Unrest In The Streets

As the Credit Crunch grinds on various organisations and individuals worldwide are expressing their outrage with bankers and financiers by targeting them for direct action. I suppose that I should condemn such actions but I can hardly express surprise. We have tolerated these 21st century robber barons for far too long yet, even as the whole financial system struggles for survival, it seems that the highly paid gamblers will insist on hanging on to every last penny of their remuneration packages and bonus payments. It is a fantasy to think that they will - with but a few exceptions - give up their bonuses voluntarily. Ordinary citizens whose money is being used to bail out the banks are mad as hell and they become even madder when they see huge chunks of their money being used to pay out bonuses to senior managers and traders at these bankrupt banks and insurers. With millions losing their jobs and homes no one can be surprised that there are those who will express their objections and their frustrations via physical attacks on the people concerned or on their property.

In expressing concern at the recent attack and vandalising of Fred Goodwin's house and car, most newspapers said that Fred Goodwin was only taking money paid to him under his contract and as a man who had paid his taxes he was entitled to be fully protected. I will agree that he should be "fully protected." But, what is "fully protected"? The police responded very quickly to reports of the vandalising attack - probably far quicker than any ordinary citizen could have expected. And did Sir Fred Goodwin pay all his taxes? He may well have done, but if he did, he would have been one of the few highly paid individuals who did. It has been revealed more than once that the very rich only pay tax voluntarily. I regard those who earn more than $500,000 per annum in pay and bonuses as probably among the very rich. They may not be billionaires but they earn enough to make tax evasion and avoidance an important part of their personal financial management. We can take it that money will be paid via various off-shore trusts and tax havens and via complex deals that exist for no other purpose than to avoid taxation. Indeed, more than one organisation has been chased by HM Customs & Revenue trying to collect the true taxes of the very rich. It is my impression, and I can say no more than that, that they have only limited success.

It seems that RBS is losing senior traders from its commodities trading subsidiary because they are not ready to reign in their pay and bonuses and are moving to companies not controlled by government and where, presumably, they feel confident that they can carry on collecting buckets of money. This has got to stop. Apart from governments indulging in short-term bouts of money printing it is not possible for these traders or anyone else to make vast amounts of money from nothing. It either comes out of the pockets of ordinary people or it is created by a system of circulating debts and over-valued bonds round and round the system in the hope that they will somehow develop an inflated value all their own. They will not. The system will go crunch all over again.

Next week we have the G20 meeting in London. Gordon Brown is hoping it will give a flip to his popularity with the electorate. I think he will struggle to improve his electoral prospects with rioting in the streets. No doubt we will conjure up a vast police presence and we will see attempts to force protesters into cul-de-sacs away from the public eye. But, at the end of some days of turmoil, the delegates will probably agree on nothing and will come out with a platitudinous communique that says nothing of substance about anything. I hope that I am wrong but I have history on my side.

Justice For All

You may be wondering why I have been quiet for more than a week. I have not run out of things to say, it has been more a matter of attending to the needs of daily life. But at the week-end, as more and more people seem to be realising just how much money greedy bankers have been taking from us, I let my mind think about another deserving profession - lawyers. Not many lawyers earn as much as bankers but they do very well, thank you. Of course, we know that lawyers are very important in maintaining an equitable society and protecting us all from criminals and abuses by those in power. Unfortunately, these wonderful ideals are not available to us all.
Only the very rich are protected by lawyers.
Nevertheless, in the most serious cases lawyers and the legal profession in general will be available to all to ensure that justice is done. Particularly, I was thinking of the crime of murder. Anyone convicted of murder will be sentenced to life imprisonment and a judge can indicate just how long he considers "life" to be. Mainly, it will be 10 to 15 years but in some cases, life can mean exactly that. There are some who believe that, for the worst offenders at least, judges should have the option of passing a death sentence. I can understand such sentiments but they are not ones that I can support. I am opposed for two reasons. First, I would not ask the state to do on my behalf, something that I would not want to do myself. And certainly that would be the case with an execution. But, second, I would worry that the possibility of a mistake could not be eliminated. It is a conclusion that settled in my mind more than 50 years ago, when I was a teenager and two specific cases became front page news.
One was that of Derek Bentley. In his case there seems no serious reason to doubt the facts. In November of 1952, Derek Bentley with his friend Christopher Craig broke into a warehouse in Croydon. The break-in was seen by a child from across the street and her parents called the police. The first contingent of police arrived and went up onto the roof of the building where Craig and Bentley were hiding. Only Craig had a gun and Derek Bentley was quickly detained. He was not formally arrested but for 20 or 30 minutes he was in police custody and taking no part in events. Craig fired many shots and PC Sidney Miles was shot in the head, dying instantly. Craig carried on shooting until he ran out of ammunition, then jumped from the roof. He was quite badly injured but was arrested. A trial took place only 5 weeks later in front of Lord Goddard, the Lord Chief Justice, an arrogant, inflexible and authoritarian figure who made sure that the jury reached the right verdict. At the time of the shooting, Bentley was 19 but Christopher Craig was only 16 and could not, therefore, be sentenced to death. Although the jury in a mere 75 minutes found both men guilty of murder, they made an appeal for mercy in the case of Derek Bentley. He was a man with learning difficulties and in today's climate it is doubtful if he would have been found fully fit to plead. Nevertheless, Lord Goddard ignored the request of the jury and sentenced Bentley to death. His appeal was rejected and the Home Secretary, Sir David Maxwell Ffyffe, did not commuted the sentence to live imprisonment - even that was unusual. So, on 28th January 1953, Derek Bentley was hanged. I thought, even then that it was not right to hang the man who did not do the killing and not hang the man who did. After 45 years of campaigning the Appeal Court finally said that the conviction was "unsafe". Even now, the lawyers will not admit that they were wrong.
The other case that took place earlier and I only became aware of during the subsequent attempts to overturn the verdict. The case was that of Timothy Evans, a retarded man who lived with his wife and daughter at 10 Rillington Place in Notting Hill, London. In November of 1949, the wife and daughter were found murdered and after some police investigations Evans allegedly admitted to murder. This was subsequently denied at the trial but, nevertheless, Evans was found guilty and was hanged in March of 1950. Subsequently it was discovered that the murders had been committed by John Christie, another tenant in the house and who turned out to have been guilty of at least five murders. It took many years of campaigning by a group led by Ludovic Kennedy and Harold Evans to get a posthumous pardon. This was granted by Home Secretary Roy Jenkins, in 1966. Yet again, it was up to others to sort out the mess.
I was thinking of these matters at the weekend when another man with learning difficulties, Sean Hodgson, was released from prison after serving 27 years for a crime that DNA evidence has proved conclusively that he could not have committed. He, also, allegedly confessed to the murder and we must accept that if the death sentence had still existed in 1982, he would have been executed. For many years Hodgson has not been considered a risk to society and he could have been released if he had been prepared to admit his guilt. Since he was not, in spite of everything, prepared to approve the infallibility of our justice system, he would not be released. The DNA evidence could have been tested 10 years ago but it was said that the samples had been lost. Only the diligence of new lawyers established that this was not so and obtained his release. And the final insult? He was released with the standard sum of £46 to help him get back on his feet in the outside world; a man who went to prison when he was 29 years old and is released when he is 56 years old and is granted £1.70 for each of his years inside.
Only the very rich are protected by lawyers.

Welcome Home

On Tuesday, 200 soldiers from the 2nd Batallion Royal Anglian Regiment, newly returned from Iraq, marched through the streets of Luton, a town at the centre of much of the Anglian Regiment's recruitment. The home-coming parade was intended as a morale booster and they were cheered through the streets by flag waving locals who did at least appreciate what the soldiers had been doing during two tours of duty in that war torn country. Many of those cheering did not and still do not agree with our involvement in either Iraq or Afghanistan but that is a matter of politics. The soldiers were men doing their jobs. All too often they have been used as political tools by Blair and Brown anxious to curry favour with the nasty regime of George W Bush - and that is another reason why we should support our soldiers. They deserve the utmost respect and appreciation for what they have tried to do, to the best of their ability on every occasion in Iraq and Afghanistan. Often they have been badly equipped to the point where individuals have even been killed as a direct result of inadequate equipment. While the government ponders the possibility of building a pair of the biggest aircraft carriers we will ever have owned - the exact purpose of these ships remains a mystery - the army is lacking much essential modern field equipment; eg communications equipment, good reliable armoured vehicles, ammunition, boots even.

But not everyone wanted to welcome the soldiers back home. A demonstration was mounted - complete with police guard - by a group of militant Muslims who shouted insults and displayed placards that attacked the men as "Anglian Soldiers Butchers of Basra" Some of these men - accompanied by women fully covered in black - displayed faces contorted with madness and rage as they shouted their words of contempt. The gathering was organised by an extreme Muslim fundamentalist organisation - it is not entirely clear exctly which one. One of the men involved in this nasty demonstration, a man named Jalal Ahmed, works, apparently, as a baggage handler at Luton Airport and so has a pass that allows him to go airside and handle baggage that is being loaded into aircraft. How incompetent can the management of this country become? Here we have a man with Islamic fundamentalist tendencies who may have connections with extreme terrorism and has, allegedly, been properly vetted for security, yet he is allowed near aircraft with bags of luggage. Have we gone totally mad? This ridiculous government has introduced numerous restrictions including the promise of ID cards and national data bases in order to fight terrorism, yet they cannot even organise simple tasks like making efficient checks on very obvious potential trouble makers. It is bizarre.

No doubt we will be told constantly that these demonstrations and blatant anti-British feelings only represent a tiny minority. I hope that this is the truth but I am sceptical. Religious doctrines can be impregnated into young minds with little regard for truth or reality and can create conflict in any society. All too many of these young men spend time in Pakistan or Afghanistan learning about Islam and a nihilistic attitude to Western society. To understand the potential for conflict, we only have to look at the tragedy that is Northern Ireland, a society riven by conflict between Catholic and Protestant. We were told, and we still are told, that the troubles were caused by tiny minorities but it was never so simple. The country is still divided even after 10 years of the so called "Peace Process". Catholics and Protestants do not mix; often they are divided by brick walls and high fences. Sure, everyone will come out and in some way condemn the latest killings but Catholics will shelter one group of militants and Protestants will shelter others. They are all complicit in the chaos and slaughter. The attitude of government to Islamic militancy is guided more by wishful thinking and political correctness than any contact with reality. But it is ever thus,

The soldiers got a much better reception in Watford on Wednesday and I hope that they will realise that most of us do appreciate what they have been doing.

How Much Is A Quadrillion?

I have been wondering in recent days if there is any place, any bank, any fund, any bond, any object that I can put my cash into that can be considered safe and could bring me a return. Last week the BoE base rate fell to 0.5% and, of course, bank savings interest rates fell 0.5%. This means that many so called savings accounts give interest rates of zero - zilch - nothing at all; it is even suggested that some of these wonderful institutions - banks - may even start asking for money to pay them to look after our money. That should cause a run on the banks like none they have ever imagined. Even now letting banks look after our money is like letting an alcoholic take charge of a brewery.

Today the BoE started Phase One of its wondrous scheme of Quantitative Easing and we could hear the printing presses rumbling into action as they start to churn out £2 billion worth of extra fivers. Only yesterday, I read an American commentator writing about debts associated with CDOs. I don't really understand CDOs - Collateralized Debt Obligations - which, apparently, are toxic bundles of asset backed securities [ABS] with different levels of risk. The trouble is that no one else seems to understand them either. But bundles of these things are floating about like concentrated doses of bubonic plague waiting to infect some apparently healthy financial institution. Now the American commentator was of the opinion that the total value of these dollops of trouble was $0.75 quadrillion. Now, as a man who has had trouble visualizing just what a $1 trillion amounts to I am in even deeper water with a quadrillion. What is a quadrillion? Let us assume that it is merely 1,000 trillion. Using a business model that I have used before. If I had this 0.75 quadrillion and started to spend it at the rate of $1,000,000 per day, for how long would my $0.75 quadrillion last The answer is just over 2,000,000 years. We have been in fantasy land for some time with the financial system, now, surely, we are over the edge. Only Mr Mugabe with his endless supply of Zimbabwean dollars can get to grips with this one. In reality, it is impossible to have so much rubbish debt. The silly number has been produced because the same toxic rubbish goes round and round the merry-go-round until .... Until what? Fundamentally, the system is bust. But we knew that.

Laughing All The Way To Work

Last week, the cops stopped someone who was caught laughing while driving his car. It seems that this unapologetic reprobate, this threat to all things we hold dear, this potentially murderous driver was talking to someone on his in-car, hands-free phone and some remark by his communicant had caused him to instigate an uncontrolled vibration of the facial muscles. Driving to work through the Mersey Tunnel on Wednesday morning, Gary Sanders, MD of Spontex Workwear was pulled over and told that laughing could be a criminal offence. In addition he had been spotted throwing his head back in a dangerous way. Did he think that he was a model in a shampoo advert? Clearly, the officer thought so and asked Mr Sanders the colour of his hair. I am losing the plot here. Was Mr Sanders wearing a hat? Did it cover every part of his head? His appearance is starting to seem bizarre. Mr Sanders explained that he did not have any hair because he suffered from alopecia [baldness]. "Ah, but what colour was it when you had some hair?" Extraordinary. Was he by any chance an illegal redhead? Quite rightly, the cops were treating the matter with more seriousness than it deserved and cross-questioned Mr Sanders for 35 minutes, causing him to be late for an appointment. Mr Sanders was also told to produce all his documents at a police station within 7 days. Presumably he was up-to-date with his laughing licence. There are, of course, many issues here. The cops would need to check that the man was not laughing hysterically at the latest news of the credit crunch and was about to have a complete nervous breakdown, thus rendering him totally unfit to drive. Was his a sinister laugh in the style of Vincent Price as he ran over in his mind some devilish plot to torture some unsuspecting Innocent? There are so many reasons why Gary Sanders could have been laughing in a potentially dangerous manner and we have to complement these zealous police officers on their vigilance.

On the other hand you may just think that they were mad, officious and bullying. Is it any wonder that the cops are often held in low esteem?

Lots To Lose

I am just a simple minded individual and I like the simple life. In my profession of engineering it always paid to keep things simple. When I think about banks I like the simple business models: borrow at 3%, lend at 5% and work part-time. It seems that today's financial institutions prefer something more complicated and yet supremely unreliable. Demonstrably, their computer generated operating business plans do not work. Every day seems to introduce us to a new level of incompetence and ever greater losses. Have these institutions agreed among themselves the order in which they will announce their results for 2008 so that we can gradually be conditioned to the scale of their disasters? Some of the numbers are so huge, so grotesque that, frankly, it is natural to assume that they have been exaggerated - only to find later that the true losses and potential losses are even worse. From today it will be difficult to imagine any single company being capable of matching AIG, which yesterday admitted to losses of $62,000,000,000. This is a lot to lose in one year; it is a lot to lose in ten years. But AIG lost this much in 3 months. I cannot see how any organisation managed by groups of people who were not certified as totally insane or suffering from the effects of a collective financial death wish could lose money at this rate day after day, month after month. The loss amounts to $28,700,000 every hour of every day for the whole 3 months. Whatever else this is, surely it is a measure of the magnitude of the funds stolen from ordinary people by these institutions and their senior staff to satiate their greed for money at levels beyond all comprehension. It is constantly said that these ludicrous institutions are too big to be allowed to fail. Soon it will be clear that no country on Earth is rich enough to stop them failing and the whole economic structure will collapse. But still they demand their ridiculous salaries, bonuses and contributions to pension funds. It is people living on ordinary real world wages, fighting to keep their jobs who are being asked now and in the future to stump up the cash to pay them.

I hope that Mr Brown and Mr Obama at their meetings in Washington this week will start to lay some foundations for running a banking system for the benefit of all the people and not just for these modern day robber barons.

In The Right Time Zone

Ah, at last I found the little box that allows my posts to show GMT instead of PST. I am not, as you may have thought, hiding out somewhere in the middle of the USA and I feel that I have saved myself a whole 7 hours at a stroke. It's a bright day so I can go out and enjoy some sunshine. I have to go down to Brighton today driving over the top of the South Downs where it is possible to see miles out into the English Channel. I can inhale the sea air as well. I hope Brighton is not as crowded as it was last time I was there 2 weeks ago. The Lanes were busier than on many an August Bank Holiday Monday. It seemed that many had brought their children down in the half-term holiday. I suppose it makes a change from taking the young ones to play in IKEA.

Sir Fred's Pension Pot

Even though I am retired, I continue to invest a small annual sum into a pension fund. I do this for tax reasons and as a way of building a small add-on pension to top up my income some time in the next few years to combat inflation. I am wrong to do this, of course, since we are about to experience deflation - so they tell us. Now I am sceptical. After all, the people telling us this are part of the group of experts responsible for the present mess - so we can't just accept what they say. Anyway, assuming that my pension fund does not totally disappear down the plug hole into the sewers of financial incompetence, my fund may one day pay me an extra £3,000 per year. I was thinking about this while reading yet another article about Sir Fred Goodwin's pension - is there any human-being who has ever lived whose pension arrangements have been so widely known or so much discussed? Sir Fred is going to get "over £650,000 per year." It later turned out that the actual sum is £693,000. Note that the extra amount of £43,000 per annum was so little it was hardly worth mentioning. But that £43,000 would need an extra pension pot of about £1m. In other words, the bit that we didn't need to even notice would require a pot of 20 x the national average pension pot. How many people outside of the daft remuneration schemes of the financial institutions and some local authorities can dream of a pension at 50 years of age that exceeds £40,000 per annum? Perhaps all will be well when we are enrolled in Gordon's great national pension fund in 2012.

Eric's mum says that she is looking forward to her increased state pension in April. She realises how lucky she is that inflation was running at 5% last September. If the cost of electricity and gas had not doubled she would not have got an extra £4 per week - and an increased fuel allowance. At the moment she is struggling a bit but she thinks that taking into account all the extra money, after April she will be able to switch the lights on again. I think she is being a little rash.

A Corrupt Plutocracy

What is this country to come to? Throughout modern history the ruling classes have been fearful of the power of the people. After the French Revolution there was concern that revolt would spread to Britain. After the defeat of Napoleon, huge military forces were kept at the ready to suppress any discontent and riot among the poor and the unemployed. It was true throughout the reign of Victoria when working classes were exploited, living in attrocious conditions, with limited life expectancy. I think we now have a ruling elite that is again afraid of the people. How else can we explain the obsession with data bases, tracking people's movements and storing vast libraries of information on every human being in Britain from the tiniest child to the 90 year old pensioner - who just might be a terrorist. Has Britain become a true plutocracy - government by the rich. A land where power is a matter of wealth and privilege; where a corrupt and morally diseased government is kept in power by bribes and propaganda; where no statement delivered by government can be believed; where Parliament has lost all power and authority and does little more than endorse the actions of government; where a minority demands control of all people's lives by surveillance, data bases and spies; where a problem of terrorism has been used as a smoke-screen for the suppression of civil rights; where the very rich extract more and more of the wealth of ordinary people; where the very rich pay no taxes - unless they wish to do so. All around us there is the evidence of tightly knit networks of privilege; where government exerts a free, relaxed approach to regulation yet persecutes the mass of the people. It is a distasteful, remote, incompetent Ancien Regime that has grown up through gentle corruption and paranoia over the last 20 years. It has been the norm that people would let governments get on with governing and would not complain too much. They would have believe that governments may not have been very efficient but they were probably well-meaning. We cannot believe that any more. The people are coming to realise what they are losing and how our country is being ruled and destroyed; where millions are unemployed while cheap labour is brought from abroad to work for low wages to sustain the wealthy. In control, we have a sick, shameful, irresponsible, hypocritical plutocracy of government and financiers that has wrecked the country and is in denial of its own part in the worst financial disaster for more than a century.

In the past the struggles of governments have been with the working classes alone. Now the rulers are so remote, so entwined by the tentacles of the sick regime they have constructed that they fear the power of all of the people. The ordinary middles classes, the skilled working classes, the students and the educated unemployed will man the barricades. We may yet have a summer of discontent the like of which no government has seen in many a year.