and resulted in a further reduction in required manpower excaberated by the huge numbers of able and willing workers in other parts of the world.

So now we need another revolution: the humanity revolution in which we rethink everything we do. Obviously we do not want a state controlled economy (there is ample evidence that they just do not work) but we have a simple mechanism that could make all the difference. Instead of the state penalising employers for every employee they employ (through taxation and regulation) why doesn’t the state provide an incentive to employers? Done properly, this incentive would mean that there could be many situations in which using man instead of machine would be the more profitable choice.

Austerity – or what?

There are plenty of arguments as to the way forward for the economy. They fall into a number of broad groups such as fiscal and monetary and names of great men crop up from Adam Smith to John Maynard Keynes (why does one always have to resist the temptation to type “Milton Keynes”) but, and this is just as I see it from my Devonian hideaway, none of these address the unique situation in which the developed western economies find themselves today. Many situations in the past have crept up and found us completely unprepared to deal with them. Often we did not properly understand the cause let alone have any idea of how to cure the problem and them with hindsight, we look back and we are amazed at how incompetent were the reactions. Let me offer two example of what I mean and then we’ll return to this business of “austerity”. 

First the Black Death. Here in the UK we had plenty of warning that a plague was advancing – sometimes slowly and sometimes in leaps and bounds – across mainland Europe towards us. We did nothing to stop it arriving. How could we? We did not even know what it was let alone how it was carried across from country to country. It changed everything for years following the event. 

You could say that the Black Death was outside our control but what about the Great War? How come we ended up with a line of trenches which divided mainland Europe and took the lives of millions – to what end? Yes, war is the failure of diplomacy and as sure as hell is hell diplomacy was found wanting. Even after that war, serious mistakes were made – mistakes which laid the foundation stones for the second world war. Looking back now we can see with stark clarity what mistakes were made: before the great war, during the great war and between the wars. Diplomacy failing, failing and failing again. 

Now, another personal view, the problem is debt – national debt and personal debt – at levels that we never, ever seen before. The position is new and yet all the old economic ideas are being trotted out with one group believing one economic system will provide the solution and another group looking at another economic system for salvation. And none of them will work. If war is the failure of diplomacy, the level of debt we have today is the failure of economics. You could say that every boom and every bust has been a failure of economics in that each time there have been warning signs which have been ignored or, more probably, went by unnoticed. 

Common to the Black Death, the Great War and the economic situation today is that we do not know how it happened and we do not know how to put it right. 

Like every one else, I have little to offer. In any event, my essentially rural and small community experiences mean I am hopelessly unqualified to make suggestions for urban UK. Since, however, ignorance is no great bar to most commentators in the media generally (including the blogosphere) I have decided to ignore my ignorance and make a small suggestion. 

At the macro scale, government can do nothing. If it tries it will have to increase its debt and we shall end up with a Great War equivalent of the Somme where so many died to no purpose. On the micro scale, however, communities can do a great deal. 

Take housing – something we all agree is needed. Within any community there are tradesmen, there are people with skills and no jobs, there are people with no skills and no jobs, there are people with a bit of spare cash, there are properties that are empty and need work to make them habitable, there are people who need a home and there is a small unit of government – a Parish or Town Council. If the best that every one of these small units can do is to organise just one house refurbishment per annum then that adds up to a total of about 10,000 ‘new’ homes every year. No problems with the need for expensive new infrastructure, no need for a new school or another hospital or a new sewage system, water main, etc. 

All it needs is to relax a few regulations, give these councils a bit more power and start looking at them as organisers and mentors rather than rulers – creating a company to buy, refurbish and let property into which local people may invest: invest in something that they can see and from which they can make a profit. Yes, you can use the power of persuasion at a local level but not at a national one but even then, if you cannot get local people to come up with the funds it could well be because what you are suggesting is not sensible. Wouldn’t it be good if we could with-hold taxes when we feel that what the government is doing is just not sensible. 

You can use the same argument for all sorts of aspects of life. It could be that the proper engines of “growth” are these Town and Parish Councils and not central government, bankers or big business after all. 

Worth a bit of thought or is it just a crazy idea?

The economic mess we’re in

There are times when I feel incredibly depressed about the financial future here in the UK. At a guess I read as much as most people who blog about politics and probably understand as much as many do but there are some things that I feel I share with virtually nobody else. Let me try to explain.

Ask most people why we are in the economic mess in which we find ourselves and they have no answer at all. A few will blame the government (any government, not just the one in power today), some will blame the unions or the work-shy or the immigrants or something but there are a few reasons that you rarely hear – and I have never read an article which puts these together as I intend to do. Please remember, I am no economist: what I am saying is based on my own personal experiences as a businessman (including a few bad tumbles) and Dickens – the author who, more than any other, realised the depths to which humanity could sink.

Here are the factors I consider responsible. To start with – say in 1900 – we had an empire which enabled us to grow rich, basically on the back of what was little better than slave labour, and we liked the lifestyle this generated. Then someone thought it would be a good idea if, out of taxes that this wealth could afford, we looked after the really old and made their lives a bit better. So we gave a few shillings a week to men of over 70 (which, based on average life expectancy, would equate to over 110 now). Then we decided it would be nice to offer free education, free health and a host of other goodies that we really couldn’t afford but we didn’t mind – we (here I mean all of us, the people of the UK) just nodded complacently as the governments (all of them) borrowed more and more to give us more and more so that we would give them our votes in return. And we (here I still mean us, the people) also borrowed more and more. The government encouraged us to do that: the more we borrowed the more we bought the more there was for our people to make – then.

But the bubbles burst, one by one. The people who we had used as slave labour to enable us to become rich decided they wanted a slice of the action. Not only did they start to want us to pay them properly they rubbed our noses in it by making the stuff that we used to make (and which we continued to buy because we continued to borrow). Double whammy, no more cheap labour and half our jobs up the spout but we carried on living the life as if nothing had happened.

Then we hit the buffers as the national debt rose and rose. Look at the graph and you should be horrified.

Follow this link to see where this came from and further facts and figures. 

No government has been able to stop the growth and even Jim Callaghan knew we had gone too far. Back in the 1970’s he said. “We used to think you could spend your way out of recession and increase employment by boosting government spending” and, “I tell you that option no longer exists. And so far as it ever did exist, it only worked on each occasion by injecting a bigger dose of inflation into the economy, followed by a higher level of unemployment as the next step.”

Even then we happily allowed public spending to go on increasing. The above graph is almost the same as a graph showing public spending indicating that all the benefits and free education, free health, welfare this and welfare that have been paid for out of borrowed money.

One of the MP’s for whom I have a good real of respect is Douglas Carswell. “Greece might be the first Western country to discover that you cannot keep running up debts to pay for a lifestyle you did not earn.” he said, “She will not be the last. The laws of mathematics are universal.”

He is, of course, right. This government has done all it can to cut the national debt – but that “all” means that it will be double what it is today before 2020. Put it quite simply, the UK has borrowed so much, there is no way it can be paid back.

Where does that leave us? Well, in the mire – obviously – and there we will stay until we understand that we cannot afford to live this lifestyle and, horrible though the consequences may be, we cannot afford to go on supporting people out of benefits the way we do today.

Back to Dickens and, of course, Mr Micawber.

 

 

 

So-and-so “will say”

There is an article in The Times-on-line today which starts as follows:-

“Disposing of the public holdings in Royal Bank of Scotland and Lloyds should be a priority for the Government, the International Monetary Fund will say tomorrow.” 

No doubt most people would wish to concentrate on the economics of the IMF’s supposed statement or even think about the politics (which I suspect are of greater importance to the IMF and certainly to George Osborne) but that is not what I want to do. 

I am sick and tired of reading things which include the words “will say”. 

Why can’t we just wait and be told what was actually said? How many times do politicians and others in the public eye find themselves boxed in by the need to fulfil a prophecy in some paper or other media report which includes those two little words “will say”? 

Apart from anything else, how does the media know what Mr X or Ms Y “will say”? Either they have been stupid enough to issue a statement before the speech (in which case they deserve whatever fate may throw at them between making their intentions known and the announcement itself) or the details have been leaked either with or without authority. 

In either case it clearly demonstrates that those in positions of power are driven more by the media than is healthy. They should stop – now.

Economics versus politics

There is a letter in the Independent today over the signatures of the following: Roland Rudd, chairman, Business for New Europe; Dame Helen Alexander, chairman, UBM; Sir Win Bischoff , chairman, Lloyds Banking Group; Sir Richard Branson, founder, Virgin Group; Sir Roger Carr, chairman, Centrica; Sir Andrew Cahn, vice chairman, Nomura, public policy EMEA; David Cruickshank, chairman, Deloitte LLP; Lord Davies of Abersoch, vice chairman, Corsair Capital; Guy Dawson, director, ASA International; Lord Kerr of Kinlochard, deputy chairman, Scottish Power; Sir Adrian Montague, chairman, 3i; Nicolas Petrovic, CEO, Eurostar; Sir Michael Rake, chairman, BT; Anthony Salz, vice chairman, Rothschild; Sir Nicholas Scheele, chairman, Key Safety Systems Inc; Sir Nigel Sheinwald, non-executive director, Shell; Sir Martin Sorr elL, chief executive, WPP; Malcolm Sweeting, senior partner, Clifford Chance; Bill Winters, CEO, Renshaw Bay.

Two links for you: the letter itself and an article on the subject. In the printed edition that I saw, the headline was, “Leaving EU would be economic disaster, say business elite”

These leaders accuse eurosceptics of putting politics before economics. They are,of course, right. More to the point, so are the eurosceptics. Let me explain

Far be it for me to pit my brains against these captains of commerce but there are two problems with what they have to say. The first deals with the economic argument which I find unconvincing – probably because I have read and studied the arguments put forward from both sides and find all of them momentarily totally convincing. Thus I am forced to conclude that nobody actually knows anything and that everybody – including these people – are purely speculating. It is, I feel, I possible to know whether in, say, ten old fifteen years time the UK would be better off or worse off were it to remain in the EU.

To a large extent that will depend on two factors well outside the control of the UK or, indeed, the leaders in the other countries in the EU: what happens to the global economy and war (should there be one of international significance, which – with a heavy heart – I fear is more likely than not). Yes, if the UK leaves the EU it will lose influence within that organisation but you could equally well argue that membership of the EU (especially if the euro collapses or there are serious disagreements in the union) would reduce the UK’s influence elsewhere.

So, I am not inclined to take too much notice of the leaders of commerce who are making these statements. They are, after all, made from their perspective which is a very different one from that of the ordinary people in the UK and that takes us to the political arguments.

Basically there are two groups of people here who are concerned about our relationship with Europe. I find myself at odds with the first group: these are the people who feel that the UK can no longer cope with immigration. At odds but deeply sympathetic. Without immigrant labour prepared to work for wages that are less than many can receive on benefits we would not be able to harvest all our crops or see many other thankless and menial jobs undertaken. This, of course, is a harsh criticism of the mentality of dependence that has been engendered by the welfare state but you should not blame the people who see no point in working for less that they receive from the state. But, and this is often overlooked, it is not really these people who find themselves threatened by the immigrants but those who feel they no longer belong in communities in which they have lived all their lives and find themselves surrounded by those speaking in a foreign language, signs they cannot understand and shops totally alien to them. Yes they may well vocalise this disquiet by talking about “taking all our jobs” which is a nonsense but these people do not have the captains of industry speaking for them – they have nobody speaking for them except the hard right. Why has that been allowed to be the case? The real truth is that we are all immigrants even if some of us have been here a long time and without immigrants refreshing us, we would not have been the vibrant, thriving nation we were and could – and should – be again.

The others, and with these I totally identify, are the ones who continue to believe that democracy (for all its faults and failings of which I am horribly aware) is the only reasonable form of governance available to man: the only form of governance which is able to give all – rich and poor, clever and stupid, industrious and lazy, good and bad, useful and useless – a say in the way in which their society is run. This, to me, is more important than the economy for a nation divided unto itself can never be a reasonable place in which to live no matter how rich it may be unless, of course, you are one of the tiny elite sharing the bulk of that wealth.

And the EU has turned out to be fundamentally anti-democratic.

Should we stay in the EU? For a long time I have felt that the only way we could resolve that would be by using a referendum and I have striven for that for a long time. Oddly I have remained unsure as to how I would vote in such a referendum until quite recently. It was the realisation that those who were predicting the economic future to be bleak if we left the EU were really using guesswork rather than actual facts that made me reasonably sure that I would vote for leaving.

The views of these nineteen “business elite” have provided the final push – we must leave the EU before the ordinary folk of this country become slaves to pure materialism.

At the end of the letter is the following sentence: The benefits of membership overwhelmingly outweigh the costs, and to suggest otherwise is putting politics before economics. The first part of that sentence I believe to be no more than an opinion (and you could say “they would say that, wouldn’t they?”) and the second suggests the correct priority: politics first and economics second.