If you import more than you export you have to sell assets to pay the bills

In the debate over how desirable it is to sell companies to foreigners people neglect the obvious. All the time we import more than we export we have to sell assets to pay for the imports. That might be flats and houses, it might be companies, but it has to be something. If we want fewer foreign owned companies then we have to sell more goods and services abroad.

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84 Comments

  1. Narrow Shoulders
    Posted May 2, 2014 at 7:04 am | Permalink

    There is of course a debate to be had about rebalancing the economy and competing against the nations from whom we continue to run a trade deficit. That competition would have to be based upon knowledge and innovation rather than wage levels

    However a simpler, short term solution is to wean ourselves off cheap tat imports. I would wager that most homes (my own included) are overfull of stuff that is not really needed but paid for by endless trips to the shops instead of more wholesome pursuits.

    Tariffs and protectionism on a range of lesser required tat would prevent us from having to sell quite so many assets abroad. Much of the property we sell to those based outside our own economy will be going to those whose income streams may not stand up to scrutiny, how are we supposed to compete on an equal footing with them?

    • margaret brandreth-j
      Posted May 2, 2014 at 9:05 am | Permalink

      One mans tat is another mans luxury, although I see shopping trolleys full of throwables instead of washeables and our tip is full of recyclable junk.

      We need to sell what others want ; we have to know what others want to be able to sell to them .We need to be able to come up with those products. Aldi have it with their excellent range of good vegetables etc. The basics are always a good start.We also need to not import as much and utilise our own resource.

  2. Excalibur
    Posted May 2, 2014 at 7:34 am | Permalink

    Yes, John. And the way to sell more goods and services abroad is to get out of this EU straightjacket. The goodwill that still exists in our former colonies, and throughout the Commonwealth, should be exploited to our mutual benefit.

  3. Iain Gill
    Posted May 2, 2014 at 7:46 am | Permalink

    I think there is an argument that says hard won intellectual property should be kept in this country regardless of who buys and sells the big corporations, and how they outsource their operations around the world. We should be protecting our best intellectual property at least as well as we protect our best art collections. I think other countries do this in all sorts of hidden ways.
    We have to be able to command a premium price in the world by having the best quality, innovation, techniques, intellectual property, and so on so “sell more goods and services” is not a competition we are going to win in quantity against lower cost base economies it needs to be in profit from being able to command a premium price for being better than average.
    Work at AZ is in any case heavily outsourced to India and Indian nationals in this country. People would be amazed how much of the work is done by Indian nationals as opposed to Brits.
    We need to compete much better internationally sure, that means amongst other things
    • Protecting our intellectual property better
    • Making it worthwhile investing in the productive economy and not fantasy level house prices
    • Controlling immigration so we force firms to hire and train Brits and not import massive workforces from lower cost base countries
    • Having political leadership that understand there is more to the economy than financial services

    Pharma is already a business in need of study. The way the big firms even if Brit firms don’t open new production capacity here, always abroad. The way cross border movement of IP works. The outsourcing. etc

    • Gary
      Posted May 2, 2014 at 9:44 am | Permalink

      You cannot protect intellectual property. eg. we have scant recourse in China and India to copyright enforcement. There is an argument to be made that ideas should never be protected, science is literally advanced by building on ideas. In any case building an economy on knowledge alone is a shakey way to proceed. The barriers to entry in such an economy are low. The way to build a sustainable economy is a combination of knowledge and capital to build things to export. That is hard and barriers to entry high.

      • JoeSoap
        Posted May 2, 2014 at 5:58 pm | Permalink

        I think the idea is that, given you understand that innovation is good rather than bad, protecting it encourages it and if it can’t be protected, it won’t happen.

      • Iain Gill
        Posted May 3, 2014 at 10:15 am | Permalink

        Everybody else on the planet protects their best intellectual property better than we do. From not showing foreigners around your most sensitive processes, to not using an outsourced foreign workforce to learn your most important trade secrets, not allowing your core data to be run from an (overseas ed)datacentre or call centre (where you correctly point out intellectual property protection and confidentiality is non-existent), there are a million and one ways in addition to the legal protections. There is nothing to stop governments doing deals with multi nationals to, for instance, insist IP stays here if handed over, for example, from our universities. We need to be a lot smarter and street wise.

  4. Brian Tomkinson
    Posted May 2, 2014 at 7:49 am | Permalink

    Is this addressed to your EUfanatical colleague Lord Heseltine?

  5. Steve Cox
    Posted May 2, 2014 at 7:57 am | Permalink

    For decades the income from our investments abroad has greatly exceeded the amount that we pay foreigners who own British assets. This allowed us to run a huge deficit in imported manufactured goods and commodities, something that we have become addicted to. Now for the first time in recent history we are actually paying foreigners more for their investments here than we are getting back on our investments abroad. Nobody fully understands why the situation has changed so quickly, but many commentators bless the fact that Indian businesses can buy up the likes of Jaguar and Land Rover, and Russians can but expensive properties in Belgravia as it pays for our extravagant tastes in imports. However, a reducto ad absurdium quickly shows that there must be a tipping point somewhere that this apparent ‘good’ becomes a big ‘bad’. Take the extreme and absurd case where we’ve finally sold everything in Britain to foreigners, what happens then? I’d say that this would be a very bad situation to be in, so selling the country may be good in the short term but do it too much and you end up broke – unless you invest the money, of course, something we are definitely not doing. So perhaps we have now passed the tipping point and unless we change our ways radically we are heading for financial disaster as a nation.

    • Gary
      Posted May 2, 2014 at 9:52 am | Permalink

      We previously ran a mercantile economy, where we would subjugate resource rich foreign countries , force them to export their raw materials back here where we would manufacture goods. The Royal Navy’s job was to enforce this state of affairs. Unfortunately the natives grew restless and obtained powerful weapons, and the cost to protect mercantilism became more than the revenues. The glory days are gone forever, although some may argue that a last ditch attempt to hang on is being made via various wars in the middle east and near east.

    • outsider
      Posted May 2, 2014 at 1:56 pm | Permalink

      Dear Steve Cox, I fear we are already long past the tipping point. Most of the big targets of non-sterling takeovers have been UK companies with large and highly profitable overseas interests and networks (eg cement, tiles, plasterboard, power engineering, rail engineering, engineering construction, confectionery, gases …). Each of these takeovers loses us not merely the UK profit but all the worldwide non – sterling income, so each increases the deficit that has to be financed.
      Our cyclical recovery is welcome but the UK is doomed to low long-term growth and static living standards, not least because many overseas buyers will only invest in the UK to satisfy growth in domestic UK demand, which is sluggish. Normally, though not always, investment in new technologies, research and new product development will go to the new home country, as will the introduction of new products, reducing the scope for future export growth.
      That is why I have given up caring about the UK economy. For a generation, no political party has given any priority to the balance of payments or UK productive capacity, whether in services, manufacturing or agriculture. No party has distinguished between genuine inward investment, which is good for us and mere foreign takeovers (although in a few cases such as Jaguar Land Rover the two can go happily together).
      It is now too late. The ship is slowly sinking and it is every man for himself.

      • JoeSoap
        Posted May 2, 2014 at 6:07 pm | Permalink

        It is never too late.
        Unintended consequences of the better kind – papers report here today in the US that it has to get its corporate tax act together to prevent more inverted takeovers, like AZ, where the HQ shifts to the UK.
        Really, low corporation tax and high capital allowances make sense in that not only do we stimulate our own companies but we attract others, particularly if we offer 100% plus R and D allowances. To that extent Osborne is heading in the right direction, albeit INCREDIBLY slowly, and I would expect UKIP influence, or any other competent party in coalition to speed him up somewhat.
        There is a case for aiming company tax policy to reach as a minimum a trade balance.

  6. Gary
    Posted May 2, 2014 at 7:59 am | Permalink

    spot on, with one caveat.

    We can sell houses ,but to foreigners not to ourselves, if we want to cover imports

    • Mark
      Posted May 3, 2014 at 9:00 am | Permalink

      We can collaterlise our houses by taking out large mortgages funded by borrowing abroad via the banking system without actually selling them to foreigners. The borrowing can then be spent on imports or funding welfare spending. This is exactly what was happening during the property bubble under Labour – to the tune of £800bn.

      The interesting question is what happens when we can no longer afford the mortgages. Perhaps that lies behind Sir John Cunliffe’s intervention yesterday.

  7. Posted May 2, 2014 at 8:00 am | Permalink

    The Chinese own some $3 trillion of US treasury bonds due to their huge trade imbalance with the US. The US government would be happy to allow the Chinese to buy Boeing commercial aircraft with some of that money but they would probably not allow the sale of Boeing military aircraft and they certainly wouldn’t allow the sale of the Boeing company itself to the Chinese.

    Effectively the Chinese have their money in the US central bank but that doesn’t mean the US government have to go cap in hand and beg favours from the Chinese. If the Chinese want to spend some of their money, in a controlled fashion, that would be fine by the US government but if they tried to do it such a way as to destabilise the US economy the US government could apply an export tax to slow down the rate of spending. I’m sure it wouldn’t come to that – but it is theoretically possible. A 50% tax would of course halve the value of Chinese holdings in US$.

    It is just the same for the UK government of course. If the UK government didn’t want overseas residents buying houses in the UK they could pass a law requiring a UK residency test. The same would apply to ownership of key companies.

    The trade imbalance started under Mrs Thatcher’s government. The City of London finds it easier to sell Treasury bonds to overseas buyers than manufactured goods and services. If the Governments want to balance the external deficit then they should phase out the sale of bonds!

    Incidentally, balancing the external deficit is a prerequisite to balancing the internal budget deficit too. The internal deficit isn’t really about the difference between taxation and spending. It is defined by the desire of the UK population to (net) save their money and also the desire of the UK government to balance the external deficit which it can do any time it likes by stopping the sale of gilts.

    • Gary
      Posted May 2, 2014 at 9:57 am | Permalink

      If the Chinese govt responded to American provocation by dumping t-bonds , interest rates would jump and the heavily indebted, ZIRP US economy would tank. China would suffer too, but being a creditor nation with a local workforce and manufacturing infrastructure, China would be relatively ok. China holds all the cards.

      • uanime5
        Posted May 2, 2014 at 7:25 pm | Permalink

        China’s economy is currently built on manufacturing things, then selling them to the USA and EU. So if China causes the US’s economy to tank (which will take the EU with it) then China’s own economy will collapse as well.

      • Posted May 2, 2014 at 9:33 pm | Permalink

        ” China holds all the cards.”

        Its a mistake to think that. The Chinese have supplied, over the years trillions of dollars worth of real goods and services to the USA, and in return they get a trillion IOUs! If you sell me a car and I “pay” with an IOU who has the bigger problem?

        What does dump them mean? If they swapped them for Euros the value of the Euro would rise which would not at all suit the ECB. So, to prevent that happening, they would then the same quantity of US$ bonds. It would end up as the Chinese owning Eurobonds. The Europeans would hold US dollar bonds.

        Nothing much would change.

        • Gary
          Posted May 3, 2014 at 5:34 am | Permalink

          China got most American factories and jobs. China got infrastructure and know-how. That can’t be undone. The west exported jobs and factories to China.

          China won’t sell all the US paper, it can’t, I am not sure that there would be any takers. China is making trade deals outside of the dollar, and specifically outside of the petrodollar with Russia. The reserve currency requires demand, and up to now China has supplied a lot of demand.

          Take away demand for the reserve currency, maybe even at the margin, and it collapses in hyperinflation.

        • A different Simon
          Posted May 3, 2014 at 6:43 am | Permalink

          Petermartin2001 ,

          “Nothing much would change”

          Ain’t that the truth .

          Economics and money are now so far divorced from fundamentals that it has all become a surreal charade .

          The man in the street can have no confidence whatsoever that any cash savings he may have (that the government is not planning on confiscating) will be worth anything a decade into the future .

    • Iain Gill
      Posted May 2, 2014 at 9:58 am | Permalink

      Lots of countries do impose much bigger property taxes on foreigners than local citizens.

      • A different Simon
        Posted May 3, 2014 at 6:48 am | Permalink

        Or prevent foreign ownership completely …. which seems to be under attack in the Philippines .

        In Malaysia foreign ownership used to be restricted to the more expensive houses .

        Think how much a location value tax could raise in London .

      • Mark
        Posted May 3, 2014 at 9:04 am | Permalink

        For example the Channel Islands.

  8. Iain Moore
    Posted May 2, 2014 at 8:17 am | Permalink

    I have banged on about our trade deficit for many years, but finding little or no interest in it from our political class. The basic sums are pretty stark, when we as a nation, buy in £80 billion more goods than what we sell, as we are and have been doing for more than a decade, then we have to find that £80 billion per annum from some where.

    I can follow the logic of linking the trade deficit with the budget deficit, and I can accept the argument of saying we have to sell assets to meet the bills for our imports, but I struggle to follow the money trail that links a private asset sale with our trade deficit.

  9. Lifelogic
    Posted May 2, 2014 at 8:18 am | Permalink

    As you say:-

    “All the time we import more than we export we have to sell assets to pay for the imports.”

    Indeed and with greencrap over expensive energy, absurdly high taxes, daft and endless regulations, a bloated state, an inefficient, slow and expensive legal system, the EU, a poor education system, expensive banking and other endless parasitic activities for the productive to carry it is rather difficult to export competitively from the UK.

    We just have to sell Chelsea, Astra Zenica etc. and much of London it seems.

  10. John E
    Posted May 2, 2014 at 8:24 am | Permalink

    I agree, and have commented here before that the balance of trade deficit deserves as much attention as the government spending one.
    There is, however, one interesting positive within the current news in that it appears the US buyers looking to buy in the UK are partly motivated by a desire to move their combined business tax base to the UK to take advantage of our lower corporation tax rates. That, together with the recent Starbucks decision to move their European business here from the Netherlands, at least would be a welcome reversal of previous trends and a vindication of your argument on reducing taxes delivering increased revenue.

  11. A different Simon
    Posted May 2, 2014 at 8:58 am | Permalink

    John ,

    I think you are either acting as devils advocate or are trying to justify flogging off the family silver . I prefer to think the former .

    If we sell all our assets abroad we are removing future generations options for using those assets . You can only sell them once . Even China leased Hong Kong to the UK rather than sell us it .

    Australia has it’s Foreign Investment Review Board (FIRB) .
    The UK has been almost alone in selling utilities to foreign owners .

    UK based companies are routinely prevented from buying utilities in other counties , for instance electricity generators in Japan .

    Look at Mr Blair selling off BNFL Westinghouse to Toshiba at knock down prices .

    Then 7 years later the UK taxpayer ends up paying over 4 times the proceeds for a single reactor in Somerset with 3X forward pricing for 20 years .

    The Govt is the one doing most of these bad deals .

    • Iain Moore
      Posted May 2, 2014 at 9:45 am | Permalink

      “The Govt is the one doing most of these bad deals .”

      Indeed the Government, of all colours, are appalling custodians of our interests. They buy the money men’s arguments which are a means to make fast bucks for them and a rotten deal for us.

      The Westinghouse deal was a great deal worse than flogging it off for a knock down price to Toshiba. Soon after Toshiba landed a $60 billion order from China. Barely a year after flogging it off, Gordon Brown woke up to the fact that we might need some nuclear power stations. So he went cap in hand to the French. Their offer to ‘help’ was the demand for us to sell British Energy (the holding company of our nuclear power stations) to their Government owned EDF. Part of the deal was that our Government owned RBS would lend the French Government owned EDF the money to buy our nuclear power stations. This loan we gave the French Government was put down in RBS’s books as a loan to British industry to meet the banks obligation to lend to British industry as part of their bail out agreement.

      So we flogged off Westinghouse, flogged off British energy, and in return got a new nuclear power station that guarantees the French Government profits for generations. And no doubt the bankers were telling British politicians it was a brilliant move ever step of the way.

      Could our politicians negotiated have a worse deal?

    • Mark
      Posted May 3, 2014 at 9:09 am | Permalink

      I have a feeling that a lot of foreign owned freeholds might magically revert to the Crown one day.

  12. Bert Young
    Posted May 2, 2014 at 8:58 am | Permalink

    High added value is the right approach to our balance of payments issue . Importing at one value and being able to add technical and scientific value to the overall product and then exporting , is a proven winner . Our education base and the consequent research and development activity puts us in an attractive economic launch position ; the weakness we have had in the past has been in commercial exploitation – eg the EMI Scanner . We have also led in the field of automotive design but failed to exploit all of its creativity . Much of our weakness was due to the prevalence of family dominated business , however , things have drastically changed in the leadership of our industry and business in the past 20 years and with this changed influence and skill , we can now challenge in all the markets of the world on an equal footing . I don’t see eye to eye with Michael Heseltine very much but I do agree with his statement today that foreign takeovers must be subject to Government approval . There is a grave danger to foreign ownership and we must protect our national interests at all costs . The EU also represents a serious danger to our economy and we must isolate ourselves from this threat .

  13. a-tracy
    Posted May 2, 2014 at 9:00 am | Permalink

    What have the Con-Libs done to facilitate and improve exports since elected? How much money was invested in overseas sales jaunts by the government, how did your party choose which businesses to help to promote, what % of these businesses had more than 50 employees and how much new business did that generate for the UK?

    Is there a region of the UK that exports more than its share? As we face a divorce by our Scottish friends choice, I think its time some of these programs like C4 news who are interviewing Scots for their opinion, should start to show the remainder of Brittania what will happen to us after the parting of the ways. What will we be called for a start! We won’t want any Scottish MPs in Westminster the minute after they get independence so that our nations good is looked after as a priority so how will that work out. Will we then become an export competitor of Scotland to balance these sales books you identify? Or will Brittanias assets be sold off to protect Scotland’s balance sheet?

    The Scots talk of HS2 and their taxes paying for it to help the English but isn’t this to link up Scotland to the Channel ports, why bother if they break away, shouldn’t we just wait to see now. My fear is this will release a wave of nationalism as the Scots have for their country for our separated new Country that the guy interviewed on C4 news last night just referred to as scaremongering but surely the ScotsNats have considered this scenario instead of just putting rose colour spectacles on.

    There was a young girl who said she wanted nuclear out of Scotland and that’s why she would vote YES, for a start how much is that worth to Scotland, would we relocate them off Cumbria and Northumbria I think its time we know.

    • Iain Gill
      Posted May 2, 2014 at 10:02 am | Permalink

      Camerons trade trips have been a joke. Highlights including India where he promised more uncapped intra company work visas, more student visas (with the right to work part time), and so on. Another classic is his representative of the British IT industry he took with him, an old contact of his from Eton full of BS but no real experience of selling British IT services abroad or delivering anything but hype.

      • a-tracy
        Posted May 2, 2014 at 6:52 pm | Permalink

        I agree with you Iain.
        Sadly sales seems to be a dirty word in the UK, very few people train in the skill and we need to do much better.

  14. Tad Davison
    Posted May 2, 2014 at 9:37 am | Permalink

    It seems to me that the bigger the market that is open to us, the better. Why limit ourselves to a diminishing market, where we have a massive trade deficit, and one that hasn’t the money to buy our goods and services anyway?

    Tad

  15. Robert Taggart
    Posted May 2, 2014 at 9:52 am | Permalink

    Indeed, Johnny – obvious really – so why do so few politicos (particularly on the left) still fail to understand this ?

    That said, if Blighty was sell some its foreign artefacts – Cleopatra’s Needle, The Elgin Marbles, The Rosetta Stone… that would be a double-whammy – money would come in, and – in future years – money would be saved (no more maintenance to pay for) !

    • Gary
      Posted May 2, 2014 at 6:47 pm | Permalink

      “if Blighty was sell some its foreign artefacts”

      oh, the delicious irony! Sums it up really. Anyone for foreign “aid” ?

  16. Ex-expat Colin
    Posted May 2, 2014 at 10:16 am | Permalink

    Complete common sense. And I undercut some big foreigners, very easily.

    I did it for 10 yrs (2000 -2010) to Europe/USA/Australia/India. This was electronics/software and unfortunately for me and my Customers I had to import the electronic parts through a line of bear traps that collected tax all the way. Thats apart from delays across any border that was imaginable.

    Sounds bad but inevitably becomes bearable by simple but frequent planning.

    For small general electronic parts, thank eBay for eBay. A few good people filling the gaps of the older larger shops/companies of London et al (circa 5o’s thru 60s).

    Yes, I know where the design of more complex electronics occur, but it is eagerly being swept away from UK, amongst other things (Ford). Car parts = too expensive even though produced in lesser countries.

    Accomplishing easy trade outside of the EU is as Farage says – not difficult and we can do that. I know it. However, multi layered/unexpected regulations emanating from the EU will only curtail trade for them..dare I say the Southern states?

    I don’t listen to big business by default, because I am never in it – simply that. And I and many others do not need big anything to trade globally. I/We just need freedom with global businesses of all sizes. EU/Gov…get out of the way!

    Yes..I know about standards and safety, anyone would be be a fool not to.

    End of Suck eggs (again)

  17. Antisthenes
    Posted May 2, 2014 at 10:23 am | Permalink

    We are being hypocritical if we decry foreign investment into the UK. We Brits did it in abundance investing all round the world at the height of our economic hegemony. We lost most of it in our decline exacerbated by our two world wars debts. We worsened the situation by become less efficient and too costly a producer and therefore less competitive, the price of decadence. The common market may have been our salvation as it created a vast home market at home and on the continent in which to sell into and offered the opportunity to hone new competitive skills by open and fair competition with our new near neighbours who were also members of the common market.

    Alas the the commissars in Brussels failed to see the benefits of such (god forbid) right wing ideas of free market capitalism and libertarianism as that road lead to prosperity, more civil liberties and trod on the toes of job saving protectionism that most continental members subscribe to (which of course is an oxymoron as in the end it does the opposite). So the EU was born to keep it’s citizens in their place so their betters could decide everything for them and at the same time pander to the protectionist instincts of the likes of France. The result is that now member states are seeing their sovereignty and democracy eroded and competitiveness not being enhanced to the degree that is necessary to create a more balanced or let alone a surplus current account.

    Getting out of the EU but remaining in the common market will of course redress some of the problem of a poor balance of payments performance. However without ditching most of the lefty policies and practices and there is much of it that have crept into the UK governance system and therefore slimming down the role and size of the state leaving the EU will not be enough to achieve the heights of competitiveness needed to become a formidable foreign investor in our own right again .

    • uanime5
      Posted May 2, 2014 at 7:37 pm | Permalink

      Alas the the commissars in Brussels failed to see the benefits of such (god forbid) right wing ideas of free market capitalism and libertarianism as that road lead to prosperity, more civil liberties and trod on the toes of job saving protectionism that most continental members subscribe to (which of course is an oxymoron as in the end it does the opposite).

      Care to explain why in the US their free market capitalism and libertarianism has only resulted in prosperity for the wealthy, a reduction in civil liberties, and has resulted in a large number of US jobs being lost to foreign countries. It seems the EU was right to reject these ideas and instead focus on making their economies better for everyone, rather than only helping the wealthy.

      The result is that now member states are seeing their sovereignty and democracy eroded and competitiveness not being enhanced to the degree that is necessary to create a more balanced or let alone a surplus current account.

      What about Germany? All those EU law haven’t made Germany any less democratic or less competitive. It’s also running a trade surplus.

      Getting out of the EU but remaining in the common market will of course redress some of the problem of a poor balance of payments performance.

      Leaving the UK isn’t the best decision for the UK’s economy according to The City UK. They recommend staying in the EU so the UK will still be able to influence the common market.

      htm

      • Antisthenes
        Posted May 3, 2014 at 6:48 am | Permalink

        The rich becoming richer is not what the left would have you believe a bad thing and does not make the gap between the rich and poor wider in fact the opposite occurs. There is not enough space here to enlighten you and explain the the reasons why. Suffice to say the trickle down effect works, the evidence that capitalism takes people out of poverty in large numbers billions in fact is overwhelming and comparisons when things such as welfare, healthcare etc is taken into account it can easily show that the poor in the USA and other develops countries is not once again at at level that the left would have you believe. They always leave those items out of their calculation because to do otherwise would destroy their case.

        Germany has been and is with France the de facto controllers of the EU and have engineered the affairs of the EU to their benefit. Germany are in a unique position in the EU as the euro has and does help their economy because it is weaker than what the DM would be if they still used it. Coupled with which the euro zone effectively gave Germany a tremendous advantage as in practice it gives them a captive market. Those two factors of course negates much of the negative effects of the draconian rues and regulations being permanently foisted on them and us from Brussels. So it is no wonder that Germany is able to enjoy current account surpluses.

        As for Europhiles claims that jobs and influence would be lost if the UK left the EU that is just scare tactics. If the UK left the EU trade with the EU will continue as it it is quite obvious that it is nobodies interest least of all the EU whose exports to the UK is considerable and that they would not wish to lose. Another benefit would be that exports to the rest of the world unfettered by Brussels idiocy could well see a rapid expansion.

        As for influence that is a joke when it comes to the UK as she has very little France and Germany lead the way and the rest of the EU members follow. When you have only one vote and nearly all the other 27 are very rarely in agreement with the UK then again no influence. The veto is not much good either as the EU finds ways to circumvent it. Further many of the world bodies that have the real influence the UK are either not on and the EU are or are being edged out for the EU to take over. If the UK leaves the EU with the size of it’s economy it would sit as equals of the the EU on world bodies so her influence would be enhanced.

        • sjb
          Posted May 3, 2014 at 8:44 am | Permalink

          As for influence that is a joke when it comes to the UK [because] she has very little […]
          What about the Single Market and enlargement? Both policies strongly promoted by the UK.

  18. The PrangWizard
    Posted May 2, 2014 at 10:57 am | Permalink

    It has always grieved and demoralised me each time one of our companies has been sold abroad; I don’t know when I first started noticing and getting annoyed, but it may have been with International Computers and then Pilkingtons, then ICI, and Rolls Royce Cars, the list is endless, and they now are after Astra-Zeneca, and Channel 5 has just gone. What philosophy is behind the idea that this is always the right thing to do? The City spivs who only have a three-month horizon and who think only short-term and thus tell the Directors it’s the only way, so they can make a big percentage, and would sell their children if there was a profit in it, greedy short-sighted and incompetent Directors and shareholders who care nothing for the nation, and who also just want the money and fall for the b***s**t. But what about all those valuable patents too? I’m no socialist and I’m trying to hold on to my national pride; surely there is a longer term and deeper national interest to be protected. Where will we be when there are no English companies left in English hands? I fear it’s too late, just another example of the Establishment selling us out. There aren’t many – in contrast why do the French and Germans take a different view and protect their assets – don’t tell me their methods don’t work. And the Americans too – they know that the best method is to buy, not sell, they have made a world-wide empire out of doing it.

    • libertarian
      Posted May 2, 2014 at 7:19 pm | Permalink

      Prang wizard

      It would really help if you had even a passing acquaintance with how a public company actually functions.

      1) There is NO such thing as a British company ( only companies listed on UK exchange)

      2) Companies are sold ONLY when a significant number of the owners AGREE to sell their shares

      3) Any idea who ACTUALLY owns most of the shares of UK listed companies ?

      Companies listed on Deutche Borse 761 of which 105 are subsidiaries of overseas companies

      Companies listed on London Stock Exchange 3307 of which 715 are subsidiaries of overseas companies

      87% of US Fortune 500 companies listed in the US in 1955 now NO LONGER exist

      So please explain why Germany or America is a better model as to France all they do is nationalise their biggest companies

      Er counties don’t own intellectual property individuals, companies and institutions do.

      The fact that a person born in England holds a patent on a piece of technology has no impact on our economy at all. The impact is where things are made/produced. The vast majority of Astra Zenica plants and employees are based overseas for instance.

      Just to be clear I don’t think Pfizer should buy AZ not for any stupid 19th century nationalist reasons, i just think that like RBS buying up all and sundry its actually bad business.

      • David Price
        Posted May 4, 2014 at 12:14 pm | Permalink

        “2) Companies are sold ONLY when a significant number of the owners AGREE to sell their shares”

        That is not true, companies can and have been sold off against the interests of shareholders, even majority ones. COmpanies can go in to voluntary administration even when quite solvent and the sharholders have no control.

        As for “stupid 19th century nationalist reasons” these are practiced quite effectively by the majority of countries. Whereas in the UK we seem to have an abundance of fools who press for unilaterally giving away IPR or selling off strategic industries and companies. Either fools or those who make a quick buck from the transactions or personnel changes.

        • libertarian
          Posted May 4, 2014 at 11:22 pm | Permalink

          David Price

          Really ? tell me which company has been sold AGAINST the wishes of a majority of the shareholders.

          A company going into administration is NOT remotely similar to a company being the subject of a takeover However you are WRONG shareholder approval is required by law in order to enter voluntary winding up. Read article 11 of the link http://www.lawdonut.co.uk/law/ownership-and-management/shareholder-and-boardroom-disputes/shareholder-and-boardroom-disputes-faqs#11

          Again really, which countries would they be then David? IPR is NOT owned by countries. The UK as a country doesn’t hold a patent or IP . As you clearly also have no clue about how a public company works it would be interesting to hear how you define a British company. Whatever its NOT Astra Zenaca which is a combined Swedish/US/UK conglomerate run by a Frenchman & Chaired by a Swede. The vast majority of its assets, operations and more than 70% of employees are based outside of the UK. So tell me what makes it British?

          As I told PW I’m not in favour of it being sold so I’m neither a fool or making any money from it.

          • David Price
            Posted May 5, 2014 at 2:56 pm | Permalink

            You did not qualify your statement, you baldly stated “Companies are sold ONLY when a significant number of the owners AGREE to sell their shares” and this is patently not the case if a company finds itself in administration. So your generalisation is not universally true.

            For example, Nortel UK was forced in to administration independent of it’s liquidity and cashflow, I am not aware of any Nortel employee shareholder that was consulted anywhere concerning the decision

            As for IPR, patents are issued by a government to (supposedly) protect the holder and permit them to exploit their invention in that jurisdiction for a period of time. In essence the government controls the invention.

            The issue that the OP made was what happens when a UK domiciled company paying UK taxes and employing UK staff is sold to a foreign company. In the specific instances I am familiar with the results have always turned out bad with loss of jobs, key skills and tax revenue in the UK.

            I wonder if you would be so condescending if you had to make your comments under your real name, or perhaps that would be bad for business.

          • libertarian
            Posted May 6, 2014 at 10:46 am | Permalink

            David Price

            Oh for goodness sake. As I already told you a company going into administration is NOT the same as a takeover. As I already told you a company going into voluntary administration MUST get the approval of its shareholders. A company being forced into administration is because it cant meet its obligations and is wound up by the tax authorities and or creditors. Nortel was BANKRUPT it couldn’t meet its obligations. It filed in order to PROTECT its shareholders. Nortel was a Canadian company and therefore I have no idea about the relevance of them to this argument ( apart from the fact you obviously worked for them).

            The government controls the invention? Ha ha yes of course they do. Which government would that be then?

            I wonder why you cant grasp simple concepts like private ownership, why you cant answer a simple question which is what makes a company British. You also seem to completely ignore the fact that its not about “nationality” but as I said a few times now its how many jobs, plants and how much revenue, profit and tax are here NOT who owns the company

          • David Price
            Posted May 7, 2014 at 12:19 pm | Permalink

            What you “tell” me does not make it a fact, it is solely your opinion. That there is a law about something doesn’t make it universal or even a fact as it depends entirely on authoirties/regulators to uphold the law. This does not always happen so to spout some generality and then make condescending remarks against people have experienced situations that do not fit your theory is to simply ignore reality.

            Nortel was not bankrupt in the sense it could no longer trade, Nortel UK was certainly not bankrupt, and the relevance is that it was one of the big global companies and was a foreign company wrt the UK. It is therefore an example of a foreign company that took over a British one (STC).

            The issue is the consequence of control and the result of that moving from the UK to elsewhere and the impact on our economy and our capacity to sustain our standard of living. The intellectual assets of a company can be transferred without selling the shares, it happens all the time with outsourcing and execs are willingly involved in that process.

            The world does not operate a perfect free trade model and to insist that the UK should do so unilaterally is stupid because it threatens our livelyhoods and the economy as a whole.

          • libertarian
            Posted May 7, 2014 at 3:36 pm | Permalink

            Dear David Price

            Oh dear me. Its not MY opinion, its company law, I even provided you with a link to the relevant legislation. Of course I will be condescending to someone who is so fixated in their opinion they can’t be bothered to read .

            (examples left out ed)
            You need to understand more about the evolution of businesses.

            If you want to tell me about Telecoms companies why not tel me about Mitel? A UK company that wanted to expand into data was stopped by its majority shareholder BT who ousted founder Terry Mathews. He left went to Canada set up Newbridge sold it to Alcatel who then bought Lucent ( the old Bell Labs who probably own more tech IP than anyone). So The Franco/US Alcatel Lucent now has a majority shareholder one Sir Terry Mathews who is Welsh. Does that make it a Welsh company? Whatever if it had remained British it would have gone long ago.

            Your point about selling IP without selling the business is correct but totally the opposite of what this discussion is about, so irrelevant in this case.

            No one ever said it was unilateral and again if you bothered to read and understand the very small list of examples that I gave of companies from “other” countries being bought and sold on a regular basis you would realise you are talking nonsense.

            There is ABSOLUTELY no threat to the economy or the countries livelihood by the sale of one company to another. As I have repeatedly told you and you have continued to ignore the nationality of the owner has no baring. Its about how many jobs are here, how much revenue and how much tax is paid here. Not the birth place of the owners.

            Private property is private property. Or are you telling me that as we have a housing shortage the government should be allowed to tell you who you can sell your house to?

    • rick hamilton
      Posted May 3, 2014 at 2:08 am | Permalink

      I fully agree with your sentiments.

      I have worked abroad for British companies for decades and despaired long ago at the easy, casual way in which great British businesses, brands and industries were sold off to foreign ownership for the sake of a quick profit for shareholders and – dare I say it – early retirement in comfort for top management. The worst aspect of it is that government stood idly by and nobody in power seems to care a damn.

      When our last nuclear company was sold to Toshiba, Blair was actually going cap in hand to the French to ask for their help in nuclear technology. Now the country that invented the nuclear power station (Calder Hall in 1956) is asking the Chinese to help. That sounds to me like a defeat and a humiliation, not a ‘vote of confidence in British workers’ as Heseltine once said. And Toshiba are now selling nuclear reactors based on that technology around the world as we should have been doing ourselves.

      The likes of the FT and Economist have endlessly peddled the line that ‘it doesn’t matter who owns what’. Try telling that to the Germans, French, Japanese, Americans in fact any country that is run by politicians who actually know something about manufacturing, engineering and technology. Management control, profits and decisions on future employment all pass to a foreign HQ. What’s clever about that?

      When Margaret Thatcher tried to sell Land Rover to General Motors long ago, people marched in the streets to protest. In the end they gave up because there was nobody in power who would show the least sense of pride, commitment or support for retaining our industries in UK hands.

      And please, don’t tell me that British management are useless, workers are militant etc etc. British management are often laughed at by the ignorant media but if our companies were so useless why would foreign investors want to buy them? Try running a business overseas and you will find that people are much the same the world over, except for their way of thinking. The elements that you can’t measure are what actually create success – pride in country, company and product, loyalty, work ethic inculcated at school, thorough training, long term commitment, determination to succeed. All of which appear to mean nothing whatsoever to our City beancounters.

      In my view UK government is run by ‘words’ people who think things will magically happen if they make the right speech, whereas the powerhouses of East Asia are run by ‘facts’ people who know how things work and are interested in building up their national assets, not selling them off for a quick buck. Possibly our politicians (our host excepted of course) only understand the income statement and have not yet learned about the balance sheet.

      I could go on…….and on.

      • libertarian
        Posted May 3, 2014 at 10:38 am | Permalink

        Tell you what Rick don’t go on and on. Why not just stick to your first paragraph and actually make an effort to understand.

        Publicly listed companies are owned by their shareholders. The shareholders hold the stock to make a profit. ( Most shares are actually owned by YOU via your pension fund and other investment vehicles ) So berating people for selling shares at a profit is the height of stupidity. If you’ve ever worked for a company thats been taken over you would know that far from management getting comfortable a large number actually get made redundant . Have you never bothered to ask yourself why management fights so hard NOT to sell a business?

        Then you really made me laugh by complaining that the government stand by and let it happen. The rest of your rant then goes into great depth about EXACTLY why politicians and government shouldn’t be let anywhere near this. There is NO SUCH THING as a British or any other nationality company. They are publicly listed and anyone anywhere can own their shares.

        • rick hamilton
          Posted May 3, 2014 at 11:53 pm | Permalink

          If you actually bothered to read the rest of my comment you would see that I was not discussing shareholders but management control. I do happen to understand clearly how shareholding works, thank you and I have plenty of experience of takeovers both ways.

          Operational management in a large international company rarely spend their time thinking about who the shareholders are. Every day they respond to the demands of the HQ. I have experienced a takeover of a British company by a huge group headquartered in the US and its culture and methods were very American, even though they operated worldwide and employed many different nationalities in management even in the US.

          My point is that when a British company is taken over by Japanese, Germans, etc, control passes to top management in those countries and they call the shots on a daily basis, of course they do. Every small design change and each local advertisement, etc has to be signed off by HQ and they make the policy.

          If you want UK businesses to be run from overseas, ok so be it, it’s too late to go back anyway. Many EU companies are run from the USA or Japan, I know. My concern is the massive amount of UK business that is controlled externally and why this does not happen in other G7 countries.

          Numbers are not everything.

          • libertarian
            Posted May 4, 2014 at 11:35 am | Permalink

            Rick

            Try reading my post too. Theres no such thing as a British Company. Astra Zeneca is a merged Swedish, US , British organisation with a French CEO.

            The SHAREHOLDERS decide if they wish to sell a business NOT management, NOT banks, NOT accountants.

            Many years ago I was a senior exec of a US based business. I’m English. What nationality does that make the company? What culture was in place?

            Numbers ARE everything. The number of people employed here, the revenues and profits earned here, the amount of tax paid here are ALL thats important, not where the parent company is primarily listed. You really don’t get business do you

        • David Price
          Posted May 4, 2014 at 12:34 pm | Permalink

          Libertarian, you are making a sweeping generalisation which does not match reality. I’ve worked for a number of large technology companies, some clearly British in terms of shareholding and HQ/financial location. In all cases when they were taken over the execs rarely fought the move and did very nicely out of it while the lower band generally did badly. Foreign takeovers were especially bad for local employees and it was very clear which country’s employees got priority treatment and funding.

          As for no company being deeply tied to a country perhaps you should go look at, for example, Boeing, Bosch, Siemens, Toyota, Intel, etc. WHat do suppose the national reaction would be if it were proposed to sell them off to some Russian or Indian company?

          • rick hamilton
            Posted May 5, 2014 at 12:01 am | Permalink

            David you have made my next point for me.

            Libertarian seems not to have noticed that it is the controlling shares that count. For example the Ford family control the company through a small number of voting shares and Toyota’s main shareholders are other major Japanese institutions.

            They are American and Japanese businesses respectively, however many overseas plants or employees there may be, and the decisions are made ultimately in Detroit and Tokyo.

          • libertarian
            Posted May 5, 2014 at 12:06 am | Permalink

            David Price

            Oh dear. No its not a sweeping generalisation its a matter of legal fact. The executives and management have no say in the sale of a company, they may recommend it but it IS entirely down to the shareholders. You clearly have no idea about the make up of the vast majority of MULTINATIONAL companies.

            Let me tell you what the reaction would be. Absolutely NOTHING. As I already told you 87% of the Fortune 500 of 1955 are no longer in business. Caterpillar of US was sold to a Swiss conglomerate, between 2006 and 2011 6,500 US large public companies where acquired by non US firms. You do know that the French car maker Renault is now part owned by Nissan?

            As for Bosch oh dear its NOT a publicly quoted company my friend the majority of its shares are held by a Trust and the rest are owned by the Bosch family. By the way Bosch has manufacturing plants in 60 countries ( do you see why this nationalism thing is a load of old bull? )

            Next up Siemens. They SOLD their entire IT solutions business to an French company ATOS, In August 2013 Nokia acquired 100% Siemens Networks by BUYING Siemens AG and ending the company involvement in telecoms. Siemens has just formed a joint venture Electric Traction R & D joint venture with a Chinese company called Zhzhou CSR Times Electric Co.

            Toyota has manufacturing plants in more than 20 counties. Its biggest operation is in the USA and the company is listed On Tokyo, New York & London stock exchanges. Toyota has a joint venture business with a Chinese motor manufacturer

          • libertarian
            Posted May 5, 2014 at 10:55 am | Permalink

            Dear Rick
            What part of the majority shareholder don’t you understand ? Do you not read anything thats posted? A company is sold if the majority shareholders choose to sell it. In most cases shareholders in a public traded company are pension funds ( yours), investment vehicles and institutional shareholders. Its really not difficult.

            So what ?where decisions are made the ONLY point about a business is where it operates. If the majority of plants and employees are based overseas, what use is it being thought of as “British” by you? Blimey no wonder this country lost the entrepreneurial spirit with this level of understanding

  19. Gary
    Posted May 2, 2014 at 11:21 am | Permalink

    an example of the farce that is GDP, we have imputed rent. This is the rent that COULD be charged IF a house that is owner occupied would otherwise be rented out. This number is calculated and goes towards GDP !

    At present imputed rent makes up an estimated 10% of GDP.

    What a farce. If you believe govt, I have a bridge to sell you.

    • Robert Taggart
      Posted May 4, 2014 at 12:41 pm | Permalink

      But will they ever cross said bridge ? – even when the time comes ?? !

  20. Steve c
    Posted May 2, 2014 at 11:41 am | Permalink

    Can I commend you on your simple but spot on report.

    The result off selling our national assets, property, companies, government debt( future taxes income ), University knowledge, utilities etc is that as a nation we will increasingly pass profits generated overseas and our children will be all the poorer.

    We are being asset stripped!

    An example of how poor our country’s leadership is can be demonstrated by the Passport Office. They are charging companies and individuals high VIP delivery charges for the (named company)to deliver our passports.

    After 2 full days of frustration waiting in at home and over 4 hours on expensive automated call handling systems that cut off when you finally get put through to talk to an operator, I started to investigate what was going on.

    Online service reviews universally report (this company ed)have (poor in some caSes ed)service with the lowest service ratings reported I have ever seen.

    I spoke to several of their staff covering the Wokingham/Woodley area, they told me they cannot deliver the passports in this area as they are closing local centres and have staff shortages in Heathrow. (Etc ed)

    How can we compete in a global marketplace when the Government run Passport Office cannot even organise a Passport to be delivered in Berkshire. When they force citizens to pay high charges to use (a company some of us dislike ed)his proves how inept and remote our civil servants running our country are, it is so easy to replace this (words left out)company or to demand service improvements!

    Etc ec

    You could not make it up, except to add the Post Office who once provided an excellent Passport service are now moving into the hands of overseas investors and may soon be based in Luxembourg where they will pay little or no tax.

    My point of this story, if our UK Government cannot even place a (successful ed)contract to deliver a Passport in Berkshire what chance do our children have competing in the global economy.

    Heartbreaking.

    Reply I am sorry you experienced poor service. I suggest you take it up with the company and hear their side of the story.I have not had complaints from other users. If you want me to take this up pleaSe write to me with details and your naMe and address and I will aLso look into it.

    • A different Simon
      Posted May 3, 2014 at 7:08 am | Permalink

      My brother in law is doing work for one of the courier companies which deliver passports .

      He is on a zero hours contract and they never pay anyone their full wages which results in people working for less than national minimum wage .

      Anyone who asks too loudly when they will get the rest of their wages is sacked .

      The Govt department tacitly approves of this behaviour .

      Reply if laws and rules are being broken those with evidence should take it up with Ministers

      • libertarian
        Posted May 3, 2014 at 10:50 am | Permalink

        A Different Simon

        Your brother in law should leave immediately and get a job ( there are 1,000’s available ) working for a reputable courier company. Or my advice which is even better is lease his own van and work for himself. The going rate for van drivers is £7- £9 per hour the going rate for self employed van drivers is £10-£15 per hour. There is a huge demand for van drivers.

      • alan jutson
        Posted May 3, 2014 at 3:44 pm | Permalink

        A D S

        I have been informed (by the Passport office) that if I was not at home then my new passport would simply be posted through the door, and the courier would take a photograph of my door as proof of posting.

        Yes it was eventually delivered when I was out, no problem for us as the house is ours, but what if it had been a house of multiple occupation ??

        Seems to me that this method could be fraught with possible security problems !

        Your Brother in Law is one of many thousands who are being abused and used by some rather shady companies who still seem able to trade no matter what the law says.

  21. Richard1
    Posted May 2, 2014 at 12:22 pm | Permalink

    Nationistic opposition to a Pfizer-AZ deal is absurd. It should be up to the shareholders who own the business. Look at the absurd behaviour of the French govt with Alston. Who wants to invest in a business if they might be told by some polotician or bureaucrat that they can’t subsequently sell it? The effect of economic protectionism will be higher cost of capital and less efficient allocation of capital. If this sort of protectionism had applied 20 years ago AZ would never have been created. Astra in Sweden and Zeneca in the UK would have remained national champions. Perhaps they’d be out of business by now.

  22. Andy
    Posted May 2, 2014 at 12:25 pm | Permalink

    “You have to sell assets” is not true. Foreigners creating assets in the UK is just as good. Building a new factory for example.

    • Mark
      Posted May 3, 2014 at 9:35 am | Permalink

      Inward foreign investment is on the right side of the accounting balance in principle, but you have to examine the other consequences too. Perhaps the plant in the new factory is imported, and the management too, who may save a large chunk of pay to spend in their home countries. If debt finance comes from abroad then the interest and loan principle will be repaid abroad, and dividends will also be repatriated. If the business is sold the beneficiaries will be the foreign shareholders. If the business conducts R&D, the benefits will accrue to the owners unless there is some particular technology sharing agreement. Of course, it will generate local incomes too, and pay business taxes, and may generate exports to (more than) offset imports of raw materials required to run it.

      I’m sure you can see where a domestically run business might differ in impact, and where it might be similar.

    • David Price
      Posted May 4, 2014 at 12:39 pm | Permalink

      Until the foreign company starts indulging in “transfer pricing” which lower tax payments and real problems for employees and pension funds when the UK company gets put into voluntary administration. In that event you quickly find out what a contract is worth exactly how much protection under law you don’t have.

  23. behindthefrogs
    Posted May 2, 2014 at 2:50 pm | Permalink

    If we are forced to sell our assets it is vital that we obtain maximum return, not just in terms of price but also on alonger term basis.

    Taking the example of the expensive flats being bought by foreigners in central London. We must ensure that any future sales are subject to capital gains tax and stamp duty and not avoided by hiding the ownership within companies that allow avoidance. We must also ensure that they pay a relevant council tax during the total period of ownership. This means maximising the tax on empty properties and introducing higher bands for these expensive properties.

    Similarly for companies we must place constraints that ensure taxes like corporation tax employers NICs etc continue to be paid and jobs are not exported abroad.

    • A different Simon
      Posted May 3, 2014 at 7:10 am | Permalink

      Why have a transaction tax ?

      Why not an levy an annual charge for “exclusive use of the commons” in the form of a location value tax ?

      Effectively we would end up selling the house but not the land it sits on .

      • Mark
        Posted May 3, 2014 at 9:49 am | Permalink

        We have the Annual Tax on Enveloped Dwellings for property owned through (foreign) companies. I’m not sure how much it raises, but I’ve seen a comment that revenue was five times higher than anticipated. Introduced in 2013 for property worth over £2m, the budget extended it to property worth over £1m next year and £0.5m in 2016. Foreign owners are still exempt from IHT, and their liability to CGT will only start in 2015 based on prices then – i.e. they will not be taxed on historic gains.

  24. Lindsay McDougall
    Posted May 2, 2014 at 2:57 pm | Permalink

    It’s not that simple. Pfizer has a track record of shutting down R&D abroad and doing the high tech production in the States. Wouldn’t that, if applied to AstraZeneca, lead to a reduction in UK exports? You shouldn’t assume that large American multi-nationals are benevolent.

    • JoeSoap
      Posted May 2, 2014 at 6:10 pm | Permalink

      That’s where you need to give them outrageous tax breaks for doing R and D here. Then even better ones for producing here. The Irish have worked this out.

    • Tad Davison
      Posted May 2, 2014 at 6:46 pm | Permalink

      Too right Lindsay, and it’s time people woke up to whose side they’re really on.

      Tad

  25. matthu
    Posted May 2, 2014 at 3:16 pm | Permalink

    OT – but topical to the elections

    Dick Taverne in The Guardian says: “David Cameron’s EU referendum pledge will be a disaster for him: the PM does not have enough time to achieve the changes he has promised, so a vote is likely to lead to Britain’s exit.”

    In one respect he is absolutely right: the PM will not have time to negotiate anything substantial by 2017.

    But in another respect he could not be further from the truth: the PM does have time to achieve the changes he has promised because he has promised nothing very definite or consequential.

    Instead, if elected, the PM will simply pack his cabinet, the BBC, the Royal Society and every other politcal institution he can influence with rabid Europhiles.

    The subsequent referendum will be so heavily financed and supported by the EU, the rich (think Cameron and Mandelson and his oligarch friends and the like), the elite (think House of Lords) and the heavily subsidised, highly paid, deeply ensconced media personalities at the BBC, The Guardian and GQ magazine (think Patten and Alastair Campbell and the like) that any debate (if there is any true debate allowed -we have seen what the level of debate is like this time around and especially as far as Scotland is concerned, we have seen how keen cameron is to engage UKIP in debate) will be completely one-sided.

    And that is the danger of electing Cameron.

    • JoeSoap
      Posted May 2, 2014 at 6:13 pm | Permalink

      Indeed, there will be no referendum under Cameron. The only answer is UKIP, or some other party of like mind holding at least the balance of power. QED.

    • Mark
      Posted May 3, 2014 at 9:52 am | Permalink

      Has Mr Hague recalled Iain Mansfield, the Brexit prize winner, from Manila to assist in negotiations with the EU yet?

  26. Kenneth R Moore
    Posted May 2, 2014 at 4:58 pm | Permalink

    The other argument is that our standard of living is undeserved and unsustainably high and we as individuals need to spend less.

    We are still living on past glory’s and have become a nation of spoiled children witnessed by our willingness to vote for our nanny Labour and latterly our nanny Conservative party . The worship of self and entitlement to anything and everything have replaced thrift and ‘cutting ones coat to fit the cloth’ etc.

    Government have their shame of the blame for throwing money around in the form of generous benefits payments which are then spent on more Chinese imports of crap we don’t really need.
    Public sector pay and pensions are too high compared to the private sector which just throws more petrol on the fire. Then we have the do gooders telling the so called ‘poor’ they are in ‘poverty’ if they can’t afford holidays and satellite television.
    What a mess.

    Mr Redwood doesn’t mention the sustainability of selling off strategic assets to foreigners to pay for our gluttony. What happens when all the ports, houses, airports and intellectual property have been bought up by our competitors ?

  27. Terry
    Posted May 2, 2014 at 6:17 pm | Permalink

    Well that is one way to cover it. Another is to raise taxes or devalue the currency to increase our exports. But both of those are self-defeating, of course.

    The answer is to cut imports and increase exports. Imported energy supplies represent a huge amount of our running costs so they should be 100% home grown. If that means building coal-fired power stations then so be it. If that means pushing hydraulic fracturing to extract natural gas and oil so be it. This country is in dire straits, despite what Osbourne may tell us and we must now brush aside ALL objections and fashionable objectors in favour of saving our nation from disaster. Green dreams and schemes will not save us. Somebody, please take charge and get this country back on its feet.

  28. matthu
    Posted May 2, 2014 at 7:31 pm | Permalink

    Completely OT

    It was actally suggested in the Daily Politics show on BBC2 today that Gerry Adams’ arrest simply proves that “nobody is above the law”.

    That immediateoly makes one remember what is alleged to have happened in the case of Cyril Smith i.e. possibly with top-level political and even MI5 involvement – and so I do hope that the investigation into Gerry Adams (is thorough and fair ed)etc ed

    • matthu
      Posted May 3, 2014 at 7:38 am | Permalink

      (is thorough and fair ed)

      Justice needs to be seen to be done, not simply the motions gone through.

      There was an investigation into Cyril Smith, several investigations into Savile, and also investigations into Hillsborough. An inquiry into the death of David Kelly, the Chilcott enquiry. Even they HS2 report.

      All covered up.

      Who today agrees they were fair?

      Why were they never put to bed at the time?

  29. Posted May 2, 2014 at 9:44 pm | Permalink

    Overseas buyers of London property don’t have the one thing that is necessary to protect it, but which is available to Londoners who might wish to buy it but are priced out of the market and so have to rent at sky high prices or even sleep in their cars.

    They don’t have the vote. A democratically elected government could act at any time they like to prevent properties being kept empty.

  30. waramess
    Posted May 3, 2014 at 5:00 pm | Permalink

    Your observation is no more than attempting to turn a tragedy into an issue of common sense, and it seems readers have fallen for it.

    “We” a nation of around 60 million are spending vastly more on imports than we are earning in overseas revenues. “We however, in the main, do not have assets to sell to overseas buyers, neither do “we” have any control over the process nor do the government, other than to provide a sanction to those wanting to sell assets.

    It’s a bit like saying that my excessive spending habits must be funded by you selling assets or, in order for the unemployed to live comfortable lives, the employed will have to work harder. They are all remotely connected but only remotely.

    So, the best we can say is that so long as inward investment is equal to or greater than our spending deficit we survive. The big question is, what will happen when that is no longer the case; what happens when inward investment slows?

    Will we borrow dollars when our capacity to repay dollars will be limited?

    A brief glance at the foreign exchange reserve position and the last two quarters of deficit make the whole matter look far less clever than selling a few more assets.

    As the State gets bigger largely as a consequence of redistribution of income from savers to spenders they fuel the demand for imports whilst squeezing the productive sector with increased taxes and reduced funding for investment.

    Cameron wants to invite overseas bidders to bid for HS2 and China to build a power station; You bet he does. Must be getting pretty concerned by now that foreign exchange to pay for all these imports is getting a bit tight. Has he ever considered how much steel will need to be imported for HS2?

    Yes, it is indeed a tragedy unfolding.

  31. Vanessa
    Posted May 4, 2014 at 7:20 pm | Permalink

    Britain is the new Greece !! We do not make enough to sell so we have to sell ourselves. Greece is putting up some of its iconic buildings for sale just to pay the bills – bit like a prostitute, wouldn’t you say?

  32. Lindsay McDougall
    Posted May 5, 2014 at 2:26 pm | Permalink

    More on this. Pfizer has just announced a 15% drop in profits because its existing blockbuster drugs are coming to the end of their patented life. Where are their new drugs, I wonder, and what happened to Pfizer’s creativity? No wonder they want to take over AstraZeneca with its promising supply line of new drugs.

    Recommendation to AstraZeneca shareholders – sell only for cash; lots and lots and lots of it.

  • About John Redwood

    John Redwood has been the Member of Parliament for Wokingham since 1987. First attending Kent College, Canterbury, he graduated from Magdalen College, and has a DPhil from All Souls, Oxford. A businessman by background, he has been a director of NM Rothschild merchant bank and chairman of a quoted industrial PLC.
    Published and promoted by Thomas Puddy for John Redwood, both of 30 Rose Street Wokingham RG40 1XU
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