The Academic Thugs

I’ve had a few run ins with people I refer to as “boy-scientists” (people whose enthusiasm for all things scientific overwhelms their ability to see things in the correct perspective) here though I do restrain myself because people tend to form the impression that I am anti – science and nothing could be further from the truth.

All we need to remember is that a science is a formal and classified body of knowledge. What I object to is the attitude of people who talk about “scientific methodology” and the “scientific way of thinking” as if parrotting these cliches makes a person’s opinion worth more that that of somebody who says “well that’s how it seems to me, based on my experiences.”

Now OK, I admit I go out of my way to provoke the boy-scientists and get them to reveal that their attitude stems from a deeply held belief that a certain kind of education makes one superior to people who followed a different path. As Oscar Wilde said, “Nothing worth knowing can possibly be taught.”

I am not the only one who feels there is a concerted attempt to create a new academic elite to replace the old aristocracy. In the USA the trend has even been spotted in the election campaign. Here’s an interesting article from Pajamas Media (their spelling) on a particularly warped theory expounded by liberal academics and is gaining currency.

It concerns Barak Obama’s stated intention to change the U.S. Constitution so that rather than all people being equal before the law, the courts are bound to favour “the weak against the strong.”

Yeah, you read that right.

Whining Academics

Crazier and crazier

The religious hysteria whipped up by The Obamessiah’s election campaign is just getting go insane I can’t write about it.

The Socialist International – Barbara Eichenreich cooks up a theory of right wing conspiracies because John McCain had the audacity to say he thought he would be a better President that his opponent. Poor Johnny Mac, he forgot The Obamessish is the anointed of God and must not be questioned. What would the Democrats be like if The Republicans had managed to find a credible candidate.

Why This recession will be a doozy – Henry Blodget.
Meanwhile the news on the global economy and the financial just gets worse. The glass is not half empty, it is lying on the floor shattered, its contents spilled.

The Obamessiah’s plan for free healthcare

Not a post that concerns UK readers but it amuses me to post blogs critical of Obama just to see how quickly some little Obamabot will turn up (one of his Fast Action Response Team – sorry I mean Vapid Rebuttal Squad maybe – to tell me I’m an evil person and that The Obamessiah is the anointed of God, he walks on water and his farts smell of perfume.

Tell a lie big enough and often enough and it will become true. Adolf Hitler said something close to that. Keep it in mind.

A phrase that is the basis of The Obamessiah’s misrepresentation’s, lies and deceptions about European health care systems holds that Britain, Canada and European nations benefited not just from their universal health care systems, but from being societies in which health care is rightly regarded as a human right

I have always found American right wing complaints that Sen. Obama is a socialist risible but the tone of the campaign makes me aware of some similarities with one European Socialist party of the 20th century, the National Socialists. Consider the messianic persona the candidate has adopted, the ruthless management of media to suppress criticism and the manipulation of information in a way that creates hysteria among followers.

But let’s look at the healthcare issue.

Healthcare is not a basic human right, access to healthcare is. Healthcare in Europe is not free, it is free at the point of delivery because of state run health insurance systems. In Britain our National Insurance contributions are a ring fenced tax, part of which funds the “free at the point of delivery” healthcare you take for granted but do not understand. Those of us who earn enough pay (and most of us are happy to) this tax to provide both ourselves and the less well off on whose work we often depend for essential services, with healthcare, unemployment and sickness benefits and pensions.

If The Obamessiah was capable of telling the truth about anything he would be admitting that the taxes paid by every American earning above minimum wage would rise by at least ten per cent to fund his healthcare plans alone. Try selling that to Joe the Plumber.

Obama is not a socialist, his policies and campaign style reveal his is closer to the philosophy of the National Socialists. With McCain as the only alternative America is truly up shit creek. We socialist Europeans are willing to fund a Universal Healthcare System because we know that a serious illness could bankrupt a family, result in the loss of the family home, devastation of savings and investments and because of the limitations of private healthcare insurance leave patients not only ill but impoverished. National healthcare provides care according to need but it sure as hell ain’t free.

Read this blog from an Obama supporting American and see how skewed a view of reality The Obamessiah is giving his followers.
US healthcare in the election

Magic Money, the great free market illusion.

At the height of summer, in those carefree days of endless sunshine and picnics in bee – loud, clover – scented meadows by languid steams (I’m writing in a metaphorical sense here obviously) it seemed the good times would go on forever. Like Keats’ Autumn the economy kept burgeoning, oblivious to setbacks. So how did it all go wrong so quickly? Sit down and I’ll tell you. You’re going to like this, not a lot but you’ll like it.

The free market, the miracle that turned us into worshippers in the high Street Temple of consumerism, the perpetual motion engine that drove global economy was no more than an illusion. The world economy was based on magic money, dreamed up by politicians and bankers and underwritten by ridiculous asset values that bore no relation to reality.

In 1976, Jim Callaghan was the undertaker for the post-war social democratic order when he said: “We used to think that you could spend your way out of a recession and increase employment by cutting taxes and boosting government spending. I tell you in all candour that option no longer exists.” Now, instead of thrashing around trying to find a way to rescue the bankers from the consequences of their folly, the prime minister should stand up and say: “We used to think you could borrow your way out of a recession and increase employment by increasing debt and setting the City free. I tell you in all candour that option no longer exists”. It would bring the house down, literally.

A year after Callaghan faced his crisis, socialism was dead, its ideals of social justice hijacked by special interest groups advocating not fair treatment for all but advancing arguments for the preferential treatment of minorities. Into the political void stepped Margaret Thatcher, as much an illusionist as any other politician but one who claimed she could really perform magic. Having got her party elected and started an unnecessary war to arouse patriotic feelings and disguise the incompetence of her government she pulled her first rabbit out of the hat, giving council tenants the right to buy their homes.

Here next trick was to make the money raised from selling council properties disappear instead of investing it in new properties so that people could get on the ladder as young tenants and earn the right to buy their home later when their lives and incomes were more settled. The lack of available homes to rent created an artificial demand for property to buy at the bottom of the market which forces prices up to unrealistic levels. In turn this pushed up prices in the middle. Meanwhile a new, classless (in every sense) elite was created. These people wanted to live in exclusive neighbourhoods for the status they imagined that gave them. They were prepared to pay over the odds for property at the top of the market but wanted top money for their suburban semis.

The madness ought to have been regulated by lending restrictions but the newly deregulated financial institutions tore up the conventional financial wisdom of not lending more than people could afford to repay, “If customers default on the loan, we take the house” they said, smugly assuming that as long as there was demand in the market their investment was safe. They were wrong, so long as the madness continued and unrealistic values continued to be placed on properties used as collateral the illusion could be maintained. Once economies slowed and earnings started to fall more and more people started to default on loans. Very soon panic set in.

The recession of the early 1990s was deep, swift and painful. It ought to have taught us about Magic Money but very soon more rabbits were being pulled out of hats this time based on a notion of The Internet changing everything in a way that would enable us to become rich by giving stuff away for free, the dotcom bubble. Ridiculous values were put on startup companies with no track record, no revenue stream and in some cases no product to sell. The first dotcom startup to fall, in the month after its shares started to be traded on Stock Exchanges had had millions of hits on its web site but converted just three of these into sales.

No matter, the dotcom tycoons continued to spend their investors venture capital as if the end of the world was imminent and to behave like Conquistadors, treating the captains of traditional industries as if they were members of some stone age tribe.

Once the rot set in the dotcoms fell like dominoes.

Enter the superheroes who would save the world. The Free Market maniacs with their mathematical models, their structured investment vehicles and their billion pound bonuses. These people had learned a new trick, not for them the tired old illusions like sawing the girl in half, making the monkey disappear, pulling the rabbit out of the hat. These guys has learned how to do transubstantiation. They were not interested in turning brad and wine into flesh and blood however. The new trick involved turning a liability into an asset.

When once people had bought a house the lender who financed the mortgage had a claim on the house which secured the debt, thus balancing the account. Thanks to a piece of financial sleight of hand which was possibly invented by the people who brought you the Enron and Worldcom corporate bankruptcies, in the brave new world of creative accounting a mortgage became a double asset for the lender. They owned the house and they owned a slice of the borrower’s future income ‘til the debt was paid.

Suddenly the balance sheets of mortgage lenders showed a doubling in the asset value of the organisation. Value of their shares rocketed and on paper they had oceans on money to lend. And lend it they did, to anybody, because every loan they made immediately doubled in value on their balance sheet. And that really was magic.

So as you stand surveying the wreckage, should you hear anyone ask “What went wrong, where did all the money go?” you can tell them; “There never was any money, it was all done with smoke and mirrors.”

Ian thinks he is the first poet out of the starting gate with poems on the meltdown:
Holy City
Chasing Bubbles

Around the blogs – 9 Oct

We’re expecting big news from the American election trail overnight. As usual Little Nicky Machiavelli will be ready to point to the really interesting stuff we do not see in the British Press. Until that story break however here are a few more local issues:

We’re all socialists now Teleraph columnist Simon heffer thinks the bank bail out has truned us into a modern version of the Soviet Union.

All Hail The Bunha Bail Out The government’s plan to rescue the economy was hatched over a takeaway curry. I’ve made better plans over takeaway curries before now, but what was on Alistair Darling’s order

Time to grasp the fiscal nettle The only way to steer the world back to reality after this crisis is to accept that just because someone says an asset is with £Xmillion, that does not mean it is actually worth anything.
creditcrunch

The Age Of irresponsibility – When did it start asks political commentator Michael White of the era that has just crashed and burned. When Thatcher abolished legal constraints on the rich or did the irresponsibility begin before that?

And finally… a welcome bit of humour from the American election, A comic book look at McCain and Obama

Child Poverty and the Financial Crisis

Last weekend Trafalgar Square, London, was the venue for a protest aimed at holding the Labour Government to its election pledge to reduce child poverty. What? You couldn’t be arsed turning up? You heartless bastards, how could you ignore the plight of those poor children?

I missed it too actually, not through indifference or inertia but by design. I refuse to subscribe to the notion that child poverty can be separate from adult poverty. All poverty is relative of course so how do we define child poverty? Are those who do not have the latest trainers, games consoles etc.. poor? Or are the onces who are decked out in the latest designer clothes and equipped with the latest toys and gadgets but starved of attention really the ones living in poverty? If everybody was given £1000 a week to live on then the people who smoke, drink, do drugs, live in over-mortgaged houses, drive Chelsea Tractors and eat only in restaurants would be impoverished while those who live on lentils, drink home made elderflower wine and drive a pair of raffia sandals would be in the money. Little Nicky’s Theory of relativity.

I digress however, so getting back on topic, a protest about the government’s failure to reduce child poverty is really nothing but a protest against hypocrisy. While this NuLab government is in power a protest against hypocrisy seems futile. Why did they single out child poverty? It is, is it not, hypocritical for a government that has devoted so much time and effort to increasing poverty among the lower paid, disabled and old and raising the bar below which people cannot afford to keep a roof over their heads, eat and keep warm to talk about reducing poverty when what they mean is performing conjuring tricks with economic statistics?

We should not heap all the blame on NuLab of course; Brown, Blair, Mandelson et al have made matters much worse than they need have been but the foundations of our broken society were laid by Margaret Thathcher’s Conservatives. The blueprint was drawn up long before them however.

The English speaking world, Britain, America, and to a lesser extent Australia and Canada suffers from a disease that though know in other parts of the globe does not periodically reach epidemic levels. The most visible symptom of this disease is an uncontrollable urge to buy houses. This obsession, once established, quickly becomes all consuming. People will sell comfortable homes that are well within their means to trade up to something bigger / in a better area / nearer to a good school (the list of excuses given by people about to plunge themselves into financial hardship is almost endless. At the bottom end of the market even people for whom anything but renting a home seems like insanity will clamour to get on the “mortgage ladder.”

not so many years ago it would have been impossible for the unemployed or low earners to buy a home but so effective was the great lie of the finance industry that property prices always go up in the long term the lenders in the industry even believed it themselves. They gave mortgages to people who should not even have been allowed to borrow the bus fare home. Thus demand was maintained in the market forcing up prices far beyond a level that was realistic and people were persuaded to take on debts they could never hope to service let alone repay even had their stated income been anywhere near accurate instead of just a figment of a cowboy who worked for a bank (The Loan Arranger).

For almost three decades and despite two major bubble / burst cycles the madness has gone on. How can the cycle be broken when even now governments speak of injecting cash into the economy to get the market moving again? The first step towards breaking the mould and alleviating poverty would be the most painful for politicians who have nailed their colours to the mast of Free Market Economics and would have to admit they were wrong. There needs to be a campaign to reverse the propaganda to the markets madness decades and destigmatise rented homes. People who rent their homes are not of less worth, it is simply the case that their circumstances are different, they have made different choices.

The next big step, painless for politicians but agonising perhaps for us ordinary punters, is a process of reeducation in individual responsibility. We cannot live on debt, we cannot simply keep borrowing more. That Cowboy Banker The Loan Arranger might tell us we can but it only works so long as we can keep earning more to service the debts. As soon as our interest payments default, good bye lifestyle, hello poverty. Borrowing more than on can afford to repay is insanity but only the individual can decide what proportion of income is available to service debts. Only you can decide how much you have to send on CDs, books, wine, gadgets, designer clothes etc. to maintain an acceptable quality of life. Only you can decide whether you want to live in a mansion, eat only bread and soup and sleep on the floor or live in a dump and go go to lots of gigs, parties, clubs etc.

The Loan Arranger says “If you will just be the same as everyone else you will be happy, trust me?” And you do because he is so likeable and really seems like your new best friend.

The very very first thing people need to learn to get themselves out of their personal mess is never trust anyone who says “trust me.”

If we get our heads round those simple things we are well on the way to alleviating poverty.

Labour, Mandy and the Glasgow Drunk.

Billy Connolly used to do a routine about a Saturday night drunk in Glasgow staggering to the all night bus stop but only striding forward with one leg and so going round in circles. In bringing back the universal sleazebag Peter Mandelson to mainstream politics, Gordon Brown is, is he not, at risk of turning the reinvented Labour Party (NuLab) into a pastiche of that comedy routine.

As if to underline the point Mandelson’s first pronouncement on rejoining the government concerned the economic crisis. The man who once wore a dead slug on his top lip (the gayest moustache east of San Francisco) informs us the only way to get out of the mess that has caused meltdown in financial markets around the world is MORE globalisation.

Is this political homeopathy I wonder or is it the alcoholic’s hair of the dog approach to curing hangovers. I lean toward the hair of the dog myself (it could actually have been a dog turd Mandy had on his top lip) because Mandelson is a hooked on power as any alkie is on booze.

Solving the problems of globalisation by pushing more globalisation is not an answer for the simple reason that China and India rather than the western economies are in the driving seat now. Advocates of globalisation claim it has reduced poverty but that is just spin and statistical trickery. Which is probably why Mandelson is a fan.

Since 1981 which was about the beginning of globalisation addiction among politicians and economists the number of people living on less than a pound a day has fallen. This is not due to the opening of third world markets to the west but to industrialisation in China and India. The measure of poverty is spin also. Since 1981, despite inflation statistics being rigged by spin doctors the cost of living, particularly of basic items like food and fuel has risen astronomically. People now living on £2 per day are now poorer that people who were living on £1 a day in 1981.

So Mandelson has not even taken his seat at a cabinet meeting yet and already he is peddling the lies of his corporate paymasters.

Good work Mandy, keep it up. Single handedly you could ensure Labour is totally wiped out at the next election.

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