Friday, May 13, 2016

IMF independently predict disaster if UK leaves EU shocker!

The economic powers that be all predicted catastrophe if we didn’t join the Euro. They all failed to predict the global crash of 2008. Now they are all predicting disaster if we leave the EU. The IMF, OECD and Treasury all predict the economy will be anywhere between 1.5% to 9% smaller in 2030 than if we stayed in the EU. Let’s be clear what that means. We won’t be 1.5% poorer than we are now, but that we will be 1.5% less rich than we would have been if we knuckled under to the EU, and meekly accepted becoming part of a country called Europe.

I’ve comprehensively debunked their figures here and here. But even if the economic establishment have got their sums right for once (please suspend your disbelief), are we really prepared to chuck away all the civil and democratic rights won by our ancestors since Magna Carta for a miserable £1.50 for every £100 we earn?

But where project complete bollox really goes into overdrive, is in the insistence that there will be NO economic upside to leaving the EU. No scenario in which the UK would be better off out. Let’s look how the economic establishment comes up with these fishy figures


1. They all used broadly the same starting point.

2. They all used broadly the same mathematical model.

3. They all make broadly the same assumptions.

Therefore, it’s no surprise they come up with roughly the same result. So how have they done it?


1. The starting point is uncontroversial. We can all agree that we are currently in the EU, have a GDP of approximately £1.8 trillion and have no trade deals of our own.

2. The model. They all use something called the “gravity model”. Some insist this is discredited. It doesn't matter, with the assumptions made the result would not be that different regardless of model.

3. The assumptions are as follows:

a) We keep all existing EU regulations because we love them. This isn't just controversial, it's inane drivel. One of the main reasons for leaving the EU is daft regulations.

b) We take an age about negotiating a new deal with the EU. This is possible, as we don't know if the common sense merchants or vindictive bureaucrats will win the day. What we do know is that we buy more from them than they do from us, so they would do more actual damage to their own economy than to ours. Just imagine the meeting where Angela Merkel tells the CEO’s of BMW, VWAudi, Mercedes and Porsche. “Hello, I’m going to support punitive economic sanctions on the country which takes 20% of your car exports.” No, I can’t imagine it either.

c) We do no trade deals with anyone else, or at least are very slow at it. EU slow, rather than say Australia quick. This isn't plausible. An EU free trade deal has to please 28 countries. We just have to please ourselves. As well as getting rid of regulation, one of the things the leave camp favour is free trade, whether that be with the Commonwealth, the Anglo-sphere or in fact almost everywhere.

There are many good reasons to leave the EU, for most of us it is the desire not to become part of a country called Europe. We want to revitalize our democracy and return to honest, accountable politics. As Dan Hannan said “We fought a civil war in this country to establish the principle that laws should not be passed nor taxes raised except by our own elected representatives.” Today, that power, that we won in a bloody Civil War, is vested in European Commissioners, most of whom owe their position to having lost elections. Economic isolationism isn’t a reason to leave the EU, it is a reason to stay in. Once out, in Churchill’s words, “we will choose the open sea”, not a stagnating EU which has only just managed to raise its economic growth above that of Antarctica.

Thursday, April 28, 2016

The OECD's creative accounting on Brexit

The OECD published it's report on the upcoming referendum and the consequences of Brexit. We'd all be worse off by £3,200 per household by 2030! The BBC covered it here, and George Osbourne seems desperately pleased.

It's shorter than the treasury report, being a mere 37 pages including the cover. What it lacks in length it makes up for with hyperbole and ridiculous assumptions though, so read it and enjoy!

It comes to some stark “We'd be doomed! Doomed I tell you!” conclusions, though it seems to lack detail on where to check its figures. It also uses the same brand spanking new favourite of remain economists of the GDP per household which no one else actually uses because it's meaningless.

The biggest hole in its numbers is there is no information on what figure it uses for the number of households and indeed what it expects either an in or out GDP to be in 2030. In one way, that's not a bad thing because frankly they don't know, no one does, including me. However if you're going to make a claim that household GDP will fall by £3200 you need to know how much GDP will be, and how many households will be in the country.

Those numbers don't exist in the report so I will run with some of the assumptions from the treasury report but the OECDs changes to GDP.

To recap, from my article here, Remain GDP in 2030 if we stay in will be 36% above what it is now.  GDP in 2015 was £1.808 trillion.

From his number we will deduct the OECD's doom and gloom: a drop in GDP of 2.5% (optimistic) 5% (central) and 7.5% (pessimistic).

Lets run with a 7.5% drop in GDP. I don't want to be accused of being over optimistic.

The OECD suggests  that if we leave, in the worse case scenario, immigration would drop to below 100,000 per year (which is what we were promised), and implies net immigration will remain over 300,00 a year if we stay. It doesn't seem to pin it self to either an in or an out figure for number of households though.

We can only work on what we know which is the household growth figures for Remain from the ONS in the treasury report (31 million) and working off a net migration of less than 100,000 in the event of BREXIT, which I estimated at 28 million.

So, time for a little bit of simple maths.

Current GDP (2015) of £1.808 trillion.

Remain GDP 2030 of £2.45 trillion. (+36%)

Leave GDP 2030 of £2.323 trillion  (+28.5)

Remain households, 31 million.
Remain GDP per household:  £79,384

Leave households, 28 million
Leave GDP per household: £82,964.

That's £3,580 per household better off!

I'm sure they didn't want you to know that.

As a footnote the IMF, OECD and HM Treasury all disagree. They all think we would be much better off remaining in the EU.

The IMF, OECD and HM Treasury also thought we would be mad not to join the ERM (That turned out well… after we crashed out of it in some pain) and also thought we should definitely have joined the Euro which would have been a disaster for both us and the rest of the Euro zone.

Andrew Lillico has this analysis here.



Monday, April 25, 2016

Osborne’s Accountancy is VERY Creative

This post is also available here, and this revision was part written by Ann Sheridan, who has a blog here.

Last week the Treasury Report was roundly panned by just about anyone who is anyone in economics, the fact checkers at the BBC and Channel 4, as well as by people like Liam Halligan at the Telegraph. The key claim in George’s rigged report was that each household would be worse off to the tune of £4300 per year by 2030. Now, let’s put to one side the fact that Osborne can’t get his sums right from month to month never mind over 14 years, and look at the claims in a little more detail. Before we do though, I’d like you to consider this nugget, Osborne himself stopped using Treasury forecasters because they were so crap. That’s why today official government economic statistics all come from the Office of Budget Responsibility.

Now, to the substance of the report. One point of contention is that the figures are based on a made up metric of GDP per household which no one uses, or rather no one has used it before, and no one is likely to use again, apart from me, in this article.

The report also assumes that we love all existing EU regulations, would ditch none and make no trade deals apart from those with the EU. This is about as likely as Jim Davidson being asked to be the turn at the Guardian Christmas do, but we’ll run with it for now.

Bear with me here please, this next bit involves sums, but unlike Boy George I can do maths without taking my shoes and socks off. According to Liam Halligan’s article we currently have 27 million households in the UK, and if we remain in the EU the treasury assumes we will have 31 million by 2030. Its £4300 per household figure is based on projected GDP in 2030. It assumes a growth rate of 36% over 15 years in the EU, and 29% out. This is where Osborne attempts to perpetuate his gigantic con on the British public:

First, the figure £4300 is reached by dividing the projected 2030 GDP by the 27 million households we have today, not by the 31 million households the Treasury assume we will have in 2030. So, the GDP per household the Treasury figure represents is the GDP per household of the 27 million households we have now, not the GDP per household of the 31 million households the Treasury expect us to have in 2030. As we all know Boy George is lousy at maths, but even he should know that that will distort the GDP per household upwards, which if you think about it, is exactly what he wants.

Second, if I tell you you’re going to be £4300 worse off you immediately look at your bank statement and credit cards and think “Oh ?$*#”. But this is manifestly not what the Treasury report says. Both in the EU and out of the EU we’ll be better off, but according to the dodgy assumptions from the Treasury, which I referred to above, we will be even more better off if we stay in the EU.

If you accept Osborne’s dubious figures, 36% growth if we stay in, 29% growth if we stay out, and then assume a lower growth in households (one of the main reasons for leaving is regaining control of our borders and reducing migration from the EU), and actually use the Treasury’s own figures for projected households if we stay in, the maths work out very differently.

It’s not unreasonable to assume there would be 3 million less households in the UK. The aim would be to reduce immigration to under 100 000 a year, so that would slow down the rise in the number of households considerably. The only way that that would not happen would be if, after Brexit, we opted to join the European Economic Area. Under those circumstances we would still have to allow free movement of people, but we would still have access to all EU markets, so one imagines our GDP would at the very least be no worse than it would be if we remained in the EU.

Now, back to sums, current UK GDP is £1.808 trillion. So in the EU it will rise to £2.459 trillion by 2030. If we leave, it will rise to £2.333 trillion. If we divide £2.459 trillion by 31 million households we get a GDP per household of £79,349. By contrast if we leave, we divide 2.333 trillion by 28 million households, we get a GDP per household of £83,329 or £3,980 better off out. I’m sure that isn’t the number George Osborne wants you to take from his report.

Unlike Boy George, I’m not saying my figures are accurate. As everyone knows there are no one handed economists because there always has to be another hand; and if all the economists in the world were laid end to end they still wouldn’t reach a conclusion. But these figures are at least as plausible as the Treasury’s. And again, unlike them, I’m not saying bet your country’s future on predictions that have as much basis in reality as Mystic Meg’s horoscopes. Even if we will be better off financially when we come out, the real prize is the revitalization of our democracy, the restoration of the rule of law and being in control of our own destiny once more.

Saturday, April 23, 2016

Treasury report shows we would be better off out per household.

There has been some controversy over the treasury report that said each household would be worse off to the tune of £4300 per year by 2030.

Much has been said about how disingenuous this claim is, by the fact checkers at the BBC and Channel 4, as well as by people like Liam Halligan at the Telegraph.

The main point of contention is that the figures are based on a made up metric of GPD per household which no one uses, or rather no one has used it before and no one is likely to use it again, apart from me, in this article.

The report also assumes that we love all existing EU regulations, would ditch none and make no trade deals apart from the EU. This is a highly unlikely scenario but we will go with it for now.

According to Liam Halligan's article we currently have 27 million households and if we remain in the EU the treasury assumes we will have 31 million. Its £4300 per household figure is based the GDP in 2030 with the population of 2015. It assumes a growth rate of 36% over 15 years in the EU and 29% out.

If however you assume the same growth but assume a lower growth in households (one of the main reasons for leaving) the maths work out a little differently.

Current GDP is £1.808 trillion. So in the EU it will rise to £2.459 trillion. If we leave it will rise to £2.333 trillion. Now if we divide £2.459 trillion by 31 million households we get a GDP per household of £79,349. If we leave we divide 2.333 trillion by say 28 million households and we get a GDP per household of £83,329 or £3,980 better off out.

I'm sure that isn't the number George Osbourne wants you to take from his report.

Monday, November 16, 2015

In sympathy with Paris we should pass the snoopers charter... apparently?

Dan Hodges thinks that is we have sympathy with the victims of the Paris bombings we should demand the snoopers charter be passed, and passed now.

He says so here, I kid you not.

The problem is that the argument does not stand up to a great deal of scrutiny.

The 7/7 bombings, the Charlie Hebdo attacks and these latest attacks all featured some people who were known one way or another to the security services. In the UK that's currently around 3,000.

Now MI5 and MI6 don't have the resource to follow all of them so they prioritise. We don't get to see the carnage that this prioritising prevents, only that which slips though. It was ever thus. If MI5 and MI6 were perfect then we wouldn't know of them or care. In fact some would probably cut their budget.

But here we are. If they (MI5 and MI6 along with GCHQ) had all the resource they needed to put surveillance on all these 3,000 they 7/7 would not have happened. So lets make that job easier by giving them 60 million innocent people to watch?

Does that really make sense to anyone? Really? Seriously?

If they (MI5 etc) want to look over every aspect of the 3,000's lives, let them get a warrant. A secret one, perhaps one that once granted can't be questioned (though must expire).

Let that warrant if it needs to extend automatically to watching contacts of the 3,000 and if evidence emerges that would lead to another warrant, then get one that does the same.

Above all, perhaps more resource.

But whatever you do, don't burden them (MI5 etc) with the job of looking through all my browsing history. It will not make anyone safe.


Corbyn would not order a shoot to kill policy!

Apparently Jeremy Corbyn would not order the security forces to shoot to kill.

See Guido here for example:

Thing is it isn't within the Prime Ministers gift to order to shoot to kill or not*.

Who shoots what and how is an operational decision that is the final responsibility of the person with the gun**. If they are faced with a hostile armed assailant (or have a reasonable belief they are armed) they can use such force as is reasonable in the circumstances. This obviously includes up to lethal force.

We do not live in a country where the Prime Minister can arbitrarily order death, or restrict self defence on a whim.

*Obviously a PM can order forms of military action highly likely to result in the use of lethal force.

**What people may not appreciate is that you don't need to be a police officer. If you are at home, cleaning your shotgun and someone breaks in, you can shoot. If they are leaving you can't. If you are walking down the street with your hunting rifle in a bag on your shoulder (does happen, not often in cities) and someone starts firing, you can fire at them to save life in self defence.

Tuesday, July 14, 2015

Has Tsipras played a blinder in getting the deal Greece needs?

Odd question you may think, given the nature of the deal that Greece appears to have been forced to swallow, and the nature of the humiliation.

Tsipras threw a less nasty deal back in the faces of Euro negotiators the week before last, held a referendum to tell the Euro group where to get off, then went back and accepted a worse deal... or was it?

Well, they did get a third bailout and with a bit of luck will get some liquidity back in their banks. The former wasn't on offer last time and the latter wasn't actually necessary until the IMF default which caused a run on Greek banks. So what else have they got?

I suppose it depends on what your looking for. When Syriza won the election, it wanted to end austerity and deal with corruption and the client state built up over the years. Some numbers I came across (from an article in the Telegraph by a Greek barrister, Pavlos Eleftheriadis who is a fellow at Oxford university and a member of a new left of centre Greek party.

Firstly, there is virtually no welfare state or state healthcare in Greece. So 90% of the unemployed get no help except for charity. Those who do not have private medical insurance also have to rely on charity.

Makes you wonder what they spend all that money on then?

Well, the answer is, part the client state. The last right of centre government inherited a state the previous socialist one had burdened with tens or hundreds of thousands of "civil servants" who just collect a salary and do no work for the state. Its answer? Not clear them out but hire 150,000 of their own. So there may be 200,000 of them. Maybe 300,000. At say €10,000 each a year that could be anywhere from €1.5 billion to €3 billion.

You wonder why Greeks don't want to pay taxes for that? I don't.

Then there are some systemic forms of tax avoidance and evasion. At the beginning of the Greek crisis a professor of computer science offered help to collect tax. He compared government databases and found some very poor (according to tax records) Greeks living in some very expensive parts of Athens driving new cars costing over €100,000. The tax inspectors union went to court to shut him down. They won, I kid you not.

Then there is the "My property is not finished yet" scam. Greeks pay a property tax, but only on completed properties. Go ask someone who has been to Greece how many places they have seen which are both lived in (or indeed fully functioning hotels) that are still not quite finished.

Many in Greece think this sort of thing is normal, and that is the way governments work in Europe, perhaps the world. They don't have other terms of reference. However many of the first Syriza cabinet have both worked and studied abroad and not only know that it isn't how other countries work but they can't do what they want to do without first clearing up the mess.

So Syriza got elected. One of the things they were going to do was clean this mess up, and why not, Greece could not afford a welfare state with that burden. In fact, Greece couldn't afford anything much. No left or right of centre government we would call sensible could operate.   The problem was that the vested interests and state clients suddenly turned to Syriza supporters so what could be done?

Alexis Tsipras could not rely on his parliament to get reforms through... so why not do what Jim Callaghan did (according to Dennis Healy)  in the 1970s and effectively call in a third party to crack the whip (In that case the Bennites in his cabinet wanted more and more public spending). And in order to do that whilst looking like a hero at home, he seems to have poked the Germans in the eye and kicked them in the shins so that they came back with some clear conditions on what Greece should do in the way of reforms.

Some of the reforms the Euro group have dumped on Greece I'm sure are unwelcome, however many must secretly please those in Syriza because they know that Greece can't afford for Syriza to do what its political predecessors have done and fill the state payroll with its own clients.

I don't have any evidence for this theory but on the other hand many involved in the negotiations are a long way from being stupid, yet they poked the rest of the Eurozone in the eye, told them to poke their deal (such as it was), held a referendum... and then went back and accepted what looks like a worse deal. Nothing else makes much sense.

Tuesday, January 07, 2014

Women being abused on the internet?

I have just listened to Caroline Criado-Perez again talking about internet abuse as a women's issue. Saying that women who wish to get involved in the political debate are being shut down... She even implied that Isabella Sorley had been abusive because she was probably brought up in a misogynist environment.

Well, there are a few home truths here..

Abuse happens on the internet. It isn't pleasant, clever or nice. It would be nice if it stopped, but it isn't directed at women. It is directed and men and women.

Anywhere there has been interaction in an um moderated way on the internet there is always some sad sorry individual who will happily issue all sorts of abuse, including death threats. Where such places are moderated those death threats tend to go to the moderators. I know, I've had a few as well as an on and off stalker.

So, Caroline Criado-Perez, stop trying to monopolise internet abuse as either your own personal cross, or a mostly women only cross, it's a cross we all have to bear and the police devote relatively little resource to dealing with it who ever you are.

The BBC has this.