Saturday, 24 June 2017

Bad Business





Housing and property have been central to UK politics for long while now. As the parties have striven to out bid each other, so the promises made become more wild and the costs greater.  A couple of links will explain this.

This from the LSE is brief and succinct and explains the general history without becoming involved in much debate about all the current policies etc.. It says about them that it is evident that these measures are failing to defy structural economic gravity.

A fuller discussion comes from biased.bbc.org Nil Desperandum in "Towering Injustice" of 23 June with two videos. The first is a brief item of one minute twenty seconds saying it has been a bad business.

The second is a full fifty minute documentary from 1984 "The Great British Housing Disaster"  which tells us a great deal about the present one. What is signal in this is that the men who actually did the building tell us what they did, or rather did not do.

It is a shocker, a tale of power crazed politicians, ambitious architects, property companies seeing certain profits, contractors making empty promises and workers paid by the job cutting corners quite literally. It is not a horse that bolted, the bolts were never there or fastened.

In 1984 all this was known. We have been paying since then for it and are now going to be paying more.


Thursday, 22 June 2017

For Whom The Motorway Tolls





It is in the news that the M6 Motorway Tolls have been sold to an Australian investment group.

The story is here if you want it.   My reaction was that this seems a little odd. What would any right minded Oz want with this scruffy little bit of England?

The tale was a longer one I was told by one of the family. Before it had been on the balance sheets of 27 financial operators. Quite how or why any of this had happened was lost to me as it would be to most people. You might think a toll was a simple basic operation for clear purposes but no longer.

It was December 1958 when the wonders of the Preston Bypass were revealed to the nation. It was intended to stop the notorious traffic jams on the old A6 as it wended its way through the ancient borough of Preston and across the narrow Ribble bridge.

So many went to see it that the traffic jams went from Lancaster to Wigan. As for getting to Blackpool by car, it was quicker to go to Berlin was the old soldier's joke. In time the Bypass became but one small part of the M6 motorway as it ran from Shakespeare country to the border and that of Burns.

There were the usual debates about its use and purpose. Some thought it would be a little used luxury, others recognised that Britain seemed finally to be admitting that the age of the motor had arrived. Among them was the issue of whether it should be "free" or whether a toll be made to contribute to maintenance etc. costs.

This was an age when a flow of cash was seen as just that and when intended for a particular purpose would go to the authority or agency responsible for doing the work that needed to be done. Ideally, the cash from tolls would pay for the longer term costs and improvements as well as the short term ones.

More recently under a Labour government, in 2004 the new M6 tolls gave rise to political argument but by then cash was looked on with eyes of envy by financial operators who see it not as there to pay for something to be done, that task should be loaded onto others, notably taxpayers if you could get enough politicians drunk, if only on power, to agree to it.

The cash would become an asset and a base for credit and in turn operations in the many and various markets for trading and lending and lending and trading. The M6 is not just a road from here to there it is a desirable instrument wherever the financiers operate.

So as you wave the latest edition of your credit card over the thing at the entrance you are setting in motion a flow of money movement through the world from the Caymans to Hong Kong and Sydney and incidentally letting GCHQ at Cheltenham know that you are off to see grannie again.

It is not exactly a highway to heaven but it is as good as you are ever going to get. The bell tolls for thee.


Tuesday, 20 June 2017

No Second Helpings





One subject that has been avoided in this blog has been diets and dieting, if only because I have a distaste for it. But Science Daily has had an article recently which was of interest.

DNA for dinner is not what the article is about, directly, but there is a school of thought that argues that man is what he or she eats, notably the DNA we have relates to the diets of our ancestors.

In the interests of diversity the farmers and the cowhands must be friends (see the musical "Oklahoma") but when it comes to eating and drinking perhaps we should be mindful of what we are in DNA terms.

If asked what you have been doing, the answer is Nutrigenomics; that is Nutritional Genomics.

Time to send out for the fish and chips.


Friday, 16 June 2017

Grenfell Tower Questions





It is difficult to avoid the disaster of Grenfell Towers and the tragedies that have ensued. To debate or comment needs care given the rapidity at which the story unfolds in both the media and on the web. Sometimes too rapidly for the editors. The Mirror online had a story on the question of sprinkler systems at Grenfell Towers along with an advert' about "Stinging funeral costs avoided by savvy over 65's".

Of necessity, the Prime Minister has stated an inquiry will be held if only to claim that something should be done and will be done. The key problem with inquiries of this kind is that they take years, become an expensive battlefield for armies of lawyers, confuse every issue and then report too late to be effective.

In the late second decade of the 21st Century with worldwide media, communication and information systems, let alone numbers of experts instantly on tap, the right method is to set up a capable team to pull it together to produce an analysis document of the key elements within weeks or even days.

The majority of our tower blocks date from the second half of the 20th Century. It had become fashionable for local authorities to have Chief Architects with large departments for whom big projects defined status and masculinity. Councillors liked them for much the same reasons. They proved that "something was being done" by virtue of the their physical impact.

What was worrying in the 1970's was that proposals often defied rationality, notably in mining districts riddled with subsidence going back centuries. To look at the alternative ways of meeting housing needs could mean a lot more time and trouble and attention to detail, despite being much less costly to both provide and maintain. In committee a chest beating chairman was all too likely to want a tower block.

In the case of Grenfell, the reports I have seen say the Kensington and Chelsea Council is the "owner", that is the freeholder. On the web property pages there have been flats for sale as leaseholds. The variations in price suggest large variations in condition and location within the block.

These leasehold prices seem to be way beyond the resources of many of the occupants who necessarily will be renting. Three questions then, what are the typical rentals and what are the ground rents payable by leaseholders to the freeholder and what are the annual service charges payable to the property management service?

There seems to be a Resident's Association, but does this represent all of the leaseholders, or only the rentals, or just those who are there? In terms of the current legislation is this Association a voluntary group or does it have the legal standing of a limited company?

It is claimed by the Council/Freeholder that the question of sprinkler systems had divided views among the residents some of whom feeling that the disruption and cost of installation was not needed. I believe it is often the case that when it comes to spending money in flat developments many residents want low cost as a priority.

A good deal of comment at present is saying this is the result of poverty for many of the residents who are low income and of deprived families. But how can they afford then to live there? The answer is the benefits to which they are entitled. What is that total? Say somewhere between half and a million a year for the block?

Which brings us back to the question of who owns the leases. 120 flats mean 120 leases and if the residents of most or many are rentals someone somewhere could be making a great deal of profit on the system. Just who might we be looking for in that area with the kind of money and incentive to invest in this kind of property?

This is something I suspect that will not be covered by the government inquiry. But then that might be because they will never really find out because the leaseholds might be owned by a chain of companies located offshore or else used as security for credits for borrowing for financial dealing.

Only their cladding will be a lot more protective than the kind used at Grenfell Towers.


Tuesday, 13 June 2017

Magic Money Trees





One of the great works of the past is the Rev. Gilbert White's "Natural History And Antiquities Of Selborne". He lived from 1720 to 1793, in rural seclusion in Hampshire but noted and commented on the immediate life about him, notably plants. His book has a web site and you are welcome to read it.

Yet he lived at a time when there was a magic money tree, MMT, and could not fail to be aware of what happened. If asked he might have advised that trees are fine when in full growth. But they can be chopped down, catch diseases, through their seeds create dense and impenetrable forests and be costly to maintain. Also, sooner or later their fruits run out.

In the Middle Ages the monasteries became the MMT's of their time. Then King Henry VIII, advised by Thomas Cromwell, and needing serious money to build, decorate, run and maintain his new 34 palaces; he might have called it infrastructure and job creation, nationalised them.

This induced a collapse in the economy. The monasteries etc. were at the centre of the wool trade, a major part of the economy, and critical to the foreign trade at that time. Also, they were the medical centres, education providers and retirement homes.

The ensuing land grab created new magnates and landowners and in the next century absolute monarchy went as well. This was because King Charles I, following the example of his father, King James I, subsidised the arts and spent heavily, only to lose his head.

It is possible to see MMT's in money economies as long ago as the Emperors of Rome and in other parts of the world, the Chinese Empires and those of say, the Mughals. There is always the question, what happened next?

This ten minute cartoon tells the tale of John Law in France at the beginning of the 18th Century in simple fun terms.

This three minutes of satire deals nicely with our very own British South Sea Bubble that enriched so few and impoverished so many. When the question arises about the 17th Century Tulip Mania the answer was it could never happen again.

The 19th Century was a period of one crash after another across the world all involving the search or believed findings of MMT's. See Wikipedia on "Long Depression" and "Baring crisis". This was central to the imperial policies of the European countries as well as both the militarism and nationalisms of their time. My posts on "Gold Fever" of 4 January and 2 May 2016 refer to these.

But my favourite MMT for personal reasons, I am proud to be Nesbitt, goes to that of the 1770's. The man was Arnold Nesbitt and there is a telling biography of him here read down  on the History of Parliament web site, Research, Members, as he was an M.P. along with his close colleague Sir George Colebrooke. It is strange how so many M.P.'s are involved in so many financial crashes.

It is my view that the Colebrooke and Nesbitt crash of The City in the 1770's cost us the American colonies. There are differences of view about this being a good or bad thing. It involved in particular the East India Company which meant that the effects hit almost everyone with wealth. It leads us inevitably to Jane Austen.

Jane, who lived at Steventon along the road from Selborne, had a close friend with a shared interest in exotic plants. She was Emma Colebrooke who had married Charles Bennet, Earl of Tankerville. Emma was the daughter of James Colebrooke, brother of George above.

One of the features then of the interests in plants was not simply as ornaments but in an age before synthetic chemicals their potential for profit as medicines or colourings or flavours. These Nesbitt's were family and close connections with the Sneyd's that Jane did know. Jane was certainly interested in money and how much men were worth, in any case a brother was a banker.

Coming to the present via a complicated story of family histories we end up in the Liverpool of the Deputy Leader of the Labour Party, John McDonnell, a recent convert to the idea of planting an MMT to save us all from inconveniences, such as paying rents, repaying loans or counting the pennies. His Marxist beliefs would seem to contradict this, but there have been a number of nations recently who married Marxism with an MMT only to collapse into poverty and social breakdown.

There has been a row over John's education, he was at the De La Salle secondary school, whose alumni include Wayne Rooney but before that alleged to be at a high fee paying "prep school". This is a nonsense. The place he was at was then an RC seminary where many were called for the priesthood but few were chosen. It would only take a forbidden trip or two to the cinema etc. to miss the cut.

But it is possible that the Parish Priest who first recommended John was of a family linked to the McDonnell of McDonnell Earls of Antrim.  Also, John's grandfather at one time lived a couple of hundred yards away and in the same parish as the grandchildren of a Kavanagh of Carlow. In 1851 Morgan Kavanagh of Carlow was sharing a house with Karl Marx.

So when John changed from one faith to another the leap was not as long as you might expect. Moreover the connections go back to people close to and related to Arnold Nesbitt, creator of one of the great MMT's of modern times and the one which arguably went most spectacularly bust.

But John's MMT for the huddled masses and students also depends on rich people paying their taxes, admitting their liabilities and eschewing the off shore and other schemes.

In fact, he will have to persuade his fellow alumni Wayne Rooney and his associates, who recently lost a court case to the HMRC, to pay more tax than in the past.


Saturday, 10 June 2017

Comparisons Are Odd





The Tories are now in troubled times.

Worse, with what is out there to be dealt with in the immediate future is far from promising.

But let us allow Ms. May and her much maligned advisers some credit.

They have managed to make Edward Heath, 1970-1974, look good.


Friday, 9 June 2017

Would You Believe It?





During the time of the Cameron coalition government the Liberal Democrats under Nick Clegg refused to allow the redrawing of constituency boundaries that were due; and which are now long overdue.

Ms. May did not attempt this as she might not have been able to get the majorities needed.

Now, we have another fine mess, Nick Clegg has lost his seat and the Liberal Democrats are a minor and divided party.

Meanwhile the constituency boundaries are becoming more and more out of date; and are likely to remain the same for years to come.