UK Politics

[tomorton]

On the nail assessment of the Tories...

I think I've fallen in love again.

I'm thinking the economic situation is so serious that whoever becomes PM next is going to have severely limited options and room for manoeuvre.

They'll have to increase direct financial support to low income households - benefits recipients, non-Income Tax payers and very low Income Tax payers . Although they will implement some minor Income Tax reductions to please party members these will be financially trivial but will grab a lot of headlines - deeper tax cuts would simply drive government borrowing to unaffordable levels without the compensation of adequately stimulating economic growth.

So, I expect standards of living to be on a downward track for 5 years. Replacing the Prime Minister or replacing Conservative government with a Labour one won't change anything.

 

[Atilla]

I'm thinking the economic situation is so serious that whoever becomes PM next is going to have severely limited options and room for manoeuvre.

They'll have to increase direct financial support to low income households - benefits recipients, non-Income Tax payers and very low Income Tax payers . Although they will implement some minor Income Tax reductions to please party members these will be financially trivial but will grab a lot of headlines - deeper tax cuts would simply drive government borrowing to unaffordable levels without the compensation of adequately stimulating economic growth.

So, I expect standards of living to be on a downward track for 5 years. Replacing the Prime Minister or replacing Conservative government with a Labour one won't change anything.

Agree with the gloomy assessment yes, however, I'd argue there is a big diff between Cons and Labour.

It is about the distribution of the cake as to who gets what slice.

Stopping the Ukraine conflict would go a long long way to easing the burdens that's for sure. Yet no one mentions it.

Deaf dumb and blind.

Right now, peeps working for the private sector and producers and retailers are able to pass on price increases and maximise profits.

Public sector workers and others on fixed incomes are losing out.

I'd be interested to see what politicians pay themselves in due course.

 

[tomorton]

Agree with the gloomy assessment yes, however, I'd argue there is a big diff between Cons and Labour.

It is about the distribution of the cake as to who gets what slice.

Stopping the Ukraine conflict would go a long long way to easing the burdens that's for sure. Yet no one mentions it.

Deaf dumb and blind.

Right now, peeps working for the private sector and producers and retailers are able to pass on price increases and maximise profits.

Public sector workers and others on fixed incomes are losing out.

I'd be interested to see what politicians pay themselves in due course.

OK, yes, Ukraine needs to be resolved and perhaps a new PM - even one from Johnson's Cabinet - can break with the current all-or-nothing strategy. That war needs to end. In a peace settlement, Russia will win eastern Ukraine. Also keep the Donbas and the Crimea.

As far as profits are concerned, profits are only made where people choose to spend money. If they find the price is good value, they buy. If they feel they're being cheated, they save their cash for another time.

In addition, we have to be honest and recognise that higher profits mean higher tax revenue. Is that in any way a bad thing?

Public sector workers, as indirectly our employees, should be paid what the market can afford. If they cannot do better anywhere else,, then they're getting enough. Same principle applies if you're the shareholder of a private plc - if your company is over-paying its workers this must be for one of two rational reasons - they're either trying to attract higher calibre / higher potential recruits so they can side-line current low calibre low potential employees, or they are idiots.

Politicians are politicians. I expect all of them to over-pay themselves. It goes with the territory.

 

[Atilla]

OK, yes, Ukraine needs to be resolved and perhaps a new PM - even one from Johnson's Cabinet - can break with the current all-or-nothing strategy. That war needs to end. In a peace settlement, Russia will win eastern Ukraine. Also keep the Donbas and the Crimea.

As far as profits are concerned, profits are only made where people choose to spend money. If they find the price is god value, they buy. If they feel they're being cheated, they save their cash for another time.

In addition, we have to be honest and recognise that higher profits mean higher tax revenue. Is that in any way a bad thing?

Public sector workers, as indirectly our employees, should be paid what the market can afford. If they cannot do better anywhere else,, then they're getting enough. Same principle applies if you're the shareholder of a private plc - if your company is over-paying its workers this must be for one of two rational reasons - they're either trying to attract higher calibre / higher potential recruits so they can side-line current low calibre low potential employees, or they are idiots.

Politicians are politicians. I expect all of them to over-pay themselves. It goes with the territory.

How do you account for bonuses and FTSE comp CEOs getting literally 100s of times more salary then the average?

I've studied all that tosh and it is theoretical tosh.

Water company bosses fecked up releasing suage into rivers and seas and they still get a massive bonus and wage rise. Really?

Well the answer is yes and they deserve it. They spend less treating sewage and make bigger profits so deserve a higher salary.

Society then needs to pay more tax to treat filthy waters and rivers.

As before Private sector internalises profits and externalises costs to the public.


One last point, where there are natural monopolies one has no choice. Thatchers privatisation and the National Grid as well as railway lines all a bit of a joke really. Human creation can make anything work if they try hard enough. Why not have multiple railway lines, water and gas pipes and electrical circuits running into the house. Crazy. That would be my idea of competition.

 

[tomorton]

How do you account for bonuses and FTSE comp CEOs getting literally 100s of times more salary then the average?

I've studied all that tosh and it is theoretical tosh.

Water company bosses fecked up releasing suage into rivers and seas and they still get a massive bonus and wage rise. Really?

Well the answer is yes and they deserve it. They spend less treating sewage and make bigger profits so deserve a higher salary.

Society then needs to pay more tax to treat filthy waters and rivers.

As before Private sector internalises profits and externalises costs to the public.


One last point, where there are natural monopolies one has no choice. Thatchers privatisation and the National Grid as well as railway lines all a bit of a joke really. Human creation can make anything work if they try hard enough. Why not have multiple railway lines, water and gas pipes and electrical circuits running into the house. Crazy. That would be my idea of competition.

CEO's etc. get the salary the market will pay for them. I expect them to do whatever they can to maximise this, including evading demanding performance targets. But if I was a delivery van driver it wouldn't make any financial difference if my boss got £100k or £1000k, my job would be paid at the market rate.

I hope that water companies responsible for pollution get a whacking big fine. If they don't its likely because those particular episodes were not that important.

What's a natural monopoly?

 

[Atilla]

CEO's etc. get the salary the market will pay for them. I expect them to do whatever they can to maximise this, including evading demanding performance targets. But if I was a delivery van driver it wouldn't make any financial difference if my boss got £100k or £1000k, my job would be paid at the market rate.

I hope that water companies responsible for pollution get a whacking big fine. If they don't its likely because those particular episodes were not that important.

What's a natural monopoly?

There is a lot of theoretical fallacy in your writings above.

1st off CEO pay is not determined by the market. It is determined by the old boy network behind closed doors. Interests for all stakeholders is to say yes because what goes around comes around.

I don't it would make much difference to CEO performance whether they were paid £250K or £2m either. What extra productivity do you think they bring to the table?

Your hope is exactly that. Empty hope. Get real would be the response from the street to you.


A natural monopoly is an industry where infrastructure setup and fixed costs are so high that it is not viable for a 2nd operator to set up shop to compete. For example the railways. Once one operator has built the lines, it would be near impossible for another operator to build another railway network to compete. The same goes for water and other infrastructure based utilities.

So for the railway lines, train franchise operators buy licences to operate a line for a fixed term. Similarly with the national grid. Changing supplier simply means changing the stationary and branding of the supplier. They use the same infrastructure. The whole sh!t show is one big fecking mess. Privatisation is merely shafting the user.


You surely know this right?


Google - How much does the UK government Subsidise the railways? and you get this...

In 2019-20, Network Rail's gross income of £7.3 billion from rail infrastructure in England included £0.4 billion of earned income and £4.6 billion of government funding, with the remainder an internal financial flow from other bodies in the rail system (see page 5).26 Apr 2021

How can a taxpayer subsidised private company pay millions in bonuses to private contractors and employees?

 

[tomorton]

There is a lot of theoretical fallacy in your writings above.

1st off CEO pay is not determined by the market. It is determined by the old boy network behind closed doors. Interests for all stakeholders is to say yes because what goes around comes around.

I don't it would make much difference to CEO performance whether they were paid £250K or £2m either. What extra productivity do you think they bring to the table?

Your hope is exactly that. Empty hope. Get real would be the response from the street to you.


A natural monopoly is an industry where infrastructure setup and fixed costs are so high that it is not viable for a 2nd operator to set up shop to compete. For example the railways. Once one operator has built the lines, it would be near impossible for another operator to build another railway network to compete. The same goes for water and other infrastructure based utilities.

So for the railway lines, train franchise operators buy licences to operate a line for a fixed term. Similarly with the national grid. Changing supplier simply means changing the stationary and branding of the supplier. They use the same infrastructure. The whole sh!t show is one big fecking mess. Privatisation is merely shafting the user.


You surely know this right?


Google - How much does the UK government Subsidise the railways? and you get this...

In 2019-20, Network Rail's gross income of £7.3 billion from rail infrastructure in England included £0.4 billion of earned income and £4.6 billion of government funding, with the remainder an internal financial flow from other bodies in the rail system (see page 5).26 Apr 2021

How can a taxpayer subsidised private company pay millions in bonuses to private contractors and employees?

By "market" with reference to CEO pay, I mean the market for CEO's. If this market wishes to pay millions to CEO's in pay and bonuses, that's up to them. Individuals who are outside this market are not directly harmed by the decisions and have no direct influence. But they can get involved if they wish. If they don't choose to do so, that's because they have assessed there's no real benefit to them in doing so.

I'm sure railways are not a good example of a natural monopoly. Almost all the UK's railway lines and stations were built by different companies and many towns and all cities had multiple stations belonging to these same different companies.

As far as Britain's privatised railway system is concerned, well, it just isn't. It never has been. The private companies involved are just contracted to deliver the front-line service rather than the government deliver it using its own direct work-force. Of course, calling the rail system privatised is a great way for politicians to evade responsibility and claim an artificially low public sector wage bill.

 

[CavaliereVerde]

I don't know much about UK politics but railways work well when they are nationalized: Germany, Swiss, France Italy ...

 

[tomorton]

I don't know much about UK politics but railways work well when they are nationalized: Germany, Swiss, France Italy ...

The UK has a government-owned railway system which is nationalised in all but name. It works badly and is the second-most expensive railway in the world. The most expensive is Switzerland. The British railway system has not worked well since it was nationalised for ideological reasons just after WWII.

 

[Atilla]

By "market" with reference to CEO pay, I mean the market for CEO's. If this market wishes to pay millions to CEO's in pay and bonuses, that's up to them. Individuals who are outside this market are not directly harmed by the decisions and have no direct influence. But they can get involved if they wish. If they don't choose to do so, that's because they have assessed there's no real benefit to them in doing so.

No no no. You are categorically wrong. CEO pay is agreed behind closed doors by other CEOs. Nothing to do with market place. You advertise those roles and you'll get zillions of well qualified candidates.

It very much harms the industry as they are goal based and just remember Fred the Shred who bought a worthless dutch company and almost bankrupted RBS. No due dilligence, no freaking idea, got some shopping manager appointed to be his yes man in banking.

You talking dribble nonsense with no sense of duty or awareness about the damages done by the likes of these t***

Even the great British banking system which was supposed to be secure wasn't because when the banking crises hit, banks management and liquidity was shown up to be wholly inadequate. Thatchers big bang and self regulation was all a pile of big pooh.

I'm sure railways are not a good example of a natural monopoly. Almost all the UK's railway lines and stations were built by different companies and many towns and all cities had multiple stations belonging to these same different companies.

So who owns the tracks? How are train time tables allocated? Who owns Britains motorways? Which company runs which routes? It's all a pile of crap. Government then pays these private operators tax payers money to deliver a service. It's one big crazy mess. Dig a little more see if you like what you find.

 

[tomorton]

No no no. You are categorically wrong. CEO pay is agreed behind closed doors by other CEOs. Nothing to do with market place. You advertise those roles and you'll get zillions of well qualified candidates.

It very much harms the industry as they are goal based and just remember Fred the Shred who bought a worthless dutch company and almost bankrupted RBS. No due dilligence, no freaking idea, got some shopping manager appointed to be his yes man in banking.

You talking dribble nonsense with no sense of duty or awareness about the damages done by the likes of these twats.

Even the great British banking system which was supposed to be secure wasn't because when the banking crises hit, banks management and liquidity was shown up to be wholly inadequate. Thatchers big bang and self regulation was all a pile of big pooh.


So who owns the tracks? How are train time tables allocated? Who owns Britains motorways? Which company runs which routes? It's all a pile of crap. Government then pays these private operators tax payers money to deliver a service. It's one big crazy mess. Dig a little more see if you like what you find.

So the CEO's of M&S and Sainsbury's decide the salary package for the CEO of Vodafone? Where do you get that theory from? It was my impression that a typical process would be that each plc appointed a remuneration committee from its board and they decided the CEO's pay. The pay is what it costs to get the right CEO for the job.

There are so obviously not zillions of well qualified candidates for CEO positions.

RBS was taken into a high-risk acquisition strategy. In other times and other situations these have been successful and transformative.

The banking system crash was not caused by high CEO pay.

The UK's railway system has not been privatised, its still nationalised. Contractors have been appointed to do certain delivery jobs. But that's just like of you go to a government department office you will find they have security staff from G4S or Serco at the lobby: they used to have their own security staff, now its outsourced.

But if nationalisation is such an advantageous option, we should look at what the UK government does really really well to get a perception of those benefits. So what stuff would that be?

 

[alan5616]

The UK has a government-owned railway system which is nationalised in all but name. It works badly and is the second-most expensive railway in the world. The most expensive is Switzerland. The British railway system has not worked well since it was nationalised for ideological reasons just after WWII.

Train operating companies were privatised. A good example of this craziness was when I had to change my journey. I bought my ticket from East Midlands Rail at St. Pancras but, had to then go to Euston to travel via a different route. The fare was identical to the penny but, because it's a different raiI company, had to buy a new ticket. Bring back British Rail!!

 

[tomorton]

Train operating companies were privatised. A good example of this craziness was when I had to change my journey. I bought my ticket from East Midlands Rail at St. Pancras but, had to then go to Euston to travel via a different route. The fare was identical to the penny but, because it's a different raiI company, had to buy a new ticket. Bring back British Rail!!

Hard to argue that the UK railways system is a private sector enterprise when the government subsidy is greater than the profit revenue.

But the nationalisation question is wider than railways. It might help us all understand the benefits of nationalisation if we could see examples of some things which the UK government currently manages really really well.

Please put up some suggestions that might convince people of the benefits.

 

[CavaliereVerde]

some things which the UK government currently manages really really well.

UK is not the point, everyone likes to blame the gov.
The point is that public transport does not work well with private companies.
Tipically we have many routes, some are very profitable and many are not profitable, the Pareto rule.
A national centralized railroad can work with a small profit cobining all routes and connections.

 

[Atilla]

So the CEO's of M&S and Sainsbury's decide the salary package for the CEO of Vodafone? Where do you get that theory from? It was my impression that a typical process would be that each plc appointed a remuneration committee from its board and they decided the CEO's pay. The pay is what it costs to get the right CEO for the job.

There are so obviously not zillions of well qualified candidates for CEO positions.

RBS was taken into a high-risk acquisition strategy. In other times and other situations these have been successful and transformative.

The banking system crash was not caused by high CEO pay.

The UK's railway system has not been privatised, its still nationalised. Contractors have been appointed to do certain delivery jobs. But that's just like of you go to a government department office you will find they have security staff from G4S or Serco at the lobby: they used to have their own security staff, now its outsourced.

But if nationalisation is such an advantageous option, we should look at what the UK government does really really well to get a perception of those benefits. So what stuff would that be?

Have a read. https://www.theguardian.com/commentisfree/2016/apr/24/observer-view-out-of-control-ceo-pay

I recall seeing a Panorama program about this too.

Also, pension funds that buy into these FTSE companies also have a finger in the pie. Shareholders have little sway in their voting power. It's all about the big boys playing god, edging their pay up. It is ALL IN THERE SELF SERVING INTERESTS TO AGREE.

System is deeply flawed. It makes me sooooo angry when people try and justify all this bollox with some perfect competition, competitive market and CEO's are in short supply skills shiite.

FSA was full of useless bodies who earned a fortune, did little work. Simply that CEO's find them selves at the top of a chain in best companies where many good people work for average salaries.

Look at what Bob Dimond did to Barclays. Still trying to recover. I remember some w***** trouting his super powers and the superiority of the market competitiveness at the time. I bailed out of Barclays and so glad I did. I'm now back in with a small investment hoping to see the big share prices again. Almost ruined the company. I think he got about 200m just to make him leave or something.

The whole system is bent and corrupt.

People need a basic wage to live on and go out on strike in a desperate measure and they get crucified. CEO's get bonuses for sh1t work, and they get defended for how marvellous they are.


There is no honesty or integrity left in people.

 

[Atilla]

UK is not the point, everyone likes to blame the gov.
The point is that public transport does not work well with private companies.
Tipically we have many routes, some are very profitable and many are not profitable, the Pareto rule.
A national centralized railroad can work with a small profit cobining all routes and connections.

Not only that but in the old days, a national unified public transport system (is a natural monopoly in most parts) was held up as being of strategic importance.

It makes the WHOLE COUNTRY more productive and profitable. Along came Thatcher and promoted private cars and motorways making company cars tax efficient. Public transport policy never quite recovered.

However, peopel will defend it. Must not speak out against the iron lady who has been iconised as some great marvel for destroying and laying down the many of the foundations of Britains fall including EU sceptics.

Crazy stuff.

 

[CavaliereVerde]

. Along came Thatcher and promoted private cars and motorways making company cars

It happened in many countries, even in Italy but worst cases were US and UK.
It did not happen in Switzerland because there were no car manifacturers to please.
Railroad is just more efficiant than roads, and national railroads are better than private.

 

[tomorton]

UK is not the point, everyone likes to blame the gov.
The point is that public transport does not work well with private companies.
Tipically we have many routes, some are very profitable and many are not profitable, the Pareto rule.
A national centralized railroad can work with a small profit cobining all routes and connections.

But the UK government's performance is very relevant to the question of whether key UK assets should be nationalised.

Surely there must be some area of UK government operation that would be a demonstration of how well they would manage a nationalised industry? There are about 25 departments to choose from and scores of agencies delivering hundreds of policies and services. Is any one of these a fantastic service?

 

[CavaliereVerde]

A national company is not the gov.
On average our railways are more efficient than our gov.
The railways are the same from 50 years while on average we change one gov per year.
The same for France Germany or Russia.

 

[tomorton]

A national company is not the gov.
On average our railways are more efficient than our gov.
The railways are the same from 50 years while on average we change one gov per year.
The same for France Germany or Russia.

But arguments concerning failing infrastructure, expensive and unreliable public services, unlawful pollution and exorbitant CEO pay always quickly resolve into an argument for nationalisation.

So, it is surely reasonable to ask for an example of how well this would work in practice.

Is there any government department or service that would be a shining example of how well the government might run a nationalised company, industry or service?