|  |
Home |  | |
News | | |
Events | | |
Contact Us | | |
Links | | |
John's blog | | |
Photo Gallery | |
|
In this section
- News RSS |
|
Comments are now enabled Sunday, 07 March, 2010
I have been busy clearing the decks and finishing off the contract I have been working on. I have spent many years working as a Contract Accountant and in my time I have worked in both the private and public sectors. In most cases I have found the staff I have worked with to be dedicated, hard working and just want to be left alone and do their job. The most recent contract I have just finished was no exception and in a way I was sad for the contract to end. However, the election is upon us, probably only 8 weeks away so it’s time to focus fully on that.
Tuesday, 02 March, 2010
Being a bit of a ship nut, in case you hadn’t noticed, I came across this superb story that sets out yet again the inherent flexibility of Aircraft Carriers (for more detailed assessments of the value of carriers see the blog on 30th April and 6th August 2009). It is the reported reply of a US Navy Admiral to a foreign admiral on the news that the US Navy was going to send a carrier to join the rescue efforts in Haiti.
The foreign admiral asked “What are you going to do – bomb them?”
The reply from the US Admiral was:
“Our carriers have three hospitals on board that can treat several hundred people; they are nuclear powered and can supply emergency electrical power to shore facilities; they have three cafeterias with the capacity to feed 3,000 people three meals a day; they can produce several thousand gallons of fresh water from sea water each day, and they carry half a dozen helicopters for use in transporting victims and injured to and from their flight deck. We have eleven such ships; how many do you have?”
I couldn’t have put it better myself, carriers are not cold war relics they are incredibly flexible platforms with a variety of uses.
On the back of the latest opinion polls the markets are letting us know what they think of a hung parliament. Sterling fell through the psychologically important €0.90 cents to the pound level yesterday and it was also sinking against the dollar. Even scarier was the fact that the Gilt market opened down as well. The market has already removed the Triple-A rating on UK government debt.
Remember there was a time last year when the money nearly stopped coming out of the hole in the wall machine. It still is because we are borrowing so much of it, and in order to lend markets need to have confidence. If they lose confidence then they may stop lending and then we are in a very sticky situation indeed.
Monday, 01 March, 2010
Copy of letter sent to the Evening Mail today. Dear Sir, I refer to the letter by Colin Thomson published in the Evening mail on 27th February 2010.
When I asked the question to Mr. Woodcock on when he expected the build of the Trident Successor boats to commence I had hoped that he would actually provide the date himself, and it was the fact he didn’t that I found most interesting. The original timetable was always seen as challenging and this was clearly stated in the NAO Report: ‘The UK Future Nuclear Deterrent Capability’ published in November 2008. It said that the design of the submarines needed to pass their ‘Initial Main Gate’ in September 2009 in order to meet the very tight build timetable. This deadline was missed and the project is therefore now delayed by however long it takes to get the designs through this gate.
In addition, the Astute programme has been delayed by a total of 4.5 years (9 months per boat for boats 2-7). This was published on 16th December 2009 in the ‘NAO Report: ‘Defence Major Projects HC 85I- 2009/10’.
The honest facts are that because the Astute and the Trident Successor programmes are both already delayed by this Government, it is nothing more than untruthful scare mongering to claim the Tories will delay it by five years.
Honesty and facts are what matter, not spin, deceit and silly grandstanding by the Labour party who claim we will delay, whilst ignoring the fact that it is they who are already delaying these projects.
Yours faithfully
John Gough
Friday, 26 February, 2010
Before anyone gets over excited by the news that the UK growth rate for the last quarter of 2009 has been revised from 0.1% to 0.3%, take a look at the equivalent US figures for the period.
The US has revised the growth rate of US GDP for Quarter 4, 2009 to 5.9%, up from its initial reading of 5.7%.
We were not best placed for the recession, and we certainly are not leading the world out of recession, this is Labour’s toxic legacy.
Thursday, 25 February, 2010
George Osborne made a very interesting speech last night on economic policy. You may not agree with his arguments but it clearly set out and, to my knowledge, the only speech that has mentioned ‘theory of Ricardian equivalence’ which will send a shiver of excitement down every economist’s spine. You can read the full speech here:
http://www.conservatives.com/News/Speeches/2010/02/George_Osborne_Mais_Lecture_-_A_New_Economic_Model.aspx
The Authentic Voice of Socialism (part 6)
Meanwhile, never one for the discussing important subjects, such as just how did the UK get into it’s current predicament and more importantly how do we get out of it, the Daily Mirror has been busy digging up dirt on David Cameron.
Once again displaying the nasty streak than runs through crappy socialist rags like this, it proclaims ‘Dave the Dunce’ and then proceeds to mock him because apparently he wasn’t top at school. Of course it would be beyond the wit of the Mirror to realise that the Left are supposed to support people in this situation and congratulate them when they get over problems such as this, or does that only apply to those, in it’s infinite wisdom, the Mirror deems fit to be worthy. So much for the concepts of respect and equality to all people regardless of background, which the Left likes to proclaim is one of its progressive values.
I have two words on this story for the Daily Mirror……..so what!
I dislike this despicable rag so much, mainly because they faked pictures of British soldiers abusing prisoners that I will not darken my website with a link to this story but I am sure you can find it on their website.
Wednesday, 24 February, 2010
You may have noticed that I have not blogged this week, this is because at 2pm on Monday my Uncle Jack died, he was 79 years old. He wasn’t actually a real uncle, just my dad’s oldest friend from his Navy days. They met on the day they joined up in 1949 and were demobbed on the same day. They never actually served together, my Dad was in the Atlantic fleet and Uncle Jack went to the Far East fleet. My Dad was fond of telling a story about how he used Uncle Jack’s hat as an ashtray on the train as they travelled home after leaving the Navy.
I have many fond memories of him, he loved to debate and was a solid traditional Labour man, and I spent my teenage years arguing with him. When I last saw him, about 4-5 weeks ago he was his usual self, argumentative, funny and full of life
He was my first character reference when I applied for a job and he most recently performed this duty when he was a referee for me applying to join the Conservative Party candidate list.
I will miss him and one of my life’s constants has gone.
Anyway, this explains why I haven’t been blogging this week.
Sunday, 21 February, 2010
The recession officially, according to the usual way of measuring them, came to an end a few weeks ago when the ONS posted that the economy had grown by 0.1% in the last quarter of 2009 so this seemed to be a relevant time to post some comments on the experience. The facts are that this was the longest and deepest recession since before the war. GDP fell by some 5-6% over the last 18 months and Britain was the first in and last out of the major economies. It was triggered by the credit crunch when a number of banks got into difficulties over their lending. As banks could not collect what was due to them, they stopped lending to each other, and like a virus the credit crunch spread around the worldwide banking system.
Government stepped in to save the banks and try to restore some stability and start lending again. What started as a monetary phenomenon as cash flowing around the system froze up turned into a full blooded recession as businesses and individuals couldn’t get finance. Further monetary measures were taken with the reduction in interest rates to all time lows as various Governments tried to kick start lending and spending.
Some Governments, ours included, went further and seeing the fall in demand responded in the time honoured Keynesian fashion and attempted to boost demand with fiscal measures. The UK Government cut VAT by 2.5% and introduced various schemes such as the car scrappage scheme to boost spending. When it was apparent that lending was still not growing the UK Government started the process of Quantitative Easing (QE), or printing money, and in total some £200bn has been pumped into the system this way.
So what has all this action achieved?
Well, the UK Government will claim things would be much worse if they had not taken this action or if they had taken a different course of action. However given that, unemployment has continued to rise (though not as much as originally expected for reasons I will explain below), lending is still not happening, the economy only grew by an anaemic 0.1% and sales figures since Christmas suggest we may slip back into recession I am sceptical that of what has been achieved, and I think it is unproven that the measures have significantly changed the course of the recession.
The consequences of these actions will be with us for many years in the form of huge debts. The UK is in debt to the tune of some £1.5 Trillion and this year alone the UK will borrow £178bn or 12% of GDP. To put that in perspective Greece has a deficit of only 13%. It is no surprise that the markets see the UK as a risk and it is probably only the possibility of a change in Government that is keeping the markets from panicking. All of this debt incurs interest payments and from next year we will spend more on these than on education or defence for example.
The unprecedented monetary expansion carried out has also let the genie of inflation back into the system. Inflation has been rising for some months now and topped 3.5% last month. Monetarist economists will not be surprised by this given the expansion in the money supply that happened under QE. We don’t really know just what the full effect of this policy will be but it certainly has not boosted lending and the risk is that as more normal lending patterns return then inflation will take off.
Unemployment has risen but no where near the doomsday scenarios that were forecast at the beginning of the recession. However if you look closely at the latest figures there are some interesting things happening. The headline figure has not risen as fast as expected, yes, but this is largely due to an increase in part time working or a reduction in hours. There has been a huge rise in underemployment, the difference between the hours people want to work and what they can work. This actually shows just how flexible our economy is that it has reacted in this way; but is this consequence of Government action, or of the inherent flexibility of the market built up over many years before Labour? Meanwhile the rate of long term joblessness has increased and a record 8.1m people are on out of work benefits.
Also, another example of this has been the rise in exports with fall all in the value for the pound. I think this also shows just how fundamentally strong the UK economy is in that it is able to react to a more favourable exchange rate. Once again I would argue this has nothing to do with Government policy but is a consequence of the hard fought reforms of the previous Conservative Government.
So we are left with huge debts that need financing, inflation is back, unemployment is high, growth is sluggish and we have zombie banks still not lending with the potential bed debts now the responsibility of the taxpayer.
To tackle the debts you usually cut spending and/or raise taxes, to boost growth you usually cut taxes, keep interest rates and the exchange rate low, but to tackle inflation you need higher interest rates, lower spending and monetary growth (which will bring upward pressure on the exchange rate). This is the course to be navigated by our economy over the next few years.
The economic consequences of Mr Brown will be with us for many years to come.
It seems John Redwood is thinking along similar lines: http://www.johnredwoodsdiary.com/2010/02/21/this-government-has-not-seen-us-through-the-recession/
Saturday, 20 February, 2010
I’m just in from a busy Saturday with a fund raiser and plenty of canvassing in the villages and Walney. I had a fascinating conversation with a person who described themselves as a Socialist. Now normally I say have a nice day and leave them to it but I was curious why this person was a Socialist so I asked them why and these are a few of the bits of the conversation I remember:
Them: I remember the Tories; they nearly closed down the yard.
Me: Rubbish, actually it was the end of the Cold War, and what happens at the end of wars is the guys building weapons lose their jobs. I don’t remember anyone saying we should just keep building submarines at the rate we had in the 1980’s, was Labour saying keep building submarines at the time?
Them: No, but the Tories never supported the yard in the first place
Me: Oh come on, do you know how many orders were placed by the Conservatives from 79 to 97, and how many by Labour.
Them: I don’t but no doubt you have all the facts and figures.
Me: I do, it was eighteen from 79 to 97 and one under Labour from 97, just one.
Them: Well that was replacing the Falklands War ships lost because of a war she started.
Me: Actually it wasn’t, all the replacement ships from the Falklands War were built by other yards, not Barrow (NOTE: 2 x Destroyers and 2 x Frigates were lost in the Falklands, they were replaced by T22 Frigates).
Them: Well, what about education, I am in education and I remember how bad it was. Labour have improved it
Me: So what do you think of the Sutton Trust report last week that showed that the poorest kids are nearly a year behind with reading when they go to school, or the fact that 20% of kids still leave school being unable to read and write properly?
Them: Well it’s not surprising they can’t read properly, it’s about money, and they haven’t got enough money
Me: Do you really believe in this day and age people can’t afford to buy books, they could use a library and you get free books sent to you?
Them: Well, all the Libraries are being closed down.
Me: and who is in power shutting them?
Them: erm, well it would be worse if you lot get in, I hope you don’t win.
Me: Well, that’s an interesting thought and time for me to head off.
Honestly, it was like talking to a brick wall. Facts which don’t fit into the lazy ‘Labour are nice’ and ‘Tories are bad’ world are just ignored and statements of opinion are said as facts. Uncomfortable truths like the fact our schools still fail 20% of kids, despite the money being spent, are blamed on the fact not enough money is being spent.
Now I don’t mind if someone is a real Socialist and argues from a point of principle but to mark your vote based on such lazy sound bites of what the Tories stand for, strikes me as, well, just plain stupid. Still that’s democracy, and you can vote for who you want and for whatever reason you want.
Anyway, if the person who this was reads this, thanks for the chat, I enjoyed it immensely, even if I felt it was a bit like banging my head against a brick wall.
Friday, 19 February, 2010
Yet more bad news on the public finances front. January, typically a month when tax receipts exceed public sector payments, due to the tax self assessment deadline, has actually seen borrowing of £4.3bn. The consensus among economists was that they were forecasting a surplus of around £2.6bn. Especially worrying is to see analysts bracketing Britain in with countries like Greece.
Thursday, 18 February, 2010
Wednesday, 17 February, 2010
According to the ONS (Office of National Statistics) long-term unemployment, (those out of work for more than a year) increased by 37,000 in the quarter to December to 663,000, the highest figure since 1997. In addition the number of people classed as economically inactive reached a record high of 8.1 million, more than 21%, or one in five, of the working age population. The figure covers students, people looking after a sick relative, or those who have given up looking for work. Unemployment in the latest quarter fell by 3,000 to 2.46 million, giving a jobless rate of 7.8%, unchanged from the previous three months but the number of people in employment fell by 12,000 to just under 29 million. And there was a drop of 37,000 in full-time employment, offset by a 25,000 increase in part-time employment.
Of course I welcome any fall in fall in unemployment, no matter how small but the figures don't lie. The number of people claiming benefit is at an all time high, the number of economically inactive people is at an all time high and unemployment is higher than when Labour came to power in 1997.
Labour may claim that things would be worse under the Tories but every Labour Government in history has left office with unemployment higher than when it took office and once again Labour is just not working
Tuesday, 16 February, 2010
Barclays Bank published profits of £11.6bn and predictably there will be calls from some that they should be a levy or that the profits are too high. Now, let’s get this straight Barclays did not take money from the taxpayer last year; they chose to raise additional funds from the market. They have therefore taken nothing from the taxpayer, and now will contribute through tax on the profits. So why as Taxpayers would we have the right to intervene If they choose to pay bonuses to their staff, are they not entitled to do so? Would people really prefer it if they were just another ‘zombie’ bank contributing only losses? Inflation is up again, although some of the rise could be explained by the increase in VAT last month. As I have said on a number of occasions on this blog, should we be surprised that prices are rising after £200bn of new money has been created within the economy?
Research has been published showing that six out of ten firms were turned down for bank loans last year according to a survey carried out by the Institute of Directors. This research shows just how ineffective the Governments actions were in stemming the credit crunch. The problem was not a lack of money but the fact it was not moving around the system. This is why I think the National Loan Guarantee Scheme we proposed through the recession would have been a better way of dealing with the effects for the credit crunch by helping to ‘lubricate’ cash through the system. Instead we had Quantitative Easing, or increasing the money supply, which as I said above I believe is the root cause of the inflationary upturn we are seeing.
Now we have the challenge of (a) stemming the rise in inflation, which usually requires tighter money supply and higher inflation rates, (b) restoring confidence with the markets, that usually includes paying of Government debt and reducing public expenditure and (c) nurturing a very fragile recession, which usually involves keeping interest rates low.
Interesting times for Economists!
Monday, 15 February, 2010
My Labour opponent has obviously decided that he believes there is some kind of dividing line between the Labour Party and the Conservatives on the nuclear deterrent issue. To my knowledge, and I may have missed something here, he very rarely talks about anything else other than the supposed threats of a Conservative Government to the shipyard. I have repeatedly offered him the opportunity to stop doing this because it is an artificial debate but he continues doing so. He was at it again yesterday on the Politics Show, and afterwards, repeating his line about how bad it would be under the Tories and completely refusing to acknowledge or debate the facts of the situation when I answered his charges.
I don’t know about everyone else but I am getting tired of this type of sterile non debate but I thought it useful to set out the various claims he has made, as well as reiterating the facts of the situation:
“But some things cannot change. In a world where unpredictable and rogue states are developing nuclear weapons it would be indefensible for Britain to give up its minimum nuclear deterrent. We cannot know what risks we might face in the future.
That is why a future Conservative government will never leave this country open to nuclear blackmail and we will guarantee a round the clock, submarine based nuclear deterrent for as long as it is needed.”
There are many areas where there is a difference between the Labour and the Conservative approach, we want to cut the deficit quicker and start next year, Labour does not. We want to maintain NHS spending because of the demographic challenges we face, Labour do not. These are but two examples upon which we have a different view and we could have a proper debate.
On the issue of the nuclear deterrent, is there a real difference? Of course I would doubt their real commitment to actually following through on their pledge, and I would point out that we have a proven track record of doing so, for example, we built the current Vanguard boats when they opposed it and we put 18 orders through the Barrow yard from 1979 to 1997 compared to Labour ordering 1 submarine in 13 years. It is easy to promise, but as many have found out under Labour, a lot harder to deliver.
We do have some differences on other defence issues we could debate, but as far as the deterrent is concerned I am at a loss to understand why Mr Woodcock wishes to create an artificial dividing line when one does not really exist.
Still, as long as he keeps throwing them, I’ll keep hitting them!
PS. I like the way this is reported in the NWEM, it says we had a row on TV, I must have missed it because it didn’t seem like a row to me. He was asked a question and gave a response, I was asked to respond and I did. What exactly were we supposed to do?
Why don’t you watch the piece on the BBC i-player for yourself and decide if it was a row or not. The link to the BBC i-player is here, the ‘row’ is 39 minutes into the programme:
Link to the NWEM story:
The Sutton Trust has released figures showing that by the age of five, children from the poorest fifth of homes are already 11.1 months behind those from middle income homes in vocabulary tests. The report also highlights that reading and library visits are essential for young children - with children who are read to daily and taken to the library regularly more advanced in their language skills than those who are not. So what does this tell us?
Well the Left of course will claim that it is all about money, that the poor reading skills of poorer kids are a direct consequence of their parents being poor.
But is this really the root of the problem or the just a symptom of wider problem?
My wife and I knew instinctively to read to our son, and encourage him to read also, which is why he is a good reader, so why are some kids not having books read to them? Books are cheap, library ones are free, Sure Start centres are crammed with books and you get free books for your children so just why is it so hard for some parents to read to their kids?
Now it could be that some parents struggle to read themselves and are themselves the adult consequence of this very problem but I think it would be stretching this too far to assume this is happening in all cases.
So is it really just a question of money?
I’m going to do some research on this and blog further in the future.
Link to the news story: http://uk.news.yahoo.com/21/20100215/tuk-poor-kids-trail-in-language-skills-6323e80.html
| |
Blog RSS feed
