Our Dickie Gets It Wrong... Surprise!

Our favorite tax-and-spend Euroweenie, Chartered Accountant Richard Murphy, is at it again. This time he offers a rousing defense of Prime Minister Gordon Brown's plans to spend England into the third world.

Here's what set him off in the first place: Bank of England Governor Mervyn King mentioning the rather obvious not-so-secret-secret that Brown was close to spending the Treasury's last pound.

This, of course, sets Murphy off big-time:

For all practical purpose Mervyn King is a a civil servant. He’s also one who has over stepped the mark. Civil servants do not contradict their ministers.

He’s wrong on other counts. He’s so god at economics he did not see the weaknesses in his regulatory system. He did not see the crash coming. He kept interest rates up when they should have been cut. He did not see the importance of supporting jobs when Danny Blanchflower did. So why is he right now?

Why is he right now when his prescription is for more unemployment, no greening of the economy and prolonged slump. Why is he right now when his inaction is designed to preserve the status quo for the City that has failed the UK economy? And why is he right now about fiscal policy when he has never had any real belief in it?

Ignore the man I say. Sack him, better still.

And as for what to do on April 22 – lest we forget it, budget day – the answer is simple. We do need a fiscal stimulus. Not less than £25 billion. But I accept not all should be paid for by debt. Minimum tax rate of 32% on those earning more than £100,000 – removing all allowances to achieve this is a start. Make it 40% minimum tax on all earnings at £200,000. Charge NIC at 11% on all investment income over £5,000 pre annum (pensioners apart). Abolish the domicile rule. Introduce a rule that all UK citizens are UK tax resident and taxable on world wide income unless living permanently in a country with a double tax treaty with the UK – and can prove they pay their tax there. Bring in a General Anti Avoidance Provision. Bring in a Stop Tax Haven Abuse Act. And so on, and on.

Oh yes, we can afford a fiscal stimulus. There is ample money available. We just have to chose who should pay for it. Some of us have the answers. Gordon Brown should be listening.

Tax The Rich.

Boy, talk about sophisticated finance...

It should be noted though, it is a little known fact that only Paul Krugman and Richard Murphy foresaw the current global economic crisis. If only we had paid attention then...

Anyway, Gordon Brown might have some difficulty hearing Murphy over MEP Hannan...

And it seems now Brown is starting to have trouble convincing those who - unlike Murphy - live in the Real World that Spending Cures All.

Might we here find ourselves soon with a devalued President of a devalued government?

Question of the Day: Why in the Hell can't the Republican Party find one fucking Republican politician in the entire United States who is this brainy, this articulate, and this fearless? Are Bobby Jindal and John Boehner the best they've got? If so, why?

Comments

[richard mcenroe]

"Civil servants do not contradict their ministers."

Man's gotta point. They're supposed to backstab them in private, like Dick Armitage.

Obama Spoke, Now You're Broke

[Dennis The Peasant]

In the last analysis, civil servants work for the citizenry... no ministers.

In this case it has been clear for some time that Treasury had been warning Brown of this in private. It is a measure of their alarm and desperation over Brown's plans that they have had to resort to this.

[elliottg]

I'll tell you what's wrong with the Republican party, but you won't like it.

#1. What self respecting human wants to be constantly kissing a fat slob, drug addict's behind?

#2 You have to lie to yourself to get ahead. Can't be too hard on creationism; can't be willing to believe all the scientific evidence about global warming; can't entertain the idea that the rich are generally luckier and not especially more talented (or vice versa that the poor are generally unluckier and not especially dumb).

#3 You have to subscribe to some morally repugnant ideas like torture is ok if the President says it's ok.

#4 You have to be opposed to policy ideas on general principle such as universal access healthcare = socialism. This despite the fact that every other 1st world country has universal access, spends less, and generally have better outcomes. Another good one is that the progressive income tax or "death tax" are evil for no better reason than that all taxes are evil.

#5 You have to justify aggressive unilateral military action as a valid foreign policy despite all evidence against it. This means not wanting to withdraw from Iraq even though a clear majority of the US would love to leave.

Put people through this filter and you should consider yourself lucky that you have someone as smart and talented as Jindal still willing to do the mau-mau for a shot at the nomination.

[richard mcenroe]

Wow, it's like distilled essence of dipshit, bravely posted in the dark of night when nobody should be around to read it.

1. That's no way to talk about Ted Kennedy, he's a very sick man.

2. Nobody has EVER forced me to believe in "creationism" and nobody has even successfully tried. BTW, are you referring to "intelligent design" creationism or do you have some special insight into how the universe started you've been holding out on us?

BTW, if you're so het up about creationism, how do you feel about Jindal's claim to have been involved in exorcisms?

I'd be happy to believe the "evidence" about global warming if the world hadn't been getting colder for the last ten years. Your comments on wealth and poverty seem to me the resentments of someone who is living below his intended station. Me, I make the money I make because I do the work I choose to do. When I've been poor, and I've been poor, it was because of my choices.

3. Yes, but now that we are reacting to man-caused disasters instead of fighting the war on terror, we can call it 'enhanced interrogation techniques' and Barry says it's okay. BTW, has he banned renditions or closed Gitmo yet?

4. I oppose universal healthcare because I have had people I know killed and maimed by it in other countries. Every other 1st world country in fact has a chronically underfunded health program that provides fewer services and less well than ours. Canadians aren't coming to America for medical treatment because their health care is so great. Toronto wasn't shut down by SARS because Canada's health plan worked, it was shut down because it didn't. Citizens in Britain and Europe are routinely denied prescription medications commonly available in the US. Senior citizens are routinely denied surgical procedures on the grounds that they wouldn't live long enough anyway to justify the expense to the system. The French national health didn't keep thousands of eldery from dying in a heat wave.

Death taxes? For someone who thinks the poor are 'unlucky', you seem pretty eager to make sure they can't pass on any smidgens of acquired wealth to the next generation. Would't want T. Boone Pickett to get his elbow bumped at the country club, would we?

5. There were over thirty nations in Iraq. Cut the unilateral crap. She's alive, Saddam's dead, you lost, get over it. Or has Barry sent in the ships yet to pull our boys off the beaches?

[elliottg]

And there's your problem dennis, the people who control the dialogue (and are the primary voters) in the Republican party are Richard McEnroe and his proud compatriots. Good luck finding better than Boehner to pander to them.

[jcw]

"can't entertain the idea that the rich are generally luckier and not especially more talented (or vice versa that the poor are generally unluckier and not especially dumb)."

This has to be one of the dopiest statements I think I have ever seen written on the net. Tell you what. Let's give IQ or talent tests to the top 2% and the bottom 2% wealthwise of US citizens and if there isn't a statistically significant difference in the scores I will eat my hat. When you aren't as smart as your neighbor, in most cases, you're going to have to outwork him to get ahead. That's the way it is. Get over it. Luck has little or nothing to do with it.

[elliottg]

Can't vouch for the following since it was just the first result, but it sounds right from every other article I've read on the subject.

http://www.flickr.com/photos/pkedrosky/472069325/

[richard mcenroe]

Elliotg -- Did you even look at your own graph? Did you see where the poverty is clustered...?

[Eric Blair]

Life is hard. It's harder when you're stupid.

I think the reason that the Republicans (never mind the Democrats--they're in the same boat, too) can't find decent candidates is that nobody decent really wants to run for office anymore, because essentially, once you do, that is going to be your profession for life.

Lookit all the politicians we see now: Dodd; how many years in the Senate? Or Frank, or Pelosi or Ried, or Biden or McCain or any of them?

That is the problem.

[Tim Worstall]

The intense joy of Murphy's argument is that a fiscal stimulus that is paid for by taxation isn't a fiscal stimulus.

A fiscal stimulus, by definition, increases the gap between money spent and money raised from taxation. That's what it means.

[elliottg]

Not if the multipliers differ and, in general, most economists think they do.

[elliottg]

Anyway, TTFN Dennis. I don't really care whether you believe me or Dick M. above. Actually, I hope every true blue Republican sticks with the delusional fantasyscape in Dick's head because although it's nice for your side to win on talent, it's still a win when the other side self-destructs.

[Dennis The Peasant]

Tim-

I've been reading Dickie too much... To the point were I am now confusing stimulus with redistribution.

Elliot-

You sound cranky and nervous. Things not quite working out the way you'd hoped?

[elliottg]

They are not working out the way I hoped. I thought you wouldn't revert so quickly to Republican hack. I was wrong and I do enjoy reading you when you're not being a stupid asshole.

[Dennis The Peasant]

The simple fact of the matter is that I am now, and alway have been, a stupid asshole. I can provide references that will prove it if you don't believe me. So let's be clear that the issue here isn't me, it's you.

The issue is this:

(a) I'm no longer saying what you want to hear, and
(b) you haven't, as of yet, been able to process that change.

How you deal with that issue is up to you. Me, I'm simply going to continue being what I am.

[elliottg]

You're being falsely modest. You are almost always an asshole, but hardly ever stupid.

a. I don't come here because I want to hear something in particular. I come here because you are generally a smart Republican asshole who doesn't traffic in delusion like Dick up there in the thread does.
b. I don't recall a series of posts comparable in knee-jerk hackdom complete with photoshopped cutesiness in the past. Please provide references.

And if you were going to go back to being yourself then you would cut the BS and present an argument rather than put on a clown nose and pretend that's an argument. For example, your most recent post seems to take the position that Obama went to the bankers to beg forgiveness. I'm guessing he went there to threaten them. Why don't you tell me why you think your interpretation is the valid one?

[Tim Worstall]

Elliott. The balanced budget multiplier depends upon the household savings rate. Which back a year in the UK was 1.6%. You're really not going to get much of a fiscal boost from that. In fact, given the deadweight costs of raising taxes (rule of thumb, 20%) you're not going to get any sort of multiplier.

You'll get shrinkage.

[elliottg]

Tim, I don't want to clutter up Dennis's blog, but using the total UK savings rate to represent the rich's saving rate where the tax hits is wee bit dishonest. Secondly, 20% deadweight cost on raising an existing income tax? I wouldn't believe that reference even if you had one AND it was right on point until I had combed over the paper with a fine tooth comb and although I have time to spew insults in blog comments, I don't think I have that much time (especially since it's going to be analyzing a totally unfamiliar taxing sytsem).

[Dennis The Peasant]

elliottg-

Until someone completely loses their marbles and offers to pay me to blog, I have the complete freedom to do whatever I want to do. At the present time, "knee-jerk hackdom complete with photoshopped cutesiness" is what I wanna do.

You see, in the final (as well as first) analysis, this blog is all about me. You are simply along for the ride. I've seen a lot of bloggers come and go over the years I've been blogging, and the primary reason I'm still blogging and they are not centers around the fact that I make sure what I'm doing makes me happy. I don't worry about traffic (which is good, because mine sucks) and links and whatever, I just do what gives me enjoyment.

Given that, I'll probably continue with the hackdom and cutesiness until it bores me, because I make a point of ignoring reader suggestions as to what I "should" be doing with my blog. Several years ago I had a very nice couple from S.F. who just loved The Westerville Chronicles, and who worked rather hard at encouraging me to put a lot of time and effort into them... They felt they could be good enough for a book and/or Hollywood. Both of them worked in the movie industry. I was flattered, but to tell you the truth, writing The Westerville Chronicles is very hard work, and I almost never like what I end up with. Since it's all too much like a job, I don't do them all that much. I suppose I could get motivated and attempt to get a book written, but if I don't like the work, why would I want to make it a career?

So the choice before you is binary: Ride it out or give it up.

[Jack Okie]

Elliot: Quite a few years ago Scientific American published an article by a cultural anthropologist who set out to measure the inflow and outflow of money in a poor (L.A., IIRC) neighborhood. Somewhat to his surprise, he found that there was little difference in per capita amounts compared to a (relatively) more affluent neighborhood. He discovered that the poor residents' behavior accounted for the difference: They tended to be impulsive, less inclined to save or budget, etc. For example, it was common for them to buy an expensive TV, then shortly thereafter pawn it because they needed the money, then redeem the TV when they had some cash again, then pawn the TV again, and so forth.

The article provoked a shitstorm: "How dare you blame the victims" being the common thread. So because self-righteous political correctness was more important than science, a valuable insight was suppressed. I think you are correct that the poor are unlucky, but in most cases it's because they did not have an opportunity to learn the necessary life skills. But skills can be taught, when one is more committed to solving real problems than to moral vanity.

[richard mcenroe]

"Given that, I'll probably continue with the hackdom and cutesiness until it bores me, because I make a point of ignoring reader suggestions as to what I "should" be doing with my blog."

That's probably a good idea. I remember what happened when that reader suggested you start posting a little 'cheesecake' to boost your readership.

I don't think that 'sexy bunny' thread was what I he had in mind.

[Eric Blair]

Elliot obviously has never spent time around poor people.

[elliottg]

Besides the fact that you are wrong, I have spent time around idiots and many of them have been quite wealthy.

[PeterUK]

Richard Murphy,Chartered Accountant,recommending his clients get to pay more tax?

[PeterUK]

" I have spent time around idiots",It shows Elliott,it shows.