Should Public Services be cut?

Thanks to the frothing at the mouth madness of the bonus-crazed profit seekers in the private financial corporations we have a massive national debt standing at 47% of NDP. Great. So Govt needs to rein make means massive public spending cuts. Tories and Labour have been having a pseudo-debate about how much each is and isn't going to cut. Also great.

So public sector pay is to be frozen. Private sector jobs have been lost in the recession. Should public sector pay rises and jobs therefore go too? Is this fair? Or are public sector jobs underpaid anyway in comparison with the private sector? Polly Toynbee thinks they are.

So we go looking for some facts, and find some on the site of the Chartered Institute of Personnel and Development (CIPD). It was the nearest I could get, but dates back to 2005. Probably as good as it gets, because it takes a couple of years to process the data.

First, 1998-2005 the number of people employed in the public sector (PubSec) rose by 11% and those in the private sector (PrivSec) by 4%. Some of this is acounted for by a phase of the cycle - public jobs tend to lag behing private, then catch up. This was the catch up cycle.

Since the late 1990's earnings in PubSec rose by 4.5%, PrivSec by 4%. Not much of a difference.

PubSec wage bill took 37.2% of National Income in 1999, rising to 42% in 2006/7 - the product of more numbers and more wages.

In 2004 the average PubSec workers earned £27.6 per week less than PrivSec.
However, the median PubSec workers earned £12 per week more than PrivSec.

This difference is due to the fact that private sector pay is more divergent, with greater numbers at the extremes of high and low pay.

At the highest extreme, the top 25% of PrivSec (executives &c) earners are clearly better off than their PubSec equivalents, although the PubSec are doing their best to catch up and pay their top dogs fat cat salaries. IDS finds that a grade 5 civil servant gets 22% less than his PrivSec equivalent, and a Grade 2 gets 65% less.

So there we have it. It's all very complex, and I have simplified it as much as I could. There is much more data to be taken into account, but so far there is no real evidence that the public sector is significantly overpaid.

Classical Keynesianism argues that Government should borrow to keep them in public service. Culling the Civil Service (much as anyone who has had anything to do with them would like to do so) will just increase the unemployment total, the social security bill, crime and mental and physical ill-health.

It all depends on what they do and how efficiently they do it. There would be an enormous benefit to the country if the idiot high ranking Civil Servants who are blocking development of a decarbonised economy were to be removed from office. We can dream.

The main gain would be to improve efficiency. The way to do this is to reinstate the old Suggestion Box, where sharp end workers can continuously modify and improve the efficiency of what they to. There must be thousands of lowly Civil Servants who are plodding along every day doing stuff that they know full well is pointless and inefficient. Their suggestions could improve efficiency enormously. Successful suggestions would be rewarded. It would improve their health and well being, since it would empower them. Marmot has found that powerlessness in the Civil Service is a cause of ill-health.

So - keep the public services going through the recession, but make them more efficient through grass roots empowerment.

Wave Cloud Sundown

sunset with angel wing
tip pinions spread
strong sweep of wave cloud
carved by the wind
drawn on a burst of dying light


the ranging run of sunset blue gold sky
fading through lemon green
purple and brown down to our dusty trail
through grey green graveyard trees
fields lit by golden stacks
then fixed dark triangle of road
a line of sparks of which ourselves are one

and to the south
a fresh new crescent moon

(c) Richard Lawson
France 2001

Iran update

Useful BBC review of the current Iran situation. It is all down now to internal politicking in Iran's elite. By no means all Iranian politicos accept that AhmadiNajad's election was fair. We shall see what emerges.

Meanwhile, Saudi Arabia has given Israel the nod in case they need to use Saudi airspace in an attack on Iran's nuclear facility. Apparently the Syrians also would not be displeased if the Iranian nuclear weapons effort met with an accident.

Nuclear is more trouble than it is worth. Always remember that if every Iranian were to be given 1 square meter of photovoltaic panel, it would create as much energy as their civil nuclear power effort.

Johnathon Porrit fingers Sir Humphrey

From today's Observer:

"Jonathon Porritt, one of Britain's leading environmentalists, has attacked the Treasury for being "startlingly arrogant" and for dragging its feet over sustainability...This month Porritt steps down as chairman of the Sustainable Development Commission, an independent government watchdog, after occupying the role since it was founded nine years ago.

He said: "Looking back now, as I am in my last few days, I see a terrain of wasted opportunity. I am not saying the only reason is the intransigence of the Treasury, but I do think the Treasury has killed a lot of the energy around sustainable development."... "Too often they have been foot-dragging and obstructive... a startlingly arrogant part of government. There is almost no curiosity about sustainable wealth creation. There is no readiness to interrogate the macro-economic model. SDC produced a report, Prosperity without Growth, in an attempt to start a debate on redefining prosperity, but we were met with a weird mixture of hostility and indifference."...Since it was founded in 2000, the SDC lobbied the government consistently to use its multibillion-pound budget to promote sustainable development through its procurement of buildings, goods and services. But Porritt said his efforts fell on stony ground for years. "At meetings relatively senior civil servants from the Treasury were sitting there glowering and wondering what they could do to scupper things when they got back to base," he said".

Ah. The Civil Service. The physical bowler hat has gone, but a virtual bowler hat (tricorn hat in the case of the Treasury) is etched into the brain of most senior Government officials. They are the substrate of political power, a cadre of lifelong dictators who will have naught but what is beaten out on their own anvil. Like insincere hotel workers, they project an obsequious servility while pissing into the customers' soup. They obstruct the will of the people, as faintly represented by elected ministers, ("Yes, Minister, but that would be a courageous decision"). They project their own agenda through the "options" that they present.

I cling to a chosen, existential optimism, but when I look upon the Civil Service, my optimism fades. They must be brought to heel. The Green Party has a paragraph in its Government policy about holding them responsible for the mistakes they make, but this is only the beginning. How can the service be revitalised, brought forward a couple of hundred years into the twentieth century, or even (idealist that I am) into the twenty first century? (At least, Conference did pass such a motion, though I see that it has not found its way into the MfSS on the web)

The best I can offer is the Suggestion Box, where workers at the sharp end can put forward suggestions to improve efficiency, said workers to be incentivised by receiving a percentage of the money saved by their improvement. This would increase their health too, as Marmot finds that disempowerment is the cause of much illness in his long-term study of the health of the civil service.

Ban ki Moon in Burma

Ban Ki Moon, UN Secretary General, is in Burma trying to persuade the generals to behave sensibly. Good for him, but he really needs to be working on a set of rules to make the process of becoming a dictatorship more difficult.

The international community treats each dictator in an ad hoc way, as if it is somehow a unique event. As consciousness rises of the dictators' brutality, political pressure slowly rises, discussion ensues, and appeals to his (it is usually a him) better nature give way to calls for some kind of sanction, which is then blocked in the United Nations Security Council because one or other of the members there has a trading relationship with the dictatorship.

It doesn't have to be like this. There are identifiable steps to dictatorship, such as closing down the free press, arrest of political opponents, and setting aside the results of elections. The UN needs to set up a tariff of sanctions targeted at the regime, applied when each step is taken, and lifted when the repressive step is repealed. The stick of action in the International Court of Justice can be balanced with a carrot, guaranteeing the dictator a comfortable life in exile if he leaves office voluntarily. More here - scroll down to Dealing Effectively with Dicatators.

Darling "warns" the bankers- not

Exclusive: 'Get real' – Darling warns the bankers - UK Politics, UK - The Independent
"Alistair Darling has warned bankers to stop backsliding into their bad old ways as he promised a much tougher regulatory system to prevent a repeat of last autumn's financial crisis."

More NuLabour hot air. Words aplenty, action zilch. As with climate change, so with reining in the banksters. [See below].

It's no good, we are going to get into the streets before we get meaningful change in this backward country.

The banksters will argue that if they don't get bonuses, the "best" (i.e. the people responsible for the fact that the National Debt now stands at 150% of GDP) people will move abroad.

Fine. The fact is that Anglo-Saxon capitalism is the most deregulated in the world. We are out in front where laissez-faire, free market is concerned. So it's not that we will be unable to compete with Europe; we are ahead of them in terms of financial excess; our influence is driving them onwards.

It's all enough to make you want to run off and join the socialists. Apart from the fact that they have no critique of the way that money is created by private corporations, on the ground that it is politically incorrect to do so, because some monetary reformers are anti-semitic, and the Left abhors anti-semitism (although it is devoutly anti-zionist). Have I got that right? I think so, but dialectical politics is so very very complex...

Bonuses: they're at it again

Well I'll be dipped in dogshit. They just don't get it do they?

The Treasury last week agreed a package worth up to £9.7m for RBS chief executive Stephen Hester, who will receive a bonus of more than £6m if he can double the people-owned RBS share price over the next thee years. "Lord" Myners grinds his aristocratic molars in impotent fury at this blatant disregard for political reality.

Network Rail defied political pressure by paying bosses six-figure bonuses. The chief executive, Iain Coucher, got£150,000 under Network Rail's long-term incentive plan on top of his basic salary of £605,000. This when a £30 billion shortfall threatens rail and road plans.

And so on and so forth, ad nauseam. The CEOs just do not get it. They just want as much money as they can get, irrespective of equity, fairness, public perception, social integration, public health or anything else. Irrespective even of whether they do good deals or do bad deals. They just want loadsamoney, and feck the rest of society. There is no such thing as society in their view, just their own individual self-interest.

From Management Today:

The starkest example ...was at Royal Bank of Scotland where, nine years ago, Sir Fred Goodwin was one of a group of directors each given a bonus cheque of £2.5m as a reward for their successful eight-month campaign to win control, at a cost of £10bn, of rival high street lender NatWest. The bonuses were to prove disastrous. Thus incentivised, these executives went out in search of more deals and ended up acquiring a whopping 24 companies over the next eight years. The final deal, completed with remarkable hubris shortly after the market had begun to go south, was the record-breaking £50bn takeover of ABN Amro.

It subsequently turned out that rather than proving a fruitful addition to the RBS clutch of nest egg, ABN AMRO egg was well and truly gone off, and was a £20,000,000,000,000 (£20billion) liability, which we the taxpayer had to pay for.

So what does this have to do with bonuses? Bonuses are individual incentives given to individual performers to acknowledge their individual achievements on behalf of the company. They indicate individual responsibility. Salaries are for being part of a team. Bonuses are recognition for individual responsibility.

Many would like to see the bonus culture wither away. That would be a good thing to happen, but it is more difficult than taking an ice-cream off a two year old without making him or her cry. However the Mabinogiblog is versed in T'ai Chi, ju-jitsu and Akido, which uses the force of the opponent to destabilise him. Subtlety is required.

If bonuses are paid for individual success, then the individuals concerned should also be responsible for their failures. If Bank A acquires Bank B and it subsequently turns out that Bank B is in fact nothing but a pile of derivative debt dogshit, a bottomless pit of toxic assets, void of any positive value, then the individual agent who brokered the deal, the individual who received a bonus for clinching the deal - he is responsible. Since it now turns out that he bought a negative asset, a stinking heap of debt, he should be made responsible for what he bought. Instead of taxpayers picking up the results of his actions, paying off debts worth thousands of pounds per capita for evermore into the future, the responsible operative should be brought to court, and made bankrupt.

The enormous advantage of this is that when a man is made bankrupt, the debt he owes disappears. It goes pouf! just like that. It is gone. It is an ex-debt. It is no more. It is finished.

So, bankrupt the likes of "Sir" Fred Goodwin, and make the future easier for our children.

Also, it would encourager les autres. The bonus culture would wither away if the bonus-hunters realised that they might be called to account for their mistakes.

These are difficult and novel arguments I know, but stick around. New is not necessarily wrong.