It is Obvious

Chris Rick has got altogether too much to say

Archive for October, 2015

In or Out (1)

Posted by chrisrick13 on October 21, 2015

It is obvious: my cat is a genius

During the last week the problems of steel companies have been mentioned much in papers and on radio and tv.  I wonder how much it will be mentioned next week?

The problems arise because Chinese steel is being ‘dumped on the market’ at below production-cost prices.  I wonder that not more is made of the actions of my local Sainsbury.  When I shop in the afternoon I often see packs of stir fry vegetables on the shelves, dumped on the market at well below production prices.  I see it in many shops.

There is much wailing and gnashing of teeth that we need to support our steel industry as it is essential to the welfare of the country.  Why?  Not seen that argument.  The leader of the TUC inferred yesterday that is part of the ‘real economy’.  I hope someone will ask her which bits of the economy are real and which bits are imaginary.

Apart from task forces and promises what can be done?  In most people’s thoughts is that we should give the steel companies money.  If we had a bulging sovereign fund, no debts and were running budget surpluses it would be an easy call.  As we have massive debts and already spend more than we receive and there is not sovereign fund it becomes more of a problem.

Why not just buy our steel at the best price we can from whoever will sell it to us?

The problem cannot be fixed in the UK as the culprit, the Chinese steel, is not bought in the UK.  It is bought elsewhere and by that action reduces prices everywhere else.  It is called a market.  Banning Chinese steel in this country or putting a surcharge on it will not do any good.

Doing that Europe-wide might work as much of the steel is bought there.  The EU has ‘muscle’.  If we are not in the EU then we can’t get it to happen I am told.  But we are in so, of course, the EU will jump to our requests and get on with stopping the Chinese from doing it?  We have put in a request to the appropriate part of the EU to consider action to be taken.  Is this influence!  Is this prompt action?

I think that the chances of ever getting the EU to do anything we want are very small.  So not being in the EU will not damage us one jot.  Perhaps the steel industry would be a good recipient of the net payments to the EU that we now make?

It is obvious: my cat is a genius – I see her sitting on the fence, unmoving, for hours at a time every day.

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Invest in the future

Posted by chrisrick13 on October 20, 2015

It is obvious: I’m not deaf

What a ridiculous statement.  Tricky to invest in the past.  Spend money because you need the result now.  Investing always is for the future.

It is a statement I hear a lot.  Just heard it again today.  Alas, it was from a Labour shadow minister.

My thought is that an investment will generate an income or a profit.  The hope is that it will be greater than the money put in or it will generate some small profit and the investment will be returned.  You can effectively roll-up any profit and just get a larger amount back at some time in the future.

From politicians I hear of investing money when all they are doing is spending it.  Labour are particularly bad at this.  It is not prudent to spend money on keeping things going but it is OK to spend money on something permanent like a bridge or a road or a railway line – step forward the Conservatives.

Investment in a power station or an airport implies some sort of return or it is not an investment.  200 years ago it took two weeks it took 3 weeks to get from London to Edinburgh in a coach.  100 years ago it was down to a day on the trains.  That was an investment with a return.  50 years ago it was 4 hours and today it is about 4 hours.  Where is the return on that investment?  20 minutes off the time to Birmingham is not an investment with a return.

The head of the TUC was interviewed yesterday mainly about steel companies closing.  She said that it was the lack of a government plan.  I’m sure she didn’t mean the Labour government in power for 15 of the last 20 years.  She also talked about the real economy and alas the interviewer did not ask her what that meant.  Surely all the bits of the economy are real?  There is talk of tariffs on steel coming into the country so it costs as much as British steel so that we can make things to compete on world markets with raw materials that cost twice as much as the competitors.  Then there is talk of subsidies for steel.  This means government money and as we have debt and deficit it means that you can count the cost of every ton of subsidised steel in bodies.  10,000 tons of subsidised steel means one less new hospital and 20 deaths a week that would not otherwise happen.  So that is one death for every 10 tons of steel subsidy.  If austerity had been in place for the last 20 years we could have subsidised steel with no body count.

It is obvious: I’m not deaf it would save me turning the radio off if I was

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No more Mr Nice Guy

Posted by chrisrick13 on October 15, 2015

It is obvious: the end is nigh

Back to the old style.

Bill sent me a quoste from someone at the Conservative Party Conference.  It can only be described as bizarre.  ‘Outrageous’ does not do it justice.  Nor does ‘ravings of a nutter’.  Still he got his 15 minutes of fame.  The Conservative party certainly has a loony right.  They occasionally see the light of day but are mostly hidden.  Unless you are a socialist when you see all the Conservatives as loonies.

Every grouping of people has a normal curve distribution no matter how the rules for that grouping are set.  By definition there must be people on the fringes.

So it is that the Labour party has a loony left.  The difference to the Conservatives is that they are in charge.

One of the Labour speakers at their conference attacked the ‘bedroom tax’.  If I were responding to that in any public debate I would furrow my brow and point out that there is no such tax on the statute book.  Then I would investigate what the measure was and insist on its proper name.  No matter, this person was damning the ‘bedroom tax’.  Later on they proposed that little old ladies living in big houses on their own should be booted out to make room for large families to move in!   You can’t make this stuff up.

PMQs was a delight today.  As soon as the rowdies started shouting Cameron said that he thought the new order was a calm debate of reasoned words.  This shut them up as last time.  In answer to all the questions he said that the answer was to have a strong economy.  Thus the Conservatives make themselves hostage to fortune.  If the reset occurs in the next 4 years then the Conservatives will lose the next election.  Think it might.

The Conservatives are doing their best to keep Mr Corbyn at the helm of the Labour party.  They really need him there for the next election.  It will be interesting to see if they can manage it.  Maybe long enough for the next leader not to have enough time to push the party back into the centre?  It will be crowded there as they will find the Conservatives well dug in after Mr Corbyn gave up the territory.

The austerity debate goes on.  Austerity does not do it but as the Conservatives have not tried it yet it is not proven.  A perpetually growing economy and some efforts at limiting spending with some increased taxation might do it.  There are endless examples of people suffering because of Conservative measures.  Moving away from tax credits is one.  The simple argument is that we have over the last 2 generations spent money for 4 generations by borrowing and leaving it to our children to repay.  No new hospital today means 1 person dies but in 20 years’ time we will have money to build hospitals and 100 people will live.  Not an argument I care to have but not one that we should need to have.

The Conservatives are moving to make sure that low paid people keep all that they earn.  The burden goes to the middle classes who earn enough to live on and then some.  (You have to accept that getting lots of money out of the rich will always be difficult.  The middle ground is a much softer target.)  I think it is right that we shoulder that burden but do it openly.  Don’t take taxes off low paid and then give the money back.  Just don’t take the taxes.

There will still be people who can’t live on what they earn so make sure that there is a realistic minimum wage.  It should be possible to cut the number of people needing some financial support close to zero.  Then the army of people administering and policing the current system can spend their time giving money to these people and ensuring that it is always a ‘reasonable’ payment.  How about making them share their wages to encourage the civil servants to move these people to a place where they can support themselves?

There is a big elephant in the room.  I know him well.  NIC is aimed at the first few hundred pounds of income and is levied on companies thus detering them from employing people.  Costs a lot to administer.  It is a tax specifically for the low paid.  Introduced by Labour to pay for the NHS.  So get rid of it and put 5p on to basic rate income tax.  You might talk about the need for NIC to keep track of who gets a pension and how much.  So simply say that everyone gets a pension.  If not a pension, society will be supporting these people with an equal amount, so just give them a pension.  A lot of NIC administrators and police will lose their jobs.
So we come full circle that austerity does not do it.  Higher taxes on the middle classes and an economy with not much overhead for government does.

It is obvious: the end is nigh – can’t be, it’s already tomorrow in Australia

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