Economics & Politics

The word ‘Democracy’ is a word according to the people’s choice of reference, Wikipedia, which refers to “a form of government in which all eligible citizens have an equal say in the decisions that affect their lives”.

Given that 2012 has brought, and has yet to bring, major government elections in democratic countries, TCE decided it would be appropriate to pass brief comment.

The November 2012 USA presidential elections in the self proclaimed “world’s greatest democracy” represent an interesting conundrum. In the past few elections the amount of money raised and spent campaigning appears to have a large influence on the outcome. In the election that first put Mr Obama in office, his team was campaigning across the USA by reports at times largely unopposed, as the local Republican campaign offices were shut due to lack of funds.

At the time of writing Mr Romney and Mr Obama are dipping into their 2012 campaign reserves at the rate of many tens of millions of dollars per month; and by some reports the Romney financial well is looking a little dry at present – Surely in the betting world there can only be one outcome?

So in the USA democracy has a price – in fact a price so high that only the wealthly realistically dictate which presidential candidate gets chosen for each party along with the policies they sell.

In the UK the population has to vote for a leader that is not directly elected by them but by their peers; not quite an equal say in decisions then either.

Although the price tag to become leader in the UK is not the same as in the USA, TCE wonders whether the meaning of the word democracy has been lost in translation to suit the elected politicians rather than the millions of people they are meant to represent.

Stage 1: Cut the costly dead weight out of Britain.

o Civil servants and their gold standard pensions and perks have to go. They only work 4 days a week by anyone else’s standard so fire 20% and make the remainder work 5 full days a week. Close all meaningless quangos and government departments.

o Nick Clegg is a classic example of how ‘Eurocrats’ can live it up at tax payers expense whilst the Bank of England’s Mervyn King must be working out what to do with his £6.5 million pension pot kindly paid for by the private sector tax payer.

o Judges, MPs, and all civil servants, have to have the same pension rules applied to them as the private sector worker. Civil servants also have to contribute to their retirement costs for a change, to reduce the state sector pension time bomb.

o Cut benefit hangers on. Those that have never worked should be forced into community schemes to improve the areas they live in; if they refuse then the benefits should go.

o Immigrants should be let in on a meritocratic basis; if they’re educated or wealthy then let them in. This is what the rest of the world does.

Stage 2: Sort out the finances

o Women for some sexist reason can draw the state pension earlier than men yet they live longer. The retirement age has to be aligned and put back to reflect the ageing population. Britain should wake up to the fact the 65 year olds may want to work part time even if teenagers do not.

o The function of the NHS has to be redefined. Fire all the over paid, part time, number crunchers, and focus resources on front line services. Keep A&E departments and examine the rest. Why should all tax payers pay for fertility treatment, sex change operations, and cosmetic procedures, for the few? The best hospitals like Great Ormond Street rely on donations from the public.

o Higher rate tax payers should have to buy into the NHS services or go privately.

o The ill informed attempts to buy the votes of the benefit classes by Gordon Brown by adding a special tax band should be reversed. The 100’s of wealthy that have left the country already have cost more in lost revenue than Darling expected to make. What a farce. Encourage the monied classes to return and build businesses here; sadly it may already be too late.

o Increase VAT and force suppliers to charge the Brits the same as they do the Americans. We’ve been ripped off for years, Cars, electronics, clothes, music etc.

o Decrease the size, and improve the resources of the armed forces.

Stage 3: Sort out other time bombs

o Get off the green band wagon and build nuclear power stations. Only the dumb don’t get it. Our children will be dependant on the Russians for energy if we don’t.

o Redefine the school system. Labour clearly have an agenda to window dress the schooling system as clearly exams are getting easier and grades higher. Universities and employers should be the judge of this inferior system.

o Set up a politically independent economic unit consisting of financial experts to build economic policy based on multi-decade time horizons

Karl Marx would be truly intrigued by the Labour party, for in government they have succeeded in making things so bad for the average Brit that communism would actually bring some light relief. It is as though the Labour party read Das Capital and decided it would become the basis for a script ‘Britain; the Blair and Brown Years’. 

The past twelve months have seen corporations and private individual’s finances collapse under the burden of excess debt , coinciding with the worst recession in the UK for decades.  This, along with the total mismanagement of the public purse by the Labour government, has created the ideal scenario for furthering communism (as outlined in Karl Marx’s work) in the UK.

However things may not be so clear cut.

TCE felt that when RBS outbid rivals for the very average Dutch bank ABN at the top of the equity market in the latter half of 2007, that the RBS Board, and in particular, Sir Fred Goodwin, had gone completely mad.

The recent media frenzy surrounding the subsequent bailout and the firing of Mr Goodwin has been completely overshadowed by the ‘scandal’ of his pension entitlement. Ms Harman (Labour’s Deputy Leader) during a 1^st March television broadcast implied that steps would be taken to ensure that the former CEO does not take his £650,000 per annum pension even if the retirement deal was valid in law. “The Prime Minister has said that it is not acceptable and therefore it will not be accepted” said Ms Harman on the BBC’s Andrew Marr show.

The morality of such a payout is perhaps debateable and Fred Goodwin’s legacy is one of arrogance and incompetence. But the message that Gordon Brown sends with such dictatorial statements should normally be of grave concern, however since communism theoretically implies an egalitarian and democratic social structure, communism has absolutely no chance whilst this Labour Party is in power.

Obama has little public history on which to be judged, but now as President, and also post honeymoon, his successes and failures will be very public.

In TCE’s opinion he’d be wise to address the vast wealth imbalances that exist in the USA. He surely would have to be judged a success on leaving office if the burgeoning number of poverty stricken underclass (that die annually) in the USA had access to basic medical provision without relying on charitable handouts like a third world nation.

If Obama were to leave a decent economy and a controlled national debt, his place in a Hollywood script would surely be assured. The problem is that the numerous problems facing America are real and vast. California is basically bust, and New Orleans an embarrassing reminder of his country’s priorities.

Given the scale of these problems TCE thinks that Obama has little chance of achieving these ‘minor’ moral or economic goals; he’ll be too busy stopping the US dollar turning into the next Argentinean Peso.

During the past year or so it seems as though anyone remotely connected to the finance industry, mainly bankers and hedge fund managers, have taken ‘one hell of a beating’ from all the uneducated pundits in the press and on television.

Unfortunately TCE thinks this is just another example of the cheap points, column inches, and pounds Sterling, gained by all the ‘Robert Peston’ types in media. Clearly the art of being a ‘Robert Peston’ is to say nothing original or meaningful, and to write a backward looking, rather than a forward looking commentary.

TCE wonders what the ‘Robert Peston’ types will have to say once Downing Street has no use for them and the puppeteer’s hands are finally extracted.