One of C Northcote Parkinson's less well known laws runs something like this, that the larger the sum of money involved in any decision, the less time a committee will devote to it. The £50 billion project goes through on the nod because most committee members can barely comprehend the amount involved, lack sufficient understanding to really question it, and are keen not to risk displaying ignorance by speaking up anyway. Conversely a small sum (such as a 10p increase in the cost of the committee refreshments) will have them at it hammer and tongs; all the committee understand the economic principles involved, most feel guilty that they didn't really pull their weight when it came to that earlier £50 billion commitment, and the likely outcome this time round is a deferred decision pending the report of a sub-committee set up to consider the matter further.
Thus it is with our government. Their indefensible abolition of the 10p tax band for the low paid has occupied our Chancellors (present and previous) and our representatives in parliament for some time now. Contrast that with the decision to use tax income to prop up a wildly inflated property market to the tune of £50 billion by bailing out reckless financial institutions; scarcely a murmur. The gulf between those two decisions is ironic beyond belief.
It goes almost without saying that both decisions are wrong. Wrong, wrong, wrong. Immoral too, but then morality hasn't entered into 'New Labour' deliberations over many years now.
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2 comments:
Great post. I know a chap whose business is going down the pan causing great hardship for himself, his wife and their children.
That's what happens in a free market - quite rightly so. They won't starve as the welfare safety net exists, much as it will be a hammer blow for their lifestyle.
Is the government swooping in to offer some spare change from the £50b? Er no, the taxman is in fact one of his main creditors and is going to be the one knocking him down, not picking him up.
What is the difference with Northern Rock? The only argument I can see for any sort of rescue package has to be that for one reason or another the gvt won't allow bank deposits to become worthless.
Accepting that, the only form of nationalisation that any sort of logic would allow would be for the taxpayers to appoint administrators to wind the business up and compensate the deposit holders. The property speculators would lose everything, but I really don't see that as a bad thing.
The credit card addiction of this country (of which the property market has been one manifestation) deserves a kick between the uprights
I think we're of one mind on this one PU. I'd say quite a bit on Northern Rock in response, but I think my earlier posts on that topic (just scroll down a bit) pretty much cover my current position - which is that excessive and ludicrously injudicious lending has inflated property prices to absurd levels; it's a merry-go-round the government scarcely dare step off since the whole house of cards collapses as soon as they do.
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