2. Osborne

Osborne’s gone NATS, selling our air to Germany – !

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Thatcher sold our water supply in 1989 which means that there can be no sensible policy to share out UKs water supply from the areas of plenty (the West & North West) to the areas of need (the South and South East). Those who now own the water do not live here so they just don’t care.The list of idiotic, incomprehensibly incompetent “policies” dreamt up, mainly by the Tories, continues.

Now there are  credible plans for George Osborne, The Treasury and a few airlines, who own the UK’s air-traffic control service  (NATS) to sell this to an outside bidder. This has been Tory party policy since before 1997, famously blocked by Labour, but now the possibility is all too real. Deutsche Flugsicherung the German air traffic service seem to be very interested.

George Osborne who has the financial nous of a bottom feeding Synodontis nigriventris (catfish if you were wondering) continues in the wake of Noo Laber  who in 2002 sold the controlling interest in NATS to the airlines for £50 million. The problem is that pollytishens, both Labour & Conservative, have no financial savvy as is evidenced, for example, by the way New Labour were screwed by the GPs when they last negotiated their pay settlement. We ended up losing our own doctors providing “out of hours services” for an enormous pay increase. Then, on top, we the people had to pay extra for Polish doctors to do the “out of hours” bit of the GPs job! Unbelievable!

This is because our current crop of rich and privileged party politicians have never had proper jobs, they therefore “know the cost of everything and the value of nothing”.

Anyway – back to the next debacle waiting in the wings! I quote an article showing the ineptitude of New Labour (just to be fair to the Tories) …

The Government seems to have received £800m from the sell off.  But the Airline Group paid only £50m of it and, by an extraordinary arrangement, the remaining £750m was paid by NATS itself out of a of £1.46bn loan taken out by NATS from 4 banks (Abbey National, Barclays, HBOS & Bank of America).  In other words, the Airline Group got a controlling interest in NATS for a mere £50m and NATS was saddled with an extra debt of £750m, which NATS – not the Airline Group – is responsible for servicing and repaying.  And if NATS defaults, the banks could acquire the controlling interest in it

NATS (National Air Transport Services) is currently 49% owned by the state and the rest is largely owned by UK resident airlines and BAA.

reading his first economics manual - economics for dummies
Osborne reading his first economics manual – economics for dummies

In my view the state should own 51% and UK resident airlines the rest, but no, Osborne, desperate for cash and clouded by short term party political considerations thinks the sales is a good  idea. Now look Georgey boy, if someone wants to buy it there’s probably a good business reason NOT to sell – and if what you are selling impacts national air security and safety then its not a very good idea!  Brainless, Asinine, Short Termist, Arrogant, Rank Dimwit …

Acknowledgements:-

  • Dominic O’Connell (Sunday Times 11th March 2012)
  • David Morrison’s website (for the picture of Osborne reading Economics for Dummies)
  • Oscar Wilde: For “Nowadays people know the price of everything and the value of nothing.”

 

It’s a funny old world (#2) QE2; £75 billion “boost” for the economy!

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The casual hypocrisy of George Osborne:-

09/01/2009 – “QE is the last resort of desperate governments when all other policies have failed” – George Osborne in opposition

06/10/2011 – “QE is an appropriate tool” – George Osborne (reported on politics home)

Yes it is par for the course for politicians to lie and spout bollocks – this is a jolly good example.

Here is some sanity from my favourite BBC economics commentator, Stephanie Flanders,  who blogged  “Some say that QE is all a confidence trick – albeit, an important one. What, exactly, the Bank does is less important than the fact that it is seen to be doing something. The US comedian, Mitch Hedberg, had a line I reprised on the Today programme this morning: “My fake flowers died, because I forgot to pretend to water them.”

Which is slightly funnier but just as accurate as is my definition of Quantitative Easing espoused in meBook.

The sound of gentle weeping … etc.

Are we being run by idiots? (Euro bailout #2)

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Did you know that when Italy joined the Euro, it failed several of the main criteria set up for countries joining the Euro?

Did you know that “bail outs” of failed economies in the Eurozone are prohibited by EU law?

You may have heard that we (residents of Great Britain – the UK …) are in a bit of financial bother and that for every £4 we spend we have to borrow £1, at around 3.0% from China. This is couched in a wonderful term “the PSBR or Public Sector Borrowing Requirement”  which makes it sound quite normal to have to borrow cash to meet our ordinary annually recurring spending needs. 

Most of us learned from Mr Micawber in Charles Dickens book David Copperfield, the following simple lesson, “Annual income twenty pounds, annual expenditure nineteen pounds nineteen shillings and six pence, result happiness. Annual income twenty pounds, annual expenditure twenty pounds and six pence, result misery.”  This statement is simple common sense, obvious to anyone other than a politician or financial journalist.

That does not include the future PFI commitments and public sector and funding conventional old age pension commitments.  (Ed: ‘Why not? ‘Answer: “It would make our finances look worse than those of Greece”. Ed: ‘Ah – of course, silly me – thanks.’)

Public sector borrowing is only ever sensible if it is for capital projects like roads, hospitals, railways etc., and then, only if future tax receipts take it into account – even this basic accounts stuff passed by Gordon Brown who criminally borrowed ever more and more without providing control systems to manage what was being spent and why.

The loan interest payments we paid in 2010 were £46 billion and will be worse in 2011.  (Same as the 2012 defence budget) … and, NO I’m not making it up!) See  here.

So then, let’s give another £9.2 billion to the IMF to help out the Euro-zone, i.e. Greece, Portugal, Spain, Ireland & now Italy shall we?

Yes great idea!

This of course is on top of the £12 billion already committed by our leaders last January.

Sounds like a good plan to me!

We can afford it!

Let’s put Gordon & Tony’s pensions up shall we? (Ed:- er, we already have – so would you like us to put them up again? <embarrassed laugh – Ed was not quite sure if I was joking or not …>) The current lot, Cameron and Osborne, are not even attempting to balance the books this year or next!

I am afraid to say that Great Britain (and many other “developed” (ho ho) countries) are in more or less the same “over- leveraged*” position; the USA, France, Spain, Portugal, Italy, Germany (yes, Germany – but they have a good chance of paying off their debt – or rather did have until Italy went bust last week…).

Don’t check up on public debt positions of countries other than China, Brazil and Arab oil producers if you want to sleep tonight.

Are we being run by idiots?

Yes we are!

The sound of gentle weeping can be heard from my study …

* “Over leveraged” = ‘bust as arseholes’ as a former insolvency accountant acquaintance used to say.