Over the last decade I have made many speeches trying to point out that Gordon Brown did not make the Bank of England independent, and did weaken the Bank’s ability to respond to financial crises. I reminded any audience willing to listen that in 1997 he took away the Bank’s power to regulate individual banks, and removed its role of running the public debt. He did not even make the MPC completely independent in the way advertised.
These two changes greatly weakened the Bank’s ability to understand and control the money markets. When the mortgage bank crisis hit the Bank of England did not itself monitor the daily cash and credit positions of the banks, and did not itself organise the daily intervention of the government in the market with its own debt instruments.The need to respond to a banking problem in negotiation with the FSA and the Chancellor was bound to slow things down and make it difficult to come to a timely and sensible answer.
I reflected this in the more meaured prose of the Opposition’s Economic Policy Review (Freeing Britain to compete – available as a download on this site). In that we wrote:
“We are concerned about the division of responsibility between the FSA and the Bank over banking and market regulation. Fortunately conditions in the last decade have been benign internaitonally, with no threats to banking liquidity. We think it would be safer if the Bank of England had responsibility for solvency regulation of UK-based banks, as well as having the overall duty to keep the system solvent. Otherwise there could be dangerous delays if a banking crisis did hit,with information having to be exchanged between the two regulators; and there might be gaps in each regulator’s view of the banking sector at a crucial time, when early regulatory action might have spared a worse problem.”
If we could see that from Opposition, why was the government unable to do so?
February 3, 2009
03/02/2009 11:19:35
Re:SHOULD TORY'S CALL FOR NO CONFIDENCE VOTE ?
A complete waste of time – Labour still hold the majority of seats in parliament.
Please explain how you think it would be possible for such a motion to be carried when clearly no labour MP is going to vote in favour of it.
Turkeys don't vote for Christmas.
Don't get me wrong, I can't wait so see this bunch(….) kicked out of office, but sadly I think we're going to have to wait until may 2010. In spite of the fact that all self respecting PMs call elections every 4 years normally, Brown is a useless waste of space who can't see that he's ruined everything.
Neither he nor any of his colleagues want to leave when there's still the possibility of getting more swill from the trough – they know they're going out at the next election, so expect them to put that off until the bitter end. In spite of the fact that if they did call an election sooner rather than later, it could limit the magnitude of their defeat, they'd sooner hang around until the last. With a bit of luck this could be the cause of the end of their despicable party for many decades to come.
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View Profile 03/02/2009 11:49:59
Re:SHOULD TORY'S CALL FOR NO CONFIDENCE VOTE ?
You sum things up quite well -Damage limitation for Brown thats all he can hope for The real problem as I see it is the economy and the way Politicians have bull-dosed their views on the City It's this policy that has now back fired on the Labour administration it could have been the Conservatives because they also have bowed to past pressure over the years to have greater say and control over the City of London.
I think out of what has happened will emerge a stronger and better enforcement system. But only if Whitehall allows the city to regulate itself in the very best interests of the Nation.
Future administrations must learn to accept that policing the city is best left with the practioners rather than civil servants. If they dont acknowledge this then our competivness and advantage will be lost as a main force in the commercial World.
It's imperative this is resolved as the City accounts for almost half the countries GDP
I just hope to God for the good of our Country the Tory's have a workable game plan when they are back in Power
February 24, 2009
I want to know if the next tory Government will aqbolish HIP's ?
If not –why not ?
regards Paul Davis
Reply: yes they will
March 1, 2009
S T E V E N K A T I R A I
B E L L A M O U R , L O N G H O R S L E Y , M O R P E T H ,
N O R T H U M B E R L A N D N E 6 5 8 R B
e – m a i l – S t e v e n @ k a t i r a i . c o m
The Right Honourable
Gordon Brown MP
10 Downing Street,
London
SW1A 2AA
Sunday, 15 February 2009
Prime Minister
An open letter demanding your resignation.
Your position is untenable and, I as a citizen of Great Briton demand your
instant resignation.
You are unelected, have no popular mandate and lack the moral authority
to be Prime Minister. Your terms as Chancellor and Prime Minister have
been a total disaster for this nation and your attempt to cling on to power
at all costs show a complete contempt for this nation and displays your
absolute vanity and thirst for political power.
I list below some of the mistakes made by you during your time in public
office. ….. As a Government minister the standards exercised
should be significantly higher than those exercised by a company director,
you have failed to maintain those standards and are unfit for public office.
Banking Supervision: You transferred responsibility for banking
supervision to the Financial Services Authority from the Bank of
England so directly laying the seeds of the current banking crisis.
Banking Crisis: The initial response to the Northern Rock crisis was so
slow as to be glacial and ultimately led to the damage done to the
whole banking sector. A strong Prime Minister would have provided
depositors with a guarantee that their deposits were safe and the
bank run would have stopped. Ultimately the same guarantee would
have ensured that the HBOS and RBS debacle would not have been
so severe.
…..Negligence: The entire UK banking crisis has been caused by
a lack of supervision under the regulatory regime set up by you, any
man of honour would have resigned upon seeing the damage caused.
You however have tried to blame everyone else and accept no
responsibility. ……..
Vanity: You have used the banking crisis to attempt to advance your
personal standing and political career at the expense of the nation.
Lack of Judgment: You have made three serious errors of judgment
in your appointment of advisers on the current financial crisis.
1. Your choice of banker to compile a report on ideas for improving
public health was Sir Derek Wanless. a Northern Rock director when
it imploded in 2007.
2. You appointed Sir James Crosby, the former HBOS CEO, to the board
of the FSA who then had to resign after becoming embroiled in the
row over failings of risk management at HBOS.
3. It now also appears that Glen Moreno will be forced out of his job, as
chairman of UK Financial Investments Ltd, the company set up to
oversee the government’s stake in the bailed-out banks, because of
his links with a Liechtenstein trust….
You Fantasize: By clinging to the idea that, thanks to your genius British
citizens are far better placed than competitors to handle this crisis. The
following two facts demonstrate that this is a fantasy:-
1. The Office for National Statistics’ revelation that while the number of
foreign workers getting jobs in the UK continues to grow (up by
175,000 to 2.4 million last year), domestic unemployment is rising
sharply.
2. According to Business Monitor International, a research company
specialising in country risk, “Britain is facing an unprecedented fall in
its economic world ranking… from 12th place in 2007 to 21st in
2010”. “Despite enjoying 11 years of growth between 1997 and
2007, the UK ran a budget deficit of 1.7 per cent of GDP over this
period, fuelling a fiscal time bomb. Faced with the financial burden of
bailing out the banking sector and kick-starting the economy, the
budget deficit will swell to an unsustainable 9.3 per cent of GDP in
2009.”
Public spending: Your 2000 Spending Review presaged a major
expansion of government spending, without any significant benefit to
public services, directly leading to the UK being in the worst shape of
any industrialised nation to weather the current financial crisis.
You have colluded in hiding the full extent of public borrowing by using
PFI initiatives to hide the borrowings off balance sheet. PFI is the most
expensive and inefficient form of finance possible, and you have
saddled the country with a debt that you cannot even quantify. Jeremy
Pocklington, leader of the Treasury’s corporate and private finance
team, could only give a rough estimate to Richard Bacon that the total
liabilities, but not debt, from the vast majority of PFIs, but not all, from
2006-07 to 2032-33, but not beyond, is £157.9bn. That is not only
astounding but unbelievable.
Public sector Employment: The office for national Statistics shows
Public sector employment was 5,846,000 (20.4 per cent of all in
employment) in June 2005, 680,000 (13.2 per cent) higher than in June
1998, whereas from 1998 to 2005 private sector employment only rose
by 1,241,000 (5.7 per cent). This growth is unsustainable and wrong.
Growth: An OECD report shows UK economic growth averaged 2.7%
between 1997 and 2006, lower than in any other English
speaking country.
Gold sales: Between 1999 and 2002 you sold 60% of the UK’s gold
reserves at $275 an ounce, close to a 20-year low, a disastrous foray into
international asset management.
Your spectrum auctions gathered £22.5 billion for the government
which caused a severe recession in the telecoms development industry leading
to the direct loss of 30,000 UK jobs. Two auctions were run in
the USA, the first being cancelled and re-run (for less revenue) due to
damage caused to the industry. The Americans realised their mistake
and tried to rectify it. The British and German chancellors copied the
North American first auction; which had failed. To copy a failed
economic model is normally considered a serious error of judgement.
Your East Coast Mainline franchise auction led directly to the demise of
GNER, an excellent company, which was replaced by National Express
who offer East Coast mainline users a significantly poorer service. Your
duty was not only to maximise revenues, you also had a duty to the
shareholders, employees and customers which you completely failed.
Anti-poverty: The Centre for Policy Studies found that the poorest fifth
of households, which accounted for 6.8% of all taxes in 1996–7,
accounted for 6.9% of all taxes paid in 2004-5. Meanwhile, their share
of state benefit payouts dropped from 28.1% to 27.1% over the same
period.
Tax: According to the OECD UK taxation has increased from a 39.3%
share of gross domestic product in 1997 to 42.4% in 2006, going to a
higher level than Germany. This increase has mainly been attributed to
active government policy, and not simply to the growing economy.
You pledged to not increase the basic or higher rates of income tax
however in all but your final budget, you only increased the tax
thresholds in line with inflation, rather than earnings, resulting in fiscal
drag.
You abolished the 10% tax band so that you could reduce the basic rate
from 22% to 20%, to make it look like you were decreasing taxes.
However in fact it led to increased tax for 5 million people, and, left
those earning under £18,000 as the biggest losers.
Pensions: Your changes in 1997 in the way corporation tax is collected,
directly led to the taxation of dividends on stock investments held
within pensions, thus lowering pension returns and contributing to the
demise of most of the final salary pension funds in the UK.
This act alone has single handedly damaged the pension of every
person with a pension in the UK but also saddled UK corporations with
a an ever growing pension liability, so much so that many companies
futures are imperilled by these debts.
Falsehoods: You used the Laura Spence Affair to beat up Oxford and
Cambridge about their admissions procedures, Lord Jenkins, then
Oxford Chancellor and himself a former Labour Chancellor of the
Exchequer, said “nearly every fact you used was false.
(bits left out-ed)
IraqWar: You supported British involvement in the Iraq War against the
wishes of the UK population and helped to justify that involvement by
publishing false intelligence. This war has directly increased the odds of
terrorist attacks on British subjects and the financial cost has had a
significantly detrimental effect on the British economy.
Military Covenant: You have not adhered to the ‘military covenant’,
leading to a significant decline in the moral of the armed forces due to
poor housing, lack of equipment and adequate healthcare provisions.
The lack of equipment has directly led to an increase in the loss of lives,
and serious injuries, compounded by a lack care following serious
injury.
The 15% VAT Rate: introduced to counter the effects of recession
demonstrated a total naivety and breathtaking stupidity. Far from
digging the nation out of a hole, it has saddled the country with a huge
unsustainable debt.
No one should benefit from failure: You have on numerous occasions
stated that no one should benefit from failure, however your tenure as
chancellor was universally recognised as a failure, but you were
rewarded with the Premiership and had the gall to accept.
There will be no more Boom & Bust: In your hubris you made a
statement that was patently untrue, and counter to any economic
theory. You either knew that statement to be untrue and lied or if you
believed it then you clearly demonstrated your foolishness and proved
that you were unfit for office.
The UK is in a better position than any other developed country: this
again is completely untrue, we have more than double the debt per
head of population than any other country in Europe.
Public Services: You have destroyed Public Services by a raft of
inappropriate targets, which have led to resources being wasted by the
attempts to meet those targets.
Surveillance society: You have presided over and led to the creation of
a surveillance society in which any perceived wrongdoing is used as a
pretext to pass oppressive laws. You and your predecessor have both
single headedly succeeded in making the UK an unpleasant place to live
in.
These are but a small sample of your failings any of which make you unfit
for public office and for which you should immediately resign. You sir are a
fraud and I am forwarding this letter to as many people as I can, via the
internet in an effort to shame you into accepting your failures.
Yours faithfully
Steven Katirai
March 30, 2009
How on eath did this (unpleasant and unintelligent man -ed toning it down a lot) ever become prime-minister now he wants to tamper with the sucession to the throne –no doubt he wants to become King Gordon Brown –the mind boggles with the idiots desire to save the planet –this guy is worse than (a named tyrant who wasn't very nice -ed)
regards Paul Davis