Thursday, 6 October 2011

A Wunch Of Bernankers

Some posh Brit gets taken out.
His missus gets carted off.

And all this from a supposedly secure 6* VIP Luxury Branded Experience on the beautiful coastline at the border of Somalia and Kenya.

Oh no!
A copycat crime.
This demands wall-to-wall media coverage.

Meanwhile in Somalia, Kenya and Ethiopia, 12 million people are starving in a famine that was predicted 3 years ago but which donor nations chose to ignore as they were too busy declaring class war on their own citizens.

Of course.
If these vacationing posh people had paid a proper percentage of tax in the pound, these narratives might have had a happier ending for all concerned.

The framing of the argument over the increasing income inequalities across the globe around this level of tax issue is something that should be resisted.
As Warren Buffett has pointed out - he pays a lower percentage rate of tax than does his secretary.
The rich do loopholes and then some.

Instead of framing the argument around whether it would be preferable if the class warmongers were to pay 55% rather than 50% of a markedly reduced real income figure, why not tackle the speculators who toy with everyone's lives?
And then deal with the myriad of loopholes, structural moral hazards and misanthropic infrastructures that allow tax avoidance to occur well before any tax inspector gets anywhere near the figures.

Dani Rodrik in 'The Globalization Paradox, Why Global Markets, States and Democracy Can't Coexist': "What do all these men in their twenties and thirties sitting in front of huge computer screens, who move hundreds of millions of dollars across the globe at a keystroke and determine the fate of nations' currencies, really do? Do they serve to eliminate inefficiencies in the market and bring currency values close to their true underlying economic worth? Or do they magnify the ups and downs in the market by acting like a herd and chasing phantom profits."

And the banks go along with the phantom profits ruse because whenever the king is about to shed his clothing, along comes the central bank to bail out the markets with quantitative easing or some other doublespeak.

The Economist: "Berkeley's Mr Saez and Peter Diamond, a Nobel laureate at the Massachussets Institute of Technology, ... say that taxing investment income is justifiable. It is often hard to draw a clear distinction between investment and labour income, especially for top earners. A low or zero rate of tax on corporate and capital income may simply encourage top earners to change how they take their compensation. The case of carried interest in private equity and hedge funds provides an example. Fund managers earn a share of profits as compensation, which is treated as capital income for tax purposes... There is a compelling argument that such compensation is simply labour income, however, and that the current pattern is basic tax-avoidance."

The uproar that greeted the possibility of a transaction tax on market trading is a further instance of the framing of an argument.
London would not lose jobs and nor would any other financial centre if the tax were global and obligatory - if you have world markets, you must have world regulation.
Piecemeal regulation constructs loopholes or competitive advantage depending on your perspective.

Shell companies set up in the British Virgin Isles with opaque ownership - tis difficult to tax what one cannot see...
Off-exchange trading and Dark Pools and even deeper pools that operate without ANY regulation whatsoever...
Swiss wealth management where leading banks pay negative interest on blood money from around the world, taking their slice of the action...
Grey markets, black markets, back-handers and kickbacks, monopolies, cartels and, probably most problematical of all, just four large global accounting firms that individually sign off the books of businesses that not only have been tied to the one accounting firm for decades but also purchase consultancy services off the same firm.
The demand for the bending of the rules and the by-passing of realities by human nature morphs into something far more sinister with the passage of years.
How can there be any objection to Barnier's big push for accountancy firms not to be able to offer consultancy work to clients?

While we're at it, we're at it, we're at it...
How about insisting that no business may use the same accountancy firm for more than five years?
Now that would bring in a few shedloads of tax!

And we'll have a maximum wage, thank you very much...
Faiza Shaheen: "We need a maximum wage to complement the minimum wage. That is, we need maximum pay ratios within companies and across sectors to put an end to chief executives getting paid more than 250 times what the cleaning staff earn."

Cashheads = Smackheads - incremental antisocial greed.

John Dewey: politics is "the shadow cast onto society by big business" and the smaller that government the less shadow cast for people to observe who is really marionetting our existences.

Take that fantastic phantasmagoric ruse the Private Finance Initiative (PFI).
Slack Jaw and the War Criminal managed to get the nation 11 billion pounds worth of public building and on current public reckoning it would appear that we will be paying those privateers £70 billion in return.

It is worse than that.
Several Institute of Directors, Chambers of Commercy, Masonic sorts have confirmed to me that the real figure could be as high as £250 billion but that the current shadow are disguising the depth of the future misery for fear of been downgraded to junk status sooner than necessary.

Just saw a house I liked.
One hundred and ten grand.
If I offer 2.5 mill, that should get it...

Rampant inequality produces instabilities that are unsustainable and, additionally lead to a poorer quality of life for all.

A recent survey in The Economist concluded that future tax will have to be transferred from business to the consumer ie a regressive top-down tax.
And this is despite high-earners currently paying less tax than was the case historically.
But it appears that the only way for businesses to globally compete in late capitalism is to speed to the least ethical practices targeting short term profits far ahead of strategic needs.
Self-defeating in every way.
If Steve Jobs had just concentrated on making amazing techie stuff instead of getting eaten up with legalistic patent power play against competitors then perhaps the pancreas might not have scored that winning goal...

But we must finish on a high note...

One cannot be other than delighted on hearing that fraudster MP Elliot Morley has been released from prison after serving just four months of his 16 month sentence.
Good job the fecker wasn't carrying a bin liner and balaclava when he was nabbed for robbing and thieving and stuff.