Billy Bragg Tax Protest

Just signed up with Billy Bragg's tax protest on Facebook. Here. Feel a bit of a prat for doing so really. I mean, he's right that RBS shouldn't be paying bonuses, but he's got it arse about face as to why they are.

Thing is, Billy old son, the first mistake New Labour made was to bail them out in the first place. There were a number of other routes that could have been taken to make the banks including RBS liquid again. Debt for equity swaps for example. Secondly having bailed out all these banks New Labour have created a cartel. And what do cartels do? Exploit their customers and everyone else. So paying out mega bonuses was always on the cards.

Now I agree that Brown Darling could stop all this but since they've made a complete fist of 'running the economy' (by the way 'running the economy' is the usual lefty delusion, economies run themselves pretty well if left to get on with it) what makes you or anyone else think that they could 'run' the banks? Quite.

Thought Control?

I notice that New Labour are setting up another thought conditioning experiment on the young. They are requiring schools to teach 'financial capability' as part of PSE lessons. They are going to teach children about bank accounts, how to set up a DD, how to write a cheque and well, all about lots of other bits of what is just administration.

This is risible for two reasons.

1. New Labour being the most financially inept government ever, has no credibility at all when it comes to financial capability.

2. If they wanted to teach children something useful they could drum into them two simple facts. (a) Don't trust banks. And (b) Don't trust governments.

The admin they can sort out for themselves when they get there.

There. Easy isn't it.

(Have you seen the equally risible NatWest Ads? There's one of their female bods in a school going on about all this admin. If I was a teacher I'd ask her to explain to the class how they made such a first class mess of their business, went bust, and tried very hard to take the whole country with them. Now that would be a useful lesson).

Who tells you what to do?

(A) Lefties, including New Labour (or just Labour) , Lib dems, BNP / Socialism: The 'get in everyone's bloody way party / philosophy'.

(B) Righties, including LPUK, UKIP, Tories (Unless they get seduced by paternalistic oligarchism and homeownerism) / Libertarianism: The 'lets get out of everyone's way party / philosophy'.

Which is likely to not just work better, but to work at all? Do YOU think they know what's best for you? Do YOU always want to be told what to do? No, me neither.

HMS Enterprise?

Whatever the taxation arguments, the John Redwood post was really about enterpreneurialism.

Many people, and respondents on his blog, get confused between enterprise and entrepreneurialism. Essentially enterprise is a quality that most of us possess to one degree or another. Very few people though possess entrepreneurialism. To be an entrepreneur you need to see things in a new way. To spot the inefficiency or the opportunity for a new good or service. You need to be really creative.

This differentiation between enterprise and entrepreneurialism is evident in the employment statistics. About 4 million workers are self employed. But very few of those actually created a new business based on a new product or service idea. Many just do what they did for an employer on their own account.

Entrepreneurs are those that disturb the steady state economy and send it off in a new direction. Enterprising people are not necessarily entrepreneurs, but they can be very successful, and excellent job creators in their own field.

The point of this ramble is that it is genuinely possible to teach people to be enterprising, you just need self belief, energy and ambition; but much more difficult, and I contend not really possible, to teach entrepreneurialism.

The root of our problem is an education system designed to create bureaucratic jobsworths and to supply supplicant and pliable cannon fodder into the maw of the bureaucratic state. It also has the added benefit of not creating people who will challenge the bureaucracy.

I was fortunate I went to one of the last true Grammar Schools. Loads of Old Boys of that school showed enterprise and some genuine entrepreneurialism.

So if you want more enterprise, liberate education. Trouble is the turn round round time for the UK is therefore generational, not just a couple of years.

(This is an edited version of a comment made on Mark Wadsworth's blog here)

And Happy New Year to You...

Well, that's it. Just been told by a contact that the Inland Revenue is not negotiating on tax payments for businesses and the self employed. Pay up now or that's it. 'Course they aren't. One, Brown has run out of our money and two, someone has to pay the IR staff. After all they don't pay any income tax themselves, do they?

Income tax is a terrible thing. It was foist upon as as a con job by a long past government probably to pay for a war on the basis that it would only apply to the 'rich'. But of course once out there the temptation of politicians to creep downwards with the limits was all too tempting until we now have the situation that even someone on minimum wage pays income tax. (Note. I do not support the idea of a minimum wage.)

And as far as State jobsworths is concerned it is just part of the mad money go round of the bureaucratic state. Since, as PAYE, income tax is a tax on employment it is the IR - part of HMG - that pays the employees tax, not the employee. And just where did the IR (or HMG) get the money to pay its employees? Yup, from the workers adding real value in the real economy. So the IR collects money from us, pays some of it to their employees and keeps back the rest. In other words it is just a saving on the employment cost of the state employee, as opposed to a cost for all of us private business employers. On top of that the profligacy of their pension benefits, at a cost of between 20% to 30% of salary roll means that this saving to us, wealth creators, is simply swallowed up in funding (or not fully funding) extremely generous pensions to state employees.

This mad money go round exposes the inequity of income tax. One, no state employee pays it. And two, it is a destroyer of employment in the non government employment sector - private business. On top of my New Year wish list is the announcement that one or other party recognises the massive unfairness and destructive nature of Income tax and will make an absolute commitment to abolish it by a certain time, say five years hence.

A first step is the introduction of a flat tax at a rate of about 20% starting at a higher threshold of about £15,000.

It won't happen. Will it?

Formula 1

Toyota, and probably Renault, are getting out of F1. A basic knowledge of freedom and markets told me that this, or something like it, would happen, and that the 'compulsory budget cuts' - or in economic terms, price controls - proposed by the Max (now Jean) and Bernie were utterly fatuous.

F1's current situation is an object lesson in what happens without democracy, the rule of law and the indulgence of oligarchs. The FIA is an undemocratic dictatorship. It has handed a monopoly patent for all the 'commercial rights' to an oligarch. The FIA operates kangaroo courts to enforce these positions. This corporatisation attracts other cartelisers and mercantilists, like big corporations and autocratic governments. This, for a time, suits the oligarch as he can demand substantial commissions from competing mercantilist and totalitarian governments to bring the show to their town to lend them legitimacy and credibility of their own lack of democracy.

This excess spending filters down to the teams where international corporations are sucked into spending an awful lot of money to try and become winners. A lot of this cash is spent not on engineering and racing but on corporate entertainment and similar. Carmakers as a genral rule are only profitable on their core business one year in five (source: Warren Buffett) hence much of their F1 spend must also come from borrowed money. Keeping up in the bling competition is not cheap.

But, as one lady once famously remarked, 'you can't buck the markets'. Sooner or later the international investors and bankers that have been bankrolling much of the profligate circuit building, carmakers and other fellow travellers will call time on their largesse. The tsunami of cheap money that has sustained the F1 bubble will retreat and an awful lot of people will have been found to be swimming naked.

Max and Bernie have been stupidly trying to impose price controls and more and more detailed rules to try stop this happening. Listen you pair of idiots, price controls never work. As neither do excessive bureaucratic rule writing (which has the entirely opposite effect by increasing costs). But, the loss of Toyota and Renualt will immediately cut the cost of competing in F1. There will be people available. Their facilities will be on offer, cheap. The remaining teams will be able to pay less for everything. This is markets working. What is more important it will cut the barriers to entry for new teams. Small innovative ingenious engineering and ideas led teams. Efficient teams. Cosworth will be back. Why not other engine suppliers like AER?

Bernie and his CVC financiers will, hopefully, be worried sick. CVC's cashflow demands to service it debts are a bigger cash drain out of F1 than any other one thing.

My fervent hope is that the Toyota and Renault exit triggers a serious financial problem at CVC leading to it getting out completely. This may also trigger the exit of Bernie. And this may lead to the FIA resuming control over all aspects of F1. There is only one problem. Jean Todt. The man is an autocratic French mercantilist political operator. Without him there would be a vague chance that the FIA would massively reduce all the fiddling rules and cut the entry fee demands to a reasonable amount and reintroduce democracy.

Williams and Brawn have demonstrated that it is entirely possibel to compete on relatively modest budgets. So lets look for a new era of innovative and very competive garagistes to bring real racing back to F1. I am only sorry that there will probably never be another Ken Tyrrell. And lastly we can say a very welcome farewell to all the ghastly souless F1 facilities like Abu Dhabi.

Quangos Try to Kill You

Not done much posting and reading of blogs for some months. I've been off work too. It'll be 5 weeks tomorrow. Hospitalised. Why? I've got endocarditis. How did I get it? See here .

I have had a not very well functioning heart valve for years. Diagnosed when I was 7 and rediagnosed when I was about 30 and told to me. So, for the last 27/28 years I have worked hard on keeping my heart fit and have done so. This regime also included prophylatic antibiotics before any dental procedure.

Consequent upon the NICE guidance my dentist asked me to check with my GP as to whether the prophylatic antibiotics should be discontinued. I asked him and he said that he had taken advice from a cardiologist and the answer was that they were 'required to take account of NICE guidance'.

I then proceeded normally, but without any prohylaxis,and had two or three minor dental treatments - check ups and cleans - and by Christmas 2008 my wife had noticed that I was not my usual self. I first noticed symptoms over the weekend of 30 / 31 May 2009. Endocarditis is very difficult to diagnose and it took until late September, by when I had become very ill, that Endocarditis was diagnosed in a consultation with a specialist that I had to pay for as the NHS could not provide an appointment until weeks later. I was immediately committed to hospital and put on a 6 week course of antibiotics.

I am incensed that some bloody bureaucrat should interfere in the professional relationship I have with my doctors and end up with exactly the wrong advice which has gone a long way to ruin all the keep fit work I have done for nigh on 30 years.

The moral of this story is that Quangos kill you. Always do exactly the opposite of what they tell you. My financial services business operates on exactly that principle and we've been proved right and the FSA wrong.

I am now going to read the NICE guidance thoroughly and send them a very straightforward letter basically telling them that they are a bunch of wankers and what are they going to do about an apology and compensation. Fat chance. Oh, and all the clinicians I have spoken to have remarked that there has been a spike in endocarditis cases since the NICE guidance.

Bastards.