The Sickness that is Contemporary Capitalism

[haranguerer]

-know nothing about harney, just know, like I've stated often, that this article is bollocks.

Well, Doctor Colin Laser probably does know a lot about Harney, and what's more he probably does know a lot about what's going on in that Council chamber, and about the provision of cancer services in the area, actual and proposed, and definitely a lot more than you, and he's not impressed (see above).

Interesting, that though you profess not to know too much about it, you've no bother dismissing those with whom you don't agree as "idiots". Interesting too, that you've no qualms about defending a conman, on the basis of a link that you assert does not exist, even though you're just about the only one who's blind to: 'Public Services Withdrawn' ------> 'Private Services Proposed' (and it doesn't matter whether the plan to proffer this proposal was hatched in 2007, 2008 or 2009, it's of no relevance). The private hospital has been portrayed as a "first-class medical treatment in areas of high demand such as oncology" and to fill the gap in the market for "radiotherapy in the northwest, and more extensive cancer treatment". And it's the developers who've been crowing about the National Treatment Purchase Fund, no one else, and that involves capital allowances of €388K for every €100K invested -- that's a very, very generous tax break, and not one that any of the lads will be too shy about redeeming.

Not those who I dont agree with, if they've a different opinion, thats fair enough. 'Idiots' referred to those who swallow stories like this without question.

I'm not defending this conman at all. Earlier I said he seemed dodgy aright; just to clear up any confusion, it was O Grady who I said I thought got a bad touch in the article. Clarkes criminal past is clear. What I am railing against is this journalist using this to push his view down everyones throat. Check the first three paragraphs of his article - if this project is so clearly without merit, does he not think the public will see this for themselves, without setting such a scene, and shouting about the lad being convicted every second sentence. There were a lot of politicians with no criminal records who backed this too....

Maybe I am blind, as I still dont see how the proposal of a private hopsital can be seen as being linked or having contributed to the withdrawal of cancer services, which will cater for an entirely different clientele, and which was proposed 2 years after the withdrawal of the cancer services was.

The national treatment purchase fund has nothing to do with capital allowances....this hospital is not being paid for by the taxpayer, again, despite the journos protestations....

Also, dr colin laser doesnt really make a good supporting cast member - anyone can post anything in reply

[Fear ón Srath Bán]

I'm not defending this conman at all. Earlier I said he seemed dodgy aright; just to clear up any confusion, it was O Grady who I said I thought got a bad touch in the article. Clarkes criminal past is clear.

OK

What I am railing against is this journalist using this to push his view down everyones throat. Check the first three paragraphs of his article - if this project is so clearly without merit, does he not think the public will see this for themselves, without setting such a scene, and shouting about the lad being convicted every second sentence.

Like the public saw it about Liam Lawlor, like the public saw it about Ray Burke, like the public saw it about Michael Lowry, like the public saw it about John O'Donoghue? O'Toole set the scene for what was to follow, as any good journalist will do, and O'Toole has been taking a very close look at the Irish body politic of late, in fact he's been specialising in the corruption therein, and he's been speaking out when no one was prepared to listen. One of the very few. I didn't know about Clarke's past, I'm glad he enlightened me first.

There were a lot of politicians with no criminal records who backed this too....

I wish that could fill me with more any confidence, at all. We have FF 'socialists' voting for a privatised scheme that goes against their own government's policy of best cancer care practice, as proposed by a conman. Not to mention some of FG, even though the county manager strongly opposed the motion. And this could only have been proposed once their government's best practice of centralised cancer care had been implemented (and local services withdrawn). And the fact that it's local developers is indeed very relevant, and that is actually a big flaw in the whole rezoning process, having led to all sorts of corruption in Ireland in the recent past.

Maybe I am blind, as I still dont see how the proposal of a private hopsital can be seen as being linked or having contributed to the withdrawal of cancer services, which will cater for an entirely different clientele, and which was proposed 2 years after the withdrawal of the cancer services was.

O'Toole did not contend that the proposed private hospital has in any way contributed to the withdrawal of cancer services from the county. Nonetheless, with no cancer cover at all in the county, there may exist an opportunity for some to make a buck, with the connivance of certain individuals in the council. They won't be building that hospital for fun, there'll be profits to made and to go around, that's the bottom line.

The national treatment purchase fund has nothing to do with capital allowances....this hospital is not being paid for by the taxpayer, again, despite the journos protestations....

Even with no direct taxpayer input, that still doesn't assuage my fears, going on recent planning form.

Also, dr colin laser doesnt really make a good supporting cast member - anyone can post anything in reply

Anyone can yes, but he's a Sligo doctor, who has suffered cancer in the town. All very relevant.

[muppet]

The National Treatment Purchases Fund is to buy treatment for patients that our hopeless Health Service either fails to provide or the waiting list is too long. The irony of mentioning that fund in the context of the removal of services from Sligo and then using the taxpayer to pay for a private replacement is obviously lost on you judging by your bowling alley analogy.

[Bogball XV]

http://www.guardian.co.uk/business/2009/dec/06/goldman-bankers-bonus-recovery

Average compensation will be $743,000 per employee

Seriously, this shite has to stop - after a year when markets plummetted to new lows, how f**king difficult was it to pick a few winners??
Would it not make more sense to try and incorporate a little bit of long termism into the structure of bonuses?  Could they not for example put this years pot into a big pot which also included last years losses?  Should bonuses maybe be paid out on a 5/10 yr rolling basis? 

[muppet]

http://www.guardian.co.uk/business/2009/dec/06/goldman-bankers-bonus-recovery

Average compensation will be $743,000 per employee

Seriously, this shite has to stop - after a year when markets plummetted to new lows, how f**king difficult was it to pick a few winners??
Would it not make more sense to try and incorporate a little bit of long termism into the structure of bonuses?  Could they not for example put this years pot into a big pot which also included last years losses?  Should bonuses maybe be paid out on a 5/10 yr rolling basis?

Cowen/Brown/Wall Street: The massive bonus scheme must not be interfered with as the private jet/yacht industry is systemic to our economy.

[Declan]

Lets all move to South America

Morales re-elected in landslide victory

Monday, December 07, 2009 - 07:18 AM

President Evo Morales easily won re-election, according to unofficial results, getting an overwhelming mandate for further revolutionary change on behalf of Bolivia's long-suppressed indigenous majority.

Mr Morales' allies also won a convincing majority in both houses of Congress.

Opponents said they fear the coca-growers' union leader union will use his consolidated power not just to continue reversing racially based inequalities but also to trample human rights and deepen state influence over the economy.

Unofficial counts of 98% of the vote by two polling firms said Bolivia's first indigenous president won with 63% of the votes – 36 points ahead of his closest challenger in a field of nine candidates.

Jubilant supporters waving Bolivian flags jumped up and down in La Paz's central Murillo square after polls closed, chanting "Evo! Evo!"

Manfred Reyes, a centre-right former state governor and military officer, conceded soon after. He won 27% of the vote, according to the unofficial counts.

In a booming victory speech punctuated by fireworks from the balcony of the presidential palace, Mr Morales called on all sectors of society – including the opposition – to unite behind him.

"We have the enormous responsibility to deepen and accelerate this process of change," he said, insisting final results will give him two-thirds of both chambers of Congress.

The lopsided results signaled an opposition in disarray.

Mr Reyes narrowly led in the opposition bastion of Santa Cruz state in the eastern lowlands with 50%, compared to 43% for Mr Morales.

The three political parties that dominated Bolivian politics for decades have now been all but erased.Can you imagine the impact here if FF,FG and LAB disappeared? The last survivor was the National Union.

Its presidential candidate, Samuel Doria Medina, a centrist cement magnate, got just 6% of the vote, according to the quick counts.

Voters also chose a new Congress, and the quick count said Mr Morales' stridently leftist Movement Toward Socialism easily won a majority in both the 36-seat Senate and 130-member lower house.

The movement appeared to secure two-thirds in the Senate but fall just short in the lower house.

It would need two-thirds control of both chambers to dictate terms of a law on indigenous territorial self-rule, make key appointments unchallenged and amend the constitution to allow Mr Morales to seek a third straight term – the 50-year-old incumbent has been evasive on the latter issue.

Still, with majorities in both houses, Mr Morales will have the power to expand on radical changes he already has made, such as indigenous autonomy and land reform.

Nearly six of 10 Bolivians live in poverty and Mr Morales gained immense support using increased profits from Bolivia's natural gas industry to fund highly popular subsidies for schoolchildren and the elderly as well as one-time payments for new mothers.

"We'll always back Evo Morales' government because he takes into account the poor," said Ramiro Cano, a 40-year-old jeweller and a member of Bolivia's dominant Aymara ethnic group who voted for re-election.

Mr Cano praised Mr Morales especially for the annual subsidy his two children receive for attending school. "He's been a great help not just for me but for all families in need."

Read more: http://www.examiner.ie/breakingnews/world/morales-re-elected-in-landslide-victory-437212.html#ixzz0YzWkA45o

[Bogball XV]

http://www.guardian.co.uk/business/2009/dec/06/goldman-bankers-bonus-recovery

Average compensation will be $743,000 per employee

Seriously, this shite has to stop - after a year when markets plummetted to new lows, how f**king difficult was it to pick a few winners??
Would it not make more sense to try and incorporate a little bit of long termism into the structure of bonuses?  Could they not for example put this years pot into a big pot which also included last years losses?  Should bonuses maybe be paid out on a 5/10 yr rolling basis?

Cowen/Brown/Wall Street: The massive bonus scheme must not be interfered with as the private jet/yacht industry is systemic to our economy.

we had a bank that was of systemic importance to our economy too, it made great profits over the years, presumably it had cash reserves to ride out any storm

[Fear ón Srath Bán]

Gordy Brown and Alastair Darling could become modern heroes of mine if they're not careful, what with their attempt to inject some humility and realism into the higher echelons of the State Sponsored Gambling Investment Banking sector.

Great stuff, to hear those insufferable prima donna bankers squeal "they'll drive the best investors out of the country", now it looks as though the feckers will be hit in just about every western country. Got to love their vanity: "... but the best talent will move as a direct result of such punitive financial penalties (such as taxing the bonuses)" they declare. Erm... would these be the same geniuses that brought not just the banks but the host countries to their knees in the very first place? Lets organise the boats now FFS.

From today's Guardian:


Where Brown dares to tread, Goldman Sachs follows

Gordon Brown realised first that governments had to intervene to save the banks from themselves. Now he's doing it again

Whenever Gordon Brown claims to be saving the world, it tends to attract nothing but derision back home. Yet just as he did during the banking crisis, the prime minister can make a genuine case for setting the international agenda this week.

His plan to tax bank bonuses in Britain could have backfired badly if all the City's highest-paid professionals just drifted off to rival financial centres. Instead, the unilateral move proved just the cue that other countries needed to start acting too – after months of dithering on the subject. Within hours, the French and Germans were supporting similar moves and Goldman Sachs, the world's most powerful bank, announced two major concessions on its pay policy.

The causal relation is not entirely straightforward. The French can make a case for having already been pushing Britain to crack down on financial excess and Goldman was under just as much pressure in New York as it was in London. But the timing is striking. Goldman had been resisting political pressure until now and had recently begun striking a more beligerent tone again, but its biggest fear was that President Obama might follow Brown's lead and intervene directly. By announcing concessions now it hopes to see off this threat. Without moves in London it would probably have been able to cling on and do nothing.

It's only a start. Goldman's decision to pay its top executives in shares rather than cash will not stop them getting very rich on the back of the taxpayers who rescued the banking system. Yet the bank's decision to put its pay policy to a shareholder vote is a major breakthrough in the battle to bring US corporate governance standards up to scratch. It will be much harder for any US chief executive to argue now that investors shouldn't have a say on what they get paid.

Similarly, Brown's push to establish a transactions, or "Tobin" tax to bring international finance down to size and raise money for global good causes such as climate change were ridiculed when they were first announced, but has now become official EU policy. Even in the US, the need to do something about outsize profits and pay on Wall Street is gathering support from figures as diverse as General Electric's chief executive to the speak of the House of Representatives. More than 200 US economists recently backed the idea of Tobin tax.

Both taxes are a long way from filling the public coffers or saving the planet just yet. The tax on bonuses will be most effective if banks choose not to pay them at all and keep the money to repair their battered balance sheets. A Tobin tax remains pretty far off, whatever they say in Brussels.

But the principle which Brown has successfully established is that even shamed and humbled financiers will not act to curb their worst practices without political intervention. When banks were falling like ninepins last autumn he realised that the state had to intervene to save the banks from themselves – now he's doing it again. As the Americans are fond of saying, a leader without followers is just a guy taking a walk. For once, Brown has turned around to find some people behind him.

[Declan]

Cleaners 'worth more to society' than bankers - study
By Martin Shankleman,
Employment correspondent, BBC News

Hospital cleaners are worth more to society than bankers, a study suggests.

The research, carried out by think tank the New Economics Foundation, says hospital cleaners create £10 of value for every £1 they are paid.

It claims bankers are a drain on the country because of the damage they caused to the global economy.

They reportedly destroy £7 of value for every £1 they earn. Meanwhile, senior advertising executives are said to "create stress".

The study says they are responsible for campaigns which create dissatisfaction and misery, and encourage over-consumption.

And tax accountants damage the country by devising schemes to cut the amount of money available to the government, the research suggests.

By contrast, child minders and waste recyclers are also doing jobs that create net wealth to the country.

The Foundation has used a new form of job evaluation to calculate the total contribution various jobs make to society, including for the first time the impact on communities and environment.

Eilis Lawlor, spokeswoman for the New Economics Foundation, said: "Pay levels often don't reflect the true value that is being created. As a society, we need a pay structure which rewards those jobs that create most societal benefit rather than those that generate profits at the expense of society and the environment".

She said the aim of the research was not to target individuals in highly paid jobs, or suggest people in low paid jobs should earn more.

"The point we are making is more fundamental - that there should be a relationship between what we are paid and the value our work generates for society. We've found a way to calculate that," she said.

A total of six different jobs were analysed to assess their overall value. These are the study's main findings:

    * The elite banker

"Rather than being wealth creators bankers are being handsomely rewarded for bringing the global financial system to the brink of collapse

Paid between £500,000 and £80m a year, leading bankers destroy £7 of value for every pound they generate".

    * Childcare workers

"Both for families and society as a whole, looking after children could not be more important. As well as providing a valuable service for families, they release earnings potential by allowing parents to continue working. For every pound they are paid they generate up to £9.50 worth of benefits to society."

    * Hospital cleaners

"Play a vital role in the workings of healthcare facilities. They not only clean hospitals and maintain hygiene standards but also contribute to wider health outcomes. For every pound paid, over £10 in social value is created."

    * Advertising executives

The industry "encourages high spending and indebtedness. It can create insatiable aspirations, fuelling feelings of dissatisfaction, inadequacy and stress. For a salary of between £50,000 and £12m top advertising executives destroy £11 of value for every pound in value they generate".

    * Tax accountants

"Every pound that a tax accountant saves a client is a pound which otherwise would have gone to HM Revenue. For a salary of between £75,000 and £200,000, tax accountants destroy £47 in value, for every pound they generate."

    * Waste recycling workers

"Do a range of different jobs that relate to processing and preventing waste and promoting recycling. Carbon emissions are significantly reduced. There is also a value in reusing goods. For every pound of value spent on wages, £12 of value is generated for society."

The research also makes a variety of policy recommendations to align pay more closely with the value of work.

These include establishing a high pay commission, building social and environmental value into prices, and introducing more progressive taxation.

[Fear ón Srath Bán]

Glad to see this, though it could be a whole lot more:

********************************

Obama outlines $117bn bank levy

President Barack Obama has said Wall Street must repay $117bn (£72bn) to taxpayers and criticised banks for "massive profits and obscene bonuses".

The tax is to recoup money US taxpayers are expected to lose from bailing out the banks during the financial crisis.

"My commitment is to recover every single dime the American people are owed," the president said.

The move follows populist anger at banks, seen as being responsible for causing the recent economic crisis.

Average American

"My determination to achieve this goal is only heightened when I see reports of massive profits and obscene bonuses at the very firms who owe their continued existence to the American people," the president said.

He said the aim was not to punish Wall Street firms but to stop abuses and excesses from happening again.

The BBC's Michelle Fleury said the president had made clear "in strong language" that the banks must repay the taxpayer, through what is being dubbed a "financial crisis responsibility fee".

"It may go some way to quelling the anger of the average American," our correspondent said.

The tax would apply only to financial firms with assets of more than $50bn.

There are reckoned to be about 50 of these institutions - although many did not accept any taxpayer assistance and many others have already paid back what the government lent to them.

It comes ahead of the latest reporting season on Wall Street, with banks expected to report record bonuses.

********************************
Especially after repulsive remarks from Lloyd Blankfein, chairman of Goldman Sachs, who justified their (Goldman's) selling of mortgaged-backed securities to clients and then subsequently betting the firms' capital that these same securities would fall in value with an assertion that Goldman's clients are investment institutions, professionals capable of making up their own minds about what to buy and sell.

This was after Blankfein had unwittingly devised the phrase "Goldman Sachs, doing God's work".

Detached fiscal depravity.

[Declan]

Goldman Sachs, the world's most powerful investment bank, has begun distributing more than $16bn (£9.9bn) in pay and bonuses to its staff, in a move that it characterised yesterday as "restraint".

The cash is its employees' cut of $45bn (£27.7bn) in revenues that the company enjoyed in 2009, a year after the financial system was bailed out by governments around the world and pump-primed with cheap money from central banks.

Amid public fury about bonuses, Goldman said it was paying out a lower proportion of revenues than it had ever done before, and had also taken $500m (£308m) out of the bonus pool in the final months of last year to give to charity.
Goldman's 32,500 employees were paid an average of $498,000 (£307,000) in 2009 – up from $317,000 (£195,500) during last year's financial panic but down from $661,490 (£408,100) in 2007. The company says that, while most bankers' pay takes the form of a year-end bonus paid in January, the total includes salary and benefits such as health insurance. The average is skewed by the huge bonuses paid to top earners, which can run into millions of dollars.

In the first nine years of the decade, Goldman distributed 47 per cent of net revenues to staff and looked on course to pay record bonuses this month. But it slashed the 2009 ratio to 36 per cent. Instead of paying more money into the bonus pool in the last three months of the year, it took out $500m (£308m) for Goldman Sachs Gives, an in-house charity that funds community development and education programmes.

On Wall Street, where the proportion of net revenues paid as compensation is closely watched, the change was being greeted as a daring experiment. Mr Viniar was peppered with questions about whether Goldman workers might flee to other firms where they may get a bigger cut.

"We have tried to strike a balance between the needs of the public with the needs of our people, and we think we have struck it well," he added. "We hope not to see high [staff] turnover."

Goldman staff, who are usually told about the size of their bonuses before the annual results, will start to hear their awards from today. "Goldman Sachs is not deaf to calls for restraint," Mr Viniar said, but declined to say if the compensation-to-revenue ratio would stay at current levels in future years.

[Fear ón Srath Bán]

On the day that Moodys (that bastion of egalitarian equity and parity) laud the bumblers-and-finaglers-in-chief for NAMA, a great article from Larry Elliot in The Guardian, and how wrong he 100% is not:

Begin by breaking up the big banks

We are sleepwalking towards an even deeper crisis. It's time to pinch ourselves, and embark on fundamental reforms

 
It's 2025, and the detox decade is over. Deficits have been slashed, consumers have money in their pockets, house prices are soaring, debt levels are rising and banks are making record profits. Siren voices who warn that little has been done to tackle the structural weaknesses in the financial sector that caused the near-meltdown of 2008 are ignored. The traditional cry of "it's different this time" goes up. Except that it isn't. Euphoria breeds complacency and a financial crisis erupts, just like the one at the fag end of the noughties, only bigger.

This, sadly, is the future unless policymakers realise that the most pressing issue facing them is not public borrowing, VAT or national insurance, but what they plan to do about the banks. Which, despite what the politicians say, is not much. There is growing international support for Barack Obama's plan for a levy on banks to provide insurance against a future crisis. Work is under way to beef up cross-border supervision and on new rules to ensure that bank lending during booms is reined in.

But it is not nearly enough. Real reform of the financial sector means asking fundamental questions. Is the current structure inherently risky? Are the banks shortchanging their customers? Could we devise a more sensible system? To which the answer, in all three cases, is yes. It is inherently risky to have banks that are "too big to fail", especially when they know the state will bail them out when the going gets tough. A properly functioning banking system would have seen the £200bn of money created by quantitative easing cascade down to businesses desperate for working capital, instead of being used as casino chips to drive up asset prices. And we know that it is possible to devise a more sensible system, because it was done in the 1930s, the last time the banks made a complete mess of things.

Instead of tinkering, policymakers should be looking at three issues: the size and structure of banks; how they operate; the way they are taxed. Current proposals do nothing to alter the structure of the banking system, will make only modest changes to how they function and are a poor second best when it comes to taxing them more fairly.

The core problem is that banks are now far too big and far too complex, a point well made by Andrew Haldane, the Bank of England's director for financial stability in a speech this week. Haldane said there was no evidence that big was better in banking. On the contrary, he argued: "The maximum efficient scale of banking could be relatively modest."

This is an important conclusion, because the case for mega-banks is that they can do things that smaller banks would be unable to do, thus making it worth the rest of us accepting the risks of "too big to fail" institutions. It now appears that the benefits are illusory. The potential costs, however, are not, and far exceed the direct taxpayer subsidy to the banks during the crisis.

When the dust has settled this may amount to perhaps £20bn, but that is nothing compared to the wider economic costs of the longest and deepest recession Britain has suffered since the second world war. Output is 10% lower than it would have been had growth continued at its normal rate, and that amounts to £140bn.

But there's worse. Some losses to the economy will never be recouped, and this substantially increases the long-term costs. Economists have worked out how much the banks have cost the global economy: assuming output tends to rise by 3.25% and that 25% of the lost output never comes back, the loss to world GDP would be $60tn. For the UK, the cost is £1.8tn, more than the current annual output of the economy.

This is far too high a price to bear, either for the banks or the taxpayer. Other industries have solved the "too big to fail" problem, Haldane notes. The computer industry used to be a highly concentrated structure dominated by IBM but is now a fragmented modular structure in which no single hardware firm dominates. The starting point for reform, therefore, should be a breakup of the big banks and reinstatement of the old divisions between retail and investment banking.

Such a move would ensure the banks operated in a different way, making them more responsive to the needs of their customers. But it would not necessarily ensure that investment went where it was most needed. If ministers want low interest rates and quantitative easing to lead to the retooling of manufacturing or startup capital for green businesses, they may need to adopt a more hands-on approach in those institutions where the government is a big shareholder. The alternative would be a state investment bank.

Finally, there's taxation. Obama wants the banks to self-finance the cost of the next bailout, but his plan is flawed. The existence of such a fund would merely encourage banks to take even bigger risks, while the proposed charge on banks would not be nearly big enough to cover the full economic costs of a crisis. In the UK, it would raise about £1bn a year – tiny in comparison to the spending cuts that are going to be needed during the next two parliaments as a direct consequence of the financial crisis.

A far better option would be a financial transaction tax, one of the options at present being considered by the International Monetary Fund. Unfortunately, even those countries keenest on a transaction tax – Germany and France – are throwing their weight behind the Obama plan, on the basis that anything is better than nothing.

This illustrates the challenge reformers face: the banks wield enormous clout and the politicians are weak. John Kay, writing in the April edition of the magazine World Economy, sums it up neatly: "The financial services industry is now the most powerful force in Britain and the US. If anyone doubted that, the last two years demonstrated it. The industry has extracted subsidies and guarantees of extraordinary magnitude from the taxpayer without substantial conditions or significant reform. But the central problems that gave rise to the crisis have not been addressed, far less resolved. It is therefore inevitable that crisis will recur."

Actually, another crisis is not inevitable. But, as things stand, we are sleepwalking towards one.