As the UK summer silly season draws to a close and we enter the even sillier party conference season looms, Holdenforth takes a look a some of the less attractive features of the current UK economy.
Let us begin by glancing at what the more prominent media have been saying.
* The Daily Mail view – mostly a favourable report on the current situation and a confident prediction that all will be for the best in the best of all possible worlds once the Remainers have been routed and their goose has been well and truly cooked.
* The Daily Mirror view – its position broadly is that the country is going to the dogs and this decline is attributable to the inept and divided Tory government. On the plus side all will be well after the next General Election which will be held before the end of 2018 and which will see a revitalised Labour Party under new and more effective management returned to power.
There follows a more detached view of the situation from Holdenforth.
What were the Augean stables?
Augeus was the king of Elis in ancient Greece and he had a problem. His problem was that he owned 3,000 oxen whose stalls had not been cleansed for 30 years. If you do the calculation you will see that Augeus had on his hands, metaphorically, and, in all probability, a lot of bullshit.
Clearly a major cleansing operation would be required to restore the status quo ante and this task was sub contracted out to Hercules. Our hero proceeded to clean up using a novel water based method. Since then the term Augean Stables has come to mean any system in urgent need of a clean up.
Holdenforth believes that many sectors of the UK economy should be designated as belonging to the Augean sector, and as being ripe for the Herculean treatment.
We will now suggest a few sectors which might sensibly be designated as Augean sector and in addition, in keeping with the practice of this blog – we will suggest remedial measures.
We have looked briefly at a few sectors to get our Augean show on the road – there is no shortage of candidates but we did not want this blog to go on for ever. In every case the rot starts at the top and accordingly that is where is our modern day Hercules will be required to make a start.
I have already assessed several of the more promising candidates – the BBC, the rail industry, University Vice Chancellors and Academy schools – in previous blog entries, so let us now move onto some others that are under starter’s orders for the great Augean stables handicap. We have no doubt that there are many others and we suspect that the choices of most voters will be determined by the extent to which their lives have been adversely affected by the sharp practices of those at the top.
“The Whore and Gambler by the State
Licensed, build that Nation‘s fate…
The Winner’s shout, the Losers curse,
Dance before dead England’s Hearse”
Blake, Auguries of Innocence
As I understand it, the Whore is not formally licensed by the state but it would appear that such laws that do exist are applied in a fairly relaxed fashion.
Blake might well be surprised at the rapid expansion of the gambling sector in recent years. In his 3rd and 4th lines he would need to make it clear that the managers of the various gambling activities are always, but always, the winners and the impoverished and the desperate always the losers.
The mission statement of the gambling sector always has been and remains – never give a sucker an even break.
In the long-gone days of my youth, the main gambling activities were based on horse racing, football results and bingo? We were vaguely aware of casinos in Monte Carlo and even in the west end of London but they were not for you and me.
Today, signs of gambling are ubiquitous and reach into the very core of our economy. One arm bandits, prize draws – these are even run by the banks, lotteries, scratch cards, and so on and so on – all enriching the managers and impoverishing the overwhelming majority of the punters.
The gambling sector is a strong candidate for the activity featuring the most antisocial elements of a decaying society.
“It’s true I have many, many friends in politics, but they would not be so friendly if my business were narcotics instead of gambling. They think gambling is something like liquor, a harmless vice…”
Don Corleone to Virgil Sollozo in The Godfather
Even Don Corleone might have been startled by the remorseless expansion of the gambling sector.
We note that that this sector loudly asserts the case to preserve the freedom of all of us to spend our money as we so wish – the hall mark of a civilised society.
Holdenforth believes that this activity exploits the frailties and vulnerabilities of the poor. The gambling sector managers have done their homework – in the long run the bookie always wins – and never more so than today.
Holdenforth’s suggested solution: a prompt return to the arrangements of say 30 years ago with effective transparent curbs on the new comers to the sector.
The pay day money lenders
Here we have an Augean sector similar to gambling but, if anything, more antisocial in terms of its impact on the poor and the vulnerable.
Holdenforth conducted an online search to establish a few representative interest rates. We found:
- Wonga – 1,086%
- Sunny – 1,277%
- Quick quid – 1,295%
- Getmyloans – 150% (sounds promising by comparison)
We at Holdenforth noted that the institutions holding our modest lifetime savings are paying around 0.5%.
This might explain why the usurers are wealthy and Holdenforth is not.
We were also puzzled as to why Wonga has found itself in financial difficulties given the advantages bestowed by its interest charges. It turns out that HMG, goaded into action by the excesses of the sector, brought in new laws to curb the likes of Wonga and the peevish customers have inundated the company with compensation claims.
The many adroit usurers out there have changed identities to evade the law and to keep the pressure on those caught short at the end of the month.
Holdenforth’s solution: tighten the law to bring the situation back to that which prevailed historically.
Rewards at the top of private sector enterprises
The Daily Mail and The Times – to their considerable credit – have worked tirelessly to highlight the propensity of significant numbers of senior managers in the private sector to spend rather too much attention to looting company funds and rather too little time to improving company performance.
A few recent examples will suffice to make this point.
“Paul Pester – Former TSB chief… After the bank’s IT upgrade in April… there were reports of further outrages last weekend. Pester finally got his marching orders on Tuesday but not without a £1.7m cheque in his pocket.”
Daily Mail, September 8, 2018
“Bankrupt rules …. Theresa may arrived at Downing Street determined to combat the image that the Tories were soft on capitalism. Instead disgraceful abuses have continued in Britain’s boardrooms.
The construction and outsourcing group, Carillion. Went to the wall leaving employees, the pension fund and suppliers up a creek without a paddle in a giant Ponzi scheme. Directors and shareholders filled their boots. At house builder Persimmon. A Government subsidy in the shape of Help to Buy enabled CEO Jeff Fairburn to earn rewards worthy of Russian oligarch. Meanwhile overpaid directors at Melrose swallowed old established engineer GKN and will in all probability break it up for vast sums.”
Alex Brummer, Daily Mail, August 28.
Holdenforth would like it to be noted that so far as we know Mr Brummer is not a member of Momentum.
“Bank Crisis – Ten Years on – He helped save the UK from ruin , now FCA chief – Andrew Bailey – asks: ‘I don’t say this out of bloodlust, but so far as I know NO ONE has been properly punished’
Ruth Sunderland, Mail on Sunday, August 26, 2018
In the course of his interview with Ms Sunderland, the doughty FCA chief named and quite possibly shamed Fred Goodwin, Andy Hornby, Adam Applegarth, Bob Diamond Eric Daniels and James Crosby as candidates for examination and possibly punishment.
Holdenforth measures to curb the greedy and especially those who combine personal greed with managerial ineptitude include:
- Prompt P45s with no comforting mega cheque – or even with a micro cheque.
- Tax rates up to 100% to encourage those at the top to concentrate their energies on improving company performance
- Encourage the whistle blowers to spill the beans.
That should do for a start.
The Charity Sector
Here we have another sector thought by many, including Holdenforth – to be pure white, the sum of the tireless altruistic efforts of millions of volunteers to alleviate the problems of the poor and the needy here and abroad has sadly been exposed as harbouring and enriching a pretty scurvy collection of thieves, chancers and spivs.
“Sex abuse endemic in the British aid sector boys club – Report blasts culture of denial by charity chiefs”
Daniel Martin, Daily Mail, July 31
The abuses included:
* The ruthless bullying of possible donors
* The starting amounts paid out to charity managers
* the insistence of some managers running overseas charities to be supplied with sexual favours in exchange for the provision of relief
There was a strongly worded letter in The Times on September 8, 2018 from William Shawcross. Mr Shawcross echoed the view of Iain Martin that “the EU Commission is the appalling and arrogant heart of an imperious EU…”
Can this be the same Mr Shawcross be the same Mr Shawcross who was the chief of the Charity Commissioners whilst the abuses listed above were in full swing?
Truly it takes a useless bureaucrat to know one.
The current UK Augean stables are, as in the days of King Augeus, the responsibility of those at the top.
The problem is not confined to the private sector nor the public sector nor the no-mans land in between.
Effective reforms must start by curbing the antisocial habits of this group.