Are you sure you should be doing that?

Monday, April 30, 2012

Gun ownership and murder

It's often argued by the gun lobby that we'd be safer if we all had guns - "just let them try and get me NOW!"

Actually, it seems that the rate of homicide by firearm is only very loosely related to the level of gun ownership. Below is a table I've put together using Wiki data from here and here:

Sunday, April 29, 2012

My druggy wugs, my freedom-weedom - REVISED

Time for me to eat a little humble pie. I wrote the following before reading the transcript of evidence taken by the Parliamentary Home Affairs Committee on 24 April - click here for link.

So my account of Brand's views and comments is inaccurate. We bloggers like to call mainstream journalists to account when they are sloppy, so we should be prepared for the lash ourselves when (as in this case) we cop an attitude before getting all the facts.

To set the record straight, he is now off all legal and illegal drugs and advocates an abstinence-based approach, as least for people with addictive personalities like himself. He is against methadone because it is a lazy (and sometimes lethal, ultimately) way to treat addicts. But he does think more of the money spent on arrests for possession could be more productively used in helping drug-takers off their addiction;  and when (gently) pressed, indicates that he favours decriminalisation - see his answer to Questions 259/260.

But do read the second part of the session also, in which, yes, Peter Hitchens (loathed by so many, especially the right-on) gives his well-known views - but so does Mary Brett, who has a background in education and also favours giving clearer, firmer guidance to youngsters on legality. It is not only Hitchens who sees prohibition as a valuable form of protection.

It is also interesting to see witnesses challenge the perception that drug-taking is so widespread that we may as well give up the fight - see Question 276, part of the answer to which reads:

Kathy Gyngell: ...At the moment, 2% of people sniff coke here. People, like Russell Brand, would like us to believe that this is common. It is still not common. It is common in certain circles.

Unfortunately, those circles include the broadcasting, journalism and entertainment industries, with their power to influence, persuade and mislead.

And, usefully, the Committee is challenged on whether it has a pro-drug use agenda (Question 281):

Lorraine Fullbrook: ...Are you making the assumption that the Committee are in favour of decriminalisation or legalisation?

Kathy Gyngell: I was worried that you took your terms of reference, or apparently appeared to—and I indeed wrote to Mr Vaz about it—from the Global Commission on Drugs policy, which is basically a highly financed legalising lobby. That did disturb me because, equally, they had given out—and they were widely disseminated in the press—incorrect figures about drug use spiralling out of control globally when, indeed, the UNODC shows quite clearly that it has been stable. So, that did concern me that your direction of travel may have been influenced by lobbies who are very much in favour of decriminalisation, and if that is not the case I am very happy to hear it.

I've now started in on Mary Brett's drug report (2006, updated 2012) and already I'm getting some startling information, e.g. how very much stronger skunk is than herbal cannabis of the 60s and early 70s. Having lost a friend to skunk-related depression and suicide, I'm not in favour of making the stuff easier to get hold of. Her report is here.

Finally, my apologies to Elby and others for losing their comments in deleting, revising and re-posting this piece. I'm very grateful for their time in reading and responding and I promise to try harder on the technical side next time.

So, warts and all, here is what I said originally, this morning (and over at Orphans of Liberty also):
_______________________________________________________________
I find it's easier to read than hear an argument, so I've transcribed as best I can what Russell Brand said in response to Peter Hitchens' accusation that drug-takers are spoiled rich Western kids who falsely claim that they are not responsible for their actions:

It’s nice to receive your bigotry from another medium other than the hate rag, The Mail on Sunday, from which you normally peddle hatred, insular thought, lack of love between human beings. What I’m saying, whether or not I’m selfish or wearing a hat is redundant and irrelevant. These are the kind of personal attacks, the aggressive styles that you continually adopt to vilify people needlessly. Hey what’s next, criminalise being a bit brown, is that your next policy from the Mail on Sunday? We can’t listen to people like you any more, it’s unevolved as a species.

There is such a thing as society, Peter. In spite of what Margaret Thatcher said there is such a thing as society, we are responsible for one another. If we treat people compassionately and with love, then people will benefit. People of course are responsible for their actions, you’re responsible for writing for a bigoted newspaper [applause].
It would have been better if Hitchens hadn’t prefaced his question with an insult (“the alleged comedian in the hat”) as he then has to be held partly responsible for the damagingly ranting nature of the reply.But what’s clear is that Brand is confused on the issue – at one point we’re not responsible for ourselves, later we are and then we should be responsible for others as well. The Guardian’s report of his evidence to the Parliamentary Select Committee is similarly equivocal and self-contradictory.

As to the so-called war on drugs, the Guardian's piece says:

He said he didn't think that drug addicts cared about the legal status of the drugs they were taking, or where they came from or the consequences for those involved in their production.
Not surprising, since there are usually no adverse legal consequences, in this country.
But if any full-on libertarians are reading this, maybe it's time they faced up to the fact that (as Sartre said) we ARE free, inescapably. Libertines and rake-hells just do it, they don't ask Authority to approve.

What semi-detached libertarians want is permission - but to ask that is to give power to another. The radical lover of freedom does what he wills and accepts the consequences - and doesn't whine for some social support safety net.

At 36, Brand is getting a little old for the role of bawling, illogical teenager, demanding autonomy and protection in the same breath. The infantile term "booky-wook" is the tell to his condition, isn't it?

Headteacher to get pay cut

The headteacher of Canary Wharf Comprehensive is to have his bonus reduced, it was revealed today. Mr Garnet's pay package had soared to £17.7 million last year, despite the school failing its Ofsted inspection.

At a meeting with the Governing Body, Mr Garnet explained that his remuneration was strictly a contractual matter, the annual bonus being linked to the size of the school's budget. Since the DfEE had pumped in huge sums to turn around its dire performance, the Head's financial reward had broken all records. The Governors have decided to review the contract.

Speaking to Birmingham Teacher & TA by satphone from his chalet in Gstaad, Mr Garnet said, "It's only fair to point out that the tax on my income will cover my staff's wages for the next two years." Asked whether heads whose schools are failing, should be sacked, he said he was on a Black Run and would have to terminate the interview, but asked us to remind his teachers that pupil reports should be handed into heads of year by Thursday afternoon.

Monday, April 23, 2012

Hanging, flogging... and caning?

Nearly 3 years ago, I was having a whinge about education going to the bow-wows, and one part was about the end of corporal punishment in schools, which some would like to see reinstated. A leader in the campaign to abolish caning was a teacher in Tower Hamlets called Tom Scott, who later left teaching and is now a theatre director.

I often say that the people who make changes in teaching often choose not to stay at the sharp end (if they've ever been there at all), and I thought Scott had been away from the chalkface for so long he'd probably forgotten the details himself.

Not so. Here's a post by the man himself, put up on the 25th anniversary of abolition (July 22, 1986). Some of the examples of maltreatment he cites there should give any fair-minded reader pause for thought. I certainly couldn't defend those teachers.

The only caning I witnessed as a teacher was of a 15-year-old who'd told me to get lost when I was urging a group to work hard and complete their CSE English assignments (in two terms - the previous teacher had left under a cloud in the summer, with his pupils having only 2 acceptable pieces of coursework out of the required 15). A senior teacher gave him the cane once on each hand, and that was the last I saw of him in the classroom. Pour encourager les autres: almost all the others ultimately got passes in both English Language and English Literature - and these were C Band children.

The school was a very large urban comprehensive, but with a tightly-run and authoritarian management. It made a difference to the life chances of many children, I'm sure, even though I think discipline alone will get you no more than 90% of potential. It also allowed teachers to teach - not everyone is a tough guy or the inspirational type who could get children to push peanuts up mountainsides with their noses, as they say.

But yes, I'm sure there were also occasions when authority overstepped the mark. I remember one youngster who these days would be quickly recognized as autistic: he'd tried to flush a teacher's handbag down the lavatory and was consistently denying it to the head and deputy head in the office. The deputy, a slick and tricky type, leaned forward and said in a friendly way, "Look, Jason [as it might be], we all know you did it. Why don't you just admit it and then you can go?" "Okay, yeah, I did do it." With a sweep of the arm, the desk was cleared of papers, "Jason" was hauled over it and given six of the very best, then released - howling fit to bust - to charge out of the office and through reception, clutching his buttocks. Where the parents of a prospective entrant to the school were waiting. They saw the flaming-arsed meteor scud past, followed by the head and deputy strolling out, laughing and swishing their canes.

All most amusing, but "Jason" had to return to my classroom, red-faced and in shock at a turn of events he wasn't equipped to anticipate. On another occasion, he'd gone with a school group to Kingsbury Water Park and noticed a fishing float abandoned in a shallow lake. Without hesitation, he undressed (in front of a mixed group of boys and girls), waded out bollock-naked to retrieve it, and then dressed again. "Jason" was just different, and in the Pupil Referral Unit where I work part-time he would now be treated as such; thrashing would teach him nothing. Autistic children need social rules spelled out to them, like a tourist learning basic phrases in Greek.

There was also something of a bullying culture among the more macho teachers. A teenager came to remonstrate with one of these, who let him into the classroom to continue the discussion, locked the door and listened to a stream of foul-mouthed abuse. As the peroration continued, he quietly interjected "you're forgetting something" from time to time, until the lad put his cursing on hold and said "what?". "The door's locked". The boy's face went white, and he fell silent.

Another teacher - a Northerner - wouldn't tolerate cheek and chinned a member of his own form registration group, knocking him clear over the desk behind. The boy reminded him of it when Sir came to make his farewell ("Now then, scum...") before leaving to teach abroad - but the kid said it with a grin: he knew there hadn't actually been any malice, it was just what the alpha male does to the naughty pup.

A retired colleague did his teaching practice in a school in (I think) Reading, somewhere around the late 60s. His class was a mixed bunch, with the yobbos ensconced at the back. But one made the mistake of taking out a newspaper and reading it behind the upraised lid of his desk. A mistake, because my friend is of Irish descent and has fully inherited the wrathful warrior gene. Leaping forward with a roar of rage, the trainee teacher smashed down the lid, which broke in two pieces across the head of the boy, who fell back stunned in his chair. There was no trouble from that class again.

Pre-World War I, my great-grandfather was a schoolmaster in an East Prussian village (paid for his services partly in firewood etc). He taught the children of agricultural labourers, dairymen and so on - tough kids in a tough time, and unlikely to appreciate the value of literacy and general knowledge. But great-grandpapa was built like a brick shithouse - once, when a man had disagreed with him, he'd suspended his opponent one-handed by the collar outside an upper-storey window until there was a meeting of minds. My ancestor started each day giving all the kids a whack - girls as well as boys. They all learned to read and write, and this might well have saved the lives of a number of the boys when the call-up came, as they would have been given office jobs instead of being sent out to absorb the enemy's bullets.

Quite a different world, and no Professor Challenger will find his way back to it.

Is there any halfway house between the hard ways of the past and the barrack-room-lawyer children of today? Should a civil whack on the hands be allowed again? Or is it all too fraught with difficulty?

Meantime, I shall not be so quick to judge people like Mr Scott.

Sunday, April 22, 2012

How will we stay rich?

Not many of us feel rich, but that's partly to do with who we have around us. Compared to most of the world, we are hugely well-off.

Let's make the comparison a little fairer. What matters is not only how much money we have, but what we can buy with it locally: this is known as "purchasing power parity" (PPP). So, here is a graph of the GDP per person (in PPP terms) of the most populous nations on Earth; I also include bars for the European Union and the world average (click to enlarge):


The vertical axis is in multiples of world average GDP: 11,800 US dollars. You see that the USA is four times as wealthy, Germany and the UK three times, and even Italy and Spain are doing terribly well, for now. Until recently, Greece (not shown) wasn't far behind Italy.

My question is, what's keeping us there?

If these countries were a series of locks on a canal, and all the gates were opened at the same time, you'd expect a lot of turbulence and then a settling-down to a uniform level throughout. We have world trade, so why shouldn't national wealth average out across the globe?

It is perfectly possible for neighbouring countries to have extreme disparities in per capita income - here's the two Koreas, separated only by a demilitarized zone around the 38th parallel:

Clearly the economic divide here is largely owing to very different economic and political systems. North Korea may not really be a threat to the world, but it's certainly a threat to its own unfortunate citizens, 150,000 of whom are kept in labour camps in scarcely believable misery. So yes, that inequality can be maintained given sufficient vigour and brutality on behalf of its rulers, who must continue to oppress because they have a tiger by the tail and a moment's weakness will finish them.

At $1,800 per capita, North Korea is far from the poorest country, according to the CIA World Factbook: Bangladesh, Kenya, Zambia and 30 other nations (mostly African) have less, bottoming out with the Congo at $300 (i.e. spending power about 82 cents a day).

But what, other than military dictatorships and civil and international war, accounts for some countries' failure to rise, and what prevents our own standard of living from falling?

Do we work harder?
Are we cleverer?
Are we - will we remain - better educated?
Do we have better and wiser rulers? Do they rule in the nation's interest?
Do we have special knowledge that nobody else can duplicate?
Is our basis of industrial skills thriving?
Are we using our human resources - our talented people - to best effect, in the best sectors of the economy?
Is it easy for our enterprising people to start up and run businesses?
Can we trust our money, and our banks?
Can we live forever off our patents - will they always be ours, and their validity accepted everywhere?
Are we blessed with inexhaustible natural resources?
Are we militarily strong enough to dictate terms of trade and hold everyone else down?

Not enough "yes" answers to the above, I fear.

How will we stay rich?

Not many of us feel rich, but that's partly to do with who we have around us. Compared to most of the world, we are hugely well-off.

Let's make the comparison a little fairer. What matters is not only how much money we have, but what we can buy with it locally: this is known as "purchasing power parity" (PPP). So, here is a graph of the GDP per person (in PPP terms) of the most populous nations on Earth; I also include bars for the European Union and the world average (click to enlarge):


The vertical axis is in multiples of world average GDP: 11,800 US dollars. You see that the USA is four times as wealthy, Germany and the UK three times, and even Italy and Spain are doing terribly well, for now. Until recently, Greece (not shown) wasn't far behind Italy.

My question is, what's keeping us there?

If these countries were a series of locks on a canal, and all the gates were opened at the same time, you'd expect a lot of turbulence and then a settling-down to a uniform level throughout. We have world trade, so why shouldn't national wealth average out across the globe?

It is perfectly possible for neighbouring countries to have extreme disparities in per capita income - here's the two Koreas, separated only by a demilitarized zone around the 38th parallel:

Clearly the economic divide here is largely owing to very different economic and political systems. North Korea may not really be a threat to the world, but it's certainly a threat to its own unfortunate citizens, 150,000 of whom are kept in labour camps in scarcely believable misery. So yes, that inequality can be maintained given sufficient vigour and brutality on behalf of its rulers, who must continue to oppress because they have a tiger by the tail and a moment's weakness will finish them.

At $1,800 per capita, North Korea is far from the poorest country, according to the CIA World Factbook: Bangladesh, Kenya, Zambia and 30 other nations (mostly African) have less, bottoming out with the Congo at $300 (i.e. spending power about 82 cents a day).

But what, other than military dictatorships and civil and international war, accounts for some countries' failure to rise, and what prevents our own standard of living from falling?

Do we work harder?
Are we cleverer?
Are we - will we remain - better educated?
Do we have better and wiser rulers? Do they rule in the nation's interest?
Do we have special knowledge that nobody else can duplicate?
Is our basis of industrial skills thriving?
Are we using our human resources - our talented people - to best effect, in the best sectors of the economy?
Is it easy for our enterprising people to start up and run businesses?
Can we trust our money, and our banks?
Can we live forever off our patents - will they always be ours, and their validity accepted everywhere?
Are we blessed with inexhaustible natural resources?
Are we militarily strong enough to dictate terms of trade and hold everyone else down?

Not enough "yes" answers to the above, I fear.

INVESTMENT DISCLOSURE: None. Still in cash (and index-linked National Savings Certificates), and missing all those day-trading opportunities.

DISCLAIMER: Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content.

Saturday, April 21, 2012

News from tomorrow

201*

The Eid Agreement has been successfully concluded, thanks to the crucial intermediation of a former United States Senate leader.

202*

Mr Abu Hamza has been appointed Deputy First Minister for Wales and Mr Abu Qatada has been elected President of the Al-Qaeda Party. Although Al-Qaeda retains a policy of abstentionism towards the Westminster Parliament, it receives allowances for staff and takes up offices in the House of Commons.

The security service reforms proposed by a former senior Conservative politician have now been implemented. The police Oath of Service no longer includes a pledge of loyalty to the Monarch, and the intelligence services are now required to recruit a proportion of their employees from violent subversive domestic political factions.

203*

In his memoirs, Mr Cameron pays extensive tribute to Hamza and Qatada, saying they were "supreme masters of the distinction between tactics and strategy" and were "an extraordinary couple".

The former Prime Minister continued: "Whether you like them or not, and no matter how strongly you disapprove of their past actions, they had courage in abundance."

Friday, April 20, 2012

Anders Breivik: the view from the street

In legal terms, it would seem that the case of Anders Breivik is as uncontentious as it is possible to be. Politically, the picture is more confused and misleading.

Guilt

He intended to kill, and did kill. Under English law, that defines murder.

Insanity plea

As I understand it, you can have a personality disorder and still not be mad. That is, you can be answerable for your actions, even if they proceed from abnormal motives. Breivik's meticulous planning and prolonged rehearsal demonstrate his ability to control and order his behaviour.

Breivik  does not consider himself insane, any more than John Bellingham did. The excuse he is using, that of self-defence, is arrant garbage but a defendant can try any argument he likes in a court of law. What is more debatable is the decision by news media to let him use the court as a global public address system, but I'll come to that in a moment.


Sentence

Reportedly, he wished to do more than he had done, and would do it again. On that basis, and given the unavailability of a death sentence, he should be imprisoned for the term of his natural life as (a) a punishment for his crimes, (b) a warning to others and (c) a safeguard for society.

Reportage and implicit political agenda

So, why the nightly TV reporting of his case?

It could be simply because the case is sensational.

Or (and it may not be so) it could be because it's a useful stick with which to beat the Right. If the latter, the message is, he did these terrible things because he is a racist, therefore anyone who opposes unrestricted immigration etc should be tarred with Breivik's brush.

Counter

The Right could answer, this simply shows the importance of what are supposedly traditional family values. Breivik is the child of divorced, f*ckabout parents. Their failure to serve their child's development, in preference to servicing their own pleasures, led ultimately to the terrible events in Oslo and Utoya. As John Lennon said of Hitler, what if he'd been told he was loved, all his life? As a part-time teacher of special needs children, this has resonance for me.

Gut feeling

We shouldn't be getting this blow-by-blow coverage. Even the BBC news pointed out tonight that some Norwegian newspapers have chosen not to feature it on their front pages.

It was a crime, he should be punished, and discussion of tangential matters should not be stifled.

Tuesday, April 17, 2012

Spanish credit now 10th worst globally; UK and USA recovering?

According to CMA Datavision's Q1 report on the sovereign credit insurance market, out today, Spain has just entered the top 10 most risky countries, with a 32% chance of default within five years. Far worse is Portugal, with a 60% 5-year default risk (beaten only by Cyprus, which is a new inclusion in CMA's tables).

More surprising is the market's favourable assessment of the USA, which has recovered its insurance-implied AAA rating, and the UK, now listed as the 6th least risky country. It would seem that the credit insurance traders have bought the good news stories, in the face of continuing pessimism from a number of other economic commentators.

Norway, last quarter the only nation to have an implied AAA rating, retains pride of place, followed by the USA, Switzerland and Sweden with their newly reinstated triple-A grades.

Is the market's optimism at the top end justified, or mistakenly short-sighted?

INVESTMENT DISCLOSURE: None. Still in cash (and index-linked National Savings Certificates), and missing all those day-trading opportunities.

DISCLAIMER: Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content.

Spanish credit now 10th worst globally; UK and USA recovering?

According to CMA Datavision's Q1 report on the sovereign credit insurance market, out today, Spain has just entered the top 10 most risky countries, with a 32% chance of default within five years. Far worse is Portugal, with a 60% 5-year default risk (beaten only by Cyprus, which is a new inclusion in CMA's tables).

More surprising is the market's favourable assessment of the USA, which has recovered its insurance-implied AAA rating, and the UK, now listed as the 6th least risky country. It would seem that the credit insurance traders have bought the good news stories, in the face of continuing pessimism from a number of other economic commentators.

Norway, last quarter the only nation to have an implied AAA rating, retains pride of place, followed by the USA, Switzerland and Sweden with their newly reinstated triple-A grades.

Is the market's optimism at the top end justified, or mistakenly short-sighted?

INVESTMENT DISCLOSURE: None. Still in cash (and index-linked National Savings Certificates), and missing all those day-trading opportunities.

DISCLAIMER: Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content.

Voting reform and campaign contributions: a modest proposal

In the UK, political parties are discussing restrictions on campaign contributions. There is also concern at the declining numbers of people bothering to vote at all - a trend particularly noticeable among those aged under 40.

I suggest we:

(a) ban all financial contributions to political parties
(b) do not fund the parties from public monies
(c) remove the Inheritance Tax exemption for legacies to parties
(d) impose a duty on all mainstream media - including newspapers and political journals - to report without bias on all political matters - and make it work better than the BBC does
(e) change the pattern of General Elections - instead of a big hoo-ha once every five years, often influenced unduly by events shortly prior to Polling Day, let us have every year a ballot in one-fifth of all constituencies
(f) ban all political advertising - let each party and each prospective MP give a clear explanation of their plans and promises, on one common website. The entries should remain up for inspection for at least 5 years, so that voters can check the record before voting again
(g) institute a system of Swiss-style policy referenda, whereby if enough people sign the petition, the proposal must be put to people's vote. In Switzerland the minimum is 100,000 requests, proportionately in the UK it would be around 800,000
(h) recognise the present franchise is failing, but rather than coerce or bull***t the young into voting, embrace the reality and switch from one-person-one-vote to one-pound-one-vote. Each elector gets to vote only in the constituency where they live, but can buy as many votes as they wish - credit or debit card machines could easily be installed in voting booths. Let it be a tax on political enthusiasm - all proceeds to HMG

Any more ideas for plain-packaging the political system?

Monday, April 16, 2012

Urgent need for UK consumers to review pensions and investments

Changes on their way mean that it's high time to review your insurance - and pensions.

Gender-neutrality law to increase costs for both men and women

By 21st December this year, the UK insurance industry will have to comply with the EU Gender Directive, which insists that men and women must be treated the same when setting rates. Up to now, by and large:

  • women tend to pay less for car insurance (typically, safer driver behaviour than men's) and life insurance (on average, women live longer than men)
  • men tend to get better annuity rates when taking benefits from their pensions, and pay less for income insurance
You might think that the fair thing to do, where gender-related pricing is concerned, is "meet in the middle", but that means the insurance company takes the risk that it may attract more business from the gender that will ultimately cost them more in payouts. So it could well be that the policy adopted will be to "level-up" premiums.

Time to get a product with guaranteed (i.e. fixed) premiums?

Taxation of life companies likely to increase premiums

But there's another change that will affect premiums, and it's to do with tax. Until now, life companies have been able to offset some of their insurance costs against gains on their investment business; this will stop from 1st January next year, so insurance premiums will no longer be subsidised by investment profits in this way. Actuaries have told HM Treasury (PDF) that this could raise premiums on some term insurances by around 10%.

Time to get a product with guaranteed (i.e. fixed) premiums?

Spouse cover and contracted-out pensions: better options now available

From April 6, 2012 the law on pensions has changed. Up to now, if you were married and some of your personal pension was built up using money from contracting-out of State top-up pensions (SERPS/S2P), that part of your pension fund had to provide a continuing income for your spouse if you died before him/her. This restriction has now been removed.

This means:

  • you can have a bigger pension income for yourself, if you opt not to include spouse protection (it may be that your spouse already has good pension benefits of his/her own), but alternatively...
  • if you prefer, you can IMPROVE spouse protection - before April 6, the spouse pension based on contracted-out monies HAD to drop to 50% of the income you were getting; now, it can be anything from 0% - 100% of yours.
For men who want a single-life annuity, this may also be a window of opportunity to get a better rate, before the gender-neutrality law comes into effect in December.

That said, there is also the question of what may happen on the stockmarkets (quite possibly affecting the value of your pension fund, unless you're in cash), and the bond markets (which influence annuity rates).

Time to review when you want to take your pension, what it's invested in at the moment, and how you ultimately intend to take the benefits?

I suggest you contact your adviser soon!

INVESTMENT DISCLOSURE: None. Still in cash (and index-linked National Savings Certificates), and missing all those day-trading opportunities.

DISCLAIMER: Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content.

Urgent need for UK consumers to review pensions and investments

Changes on their way mean that it's high time to review your insurance - and pensions.

Gender-neutrality law to increase costs for both men and women

By 21st December this year, the UK insurance industry will have to comply with the EU Gender Directive, which insists that men and women must be treated the same when setting rates. Up to now, by and large:

  • women tend to pay less for car insurance (typically, safer driver behaviour than men's) and life insurance (on average, women live longer than men)
  • men tend to get better annuity rates when taking benefits from their pensions, and pay less for income insurance
You might think that the fair thing to do, where gender-related pricing is concerned, is "meet in the middle", but that means the insurance company takes the risk that it may attract more business from the gender that will ultimately cost them more in payouts. So it could well be that the policy adopted will be to "level-up" premiums.

Time to get a product with guaranteed (i.e. fixed) premiums?

Taxation of life companies likely to increase premiums

But there's another change that will affect premiums, and it's to do with tax. Until now, life companies have been able to offset some of their insurance costs against gains on their investment business; this will stop from 1st January next year, so insurance premiums will no longer be subsidised by investment profits in this way. Actuaries have told HM Treasury (PDF) that this could raise premiums on some term insurances by around 10%.

Time to get a product with guaranteed (i.e. fixed) premiums?

Spouse cover and contracted-out pensions: better options now available

From April 6, 2012 the law on pensions has changed. Up to now, if you were married and some of your personal pension was built up using money from contracting-out of State top-up pensions (SERPS/S2P), that part of your pension fund had to provide a continuing income for your spouse if you died before him/her. This restriction has now been removed.

This means:

  • you can have a bigger pension income for yourself, if you opt not to include spouse protection (it may be that your spouse already has good pension benefits of his/her own), but alternatively...
  • if you prefer, you can IMPROVE spouse protection - before April 6, the spouse pension based on contracted-out monies HAD to drop to 50% of the income you were getting; now, it can be anything from 0% - 100% of yours.
For men who want a single-life annuity, this may also be a window of opportunity to get a better rate, before the gender-neutrality law comes into effect in December.

That said, there is also the question of what may happen on the stockmarkets (quite possibly affecting the value of your pension fund, unless you're in cash), and the bond markets (which influence annuity rates).

Time to review when you want to take your pension, what it's invested in at the moment, and how you ultimately intend to take the benefits?

I suggest you contact your adviser soon!

INVESTMENT DISCLOSURE: None. Still in cash (and index-linked National Savings Certificates), and missing all those day-trading opportunities.

DISCLAIMER: Nothing here should be taken as personal advice, financial or otherwise. No liability is accepted for third-party content.

Plain packaging for political parties: the debate continues

How it might look:

Sunday, April 15, 2012

Is there a limit to wealth inequality?

What would happen if one person in the USA finally owned ALL its wealth?

Not possible, I suppose, because two of the three functions of money would be impossible: there would be nothing to act as a medium of exchange, or as a unit of account, until the omni-owner started to spend. And why would he spend? He would already own everything. Having no property, everyone else would be a slave.

So what is the theoretical maximum degree of financial inequality? And how close are we to that point?



Is this why the stockmarkets are stalling - there's not much wealth left to transfer to the upper crust, and what there is, the middle class are desperate to hang onto? Is that why, according to Tyler Durden, there's $8.1 trillion in cash holding off from investment - the rich won't put it back in unless they can pull out again at a profit, and the rest don't want to fall for the trick?

Saturday, April 14, 2012

Why Britain is utterly, terminally stuffed

I live in Birmingham (UK), where our car industry was taken over first by the Germans and then (partially, though they also tried to raid us for other paperwork and designs that weren't part of the deal) by the Chinese. More could have been saved earlier, but the Rover crisis came to a head as the then Labour Government, facing re-election, chickened out of accepting a venture capitalist plan from Alchemy, since this would mean admitting that the plant had to shrink. The politicians lied that the land the factory was built on couldn't be used for housing and retail, because of ground pollution; now, the land has been cleared for exactly those purposes. Trust the British Labour Party to betray workers in order to get workers' votes.

We have also recently seen philanthropic chocolate makers Cadbury's fall into American hands (a company headed by a lady who reminds me of the frightening nurse in Mel Brooks' "High Anxiety"). And HP (for Houses of Parliament, ironically) Sauce has been bought by the US (Heinz), production has been transferred to the Netherlands and the factory here has closed.

Birmingham looks different, these days.

In today's Daily Mail, Alex Brummer paints the bigger picture of the national garage sale that is UK plc. Company directors, bankers and hedge funds have all made out like bandits (to use a Matt Taibbi expression) and the UK government has been happy to let them do it, cheered by the prospect of short-term revenue and the illusion of economic prosperity as the new rich shovelled cash into the stockmarket after buying up the best bits of London and the South-East. Brummer traces the Dolorous Stroke back to the Tories in 1979 (Chancellor Howe's relaxation of foreign investment rules) and 1986 (the financial services sector's Big Bang). Trust the British Conservative Party to betray the middle and aspirant working classes in order to get their votes.

The downside of this prolonged boss' jolly is the loss of future income to overseas interests, the withering of our patent base (now 39% foreign owned) and R&D activity, the decline in industrial skills and, inevitably, our country's ultimate ruination.

Elsewhere in the same edition of the Mail (a paper hated by bien-pensant comedians) is the reported displeasure of Scottish National Party leader Alex Salmond (I sometimes call our cat I-Lick-Salmon) at a spoof in the Economist magazine, which suggests (as I have long thought) that independence for Scotland is a romantic and economically self-destructive dream. It's tempting to think that the rest of the nation would be financially better off without Salmond's land, but that's the same sort of flawed short-term analysis as the one Brummer describes. It's clear, is it not, that the EU plan for splitting and regionalizing the UK is a sort of long-brewed adolescent revenge for owing us their hastily cobbled-together postwar democracies, and they're now trying to haul us out of the jollyboat and onto the deck of the Euranic just after the funny-money (read Bill Black's latest) iceberg has slit their hull.

Action points:
  • don't depend on the State being able to maintain public sector and State pensions in future
  • prepare your children for life and a career abroad
  • if you're young enough, consider leaving before the social compact falls apart

Friday, April 13, 2012

Syria and the Great Game

If all you go by is the radio and TV news here, President Assad is a bad man. This has only been discovered recently, which is why it's taken us until now to do something about it. Fortunately our friends in Turkey are joining in, and Gulf States are generously funding the struggle of the oppressed against him. The TV is showing us exciting but also horrid footage of things going bang, rifles being fired; please make it all go away so everyone can be nice to each other again, we say.

Or is this part of a bigger picture? Russia resurgent, China emergent, America's problems getting urgent. Oil getting short, allies being bought, civil wars being fought in non-aligned states.

Great nations are foolish if they take each other on directly - the cost is so high economically and socially that the ruling classes risk overthrow from within. What you do instead is draw other countries into your team, and if their leaders insist on standing apart, you undermine them so they'll be replaced with someone more compliant.

Isn't that what happened in Libya, and is going on in Syria? Maybe Tunisia and Egypt, too?

Thursday, April 12, 2012

Kill people and save money: a libertarian proposal

Day after day, I read the same thing: government is evil per se, and we shouldn't have to pay any taxes. The old and poor are a burden on the rest of us.

So are the sick and disabled, but the time for overt Nazism isn't quite yet. However, we are making encouraging progress.

Since 1967, some 7 million unborn British children have been killed. Some of them on grounds of "serious handicap" such as having a cleft palate (shame they didn't get Lord Byron, with his club foot) - but the overwhelming majority of abortions are simply because the child is inconvenient. That's against the law as it stands, but who cares?

This old-style-Oriental solution to problems (Stalin would surely have approved) is weighted towards the lower social classes so, as the authors of "Freakonomics" pointed out, it has a beneficial side effect, in that we're executing common criminals before their career can begin. And compared with the cost of arrest, trial, appeal, imprisonment etc a little fake-objective "pregnancy advice" and a swish of the scalpel are so much cheaper, quicker and final. After all, since 1965 we can't kill adult criminals and despite what Parliament was promised in return for giving up the death penalty, "life" doesn't mean life in jail except in the rarest of cases.

Like so much other bad law and practice, self-deception, poor logic and inconsistency bedevil our approach. Apparently it's okay to terminate a foetus under 24 weeks old, because it doesn't feel pain and is therefore not alive; so with the prior use of a really good anaesthetic, we could make inroads on the prison population right now.

We're doing this already for the sick and depressed, but first we have to send them to Switzerland, sometimes accompanied by a popular children's author who lards his work with references to death and total spiritual annihilation. However, the courts are winking indulgently at those who top their relatives here and are now paving the way for advance carte blanche so the doctors involved won't be prosecuted.

Really, criminals are the glaring exception to our enthusiasm for the short way with those who trouble us.

And after that, we can have a really good go at all those born with deformities (not just the ones whose mum doesn't want them), plus cripples, orphans etc.  Worldwide, there's something like 5 million new cases of people permanently disabled each year because of road accidents alone, so there's much to do. And we could always reinstitute forcible sterilization, which was a policy in many countries but which the Germans did so much more thoroughly, as they do everything. In short, let us off anyone who costs more in taxes than he's paying.

Yes, death is not the end, it's the answer. After we have rid ourselves in this way of all social and fiscal burdens, we shall have a thousand years of peace and prosperity. Those who still have life will have liberty, and only libertarians will live.

And money, dear money, the fount and origin of happiness, the fifth element that creates and sustains all, will be safe at last.

Monday, April 09, 2012

Greece has defaulted - Dagong

Chinese credit rating agency Dagong has re-rated Greece to "D":

"The Greek government bond exchange action in March 2012 violates the will of the holders of the Greek law governed bonds, and inflicts substantial losses to them. Accordingly, Dagong determines that the Greek government has defaulted."


Emperor's new clothes, and all that.

Fun with sport

Following the suspension of the Boat Race, what other events - sporting or otherwise - would YOU like to see interrupted by The Swimmer?


Sunday, April 08, 2012

Thick as a brick? No, much thicker: how Samantha Brick mugged Daily Mail readers

All that fuss about Samantha Brick's April 3 article, "Why Women Hate Me For Being So Beautiful". Mail readers obviously didn't do any research at all before keying in their bilious online comments, for if they had they'd have come across one of hers from almost exactly a year ago: "I'll always be that fat girl: Samantha Brick has always obsessed about her weight... all because she was a chubby child".

The latest, controversial hit was published two days too late, for it's made fools out of millions.This is about beauty versus brains, and brains win hands down every time.

What clever Brummie (and there's another preconception exploded) Samantha has discovered is what Malcolm MacLaren said years ago: you can make much more exploiting yourself than exploiting others. I'd like to know who at the Mail gave her the space to do this one, but I guess it's enough of an obvious coat-trailer to justify publication on its own meretricious merits, without having to speculate on the possible use of her feminine wiles at the workplace, delicious journalistic follow-up though that might be.

Can men do the same? You may care to copy and paste her article, and swap the sexes to make a comic spoof. The exercise is comically revealing, because male attractiveness is measured differently in a woman's eyes.  They say a woman is what she is, and a man is what he does. He does confidence, action, aggression  - like Lord Flashheart in the Blackadder series:  



... and again here (from about 4:07 in):



Traditionally, the strategy for women is to have a sponsor, and to be set in a context of focused admiration, as Roger Vadim did for Brigitte Bardot in the cinematic launch vehicle "And God created woman":



But a young, slightly chubbier in those days Madonna broke the mould - it became "look at me", not "look at her", though again it's be piquant to know the who and how behind getting her the film deal:



Like Madonna, what's smart about Brick is her use of brash self-assertion - and if she hasn't really got the confidence, she's faked it very well for the purposes of her piece. She's played it the man's way.

Good luck to her.

Saturday, April 07, 2012

Patenting the debt bomb

It's only occurred to me today that Collateralized Debt Obligations might actually have been patented, and thanks to Google's patent search option here's one, by George H Butcher III, which he sold to Goldman Sachs. The application was filed in 2000, but the patent was finally granted in September 2007.

And here's one of the drawings:


I suppose they patent Ebola-derivative viruses, too.