Wednesday, 31 December 2008

What a fine year it has been

I have rather enjoyed 2008, rarely a day went past without something interesting happening and some events were truly monumental even if not yet understood as such. The saddest note is that the year ends just as it began with justified public outrage at the failure of the powers that be to secure a knighthood for Bruce Forsythe. Clearly he has failed to make substantial donations to the Labour Party, a change of government is required so that justice can be done.

The state of the economy has dominated the year. In January thoughts were predominantly on the credit crunch and the state of the housing market. Northern Rock had recently been nationalised and the government was seeking to assure everyone there were no systemic problems, a rogue lender caught a cold but all was otherwise well. They were desperate to halt the slide in house prices which had begun in the summer of 2007 because they knew the illusion of increased wealth caused by prices forever rising was necessary if they were to be able to afford the grossly bloated state machine. Even the budget in March failed to acknowledge that the continued slide in house prices combined with a lengthy period of food price inflation was having a significant effect on peoples perception of their ability to live as high on the hog as in the recent past. Their delicious incompetence in abolishing the 10p tax rate combined with staggering mendacity in asserting that no one would be affected adversely brought home to even the least avid observer of matters economic that poor Gordon and the hapless Mr Darling were utterly adrift from reality, swimming in a sea of their own defecatory product and inviting all to "come on in, the Brown water's lovely".

And then, of course, that which was in the sea rose up and hit the fan. Northern Rock was not an isolated player in the game of incompetent lending, merely the tip of the iceberg. Bank after bank was seen to have made loans to people who never had any realistic prospect of being able to repay them, secured against properties which were reverting to their true value. Poor Gordon's response was to hide away behind a bank of denials. It really was a delight to hear the pitiful oaf boasting that it was full steam ahead along exactly the path which caused the problem in the first place. No change of tack, no change of speed, no acknowledgment of the problem, all we heard were the rantings of a deluded incompetent that he was correct all along and therefore things must continue as before.

By late summer poor Gordon was nowhere to be seen. Even he could no longer deny there was a serious problem so he hid away again, this time behind a bank of accusations. It was America's fault, it was the greedy bankers' fault, it was the Bank of England's fault, it was the regulators' fault. He claimed to have been warning them for years, oblivious to the recorded fact that his speeches contained no warnings and were packed to the gills with praise for the economic miracle they had brought into effect by following his wise guidance. He it was who needed the tax from the bankers' massive salaries and bonuses to pay for his pet gimmicks. He it was who removed the Bank of England from day-to-day supervision of the banking industry. He it was who set the parameters for banking regulation by the Financial Services Authority. They were all doing exactly what he wanted them to do and, indeed, what he required them to do. To read his press releases and hear his occasional witterings in the House of Commons you would have thought he was the only Chancellor of the Exchequer for more than 150 years not to have had anything to do with the economy. It really was such fun.

The curious upshot of the disaster poor Gordon manufactured is that some people seem to believe it really did have nothing to do with him. Almost overnight he became the man who can save us from the monster and his ratings in opinion polls rose sharply. Of course that is the way of the world. Nobody is obliged to take an interest in the economy or to follow politics. Many are guided in their assessment of a Chancellor of the Exchequer by the state of their own budget. The man on a £30,000 salary who sees his house rise in value by £15,000 in a year sees himself as having made £45,000 only £30,000 of which was subject to tax, £15,000 tax-free is equivalent to a salary of about £20,000 so he could perceive himself as being a £50,000 a year fellow. Yippee, well done Chancellor. Because Chancellor Brown made him rich he listens to Prime Minister Brown for an explanation of why his wealth is diminishing and hears that it is all the fault of matters beyond the government's control. But, not to worry, just as Chancellor Brown made him rich so Prime Minister Brown must be the man to restore that wealth now that wicked outsiders have attacked it. There is a degree of myopic logic to that approach so it is hardly surprising that many people take it.

Perhaps the greatest challenge for the Conservative opposition in 2009 is to hammer home the message that there never was a massive increase in personal wealth over the last decade. It was pretend money manufactured at poor Gordon's behest in order to take as much of it as he could in tax without taking so much that he lost the votes the pretend money bought him.

The other great feature of 2008 has been the dramatic collapse of the great global warming hoax. There is still a long way to go. This year we saw the annihilation of the hockey stick graph by devastating analysis of both the source data and the statistical method used in its compilation. Its author, a redoubtable fellow with a Brownian approach, claimed to have answered all the criticisms and to have proved that the hockey stick was correct after all. He created a new hockey stick using what he claimed was a different method. This was reduced to rubble in a matter of moments. The English High Court was invited to examine some of the claims made by St Al of Gore in his film and concluded them to be an inconvenient pack of distortions. St Al himself was exposed for having bought a hugely expensive seaside property which will be destroyed if his claims about rising sea levels prove to be even a quarter true and to have a main home which uses more electricity than many towns. And the naughty planet has frustrated every single prediction the hoaxers' computers have made. We have now reached the truly farcical position of hearing today apocalyptic warnings about the next ten years which match exactly the apocalyptic warnings of ten years ago. "Ten years to save the planet" they said then, "ten years to save the planet" they say now. With any luck when they say it again in 2018 they will do so to the only remaining receptive audience, the convention of those convinced they have seen Elvis behind the bacon counter at the Co-Op.

Of greatest interest has been the back-tracking of sensible governments. Canada elected a government opposed to cap-and-trade schemes and handed a thorough drubbing to the main opposition party which proposed a wholly unaffordable system of carbon taxes. Australia elected a government committed to wholesale slaughter of industry, only to realise after the event that this was the plan, so now that government cannot bring in 90% of what it proposed because of the risk of a popular uprising. The German government decided carbon taxes are a jolly good thing provided they don't affect Germany and the Baltic states won't have any of it. Most significantly both India and China continue to laugh at the absurdity of the west taxing its heavy industry out of existence and continue their steady path of modernisation for the continued betterment of their people. Only in the UK and America are there signs of suicidal lunacy continuing to rule the roost. I'm optimistic that the cost will eventually hit home as it has with Germany's political leaders, time will tell.

So much more has happened to make 2008 a fun year, but these are my favourites. We will read and hear a lot more about them in the twelve months ahead. I look forward to chipping in my contribution for the continue delectation of both my regular readers.

A very Happy New Year to everyone


Anonymous said...

Yet again another brilliant post. Thankyou for giving me so much enjoyment since discovering your blog and may you write many more.
Yourself and Mr Leg-iron are my 2 top blogs.Both well thought out,well written and well argued too.
May you and yours have a very happy and satisfying new year tho i doubt it will be a prosperous one.
Many thanks.

woman on a raft said...

"It was pretend money manufactured at poor Gordon's behest in order to take as much of it as he could in tax without taking so much that he lost the votes the pretend money bought him."

Excellent summing-up. Ought to be on a (big) t-shirt.

Pogo said...

Happy New Year FB...

I think that you owe me a new keyboard - I was 'avin' a noice cupper when I read the reference to "Elvis"...

Keep up the excellent work old bean.

james1071 said...


I am afraid you have got this wrong.
The electorate can see that the financial crisis is global in nature.

It is plainly absurd to suggest, as you do, that the UK housing boom and Northern Rock are anything other than secondary issues.