Friday, 30 October 2015

Another recession is coming - the only question is how bad

Jeremy Warner in The Telegraph


According to the late, and great, American economist Rudi Dornbusch “none of the US expansions of the past 40 years died in bed of old age; every one was murdered by the Federal Reserve”. What he meant by this was that all US business cycles are brought to an end not by natural causes but by the actions of the Fed in raising interest rates. The art of the central banker is to take away the punch bowl before the party gets going, but few succeed; invariably they leave it too late, so that when they do apply the brakes, the economy crashes.


A powerful US senator is proposing the Federal Reserve, pictured, is stripped of the majority of its regulatory powers


With the Fed’s Open Market Committee again hinting at a rate rise by the end of the year, are not policymakers in danger of repeating the same mistake? I believe they are – that recession risk in the US and in Britain is substantially underestimated both by policymakers and the markets. Consider the facts. The current expansion may not feel like a boom, and in many respects it isn’t. In the UK, working age disposable income has still to recover to pre-crisis levels.

Yet in both Britain and the US, the economic expansion is already a long one by historic standards. Indeed, in the US it is one of the longest ever, as defined by the National Bureau of Economic Research, proud keeper of the record on American business cycles – a full 76 months, against the 58.4 month average for the 11 post war cycles identified. Only three of these cycles have been longer.

No recession is ever predicted by official forecasting; it would be an admission of failure if it was, for the whole purpose of economic policy making is to keep things just right – not too hot and not too cold. Ultimately, the policymakers always fail. Gordon Brown, the last UK prime minister, preposterously boasted that he had abolished boom and bust. Alan Greenspan, former Fed chairman, likewise believed he could defy the gods. Both were in for a rude awakening, having failed to notice the mega-boom their policies helped create in financial services.

With this searing experience to learn from, the present generation of economic decision makers tends to be less hubristic in aim, yet even George Osborne, the Chancellor, is relying on extended growth way beyond the normal parameters of a typical business cycle to meet his target of a budget surplus by 2019/20.

As it is, there is little chance of this target being met. It will be broken on the anvil of events. Already there are worrying signs of a slowdown in the UK, with both construction and manufacturing contracting in the last quarter. Lead indicators published by the OECD, a relatively accurate predictor of past recessions, point unambiguously to a pronounced UK slowdown and to a loss of growth momentum in the US.

In Europe, things are still so bad that the European Central Bank is considering even more monetary accommodation on top of the quantitative easing and negative interest rates already applied. Likewise China, where far from raising rates, they are cutting them in an attempt to head off a hard landing which in all probability is already happening. The China Iron & Steel Association has warned of an “unprecedented” slump in steel demand and prices as China attempts to transition from investment to consumption led growth.

Central banks normally act in raising rates when the economy is booming. The curiosity of this particular expansion is that for advanced economies at least, it seems barely to have begun. If there has been a boom, you’ll be forgiven for not having been aware of it. So why is the Fed thinking of acting?

There are two reasons. First, the Fed worries that once the effect of the sharp drop in oil prices falls out of the equation, inflation will come surging back, and it wants to dampen things before this happens. The other is that it simply yearns, like the rest of us, for a degree of normality in interest rates. If it can’t do it now, with the economy growing, when will it ever?

Regrettably, it may already be too late. After seven years of “unconventional monetary policy”, the world economy is once more drowning in easy credit, with few of the underlying causes of the global financial crisis even remotely addressed.
Excessive leverage and investment risk taking is again the order of the day, not so much in Britain, but certainly in the US and previously booming emerging market economies. One small interest rate rise may be all it takes to plunge the world back into some kind of mild recession. Yet to double up, as the Bank of England’s chief economist, Andy Haldane, recently suggested as a possible answer to renewed weakness in the global economy, and pile yet further “unconventional” policy on top, risks an even bigger bust further down the line. The choice, I’m afraid, is between the economy catching a cold now, or full-blown pneumonia later.

Paralysed by political cowardice, advanced economy governments have become far too reliant on monetary voodoo to support demand, leaving central banks with an almost impossible task. Supply-side measures to turbo-charge investment, including if necessary additional public infrastructure spending, must be brought forward as a matter of urgency.

Why cricket is the greatest of all games

Ian McDonald in Cricinfo 

No other sport compares in terms of the number of skills displayed, and the blend of subtlety, entertainment, sudden thrill and sustained intellectual interest on offer


Twenty-two yard theatre: a good Test match is the equal of a five-act masterpiece of the stage © Getty Images

I have been looking at a great deal of cricket lately from across the world: Test cricket - the Ashes, India versus Sri Lanka - and ODIs and T20 cricket from all over. I am more than ever convinced that cricket is the greatest game that exists for the delight and fascination of mankind. I am also confirmed in my settled view that of all forms of this great game, Test cricket is by far the most interesting, satisfying and lastingly memorable.

When I was young I played a little cricket. Indeed, one of my most precious memories, a memory now nearly 70 years old, is of playing for my school 3rd XI on a rough pitch up near Mount St Benedict in Trinidad and taking five wickets in one eight-ball over with some slow, cunning legbreaks that did not turn - they were an early incarnation of the doosra. However, much to my regret, I never became a serious cricketer. I played tennis hard and grew to love the game. And tennis was certainly good to me, filling my life with much pleasure, excitement, challenge and reasonable achievement. It was a game that introduced me to many lifelong friends and taught me, I think, a few of life's important lessons.

And yet always, in my heart of hearts, I have thought that cricket is the greatest, the most splendid, game of all. If I had been given the choice by some benevolent God between winning Wimbledon and hitting a match-winning century at Lord's for West Indies I always knew which I would have chosen.

I have no doubt that cricket is in fact the greatest game yet invented. No other sport compares with it in the number of skills displayed: batting skill; bowling skill; throwing skill; catching skill; running skill. It requires fitness, strength, delicacy of touch, superb reflexes, footwork like a cat, the eye of a hawk, the precision and accuracy of a master jeweller. It involves individual skill and nerve and also unselfish team play. It calls for short-term tactics and long-term strategy. In the course of a good cricket match there is a mixture of courage, daring, patience, aggression, flair, imagination, expertise and dour defiance that is certainly unequalled in all other, more superficial, games. It is not at all surprising that cricket has inspired by far the best and most varied literature of any sport.

If I had been given the choice by some benevolent God between winning Wimbledon and hitting a match-winning century at Lord's for West Indies, I always knew which I would have chosen

There are games that take more strength, more speed, ones that require a higher level of fitness, and ones that require deeper resources of endurance. But no game equals cricket in its all-round development of all the aptitudes. There are games that contain a greater concentration of excitement per playing hour. But no game approaches cricket in its blend of subtlety, entertainment, sudden thrill and sustained intellectual interest. Cricket, like no other game, takes the whole of a man - his body, soul, heart, will and wits.

Cricket - real cricket; that is, Test cricket - has been stigmatised as being too slow, too leisurely, lacking in colour and excitement. I believe this is simply one more aspect of the malignant modern appetite for instant stimulation and quick-fire titillation. The slash-bang games may satisfy the craving for a quick thrill, but they bear about the same relationship to a good game of cricket as instant food does to a superbly cooked gourmet dinner.

It is like the difference between lust and love. There is, it is true, the temporary excitement of a passionate one-night stand. But who can doubt that the more mature, the more beguiling, the longer-lasting love affair provides the more challenging and the deeper experience?

So it is with Test cricket. Like any lasting love affair a good Test match has its moments when the play is ordinary, slow-moving, and even boring. But the complex interplay of emotion, psychology, collective bonding and individual character, allied with the sudden bursts of excitement and the unexpected twists of fortune, add up to an experience that far outweighs the temporary and quick-fading lust for instant gratification that so many other sports supply.

One of the glories of cricket is the way the drama of a match develops, how the pace varies from the leisurely to the suddenly lethal, how the plot thickens, and the subplots are interlinked as the play goes on, how the heroes and the villains take the stage with time enough to act out their roles. A good Test match is the equal of a five-act masterpiece of the stage. Even the best of the other games can really only compare with one-act spectacles that attract those whose attention span is brief and whose imaginations are lacking. It may be that the latest pop star with his highly charged and hectic act can attract much larger crowds than Shakespeare's King Lear or Brecht's The Caucasian Chalk Circle, but we all know that the one will fade into oblivion long, long before the others' glory ends. For me, T20 cricket is a very popular, quickly-fading-in-the-memory game whose main purpose is to generate the money that will keep Test cricket active.

T20 money may keep Test cricket alive in other countries, but in the West Indies the dissolution of its Test team is a threat to be feared © Caribbean Premier League


Sadly, it will not keep Test activity alive and well in the West Indies. It is becoming clear the we will never again compete at the highest level of Test cricket. Increasingly our players are opting out of Test cricket for the sake of T20 gold. More and more our administrators will concentrate on the shorter, easy-to-make-money game. And more and more of our fans will only be interested in T20. And as these tendencies grow, the forces leading to a break-up of the West Indies team into its constituent parts will gain strength and eventually the countries will find their way in the shorter cricket world as Jamaica, Trinidad, Guyana, Barbados etc. It is sad but there seems no stopping this. The current sorry lot in charge of West Indies cricket are presiding over the death not only of West Indies Test cricket but also over the dissolution of the West Indies cricket team.

I think there is a large measure of truth in what the old men say - that in cricket today there is too much playing for self, playing for averages, playing for money, and that therefore a lot of the variety, spice, spontaneity and sportsmanship has gone out of the game. Lord Harris, a former England captain, wrote some famous words about cricket:

"You do well to love this cricket, for it is more free from anything sordid, anything dishonourable, anything savouring of servitude, than any game in the world. To play it keenly, honourably, generously, self-sacrificingly is a moral lesson in itself, and the classroom is God's air and sunshine. Foster it, my brothers, so that it may attract all who can find the time to play it, protect it from anything that would sully it, so that it may grow in favour with all men."

These words summon up a view of cricket that, sadly, seems now much too idealistic and almost completely outdated.

And yet, and yet, I wonder. Cricket is a game great enough to rise above the limitations of this overly commercial age. In cricket we will always have dramas and performances to match any in the past. You can be sure there will be games of cricket that generations to come will wish they had seen.

Cricket contains the pure stuff of human nature. As Neville Cardus and CLR James advised long ago, you must go to this best of all games with your imagination's eye, as well as your physical eye, open. To the dull of spirit who merely looks at the scoreboard when, say, a Sobers is batting:

"A Sobers at the crease's rim
A simple Sobers is to him
And he is nothing more."
But to the cricket lover of sensibility this Sobers, and his fellows, are artists all and the game they play is the wonderful game of life itself.

Wednesday, 28 October 2015

Why don’t we save our steelworkers, when we’ve spent billions on bankers?



Aditya Chakrabortty in The Guardian


 
‘Britain is entering the early stages of yet another industrial catastrophe.’ Illustration by Andrzej Krauze



Every so often a society decides which of its citizens really matter. Which ones get the star treatment and the big cash handouts – and which get shoved to the bottom of the pile and penalised. These are the big, rough choices post-crash Britain is making right now.

A new hierarchy is being set in place by David Cameron in budget after austerity budget. Wealthy pensioners: winners. Young would-be homeowners: losers. Millionaires see their taxes cut to 45%, while the working poor pay a marginal tax rate of 80%. Big business gets to write its own tax code; benefit claimants face harsh sanctions.

When the contours of this new social order are easy to spot, they can cause public uproar – as with the cuts to tax credits. Elsewhere, they’re harder to pick out, though still central. It is into this category that the crisis in the British steel industry falls.




Tata Steel confirms 1,200 job losses as industry crisis deepens



It would be easy to tune out the past few weeks’ headlines about plant closures and job losses as just another story of business disaster. But what’s happening to our steelworkers, and what we do to protect them, goes to the heart of the debate about which people – and which places – count in Britain’s political economy.

If Westminster lets the UK’s steel industry die, it’s in effect declaring that certain regions and the people who live and work in them are surplus to requirements. That it really doesn’t matter if Britain makes things. That the phrase “skilled working-class jobs” is now little more than an oxymoron. That’s the criteria against which to judge MPs, as they continue to take evidence today on the crisis and then debate options.

What does this crisis look like? Imagine coming to work on a September morning – only to find that you and one in six other employees in your entire industry face redundancy before Christmas. That’s the prospect facing British steelworkers. Motherwell, Middlesbrough, Scunthorpe: some of the most kicked-about places in de-industrialised Britain now face more punishment.

Mothball the SSI plant in Redcar and it’s not just 2,200 workers that you send to the dole office and whose families you shove on the breadline. An entire local economy goes on life support: the suppliers of parts, the outside engineers who used to do the servicing, the port workers and hauliers, the cafes and shops. Within days of SSI’s closure, one of Teesside’s biggest employment agencies went into liquidation.



‘If Westminster lets the UK’s steel industry die, it’s effectively declaring that certain regions and the people who live and work in them are surplus to requirements.’ Photograph: Nigel Roddis/Reuters

Steel is a fundamental part of manufacturing, so that the closure of a handful of steelworks in Scotland and the north endangers businesses in Derby and Walsall. At the West Midlands Economic Forum, the chief economist Paul Forrest calculates that about 260,000 jobs in the Midlands rely on steel for everything from basic metals to car assembly and aerospace engineering. He believes that the closures at Tata, SSI and Caparo leave 52,000 local manufacturing workers at direct risk of losing their jobs within the next five years. That’s just after the past few weeks – the UK Steel director Gareth Stace thinks that more plants face closure “within months”.

Join up these predictions, and Britain is entering the early stages of yet another industrial catastrophe. It could finally sink a sector, steel, that actually helps reduce the country’s gaping trade deficit. With that will go another pocket of well-paid blue-collar jobs. Chuck in employer contributions to pensions and national insurance, and the total remuneration per SSI staffer is £40,000 a year. Just try getting such pay in a call centre or distribution warehouse, even as a manager.

Imagine what would happen if manufacturing were centred around the capital, and its executives had Downing Street on speed dial. Actually, you needn’t imagine – merely remember the meltdown of 2008. Then Gordon Brown was so desperate to save the City that the IMF estimates he propped it up with £1.2 trillion of public money. That’s the equivalent of nearly £20,000 from every man, woman and child in the country doled out to bankers in direct cash, loans and taxpayer guarantees.

That’s what the state can do when it decides a sector matters. In 2011 David Cameron stormed out of a Brussels summit rather than agree to more regulation on the City. When it comes to steel, his ministers shrug at the difficulties posed by the EU’s state-aid rules. Michael Heseltine even declares this a “good time” for Teesside’s workers to lose their jobs in Britain’s “exciting” labour market. Let them eat benefits!

True, the problems in the steel industry aren’t confined to these shores. They’re driven by a world economy coming off the boil and China dumping its excess steel output on the global market. Yet other European governments are being far more aggressive in confronting them. Italy’s prime minister, Matteo Renzi, bailed out a huge steelworks last December. Germany’s Angela Merkel ensures that steel producers are cushioned from higher energy prices.

Just how lame, by comparison, is Cameron? Here’s an example: the European commission runs a publicly funded globalisation adjustment fund that can grant over £100m a year for precisely the sort of situation British steelworkers now face. The Germans, the French, the Dutch: they’ve all drawn down many millions apiece. The British? European commission officials told me this week that they had never so much as seen an application from the UK. Here’s a giant pot of money – into which Whitehall can’t even be bothered to dip its fingers.

Once our steel capacity is gone, it’s gone – and with it goes a big chunk of what’s left of our manufacturing base. Whole swaths of the country that have only just got off their backs after Thatcher’s de-industrial revolution will be knocked to the floor all over again.

The choice is stark. Westminster can sit on its hands, pretend it can’t do anything about the supposedly free market in steel (in which the single biggest player is the Chinese Communist party), and let tens of thousands of families go to the wall. Or our political class acts as if its job is actually to protect people from market fluctuations – and keep the steel industry afloat by extended bridging loans and capital investment in return for public stakes.

A return to British Leyland? No: a far cheaper and smaller rescue than RBS and HBOS. Free-market fundamentalists will decry this as a wage subsidy to steelworkers. But the alternative is to wind up paying far more in benefits to thousands of unemployed workers and their families. Besides, the state already shells out billions in hidden wage subsidies, through the tax credits and housing benefit that taxpayers give to employees of poverty-pay firms such as Sports Direct and Amazon.

What’s being proposed here is open, transparent support to employees in normally high-paying and high-skilled jobs. To keep a vital industry from disappearing for good. And to show that it’s not just the City that matters.

Why are drugs illegal?


‘To enable Harry Anslinger to keep his army of drug enforcers [the Untouchables], he created a new drug threat, cannabis, which he called marijuana to make it sound more Mexican.’ Photograph: Tomas Rodriguez/Corbis

 David Nutt in The Guardian


This is, of course, a flawed question but one that illustrates a major paradox in the UK and international laws on drugs. Some drugs – such as alcohol, caffeine and nicotine – are legal, whereas others – such as cannabis, cocaine and opium – are not. This has not always been the case.

In the 19th century extracts of these three now-illegal drugs were legal in the UK, and were sold in pharmacies and even corner shops. Queen Victoria’s physician was a great proponent of the value of tincture of cannabis and the monarch is reputed to have used it to counteract the pain of menstrual periods and childbirth. Now it is denied to people with severe enduring spasticity and pain from neurological disorders and cancer. Why?




Activists to get high together in protest against psychoactive substances ban



The truth is unpalatable and goes back to the period of alcohol prohibition in the US in the 1920s. This was introduced as a harm-reduction measure because alcohol was seen (correctly) as a drug that seriously damaged families and children. But public demand for alcohol in the US did not abate and this fuelled a massive rise in bootleg alcohol and underground bars (known as speakeasys) that encouraged the rise of the mafia and other crime syndicates.

To combat this, the US government set up a special army of enforcers, under the command of Harry Anslinger, which became known as “the untouchables”. This army of enforcers was widely celebrated by the newspapers and the acclaim propelled Anslinger to national prominence. However, when public disquiet at the crime and social damage caused by alcohol prohibition led to its repeal, Anslinger saw his position as being in danger.

To enable him to keep his army of drug enforcers, he created a new drug threat: cannabis, which he called marijuana to make it sound more Mexican. Working with a newspaper magnate, William Randolph Hearst, he created hysteria around the impact of cannabis on American youth and proclaimed an invasion of marijuana-smoking Mexican men assaulting white women. The ensuing public anxiety led to the drug being banned. The US then imposed its anti-cannabis stance on other western countries and this was finally imposed on the rest of the world through the first UN convention on narcotic drugs in 1961.


 
Mexican soldiers burning marijuana, cocaine, heroin and other drugs in Ciudad Juarez, Chihuahua. Photograph: AFP/Getty

This process of vilifying drugs by engendering a fear of the “other people” who use them became a recurring theme in drug policy. Black Americans were stigmatised on account of heroin use in the 1950s. In the 1960s hippies and psychedelics were targeted because they opposed the Vietnam war. In the 1970s it was again inner-city black Americans who used crack cocaine who received the brunt of opprobrium, so much so that the penalties for crack possession were 100 times higher than those for powder cocaine, despite almost equivalent pharmacology. Then came “crystal” (methamphetamine) and the targeting of “poor whites”.

The UK has followed US trends over cannabis, heroin and psychedelics, and led the world in the vilification of MDMA (ecstasy). In the UK a hate campaign against young people behaving differently was instigated by the rightwing press. As with past campaigns, they hid their prejudice under the smokescreen of false health concerns. It was very effective and resulted in both MDMA and raves being banned. This occurred despite the police being largely comfortable with MDMA users since they were friendly – a stark contrast to those at alcohol-fuelled events.


Since the demise of ecstasy we have seen the rise and fall of several alternative legal highs, most notably mephedrone. This was banned following a relentless media campaign, despite no evidence of deaths and with little attempt to properly estimate its harm. Subsequently we have discovered that it saved more lives than it took because so many people switched from cocaine and amphetamine to mephedrone that deaths from these more toxic stimulants decreased by up to 40%. Since mephedrone was banned in 2010, cocaine deaths have risen again and are now above their pre-mephedrone levels.

As young people seek to find legal ways to enjoy altered consciousness without exposing themselves to the addictiveness and toxicity of alcohol or the danger of getting a criminal record, so the newspapers seek to get these ways banned too. Politicians collude as they are subservient to those newspapers that hate youth and they know that the drug-using population is much less likely to vote than the drug-fearing elderly. We have moved to a surreal new world in which the government, through the new psychoactive substances bill, has decided to put an end to the sale of any drug with psychoactive properties, known or yet to be discovered.

This ban is predicated on more media hysteria about legal highs such as nitrous oxide and the “head shops” that sell them. Lies about the number of legal high deaths abound, with Mike Penning, minister for policing and justice, quoting 129 last year in the bill’s second reading. The true figure is about five, as the “head shops” generally now sell safe mild stimulants because they don’t want their regular customers to die.

‘Queen Victoria’s physician was a great proponent of the value of tincture of cannabis, and she is reputed to have used it to counteract the pain of menstrual periods and childbirth.’ Photograph: Alamy


The attack on nitrous oxide is even more peculiar as this gas has been used for pain control for women in childbirth and surgical pain treatments for more than 100 years with minimal evidence of harm. But when a couple of premiership footballers are filmed inhaling a nitrous oxide balloon, then it becomes a public health hazard. In typical fashion the press renamed it “hippy crack” to scare people – what could me more frightening to elderly readers than an invasion of hippies on crack? In truth, the effect of nitrous oxide is nothing like crack and no self-respecting hippy would ever use it. Still, it seems likely it will be banned along with every other mind-altering substance that is not exempted.

The psychoactive substances bill is the most oppressive law in terms of controlling moral behaviour since the Act of Supremacy in 1558 that banned the practice of the Catholic faith. Both are based on a moral superiority that specifies the state will decide on acceptable actions and beliefs even if they don’t affect other people. Worse, it won’t work – evidence from other countries such as Poland and Ireland that have tried such blanket bans shows an increase in deaths as people go back to older illegal drugs such as cocaine and heroin.

Moreover, it may seriously impede research in brain disorders, one of the few scientific areas in which the UK is still world-leading. But hey, who cares about the consequences of laws, so long as the police and the press are appeased?

So the short answer to the question “why are (some) drugs illegal?” is simple. It’s because the editors of powerful newspapers want it that way. They see getting drugs banned as a tangible measure of success, a badge of honour. And behind them the alcohol industry continues secretly to express its opposition to anything that might challenge its monopoly of recreational drug sales. But that’s another story.

To Beef or not to Beef - A Personal View on the Beef Crisis in India

 By Girish Menon



Photo courtesy: Berkeley Graduate School of Journalism


I come from a Hindu family from Kerala. Our diet used to be pre-dominantly vegetarian by tradition and choice, though some men folk indulged in the pleasures of animal flesh whenever they wished to give themselves 'a treat' (usually accompanied by alcohol). I studied in a Catholic school in Mumbai with UP Brahmins as my teachers of Sanskritised Hindi. My first conflict with beef arose when Mr. Tiwari mentioned in class that Hindus do not eat beef while only a few days earlier my father had cooked some beef at home for the two of us to eat.

Historically, beef eating has been used as a primary ritual in the conversion of a Hindu to Islam. I'm not sure if the early Christian missionaries indulged in similar Hindu iconoclasm? Hence, I can understand why banning beef has become a major issue in the first predominantly upper class Hindu Indian government.

In Britain where animal meat is the staple food of most residents there was recently a great display of revulsion when horse meat was found to enter the food supply. Britons have also been critical of the Koreans who love to eat dog meat. And human meat is still frowned upon. Using the market mantra isn't this totalitarian view depriving lovers of unusual meats a chance to improve their own welfare?

In my view, beef will become the next Babri Masjid of modern India. Its ban will be essential for Hindus to prove that they have exorcised yet another ghost from the past (how many more ghosts do they wish to exorcise?). 

So, what will happen to the Taslima's orphaned cows and to beef lovers like me? The orphaned cows will meet the same fate as the Indian poor - who cares!. As for beef loving Hindus like me, I could get a permit to eat beef for health reasons (the Dubai model). For those who cannot afford the high price of a permit, the Gujarat model on alcohol could be also be successfully replicated. Go to the police station for a portion of beef!

Tuesday, 27 October 2015

The Joy of Tax

The Joy of Tax
by
Richard Murphy
(extracts)

- It has been said that the only two things in life that are inevitable are death and taxes. This is not entirely true; while death has been with us from the time life dawned on earth 3.5 billion years ago, taxes have a recent written recorded history - 4500 years ago.

- Top UK taxes in (£) 2013-14

Income Tax -                    155 bn - 27.3%
National Insurance -         106.9 -   18.8%
VAT -                               105.1 -   18.5 %
Corporation tax -                40.1 -     7.1%

- Oxford dictionary on tax:

A compulsory contribution to state revenue, levied by the government on workers' income and business profits, or added to the cost of goods, services and transactions.

This is misleading because; we also charge tax on income from invested savings, pensions and rent. We also charge tax on wealth and on inheritance as well as on occupation of property. The collective term for all this is 'the tax base'. The tax base is made up of things on which we want to charge tax.

There are major problems with the view that tax is 'a compulsory contribution to state revenue'. The whole history of tax, government and democracy is entangled precisely because those who have been taxed have demanded that their consent to taxation be sought before any such charge was imposed. In that case is it true to say that there is a compulsion?

Even if it is undoubtedly true that a great many people in modern democracies are disenchanted with modern politics they do have the right to vote in elections that result in the formation of the governments that set taxes in the countries in which they reside. Compulsion is hard to suggest in this case.

What follows on logically is that tax paid does not become the property of some alien body. It is the property of a government in which we have a stake and in which we participate i.e. the government is something that we want to exist and in whose operation we consent.

We also understand that the government is different from us; the democratic process creates the possibility that there will be governments and taxes that we would not have personally supported with our votes. We consent nonetheless because we recognise that within the democratic process there could be a will greater and different from our own.

- If we consent to the existence of government and willingly consent to its right to tax, the the favourite phrase of politicians, 'they are spending taxpayers' money' is not true. Tax is not taxpayers' money. It is the government's money and it is the government's rightful property.

This property right of the government has been created in exactly the same way as all other property in a modern democracy by statute law.

- Modern definition of tax

In a democracy with a universal franchise that provides every adult with a right to seek election, tax  is that property held in trust by an individual or a company that is due to the state whose rightful and legal property it is.

- Any attempt by an individual to reduce the property right of a state to claim the tax that is rightfully its property is an action like all others that are motivated by the desire to take away from someone something that is rightfully theirs. Conventionally they could be called theft, tax avoidance or tax evasion.

- Why does a government tax? Contrary to popular perception, no government has to charge tax to be able to spend on what it wants to do. The most obvious alternative to tax is for a government to print money to pay for its expenditure. Modern governments tax to meet the expectations they have raised among their electorate as to the services they will provide in exchange for their votes.

In reality the main reason to use taxation is that a tax lets a government reclaim the money it has spent into the economy, in order to stop the money supply from over expanding. It is just as necessary that the government has available to it a means of destroying the money it can create and spend at will into the economy, and that mechanism is taxation. Taxation literally counterbalances government spending by reclaiming all or part of it from the economy. But what it never does is pay for the spending in the first place because any government can spend without tax.

Another reason for demanding payment of tax is to make the local currency, issued, backed and controlled by the government, the only useful currency in that place. By creating a demand for its coins and notes to settle tax liabilities the state ensures that these same notes and coins become readily acceptable as payment for the goods and services the government itself wishes to buy within the economy it manages.

In countries where the shadow economy is very large, meaning that very little tax is paid, there is ample evidence that currencies other than that issued by the local government are often used as the preferred basis for trading.

Another reason for tax (as fiscal policy) is to reorganize the economy to ensure that it delivers the government's economic goals.

Yet another reason for tax is when the market price for goods and services do not reflect all the costs and benefits that result from trade in that activity.


- In brief the six Rs for tax:

1. Reclaiming money the government has spent into the economy for re-use.
2. Ratifying the value of money
3. Re-organizing the economy.
4. Redistributing income and wealth
5. Repricing goods and services
6. Raising representation. 

On leg spin - Straight from the wrist

Source: Cricinfo






Imran Tahir on Abdul Qadir: "He could easily mesmerise someone like the 17-year-old me. He was the guy I wanted to be"© AFP


INTERVIEWS BY NAGRAJ GOLLAPUDI AND GAURAV KALRA | OCTOBER 2015

It takes heart, it takes skill, it takes brains, and it makes for the most tantalising sight in cricket. Three legspinners with three decades of experience around the world tell us how it's done.

What skills are necessary to become a good legspinner?

Mushtaq Ahmed: You've got to spin the ball. That is the most important thing. Then you need to have the variations: legbreak, wrong'un, flipper, topspinner. Then your action needs to be very repeatable. You should know how to use the crease, know when to go round the wicket. Those are the basics.

You have to spin the ball with drift. I learned that in the last five years of my career. It was difficult for me because of my action, where my arm was very high. Drift is something that forces the batsman usually to get caught at the wicket, in slips and gully. I can never tire of watching a legspinner who can drift the ball in and spin the ball away from a right-hander.

Stuart MacGill: The number one attribute for a spin bowler is resilience. You have to take a pile of beatings before you can become an international bowler. You can't judge a legspinner based on the number of bad balls he bowls in an over. You have to judge him at the end of the day, based on the number of wickets he has taken. If a young spinner bowls ten or 20 bad balls, it is the ball he bowls that belongs in the Shane Warnevideo category that should keep him going the next day. If you are more interested in the batsman hitting sixes, then you should be a batsman. If you're the bloke interested in getting the batsman out when he's on top, then you stand a chance.

Imran Tahir: With time and experience you start learning the skills. For me what is important is, as a legspinner you need determination, especially in modern-day cricket. You need to feel that you can change a game. Legspinners are exciting characters. Look at guys like Warne, Qadir - they change results, they make things happen.

"You have to watch the batsman, read him. If somebody plays with hard hands you have to bowl slow. You have to deceive him with pace"MUSHTAQ AHMED

Did any bowlers from history have an impact on you?

Mushtaq: I was very lucky that I could imitate people easily. At school I used to act like Imran Khan by copying his bowling action. If Javed Miandad scored runs, I would walk like him, field like him. When I saw Abdul Qadir for the first time on TV, I liked his bouncing, dancing action. I copied him instantly. I did not have his height, but I felt that I could bowl legspin. For the first two years of my career I bowled exactly like Qadir bhai.

I met Qadir bhai for the first time in 1987. I played in a tour match against Mike Gatting's England. I was a schoolboy, but I took six wickets in the first innings. I was picked in the Test squad and met him in Karachi. I was shy so I did not approach him, but I watched him very closely. What I observed from his body language was that he was very confident. I have since believed, and I always tell this to young bowlers, the most important thing you need to have as a legspinner is confidence. Your body language should always be that of a fast bowler, but you need to think like a spinner. When somebody hits you for a six, you need to still look into the batsman's eye, but you need to be cool and keep in mind that you still have to spin the ball.

Tahir: Abdul Qadir was my main role model. I just wanted to be like him because for me he was only guy who no one could read. He was that good. His passion, his love for legspin, was unique. He would create new things all the time: flippers, sliders, three to four kinds of googlies, legspinners, topspinners. He could easily mesmerise someone like the 17-year-old me. He was the guy I wanted to be.



MacGill: "The pressure applied by Shane is far more significant than the pressure applied by me, and consequently it was easier for me to take wickets" © Getty Images

MacGill: My father and grandfather were first-class cricketers. Being born into a cricketing family, I was always gunning to play cricket. Most kids in the '70s and '80s wanted to be fast bowlers and emulate Dennis Lillee but my father was a legspinner. He was a very different bowler to me as he relied on accuracy and change of pace along with variation off the pitch.

Clarrie Grimmett and Bill O'Reilly were really big names in Australian cricket folklore. I have read Grimmett's books and it's amazing how their generation learnt through feel in the absence of technology. I really like them because they played together but were different bowlers and different personalities. O'Reilly sometimes bowled with the new ball. They succeeded to the point that rules were changed to protect the batsmen.

I met Warnie when we were at the cricket academy in 1990, shortly before he played for Australia. I never compared myself with Shane Warne. I wasn't even playing state cricket back then. In his success was my opportunity as we started to rely more and more on a spin bowler as an attacking component.

"You should never have fear in T20. Even if you are hit for 20 runs in an over, in the next over by taking two wickets you can finish the game"IMRAN TAHIR

How do you explain having a superior record to Warne in the games you played together?
MacGill: When I was bowling I was lucky I had Shane Warne up the other end. When he was bowling, he had me up the other end. The pressure applied by Shane is far more significant than the pressure applied by me and consequently it was easier for me to take wickets because they had to score off me as they were not scoring off him.

Warne came into the side when spin bowling was not used as front-line attack. We had some seriously attacking spinners like Ashley Mallett but then there was a gap. Bruce Yardley was another one, Greg Matthews became an attacking spinner in the second half of his career, but none of them got an extended run and became a core member of the team. Warne showed nations around the world the importance of having a diverse attack.

Was there a spell from your early days which gave you the confidence that you belong?
MacGill: I always cared about taking wickets and not the runs I gave away. In one of my first games of fourth-grade cricket I got hit for nine sixes by a first-grade batsman. But I got six wickets in the game the next week.



A calculated dismissal: Mushtaq Ahmed goes round the wicket and traps Michael Atherton at The Oval in 1996 © Getty Images

Mushtaq: It would be the 1992 World Cup final, when I got three wickets. I had 16 wickets in nine matches, just behind Wasim [Akram] who had 18 wickets in ten matches. After that I realised I can play international cricket.

After the World Cup, Pakistan toured England where we won the series. And even if Wasim and Waqar dominated, I still had 15 wickets. That gave me the confidence that if I get more opportunities I could dominate too. That belief was confirmed on the 1995 tour of Australia, where I got 18 wickets including nine wickets in Sydney. I remember Australian captain Mark Taylor saying Mushy was the most difficult legspinner he had faced. That was because he could not read my googly.

I had also become more accurate and versatile playing county cricket. I enjoyed the responsibility. In county cricket you play in different weather conditions - cold, hot, rainy - you play on slow, turning, green pitches, so once you experience all these varied conditions you become a very matured bowler.

"Your body language should always be that of a fast bowler, but you need to think like a spinner"MUSHTAQ AHMED


Tahir: That spell against Pakistan in Dubai when I got 5 for 32 was the most important. That is the only five-for I have got in my Test career. It had come against some of the best batsmen of spin on one of the flattest decks. I had played against most of the Pakistan batsmen, including Misbah-ul-Haq, as a youngster and that made it more special.

Is spinning the ball mandatory?

MacGill: Nowadays there's a temptation to turn everybody into Shane Warne. Being a wristspinner doesn't mean you need to have the same approach as Shane Warne. I loved watching Anil Kumble bowl. I thought he was great. People who said that he didn't turn the ball didn't know the huge amount of work he got into the ball. He generated a lot of revolutions and the ball did drop a lot through the air. His height was an advantage but he moulded his bowling around what he had physically. He was a superstar. People focus on what happens to the ball off the pitch but a great batsman is beaten before the ball pitches.


MacGill: "You can't judge a legspinner based on the number of bad balls he bowls in an over" © Getty Images

Mushtaq: My legbreaks, I did not spin them much. But there was enough spin to create doubts in the batsman's mind. When you are at your peak, when you are bowling your legbreaks, wrong'uns, and flippers and even the best batsmen are not reading you, for doing that you have got to be a good spinner of the ball.

I will cite the example of Kumble. His stats are brilliant. He was unplayable where the pitches were helpful. If the pitch was dry, turning, breaking, he was a very difficult bowler to play because he was tall, he would get bounce and had good pace behind the ball. But in Australia, South Africa and England, places where the pitches are not turning enough, it became difficult. Where pitches are unhelpful if you are not a big spinner of the ball, people can play you off the pitch or like a medium-pacer.

Tahir: No, it is not. I had spoken about the same thing with Shane Warne when I met him. I wanted to turn the ball like him, I told him. He said I should not bother about spinning more than the size of the bat otherwise I would not gain the edge. Perhaps he said that after having observed my bowling action. He did teach me a few grips, how he used to hold the ball, but he asked me to stick to my own action and focus on my strengths. In modern-day cricket there is no legspinner who turns the ball big.

"The googly and the slider are my favourite type of deliveries and I love it when batsmen try to cut or sweep me"IMRAN TAHIR


What's the process for developing the various deliveries that legspinners bowl?

MacGill: The process is that everybody has their stock ball, which I like to call their best ball. The ball you can fall back on and which you can bowl with your eyes shut. You then understand the angle of the wrist and the angle of the release. That is the only thing that matters. Pace through the air can be generated through your body. You can go a little bit wider or go round the wicket, but the angle of your wrist and point of release determines the type of delivery. There are gentle differences in the degree. If my palm faces the batsman, it's a legbreak. There are no magical deliveries. It's all about the angle of release.

I tried to get one at a time. The first and most difficult one was the googly, so I tried to spend a lot of time developing that. Unfortunately for me, I tried to develop it to the detriment of my legspinner. It took me six months to get my legspinner back. It took me longer to learn the backspinner as I found it difficult to incorporate it into my action. In the end it was one of my better variations.



Mushtaq Ahmed: "I learned drift in the last five years of my career. It was difficult for me because of my action, where my arm was very high" © PA Photos

How important is the stock ball?

Tahir: My belief is whatever be my stock ball, the key is to keep the batsman guessing every ball. I want him to think all the time. I should not be predictable to the batsman. If you spin the ball big like Shane Warne, then you are bound to trouble the batsman. But if you cannot, then you need to play mind games.

Mushtaq: People used to think my googly was my stock ball. As a legspinner, the stock ball for me is the legbreak. I would bowl it with a scrambled seam. Because I had a quick arm action, batsmen could not pick it from the seam or my hand. With experience I brought in the variations to the legbreak. You have to watch the batsman, read him. If somebody plays with hard hands then you have to bowl slow. You have to deceive him with the pace of the ball. If somebody is playing with soft hands you've got to push the ball quicker.

At times you have to bowl legbreaks wide of the crease, sometimes you pitch it from closer to the stumps. In between you bowl a wrong'un and topspinner from the same area, which makes it more difficult for the batsman. If he is good at reading the hand or reading your wrong'un then you should go round the wicket to put a doubt in his mind and then swap to over the wicket.

"The angle of your wrist and point of release determines the type of delivery"STUART MACGILL


Possibly a good example of that strategy could be you getting Michael Atherton out twice, both times on the final day, of the Lord's and The Oval Tests in 1996. You went round the wicket both times. What was the plan?

Mushtaq:I remembered Atherton used to be a legspinner, so he would play with very soft hands. He would easily push me to cover. He would put his front leg outside off stump and that way he would kill or put away my googly. Then I realised that I have to bowl from round the wicket because he is going across. By going round the wicket he would be forced to open up, which he was not used to. He had to play me from the leg stump and consequently he was caught at bat-pad and once at slip.

Can there be a temptation to overuse the googly? During the initial phase of your county career Martin Crowe, the opposition captain, asked his batsmen to play you as an offspinner.

Mushtaq: It really hurt when I was told about Crowe's plan. But what he said proved beneficial for me because I decided that I would improve my legspinner so much that even if they played me like an offspinner I could get them in my sleep. But I must admit that when I realised that a batsman could not read me I used to overcompensate with my googlies. After Crowe made that statement I started to spin my legbreaks more, spin my flippers more, spin my topspinners more. A lot of people would at times misread my topspinner, where the ball would stop and get extra bounce, as a googly.



Tahir: "Legspinners are exciting characters. They change results, they make things happen" © Getty Images

Who were the batsmen you enjoyed bowling most against?

MacGill: The batsman who destroyed spin bowling consistently was Brian Lara. I certainly enjoyed getting him out, though it didn't happen all that often. I liked bowling to him because that was the ultimate challenge. Lara smashed the daylights out of me at Adelaide in the early 2000s and I really lost the plot. I didn't bowl well for the rest of the innings to any batsman and I got dropped from the Australian team. I worked on a few things and then picked him up in Sydney in the first innings and had a dropped catch in the second innings. I could have had him in both innings, which was a good turnaround. I did enjoy that.

I enjoyed bowling to VVS Laxman because he was different and watching him bat was enjoyable. He is a nice guy. Bowling to him, I knew that if I bowled poorly, I'll get destroyed and if I bowled well, it didn't mean I'll necessarily get him out. I loved bowling to him at Melbourne [in 2003-04], where I bowled well. My reaction shows how highly Laxman's wicket was valued by me. I also enjoyed bowling to Rahul Dravid, as in 2003 his batting suddenly changed. I had bowled to him in the past where I could think of certain ways of getting him out. But in 2003 I could not think of ways to get him out.

"People focus on what happens to the ball off the pitch but a great batsman is beaten before the ball pitches"STUART MACGILL


Can you talk a little about how Lara played you differently from other batsmen?
MacGill: He hit me to areas that I hadn't been hit to before. When you're bowling spin, you should aim to hit the top of off stump. So I tried to pitch the ball outside his off stump, because if the ball is turning, the over-the-wicket angle provides you an advantage. The ball was turning a lot in that [Adelaide] match, but Lara was not perturbed about that. He was able to hit me off the front foot anywhere in the arc between mid-off and backward point. It was a sign of his mastery with the bat.

Mushtaq: Brian Lara was the batsman who came close to destroying my confidence. His feet and hands were quick. He could hit even your good balls for four. He has said that he never picked my hand, nor my googly. But his hand-eye coordination was amazing. Lara could hit the ball pitched in the rough in two different places. If the ball was pitched in the rough and spun in, Lara would cut the ball. And if I moved the fielder to defend the cut, Lara would hit the same ball to extra cover. He used to have that much time. If you can cut, sweep, punch on the back foot and use your feet, then you will be successful against a legspinner. Lara was one of them. The other guy was Darren Lehmann. He used to give me a proper hard time both in county cricket and in the few Test matches I played against him.

What do you do when you can't land a ball?

MacGill: It's only happened once to me and it's incredibly embarrassing because you know that you're better than that and you've got to do better not only for yourself but also for the guy at the other end. If I'm bowling absolute rubbish, I'm letting him down, it makes it much more difficult for them to do their job. The best you can do is fall back on your best delivery and hopefully it works.



Anil Kumble didn't turn the ball much but he put in a huge amount of work on the ball to deceive batsmen © Global Cricket Ventures-BCCI

Mushtaq: I have suffered such a fate lots of times, especially when I was under pressure. In such a situation the key is to try and come back to your basics. Do not try to spin the ball too much. At times it could be very cold weather, or when the conditions are wet you cannot grip and control the ball properly. I would shut out the batsman in such a situation. I would not bother about whether he was using his feet, whether he was going to hurt me. I would tell myself: "This is my action. This is where I am going to land."

Tahir: It mostly happens when the conditions are cold. You cannot grip the ball properly and it takes a few overs to warm up and settle down. The other reason can be duress. In my secondTest, against Australia, I could not land the ball consistently because of the pressure. I was bowling full tosses, short balls, but it was the early part of my international career. I bounced back strongly by taking three wickets in that innings.

What role do you see for a legspinner in T20 cricket?

MacGill: Spin bowlers have taken wickets in T20 cricket right since its inception. It's a game that is dominated by the bat but won by the ball. Spinners have dominated T20 cricket because the batsman is obliged to play shots. If you spin the ball, then you open up one side of the field. The batsman has to hit against the spin to hit to the other side. The turn as opposed to the spin is what gives you the advantage in T20 cricket, as you cut down on the scoring options. I don't think it matters whether you're a fingerspinner or a legspinner.

Mushtaq: Not just T20, even in ODIs the more successful spinner is the legspinner, especially with the two new balls. When the legspinner has a new ball he can bounce it, skid it, spin it. Delhi Daredevils played Amit Mishra and Imran Tahir in the IPL this season and both took wickets. In the early part of my career, Imran Khan saab played Qadir bhai and myself a lot in ODIs and a few Test matches. The reason a legspinner is more successful in T20 cricket is because of his variations and the bounce he can derive off the wicket. If a batsman tries to hit a legspinner over mid-on or midwicket you stand a good chance to get a top edge as he's playing against the spin.

Also remember this, if a legspinner can land the ball in a good spot the batsman cannot take an easy single. Against a left-arm spinner or an offspinner you can sweep or step out or push for a safe single to mid-off or mid-on. But against a legspinner the batsman is edgy to sweep for the fear of the ball skidding in or bouncing, or getting stumped if he charges down. If you get two or three dot balls in T20, the batsman starts looking for a boundary, and in that situation a legspinner stands a good chance of taking a wicket.

"Brian Lara was the batsman who came close to destroying my confidence. His feet and hands were quick. He could hit even your good balls for four"MUSHTAQ AHMED

Tahir: You should never have fear in T20. You need to go in with a big heart. You need to back your skills. You need clear plans. Even if you are hit for 20 runs in an over, and this is my advice to a youngster, in the next over by taking two middle-order wickets you can easily finish the game.

What was your favourite mode of dismissal?

MacGill: I loved bowling people, right-handers and left-handers. Obviously right-handers was a little more difficult unless I was bowling the googly. I really enjoyed bowling left-handers, and bowling to left-handers.

Tahir: The googly and the slider are my favourite type of deliveries and I love it when batsmen try to cut or sweep me and while attempting those strokes get lbw or clean bowled. I remember Misbah in the Dubai Test, who I feel had read my googly but was still beaten. It gave me immense joy because Misbah was my state captain in Pakistan when I was a young leggie and despite knowing my bowling and despite having picked the wrong'un, he still went for the shot and was deceived.

Mushtaq: Nothing gave me more joy than watching a batsman who would be lured into attempting a drive against a googly which he could not read and the ball pierced through the gap between his bat and pad and hit the stumps. That was my best moment. My favourite dismissal remains the googly that beat Graeme Hick [lbw] in the 1992 World Cup final. I still enjoy watching that ball. Steve Waugh, if I'm not wrong, was bowled in the Sydney Test [1995-96] trying to drive. David Boon was clean bowled in the Rawalpindi Test [1994-95], again attempting a drive.

The secret to self control - Jonathan Bricker


Sunday, 25 October 2015

From football to steel, we don’t have to be slaves to the market

Will Hutton in The Guardian


The southern corner of Arsenal’s Emirates stadium, reserved for fans from visiting teams, was eerily empty as the game against the Bundesliga champions, Bayern Munich, began last week. Instead, there was a banner. “£64 for a ticket. But without fans football is not worth a penny,” it read. After five minutes, the Bayern Munich fans cascaded into the stands to loud applause from the 60,000-strong home crowd. Everyone knew a powerful point had been made.

Except Arsenal do have a huge fan base and they do pay £64 a ticket because that is the price the market will bear. The clapping against blind market forces came as much from the management consultants, newspaper columnists, media multimillionaires, ex-central bankers and university vice-chancellors who now constitute Arsenal’s home base, as much as painters, plumbers and assembly line workers.

Yet everyone was united in understanding the Germans’ protest. Football has to be more than a money machine. Passion for a club is part of an idea of “we” – a collective identity rooted in place, culture and history – that defines us as men and women. £64 tickets redefine the Arsenal or Bayern Munich “we” as those with the capacity to pay.

Britain in 2015 is in a crisis about who the British “we” are at every level. Decades of being told that there is nothing to be done about the march of global market forces has denuded us of the possibility of acting together to shape a world that we want, whether it’s the character of our football clubs or our manufacturing base.

The same day that the Arsenal crowd was clapping the Bayern Munich fans, Tata Steel announced it was mothballing its steel plants in Scotland and Teesside. Over the last fortnight, Redcar’s steel mill has been shut as Thai owner SSI has gone into receivership, while manufacturing company Caparo is liquidating its foundry division in Scunthorpe. A pivotal component of our manufacturing sector, with incalculable effects across the supply chain, is being shut.

Yet when questioned, business secretary Sajid Javid’s trump answer is that the British government does not control the world steel price. He will, of course, do everything he can to soften the blow and help unemployed steel workers retrain or start their own businesses. But the message is unambiguous. Vast, uncontrollable market forces are at work. The government will not even raise the matter of how China exports steel to Britain at below the cost of production and intensifies the crisis.

It becomes purposeless to talk about what “we” might do because there are no tools for “us” to use. The new world is one in which each individual must look after her or himself. Even the trade unions and new Labour leadership, aghast at the scale of the job losses, do not have a plausible alternative – except to plead that the £9m proposed support package for unemployed steel workers in Scunthorpe is paltry.

There could have been, and still are, alternatives, but they are predicated on a conception of “we” resisted by right and left. A stronger steel industry, more capable of riding out this crisis, could have been created by more engagement with Europe and refashioning the ecosystem in which production takes place.

But since the collapse of Britain’s membership of the Exchange Rate Mechanism in 1992, governments of all hues have abjured any attempt to keep the pound stable and competitive, either pegging sterling against the euro and dollar or even – perish the thought – joining the euro. The pound, except for a short period after the banking crisis, has been systematically overvalued for a generation. Manufacturing production has stagnated as imports have soared. The trade deficit in goods in 2014 was a stunning £120bn, or some 7% of GDP. Yet dissociating Britain from all European attempts to manage currency movements and keeping the independent pound floating is as widely praised by John McDonnell on the left as John Redwood on the right. A devastated manufacturing sector, and now the crisis in the steel industry, is too rarely mentioned as part of the price. Alongside pegging the exchange rate should have been a determined effort to develop areas of industrial strength, with government and business working closely as co-creators. Yet even such a relationship – close to unthinkable in a British context – would have needed business keen on creating value rather than a high share price and a government setting some ambitious targets backed by spending the necessary billions.

Britain, for example, could have had a brilliant civil nuclear industry, a vibrant aerospace sector, the fastest growing windfarm industry, clusters of hi-tech business all over the country – and a hi-tech steel industry. Instead it is no better than a mendicant subcontractor. It does not have a share stake in Airbus, while France and China are building our nuclear power stations. Our green industries, once the fastest growing in Europe, are shutting. Only banks and hedge funds are protected and nurtured in a vigorous, uncompromising industrial policy, but they don’t buy much steel. They are the “we” behind which even ultra-libertarian Sajid Javid will throw the awesome weight of the state. Scunthorpe, Redcar, Teesside and the West Midlands are not; they can go hang.

And yet. Part of the reason the “northern powerhouse” is such a powerful idea is that it redefines the “we” so that the priorities and aspirations of the north are as valid as those of a hedge fund manager or the pampered board of HSBC. It is also obvious that newly empowered public authorities will have to co-create the vision with private partners and work with a Conservative government and the EU. There will be no “northern powerhouse” if it is locked out of European markets, nor is much progress likely with a third-rate transport and training infrastructure. It also needs a prolonged period of exchange rate stability.

Little of this easily fits the categories in which either Javid on the right or McDonnell and Corbyn on the left think. There is a powerful role for public agency and public spending, but it is much less directive, statist and top-down than traditional left thinking. Equally, the driver of any growth has to be vigorous, purposeful capitalism, but one co-created between private and public in a manner foreign to the traditional libertarian right. And there should be no place for hostility to Europe, also part of this reformulated “we”.

In this sense, there is a golden thread between the applause of the crowd in the Emirates and the way the “northern powerhouse” is taking shape, along with dismay at our dependence on China to build our nuclear power stations. There has been too much of a surrender to supply and demand. It is time to shape markets and football leagues alike. There is a “we”. It could be different.

Saturday, 24 October 2015

My atheism does not make me superior to believers. It's a leap of faith too

Ijeoma Olua in The Guardian

 
I don’t believe in a higher power, but the fact we’ve never proven there isn’t one means there could be a God.

There are many different ways in which people come to atheism. Many come to it in their early adult years, after a childhood in the church. Some are raised in atheism by atheist parents. Some come to atheism after years of religious study. I came to atheism the way that many Christians come to Christianity – through faith.

I was six years old, sitting in my frilly yellow Easter dress, throwing black jelly beans out into the yard, when my mom explained the story of Easter to me. She explained Jesus’s crucifixion and resurrection as the son of God, going into great detail. And when she was finished telling me the story that had been a foundation of her faith for the majority of her life, I looked at her and said: “I don’t think that really happened.”

I didn’t come to this conclusion because the story of a man waking from the dead made no sense – I wasn’t an overly analytical child. I still enthusiastically believed in Santa Claus and the Easter bunny. But when I searched myself for any sense of belief in a higher power, it just wasn’t there. I wanted it to be there – how comforting to have a God. But it wasn’t there, and it isn’t to this day.

The same confidence that many of my friends have in the belief that Jesus walks with them is the confidence that I have that nobody walks with me. The cold truth that when I die I will cease to exist in anything but the memory of those I leave behind, that those I love who leave are lost forever, is always with me.

These are my truths. I don’t like these truths. As a mother, I’d give anything to believe that if anything were to happen to my children they would live forever in the kingdom of a loving God. But I don’t believe that.

But my conviction that there is no God is nonetheless a leap of faith. Just as we have been unable to prove there is a God, we have also been unable to prove that there isn’t one. The feeling that I have in my being that there is no God is what I go by, but I’m not deluded into thinking that feeling is in any way more factual than the deep conviction by theists that God exists.

I keep this fact in mind – that my atheism is a leap of faith – because otherwise it’s easy to get cocky. It’s easy to look at acts of terror committed in the names of different gods, debates about the role of women in various churches, unfamiliar and elaborate religious rules and rituals and think, look at these foolish religious folk. It’s easy to view religion as the root of society’s ills.

But atheism as a faith is quickly catching up in its embrace of divisive and oppressive attitudes. We have websites dedicated to insulting Islam and Christianity. We have famous atheist thought-leaders spouting misogyny and calling for the profiling of Muslims. As a black atheist, I encounter just as much racism amongst other atheists as anywhere else. We have hundreds of thousands of atheists blindly following atheist leaders like Richard Dawkins, hurling insults and even threats at those who dare question them.

Look through new atheist websites and twitter feeds. You’ll see the same hatred and bigotry that theists have been spouting against other theists for millennia. But when confronted about this bigotry, we say “But I feel this way about all religion,” as if that somehow makes it better. But our belief that we are right while everyone else is wrong; our belief that our atheism is more moral; our belief that others are lost: none of it is original.

Perhaps this is not religion, but human nature. Perhaps when left to our own devices, we jockey for power by creating an “other” and rallying against it. Perhaps we’re all part of a system that creates hierarchies based on class, gender, race and ethnicity because it’s the easiest way for the few to overpower the many. Perhaps we all fall in line because we look for any social system – be it Christianity, Islam, socialism, atheism – to make sense of it all and to feel like we matter in a world that shows time and time again that we don’t.

If we truly want to free ourselves from the racist, sexist, classist, homophobic tendencies of society, we need to go beyond religion. Yes, religion does need to be examined and debated regularly and fervently. But we also need to examine our school systems, our medical systems, our economic systems, our environmental policies.

Faith is not the enemy, and words in a book are not responsible for the atrocities we commit as human beings. We need to constantly examine and expose our nature as pack animals who are constantly trying to define the other in order to feel safe through all of the systems we build in society. Only then will we be as free from dogma as we atheists claim to be.

Friday, 23 October 2015

Portugal's anti-euro Left banned from power


Constitutional crisis looms after anti-austerity Left is denied parliamentary prerogative to form a majority government


Ambrose Evans Pritchard in The Telegraph

Portugal has entered dangerous political waters. For the first time since the creation of Europe’s monetary union, a member state has taken the explicit step of forbidding eurosceptic parties from taking office on the grounds of national interest.


Anibal Cavaco Silva, Portugal’s constitutional president, has refused to appoint a Left-wing coalition government even though it secured an absolute majority in the Portuguese parliament and won a mandate to smash the austerity regime bequeathed by the EU-IMF Troika.


He deemed it too risky to let the Left Bloc or the Communists come close to power, insisting that conservatives should soldier on as a minority in order to satisfy Brussels and appease foreign financial markets.

  “In 40 years of democracy, no government in Portugal has ever depended on the support of anti-European forces, that is to say forces that campaigned to abrogate the Lisbon Treaty, the Fiscal Compact, the Growth and Stability Pact, as well as to dismantle monetary union and take Portugal out of the euro, in addition to wanting the dissolution of NATO,” said Mr Cavaco Silva.








“This is the worst moment for a radical change to the foundations of our democracy.

"After we carried out an onerous programme of financial assistance, entailing heavy sacrifices, it is my duty, within my constitutional powers, to do everything possible to prevent false signals being sent to financial institutions, investors and markets,” he said.

Mr Cavaco Silva argued that the great majority of the Portuguese people did not vote for parties that want a return to the escudo or that advocate a traumatic showdown with Brussels.

This is true, but he skipped over the other core message from the elections held three weeks ago: that they also voted for an end to wage cuts and Troika austerity. The combined parties of the Left won 50.7pc of the vote. Led by the Socialists, they control the Assembleia.

The conservative premier, Pedro Passos Coelho, came first and therefore gets first shot at forming a government, but his Right-wing coalition as a whole secured just 38.5pc of the vote. It lost 28 seats.


Newly re-elected Portuguese prime minister Pedro Passos Coelho

The Socialist leader, Antonio Costa, has reacted with fury, damning the president’s action as a “grave mistake” that threatens to engulf the country in a political firestorm.

“It is unacceptable to usurp the exclusive powers of parliament. The Socialists will not take lessons from professor Cavaco Silva on the defence of our democracy,” he said.

Mr Costa vowed to press ahead with his plans to form a triple-Left coalition, and warned that the Right-wing rump government will face an immediate vote of no confidence.

There can be no fresh elections until the second half of next year under Portugal’s constitution, risking almost a year of paralysis that puts the country on a collision course with Brussels and ultimately threatens to reignite the country’s debt crisis.

The bond market has reacted calmly to events in Lisbon but it is no longer a sensitive gauge now that the European Central Bank is mopping up Portuguese debt under quantitative easing.

Portugal is no longer under a Troika regime and does not face an immediate funding crunch, holding cash reserves above €8bn. Yet the IMF says the country remains “highly vulnerable” if there is any shock or the country fails to deliver on reforms, currently deemed to have “stalled”.

Public debt is 127pc of GDP and total debt is 370pc, worse than in Greece. Net external liabilities are more than 220pc of GDP.



The IMF warned that Portugal's “export miracle” remains narrowly based, the headline gains flattered by re-exports with little value added. “A durable rebalancing of the economy has not taken place,” it said.

“The president has created a constitutional crisis,” said Rui Tavares, a radical green MEP. “He is saying that he will never allow the formation of a government containing Leftists and Communists. People are amazed by what has happened.”

Mr Tavares said the president has invoked the spectre of the Communists and the Left Bloc as a “straw man” to prevent the Left taking power at all, knowing full well that the two parties agreed to drop their demands for euro-exit, a withdrawal from Nato and nationalisation of the commanding heights of the economy under a compromise deal to the forge the coalition.


President Cavaco Silva may be correct is calculating that a Socialist government in league with the Communists would precipitate a major clash with the EU austerity mandarins. Mr Costa’s grand plan for Keynesian reflation – led by spending on education and health – is entirely incompatible with the EU’s Fiscal Compact.


The secretary-general of the Portuguese Socialist Party, Antonio Costa, appears on Saturday after the election results are made public Photo: EPA

This foolish treaty law obliges Portugal to cut its debt to 60pc of GDP over the next 20 years in a permanent austerity trap, and to do it just as the rest of southern Europe is trying to do the same thing, and all against a backdrop of powerful deflationary forces worldwide.

The strategy of chipping away at the country’s massive debt burden by permanent belt-tightening is largely self-defeating, since the denominator effect of stagnant nominal GDP aggravates debt dynamics.

It is also pointless. Portugal will require a debt write-off when the next global downturn hits in earnest. There is no chance whatsoever that Germany will agree to EMU fiscal union in time to prevent this.

What Portugal needs to pay off (Source: Deutsche Bank)

The chief consequence of drawing out the agony is deep hysteresis in the labour markets and chronically low levels of investment that blight the future.

Mr Cavaco Silva is effectively using his office to impose a reactionary ideological agenda, in the interests of creditors and the EMU establishment, and dressing it up with remarkable Chutzpah as a defence of democracy.

The Portuguese Socialists and Communists have buried the hatchet on their bitter divisions for the first time since the Carnation Revolution and the overthrow of the Salazar dictatorship in the 1970s, yet they are being denied their parliamentary prerogative to form a majority government.

This is a dangerous demarche. The Portuguese conservatives and their media allies behave as if the Left has no legitimate right to take power, and must be held in check by any means.

These reflexes are familiar – and chilling – to anybody familiar with 20th century Iberian history, or indeed Latin America. That it is being done in the name of the euro is entirely to be expected.

Greece’s Syriza movement, Europe’s first radical-Left government in Europe since the Second World War, was crushed into submission for daring to confront eurozone ideology. Now the Portuguese Left is running into a variant of the same meat-grinder.

Europe’s socialists face a dilemma. They are at last waking up to the unpleasant truth that monetary union is an authoritarian Right-wing enterprise that has slipped its democratic leash, yet if they act on this insight in any way they risk being prevented from taking power.

Brussels really has created a monster.