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The Obscurer Donald S writes an open letter to his gas supplier. Dear Atlantic Gas Quick question about a letter you just sent me last week, dated October 2008. I don’t understand how you can write to me in October telling me that gas prices “will” (future tense) increase from 25 August 2008 (2 months ago). This is gas I’ve already used at an agreed price. You surely aren’t allowed to raise prices retrospectively for goods I’ve already bought? After all, PC World can’t come and call on me for an extra tenner for that Epson printer they sold me at 49.99 last month. Why are you allowed to do the equivalent? I know the feeling, or rather I know a similar feeling. We recently received our statement from British Gas wherein they announced that it was their sad duty to inform us that our direct debit payment would be increasing from £63 to £87 a month. Curious, I thought, since the statement showed that we are over £120 in credit with them as it is, having paid them £189 this quarter while using £50 worth of gas; but winter’s a-coming, and as they explained, over the last 6 months wholesale gas prices has risen by over 60%, and British Gas’s new prices came into effect on the 30th of July, so this explains the dramatic rise. Or does it? Because it was only three months ago in our previous statement that British Gas said they were increasing our monthly payment from £42 to £63, when we were just £15 in debit at the time and heading into those lean summer months. So how can a 60% increase in the price of gas in the last 6 months translate into a doubling of our monthly payment in the course of 3 months? Well, it evidently can, but it shouldn’t. Perhaps they just want my money to be earning interest in their bank account rather than in mine. British Gas helpfully included a little brochure with our statement explaining how they work out the monthly direct debit charge, taking into account gas usage as averaged over the year, long term weather forecasts, current payment levels and so on. It’s pretty easy to work out, I can only think it a shame that the cack-handed all-fingers-and-thumbs numpty with the calculator who came up with our new monthly figure must have done it last thing on a Friday when his mind was already in the pub and without him referring to any of our previous statements. Now I know that I could phone up British Gas and point all this out to them, perhaps ask if they can come up with a more sensible payment figure which has some basis in reality, but I’ve been there before and I have bad memories of the last time I tried such a tack. The friendly call handler agreed that the new payment at the time of £45 was indeed way too high and she said she would lower it to more a common sense figure of £28. Job done. In fact all that happened was that we continued to be charged £45 but our payment date moved from the 1st of the month to the 28th, meaning we actually paid them £45 twice in the month they made the change. Once bitten, and all that, so I’m leaving it be for now. Instead I can guarantee that history will repeat itself in another way; come April, British Gas will realise, not for the first time, that we’ve massively overpaid for the gas we’ve used, they’ll again send us a cheque to repay what they owe us, and then they’ll once more concoct a brand new but lower monthly direct debit payment, but this time one so low that it won’t even come close to covering our consumption of gas. Then, and only then, will I be tempted to call them up and tell truth about enzyte them not to bother, that they can spare themselves the effort; I’ll reach for that handy guide to how they figure out the monthly direct debit and I’ll do their work for them, simply presenting them with my new, higher, reality-based monthly charge and telling them that they can like it or lump it. Either that or I’ll just pluck a new figure out of mid air, for all the difference it would make. Gove [gōv] v.i. to stare stupidly. eg. The Shadow Secretary of State for Children, Schools and Families was happy to criticise government policy, but could only gove when asked to describe how his party would do things differently. No, really. (Hat-tip: Mrs. Quinn) I think it’s great that David Cameron is a “man with a plan” just now; I only wish he wasn’t being so coy about telling us what it is. Why the secret? Why so hush-hush? If I had a plan right now then believe me I’d be boring the pants off everybody by spelling out exactly what it entails; you wouldn’t be able to shut me up! So come on David; spill the beans! Great as this plan of yours undoubtedly is, it won’t do us any good locked up inside your head. Justin “can’t think of a single thing to say” about Cameron’s speech. I can’t do much better. The only thing I took away from his performance is that neither he nor his speechwriters can own Stevie Wonder’s finest, seminal LP Innervisions. Or else they haven’t played it all the way through. Or if they have then they can’t have listened very closely to the lyrics. Anyway, I’ve had “He’s Misstra Know-It-All” buzzing around in my head since Cameron made his speech, so here are a few choice lines from the song. Makes a deal / With a smile / Knowin’ all the time that his lie’s a mile Must be seen / There’s no doubt / He’s the coolest one with the biggest mouth Any place / He will play / His only concern is how much you’ll pay If he shakes / On a bet / He’s the kind of dude that won’t pay his debt Take my word / Please beware / Of a man that just don’t give a care If we had less of him / Don’t you know we’d have a better land He’s Misstra Know-It-All (Look out he’s coming) I find that last line quite chilling. Is this really what Cameron wants to be associated with? Was this done my accident or design? Let’s just hope that Cameron’s team are unaware of this song, since the alternative is that they know what they’re doing and they are giving themselves an option so that at some point in the future, as Cameron’s premiership dissolves in a solution of derision and resentment, they can turn around, refer us to that famous phrase from his historic 2008 conference speech, and say “well the clues were all there; don’t say we never warned you”. Now, you may violently disagree with the conclusion that I have drawn here. If so then I respect that and I will know what you’re thinking; that this is just lazy blogging, that I’m being unfair and dismissive. Fair enough; but all I will say is that in all honesty, while I agree that both Talking Book and Songs In The Key Of Life are excellent works in their own right, I genuinely think that Innervisions just about has the edge. Last week in an interview shadow Chancellor George Osborne revealed how the Prime Minister had barely spoken to him since they fell out three years ago over a Parliamentary vote, when Mr Osborne refused to cover for the then-Chancellor by pairing with him. That’s intended to reflect badly on Gordon Brown, no doubt, but I don’t see why. If I regularly had to deal with Osborne in a professional capacity then I too would be looking for any flimsy excuse to wriggle out of my responsibilities. There is something I find instinctively dislikeable about the man, and you should remember my bias when you read this post. However, I tried to listen to his conference speech yesterday with an open mind. I’m not sure I succeeded. Last year you’ll recall Osborne’s pledge to raise the threshold on inheritance tax brought the house down, prompted a surge in popularity for the Tories, and made Brown abandon any plans he had of holding a general election. The question now was whether Osborne could repeat the feat this year. The headline grabber this time around was a proposed freeze in council tax; this was unfortunate, from a Tory point of view, as the “Labour has done it again” comment reflecting on the current economic crisis seemed to me to be a far more effective bit of political rhetoric and a fine narrative to run with. Instead, for those who could be bothered to get past the “credit crunch” news headlines to read about the Conservative party’s conference the main point they will have taken away is that the Tories have come up with a convoluted dog’s dinner of a proposal that is not really a council tax freeze at all. How it will play out in the country only time will tell, but I really have my doubts about the policy. Anything that is apparently paid for by those damned elusive “efficiency savings”, located as they are somewhere between the holy grail and the golden fleece, has to be questioned. The savings that have been mentioned include cutting advertising, regional agencies and management consultants; but I’d be amazed if advertising spending amounts to all that much, cutting regional agencies while increasing central government funding to councils seems a retrograde, centralising step, and while you would be hard pressed to find anyone with a lower opinion of management consultants in general as I have, the idea that we can just sweep them all away at a stroke to cut costs seems absurdly naïve. All this, by the way, while on the other hand Osborne announced setting up the independent “Office for Budget Responsibility” to monitor government’s fiscal policy and shadow Health spokesman Andrew Lansley trailed the creation of “Healthwatch” to act as “a national consumer voice” for the NHS. I assume neither of these bodies will be charities staffed by volunteers. The reason for such an odd plan – to freeze council tax rather than to simply cut taxes – is because of the gloomy economic situation we are in, and to hammer home the fact that the Conservatives are serious politicians, hampered by Labour’s legacy of profligacy, and are not merely reckless tax cutters. “We will make sure that this mess never happens again,” assured Osborne, making a promise he must know he cannot keep, or perhaps mindful that he can always claim that a completely different mess happened to occur on his watch. But for the here and now “the cupboard is bare,” he lamented; there is simply no money for any “up-front tax giveaways”. While he managed to lower his voice from his usual shrill whine in a stab at gravitas, he admitted he could not promise to similarly lower taxes, and indeed elsewhere he has said that he may even have to raise them. But just a minute; I thought the Tories had pledge to cut taxes, or at least to cut a tax; for cast you mind back a year and that is effectively what the promise to raise the threshold on inheritance tax to £1m amounts to. Opinion polls still regularly attest that this is a hugely popular move, thought I’ve never quite been able to figure out why; but as the Tories ladle on the dire news that they cannot promise tax cuts overall, the fact that they can promise one for the richest 6% of estates seems all the more inequitable. The more the Tories lower their voices and talk of lean times for all the more that pledge on inheritance tax seems to stick out like a sore thumb. So how come the support? How have they got away with such a freebie for a rich minority? Where is the sense of righteous moral outrage? The promise to raise the threshold on inheritance tax has rightly been seen as a turning point in Conservative fortunes that has helped to propel them towards government. But if this is the only tax cut that George Osborne can promise while admitting that taxes overall may have to rise, then rather than being a popular vote winner that pitches him into 11 Downing Street this policy should really have 94% of us reaching for the pitchforks, the torches, the tar and the feathers. I’ve largely kept out of discussions about the current financial crisis, and in a bit I may well wish I had maintained that position. I try not to talk about issues I don’t really understand, and international finance is certainly one of those issues. On the rare occasions when my eyes don’t glaze over at the merest mention of short selling and hedge funds my grasp of the subject itself is at best tenuous. Still, that doesn’t stop opinions from bubbling up within me from time to time in need of release, and this blog seems the obvious place to do that very thing. And I like The Economist, I do, although I often skip the Finance section. I’ve subscribed to it for a number of years and I intend to continue. But good God does it have its faults. Don Paskini, for example, wasn’t far of the mark when he said I’ve heard people say [The Economist] is very good because of its international coverage. On closer inspection, its international coverage turns out to be articles from round the world about the need to cut taxes, privatise services and deregulate in [insert country here]. And I have nothing against cutting taxes, privatising services and pruning regulation myself, but The Economist tends to hold so dogmatically to these ideas, laughably so at times, and so it can be easy to dismiss a paragraph here or an article there as simply lazy space filling plucked from the ideological section of their style guide, where the “public sector” anywhere is always “bloated” – or at the very least “inefficient” – and so to blame for whatever failure is imagined, even if the failure appears to be of the market rather than of government. So to this week’s Economist leader, discussing, of course, the recent financial problems. And it’s fine stuff in the main, much I agree with. But then, towards the end, we read Regulation is necessary… But naive faith in regulators’ powers creates ruinous false security. Financiers know more than regulators and their voices carry more weight in a boom. Banks can exploit the regulations’ inevitable blind spots: assets hidden off their balance sheets, or insurance (such as that provided by AIG) which enables them to profit by sliding out of the capital requirements the regulators set. It is no accident that both schemes were at the heart of the crisis. And that’s fair enough in the main. Of course a naive faith in the regulator is wrong. But is that any worse than the naive faith that financiers “know more than regulators”? It is touching that The Economist still feels emboldened to make such a bald assertion in these times, but haven’t bankers pissed away any unquestioning faith that once went their way? I’ve never met a generalisation I didn’t hate (even if I issue as many as anyone) and this simple comment crystallises the bugbear I have with some of the recent comments on the financial crisis. I mean, if financiers are that much better than the regulators then they have done a good job of hiding it recently, especially considering their risks. After all, bankers have a far greater incentive than regulators not to fuck up royally, so what is their excuse? It is gratifying, in a way, to find out that those described by some as the very cream of the global market for “talent” can be quite as inept in their field of expertise as I am in mine. (And not just inept. In an article I read somewhere last week one particularly brainy employee from the UK arm of Lehman Bros. complained about the better treatment the US employees were receiving and so vowed never to work for an American company again. What a clot.) The credit crunch can appear at times to be a canvas on which one can project whatever opinions one already holds; or at least that seems to be the case judging by some newspaper opinion pieces and from within the echo chambers of the blogosphere where sober analysis is at a premium. Perhaps the only change in some has been a new found acknowledgement that government can be good for something (ie. good for $700bn.) On the one hand those opponents of capitalism, markets and globalisation have been handed their ammunition on a plate; but the joyful conclusions drawn, that rapacious capitalism is fucked and global finance cracked beyond repair, are simplistic and flawed. At least I hope they are, as does the manager of my pension fund. In reality we will get through this; there will be changes to regulation, lessons will be learned, and then we will carry on again in our own sweet way until the next financial crisis, when it will be realised that we overlooked something else again. It is the opposing views that interest me more however since they seem more perverse; the defensive glossing-over and scapegoating that has gone on, the search for blame that fits in with existing prejudices. Hence in some we see the pointed criticism of the regulators given more weight than the grudging criticism of the financiers, reminiscent of the way voices complaining about the failures of a social worker can drown out those criticising the parents of an abused child; how for some it is the police rather than the murderer that is are more to blame when they fail to prevent a stabbing, or it is in fact the terrorists’ fault when the police feel forced to mistakenly gun down an innocent. It is to be expected, no doubt, but it drives me up the wall. So we hear this bleating that the regulators have failed, which they have to an extent; but it is a second degree failing let’s not forget. We are then warned repeatedly that if there are to be any regulatory changes we should ensure that they are appropriate and not of the knee-jerk variety, that there is a danger in bad regulation, or too much regulation. Do we need such statements of the bleeding obvious? To those I sense are still instinctively opposed to regulation then it seems the answer is “yes we do”. But an excess of anything is bad, and to voice such a truism adds nothing of any real value to the debate. We know that water is essential to human life, but also that drinking too much of it or drinking it badly can be fatal; we don’t need to be told this, and I would suspect anyone who felt the need to state something so basic to be either a simpleton or to be trying to diverting attention from something. Look, a bird! Obviously we need regulation that is as “just right” as Baby Bear’s porridge, but we can take that as read. We know all this. And we also know that Goldilocks is a fairy tale. Some critics go further, however, and blame regulators and central banks for not only failing to prevent the current crisis but for helping to create it, which can seem like just another bit of blame shifting to me. So the argument is made that existing regulation is bad because it made banks look for weaknesses in the regulators’ armour, to hide items off balance books and away from regulators’ prying eyes, to surreptitiously duck capital requirements and to be forced into a lack of transparency which is where much of the damage was done. They just couldn’t help it, bless them. But isn’t it the height of naivety to believe that if there wasn’t such regulation the banks’ actions would all be honest, above board, adequately insured and funded? Isn’t this like blaming the number of dogs killed in illicit dog fights on the law banning dog fighting in the first place; to then draw the conclusion that this problem would never have occurred at all if dog fighting hadn’t been made illegal, so forcing it to operate underground; and to then warn against any tougher enforcement of the existing law as that may exacerbate the problem? Well, that makes about as much sense to me. As for central banks, there is a general belief that Alan Greenspan helped create our predicament by cutting US interest rates too low and holding them down for too long in response to earlier crises; but how comforting to be so wise after the fact. Sure, these criticisms of Greenspan were always there, and kudos to the people who have held onto this opinion through thick and thin, but this was always a miniscule minority view, barely audible when he retired from the Fed to almost universal acclaim. Now this complaint is pretty much the consensus position, and other central banks have also shared in the blame for having too loose a monetary policy (but with less justification as far as I can tell.) The impression given is that keeping interest rates higher during, say, the dot com boom, would have been the obvious cost-free policy solution without any further consequences; and it may have been. But it also may have tipped the world into recession there and then, we just don’t know. Gordon Brown’s announcement of no return to boom and bust was always a hostage to fortune, but in all fairness developed countries have seen more of a period of sustained growth rather than a boom over recent times (asset prices notwithstanding) and higher interest rates could have put that at risk. It is easy to suggest different policy decisions in hindsight knowing they cannot be enacted and that no ill can befall the economy as a result. Which is not to say that central banks didn’t make mistakes and perhaps did keep interest rates too low for too long, but even then surely this can only lay the groundwork and create the conditions that allowed the banks to chase illusionary pay days and to lose sight of their own risk management; there was no compulsion, no one put a gun to the financiers’ head. I’m not seeking to have a go at the banks here, or to seek to deny the important work they do, it’s just that they are at the heart of the storm and those that failed should take the bulk of the blame regardless of whatever else was going on around them; the fact that others were at fault should be an aside, not the set-piece soliloquy that some have sought to make it. After all, do we blame the proprietor of the All-You-Can-Eat Chinese Buffet when we pig ourselves sick? Do we say that it is Wetherspoon’s fault that their cheap beer leads some people to empty their stomach’s contents in a taxi at four in the morning? Some may, but they’re dicks. Whatever happened to personal responsibility? I’ll go now as I have wittered on for too long and I now appear to be drowning in a sea of weak analogies. All I will add is that in common with most people my opinion hasn’t shifted with events. I believe in a mixed economy, in the power of the market and in the necessity of government; they both have their role, they both have their faults, and I don’t like seeing people trying to shift the blame from one to the other, not when it doesn’t seem deserved and not when it looks like a transparent attempt to deflect attention and to defensively bolster one’s own ideology. Well you’re due a short post after my recent extended blatherings, so here it is. And I guess I can’t really complain, viewing pay-TV for free via the internet, piggy-backing parasitically on someone else’s football feed. But still and all, it’s a bit annoying while watching a match to find a bit of editorialising suddenly popping up, obliterating a half of the screen.
It could be worse, though. A previous interruption, that I was too slow to catch, declared, “Bin Laden is a Gooner”. Also, I never actually missed a goal because of such anti-Arsenal interventions, although then again I was eating my tea while listening to GMR at those specific times. It’s still better than paying for Sky, mind. Someone kindly left Tuesday’s copy of the Daily Express lying around at work, and I present the front-page story to you now as a kind of public service; for in these uncertain economic times, who knows? Should we find ourselves having been made redundant we may have to consider applying for all sorts of jobs that we wouldn’t otherwise look twice at; and if the job centre advertises a vacancy for an Express hack then we may have to swallow our pride in the pursuit of being able to put bread on the table. Tuesday’s paper, then, could prove invaluable, providing for the uninitiated a perfect template for creating an Express lead story, and if you stick to this script then you could get a head start in the interview and selection process. Now, I must point out that I am well aware that the tabloids engage in far more disgraceful behaviour that that featured in this story – see Anton Vowl, for example, on the handling of the recent terror trial – but Tuesday’s paper was a more typical example of what you would be expected to write if employed by the paper, and so is the perfect beginners’ guide. And anyway, it was the only paper I found discarded by an obliging colleague this week. First the headline: “NOW THEY WANT TO BAN YOUR LAWN”. No they don’t, reply the sane; but remember we’re dealing with Express readers here, so this headline is perfect. At this point a normal person would probably want to skip to the end of the article, to find out the truth in the story which is no doubt completely at odds with the headline; but where’s the fun in that? The story itself concerns the idea that An army of town hall snoopers could soon be telling people what they can and cannot grow in their gardens. Fast-growing plants and even lawns could be banned, under Labour’s latest environmental blitz. People would be forced to get planning permission to make changes in their gardens in order to help the Government hit its targets for reducing waste. Town hall snoopers, of course, are just the latest group to join Muslims and asylum seekers in drawing the Express’s ire, usually for invoking the RIPA to engage in the sort of surveillance that private sector firms like insurance companies can conduct without any such regulation whatsoever. Foolishly, councils have been going around attempting to fulfil their remit and legal obligations by, say, trying to prosecute respectable middle-class people when they have commited a littering offence, whereas we all know that only feral youths should be punished and face the full force of the law. At this point you may feel there is a need to flesh out this story with a fact or two, perhaps even present some evidence such as a quotation or excerpt from some document detailing any plans. Don’t. Get straight into the quotes from the usual suspects denouncing the proposals, no matter how flimsily you have presented the case. First up you’ll need a compliant Tory MP, in this case Bob Neill, the local government spokesman. Are they really expecting hardworking people to go along to the council to get building regulation consent to plant their rhododendrons? This is another example of the heavy hand of Labour needlessly meddling in people’s lives. .
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