GOP leaders take fright at Obama deficit reduction plan

House Majority Leader Eric Cantor

Republicans have today come out with fighting talk against the notions for deficit reduction that the Obama administration is contemplating. They had a message today, Wednesday, for President Obama as he prepared to outline his plans, with at least a partial emphasis on taxes.  "Don't go there!" is their message to him. GOP leaders reiterated their argument that Washington has a "spending problem," not a revenue problem, and that new taxes on the wealthy, who Republicans describe as the job creators and small business owners who will drive the economic recovery, are a bad idea.

Generally speaking I'd agree with them. However, I'd separate the corporate types from the small business owners. The likes of Wal-Mart have exported jobs to Mexico, China and India. Brazil is now in the mix. Small business owners create jobs built on effort. The larger corporations tend to rely on tax avoidance, cost cutting and funny money. America is suffering from the fact that the Federal Government needs to spend money in order to keep people off the streets, with the mayhem and bedlam that would cause. It is going to require more than tax rises or tax breaks. The whole system needs a makeover, starting with giving the computerised money makers a lesson in fiscal integrity.

Congressman Pete Stark, the Great Debt Lover!

Congressman Pete Stark, from California, thinks the bigger a country's national debt the more the other less indebted nations will genuflect at its corrupt altar.

Can any one suggest a good reason why this moron was ever let loose on US politics?

Update: I've just taken a look at Wikipedia on Pete Stark. He's got no degree in economics. He's got one in general engineering. Still that didn't stop him tooling up in the banking industry. In 1963, Stark founded Security National Bank, a small bank in Walnut Creek. Within 10 years it grew to a $100 million company with branches across the East Bay. No wonder he likes debt! Other people's and the nation's, of course!

To whom do we pay the deficit?

The government is pressing on with reducing the deficit and I have no qualms or quibbles with this. However, it would be nice to know where all the money is going. It seems that when one enters the counting houses of billionaires, no questions need be asked. A billion pounds off this quango and a billion pounds off that state department. Good, but where does all the dosh go? Who will be getting it? Transparency is thin on the ground at the moment.

Last week, Matthew Wright had as a panellist that gruff Mancunian Terry Christian. In a moment of "hang on a tick", Christian asked Wright about the deficit payments. Matthew had no clue other than waffle. Then a day or two later, Christian asked the same question. Wright appeared to have been given a brief of sorts, but the answer was pretty vague and vapid. None the wiser.

Robert Preston hasn't helped much either. He never talks about it, which is a pity, as the BBC could do us all a favour. We are still in this triangle of quantative easing, fractional reserve banking and deficit reduction. Nobody gives us any balance sheets, tells us who owes what to whoever, and the merry-go-round still pumps out the same rickety tune. "We're all in this together". Yeah, OK, but in what exactly?

If you Google "To whom do we owe the national debt" it appears that the search engine to beat all search engines gets chronic amnesia. I've seen a bit about a guy who is seeking a Freedom of Information answer and a couple of weird answers on Yahoo Groups.

Come on George Osborne! Let's have a fact sheet with the pithy points laid out. Surely we should know who Paul is before we rob Peter?

George Osborne's cutting plans today

Today is the day. George Osborne is about to tell us what's in store for us by way of hardships and hefty cuts. I'm getting all doubtful about what is best. All I know is that we've been playing with monopoly money for too long. Something has to give. The only problem is who gives more and who gives less. Being all in it together implies the tax avoiders are going to cough up as much as the soon-to-be redundant state workers.

I wouldn't mind if we all had an equal shot at trying to reduce the deficit but just as in wartime, when some were active backsliders, we must be on our guard for those who think this debt crisis is nothing to do with them. We'll see in just over an hour!

All In This Together - Part 1

David Cameron has said we are "all in this together" as the country battles the financial problems such as the mega deficit. It has been decided that richer types won't be getting child benefit from 2013. They don't need it and it will save £1 billion. I don't need the winter warmth allowance, so I'm happy to give that one up. But is everyone playing with the same bat? I suspect those in the "financial services" industry are not yet in a mindset to play nicely.

The bankers are still getting stick from the public. This is partly I suspect because they don't want reform that will expose some of their murkier transactions. Banking was once an honourable profession. It is now infected by the practices of spivs and charlatans. I know of a number of good people who have left modern banking because their consciences were sorely tested by what they were asked to do in order to get a sale.

If we are "all in this together" then those in the financial services need to be properly in with us. When it comes to pensions most of us believe we are dealing with honest brokers. However, this may not be the case. Most of us thought the Robert Maxwell days were gone. But we live today with pension deficits. Why? Because companies have not been paying into the funds. Shortfalls abound everywhere. The Post Office pension fund is a disaster masquerading as a genial leviathan. If ever the outfit is privatised it will be the taxpayer that gets this actuarial monster to deal with. And yet more liability will be heaped on us. The governance of pensions has been left in the hands of the incompetents and handwringers. Not only are the contractual elements of pension funds being flouted but those in power seem not to care. Let the coalition government shine a light on these pension deficits.

Transparency is hard to get in the pension world. BBC Panorama is exposing the collossal fees taken by private pension funds. Pension-selling companies are taking the equivalent of 80% of money paid into some pension plans out in fees and commissions, Panorama has found. In one HSBC pension plan, £120,000 paid in over 40 years would result in fees and commissions totalling £99,900. How much, HSBC? And this organisation used to be run by an Anglican priest. Surely he had some idea of this daylight robbery. HSBC just replied that its pension product is competitive. BUT THEY JUST DON'T GET IT. It is precisely this weasly way of working that has got the banks into such a dim light with the public. Shanghaid indeed! Perhaps when the reverend gent becomes a trade minister he can advise the prime minister on how to clean up this pension fiasco? He and Vince together, the Dynamic Duo. Angela Knight watch out!

Malcolm McLean is a pensions consultant. He says, according to the BBC, that the problem is a lack of transparency when the pension is sold and what seems like a small annual percentage charge grows each year in real terms as the fund gets bigger. "You suddenly find that after 30 or 40 years there's a terrific amount of money lost and I don't think many people actually understood that when perhaps they took out the pension," he said.

Lack of transparency, eh? Well, if we are "all in this together" let's have these pension providers being honest and open. By all means take properly earned fees. Nobody can run a business without a profit. But this is ridiculous. How much of this excessive skimming off the top goes into bonuses? Dig deeper Dave! We need answers.

The city has an expression for poorly performing funds. They're called dog funds. And I expect they come with all the crap as well!


Panorama site