Brexit is a £1 trillion con job

Just over a decade ago the British state conjured up staggering amounts of money in order to save the City of London financial sector from insolvency.

This unprecedented tsunami of cash included £200 billion in liquidity support, £76 billion to bail out RBS and Lloyds, £40 billion to bail out Bradford and Bingley and the Financial Services Compensation Scheme, £280 billion in insurance cover for financial sector assets, and £435 billion in quantitative easing.

In 2010 the general public decided to punish Labour for having been in power during the financial sector insolvency crisis by replacing them with a Tory/Lib-Dem coalition (despite the fact that the Tories had been squealing for even more financial sector deregulation even right up until the financial sector meltdown was kicking off!).

The Tories and their despicable Lib-Dem enablers immediately began loading the cost of the bailouts onto ordinary British people via a ruinous programme of austerity fanaticism, unprecedented wage repression, devastating public service cuts, deliberate under-investment in infrastructure, and vandalism of the social safety net.

Meanwhile they continually lavished vast tax cuts and extravagant handouts on corporations and the mega-rich, as they raided the infrastructure budgets of Scotland, Wales, Northern Ireland, and northern England to further boost spending in already wealthier areas like London and the south east.

The consequences of these policies were absolutely dire. The slowest economic recovery in two Centuries, the longest period of real terms wage depreciation since records began, soaring child poverty and in-work poverty, unprecedented cuts to the education system, unprecedented cuts to local government budgets, catastrophically failing public services like the NHS, police & fire service, tens of thousands driven into early graves, the most unaffordable housing in history ...

And then David Cameron decided to gamble the entire nation's future in order to nick a few thousand UKIP votes at the 2015 General Election.

An environment of collapsing wages, insecure jobs, soaring poverty, failing public services, unaffordable housing, and an annihilated social security system was exactly what the Brexiteers needed in order to push Leave marginally over the winning line in the 2016 referendum.

All they needed to do was blame the consequences of these devastating domestic policies on immigrants and the EU, then watch the votes flood in as the Tories and Lib-Dems outright refused to admit the truth, that it was actually them to blame for the living standards collapse, not immigration or the EU.

The austerity fanatics and their vile austerity-enabling sidekicks couldn't counteract the lie without implicating themselves, so they just sat back allowed the lie to stand, and allowed Leave to win.

Britain has been in a state of constitutional chaos ever since, especially so after Theresa May decided to give the British public the chance to get rid of the Tories who created this Brexit chaos in the first place, and instead of seizing the opportunity we decided to intensify the chaos by keeping them in power but without a majority so that the government was beholden to the Northern Irish DUP sectarians and the ERG Brextemists in the Tory ranks.

Hence huge numbers of financial institutions simply giving up on all the chaos and uncertainty in the UK to seek economic refuge in the safety of the Single Market, taking £1 trillion in assets with them as they flee.

Dublin, Frankfurt, Paris, and Luxemburg being the main beneficiaries so far.

So that's £1 trillion in financial sector bailouts. The British people being forced to cover the cost of these bailouts through Tory/Lib-Dem austerity fanaticism. Then a furious backlash against collapsing living standards resulting in the financial sector pissing off out of Britain taking £1 trillion in assets with them!

The saddest thing of all is that millions of Brits remain absolutely incapable of seeing this con go on right in front of their eyes, and it's not just an inability to synthesise information without allowing the mainstream media propagandists to do their thinking for them that's causing people to completely miss the bigger picture, it's an extraordinary level of political forgetfulness.

Remainers flocking to support the Lib-Dems seem to have completely forgotten* all of the Lib-Dem lies, and their red-handed culpability in laying the groundwork for Brexit by helping the Tories wantonly trash our living standards for five devastating years.

It's just four years since the Coalition ended, yet huge numbers of people have apparently already forgotten how appallingly the Lib-Dems behaved, and we're somehow back to trusting them again, despite all their betrayals, despite their austerity-collusion, despite the fact that their entirely unrepentant leader Vince Cable wilfully served as George Osborne's austerity hatchet man at the treasury for five years, and despite the fact he defrauded the UK taxpayer of hundreds of millions by selling off the Royal Mail property portfolio at a fraction of its true value.

If people can't even remember four years ago, what hope is there of them remembering how the very same financial sector that's scarpering with £1 trillion in assets today were the beneficiaries of £1 trillion in bailouts 11 years ago?

So what are the lessons here? 

• Brexit is a chaotic and ongoing economic disaster.

• There's nothing patriotic about supporting the diminishment of your own nation.

• Capitalism has no national loyalties, even to the extent of scarpering just a decade after being lavishly bailed out at the public expense.

• People are apparently so forgetful the bankers' bailouts are ancient history to them, and they're even back to trusting the Lib-Dems again!

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* = Well, either they've forgotten, or they were actually perfectly fine with ruinous austerity fanaticism all along because they were socially and economically insulated from it. So they've either somehow forgotten it all in the space of four years, or they're a bunch of horrible "I'm alright Jack" wankers who simply didn't mind austerity malice at all because the dreadful consequences always fell on other people, meaning they're exactly the kind of insufferably aloof and uncaring metropolitan elitists their opponents always claimed that they were.

George Osborne hypocritical feigning of concern for the poor

George Osborne has warned that quitting the European Union would be far worse for people on lower incomes and with less job security than it would be for those with the wealth to avoid suffering during a recession.

In this article I'm going to explain how he isn't actually wrong to point out that the poor would suffer more during a post-Brexit recession, but that he is staggeringly hypocritical to suddenly begin feigning interest in the poor after six long years of making them carry the burden of ideological austerity whilst handing out huge tax cuts and vast slices of public infrastructure to his super-rich mates.

A post-Brexit recession is likely

You only need to look at the stock market falls and collapsing value of the pound to see that the financial markets are afraid of the UK engaging in a rapid bailout of the EU without anything even remotely resembling a coherent and costed economic restructuring plan from the OFFICIAL Brexit camp.

A lot of people seem content to wait and see what appalling surprises could be hidden in the Brexit mystery box, but a lot of businesses and economics experts are deeply concerned about such uncertainty, because they understand that uncertainty is one of the main triggers of economic crises.

Even leading Brexiters like Iain Duncan Smith openly admit that Brexit is likely to cause a recession and give the Tories an excuse to push even more of their toxic ideological austerity. However his claim that these cost would be "a price worth paying" is very easy for a millionaire who was given his plush country estate by his in-laws to say, but much less easy for someone who could lose their livelihood, their home or their family life as a consequence.

The poor do suffer more during recessions

George Osborne is absolutely right that the poor generally do suffer the most during recessions. People who earn so little that they scrape by from one pay packet to the next are usually the ones who end up destitute when their wages and in-work benefits are slashed, or they are made redundant.

Better off people, who have earned or inherited enough wealth to put something aside for a rainy day will usually feel the pinch during a recession, but instead of skipping meals or living without heating during the winter or not being able to afford basic things like shoes for their kids or losing their home, the pinch for the well-to-do means means they might have to make a few sacrifices. Instead of cutting back on essential things like food, heating or clothes for the kids, the well-to-do can cut back on things like new cars, foreign holidays and trips to exclusive restaurants. 

What George Osborne doesn't mention is that there are always winners during recessions too. There are the obvious examples like budget supermarkets, which see increases in trade as people search for bargains in order to try to make ends meet, but the much bigger recession beneficiaries can be seen in the financial sector.

Many financial institutions deserved to be left to bankruptcy back in 2008 when their reckless speculative gambling on sub-prime mortgage junk left them technically insolvent. We all know that governments in the UK, US and Europe rescued the financial sector from the wave of bankruptcies they so thoroughly deserved with the biggest state subsidies in economic history. The bailouts gave the banks a free pass from the consequences of the competitive environment that hard-right capitalists (like George Osborne) refer to as the main justification for their "private is always more efficient than public" ideological mantra.

These vast state subsidies meant that the private banks were given a reprieve from their fate, so they still exist now. The bankers will have learned two valuable lessons, both of them pertinent in a post-Brexit recession.

The first lesson is that it's important to hedge your bets. Strategic investments can be made so that whichever way the referendum goes, the bankers' losses will be mitigated. The lack of strategic investment to mitigate the losses should the sub-prime market collapse (especially by AIG) was the main cause of the global financial sector insolvency crisis. Any remotely competent financial institution will now be carefully hedging their investments to make sure their losses are minimised whichever way the referendum goes.

The second, and more important, lesson the bankers learned back in 2008 was that if the crisis gets really bad, governments will use public money to bail them out, then extract the huge cost of rescuing them from insolvency by squeezing it out of the taxpaying public. The banks will know that even if the doomsday scenarios come true and Brexit triggers a major economic crisis, the government will ride to their rescue with hundreds of £billions in public cash, just like they did in 2008.

The effects of the 2008 bailouts (and quantitative easing) and the six years of Tory ideological austerity that followed it were that ordinary British working people suffered the longest sustained income declines in recorded history while the super-rich minority collectively doubled their wealth.

George Osborne is a hypocrite

George Osborne's hypocrisy is obvious. He's not wrong that Brexit could cause a severe recession, and neither is he wrong that the poor are far more likely to suffer the worst of it than the rich. However it's utterly hypocritical for him to make such points when the exact same criticisms can be made against his own ideological austerity agenda.

Here's what George Osborne said:

"We have got to make sure people understand the big economic risks facing the country, leading to real economic consequences for families. It’s the people on the lower incomes, the people who have got less job security, that will be hit first if there’s a recession. Brexit is for the richest in our country, they can afford recessions." [source]

And here's what anyone who is not economically uneducated enough to still be believing in George Osborne's austerity con might have been saying before the 2015 General Election.

"We have got to make sure people understand the big economic risks facing the country, leading to real economic consequences for families. It’s the people on the lower incomes, the people who have got less job security, that will be hit first if there’s more Tory austerity. Voting for the Tories is for the richest in our country, they are the intended beneficiaries of Tory economic ideology." 

George Osborne has spent six long years wreaking social and economical chaos with his ideological austerity con which is clearly intended to produce a vast transfer of wealth to the tiny super-rich minority at the expense of the majority of UK citizens, and most especially at the expense of the poorest sectors of society.

After repressing wages, attacking workers rights and deliberately orchestrating such a vast transference of wealth from the poor to the rich, George Osborne has got some damned cheek to suddenly pretend that he's sticking up for the interests of the poor, the low-earners and people with low job security.

Conclusion

If Brexit triggers a major recession, three things are certain (especially under a Tory administration): The poor will generally suffer the worst of it, the well-to-do will generally have to make more superficial sacrifices than the poor, and the super-wealthy minority will continue getting richer (especially if the crisis leads to more bankers' bailouts and more Tory austerity).

George Osborne isn't wrong to claim that a post-Brexit crisis is likely (it is) or that the poor generally suffer more than the well-to-do or the rich during a recession (they do, especially if the Tories are in power).

What makes George Osborne so wrong is that his criticisms clearly make an equally compelling case against his own ideological austerity agenda as they do against Brexit.

Furthermore, the negative consequences of Brexit are still hypothetical (highly likely but not certain), while the disastrous consequences of George Osborne's austerity agenda are all too real (six years of hard evidence that the super-rich have been getting richer at the expense of pretty much everyone else while Osborne has ended up borrowing more than every Labour government in history combined).

His appalling track record of ineptitude and his continued unpopularity make George Osborne an terribly self-defeating spokesperson for the remain camp, but when his criticisms of Brexit are even more applicable to his own ideologically driven austerity agenda, it makes him look like an extremely hypocritical opportunist who is simply feigning concern for the poor in order to obscure his real motivations for supporting Remain.

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Why is the Better Together campaign such a shambles?

In the last couple of weeks before the Scottish independence referendum I've covered the subject in some detail on my blog. Two of the core themes of my work have been the complacency of the Westminster establishment, and the astonishingly poor campaign strategy of the anti-independence camp.

In the article I wrote about the failings of the anti-independence campaign I identified four key areas of failure. The strategic error of ruling out Devo Max in order to play an "all or nothing" gamble with the constitutional future of the UK; the incessantly negative fearmongering tone of the No campaign; the risky and economically destabilising "you ain't keeping the pound" game of economic brinkmanship; and the unedifying spectacle of the three establishment party leaders making a haphazard dash to Scotland to make some undeliverable last minute promises.

There is plenty of detail and analysis in the original article, but for reasons of space I chose to leave out more detailed analysis of why I think Better Together has been such a strategic mess, which is the reason for this secondary article.

Let's get this absolutely clear before I go any further. Even if the swing to Yes is halted and reversed in the last week before the referendum, and the No campaign somehow manage to snatch victory from the jaws of defeat, the anti-independence campaign has been completely inept. With the full weight of the political establishment and the corporate media behind them, the anti-independence campaign has still managed to lose control of the way the debate is being framed, and consequently they're losing the debate in the streets and in public meetings across Scotland.

Given the huge advantage of having the mainstream media on their side, the only way to explain the appalling failure of the No campaign is to look at the key personalities and decision makers. In my view the two most obvious politicians to blame for the strategically inept nature of the anti-independence campaign are Alistair Darling and George Osborne.

Alistair Darling

Other than the fact that he is an MP for a Scottish constituency, it's extremely difficult to think of any reason why Alistair Darling was selected as the leader of the anti-independence movement.

It's almost as if the political establishment imagine that the public are such a bunch of feckless halfwits that we'll simply have forgotten that he was the man who rescued the insolvent financial sector with £1.5 trillion in bailouts (over 100% of the GDP of the entire UK at the time) and demanded virtually nothing from the banks in return.

After years of New Labour turning a blind eye to the catastrophic decline of the UK manufacturing sector, Darling's bailouts for the insolvent banks were by far the biggest state subsidies in history.

What makes this grotesque example of "socialism for the rich" so much more offensive is that in his youth Darling was a Trotskyist and a member of the International Marxist Group. It doesn't matter if you're a left-wing or not, a guy who changes his stance from outright communism, to one of blatantly serving the interests of the capitalist financier class at the expense of the public, is clearly not a man to be trusted at all.

George Osborne
      
George Osborne may not be at the forefront of the anti-independence campaign, but his fingerprints are clearly all over it. The most notable influence he's had is the economically risky game of "you ain't getting the pound" brinkmanship.

Most well informed people know that George Osborne hasn't had a proper job in his entire life other than short stints at data entry and towel folding, and that he has no economics qualifications at all either. What a lot of people don't know is that aside from being the Chancellor of the Exchequer, he is also the chief strategist at Tory party HQ. Osborne has been deeply involved with Conservative Central Office since his decision to become a career politician in 1994. It's worth noting that since Osborne has been involved in Tory party strategic planning, the party has endured its longest run in history without achieving a majority government.

Since the Liberal Democrats helped the Tories sneak into power in 2010 George Osborne has been working tirelessly to extract the costs of Alistair Darling's bankers' bailouts from the poor and ordinary in the UK, causing a huge drop in public spending power, and the flatlining of the UK economy. Osborne's ideological austerity experiment is conclusive evidence that the man is oblivious to, unable to understand, or willfully ignorant of basic macroeconomic theory.

The flatlining of the UK economy that Osborne's ideological austerity experiment has caused, has resulted in him borrowing an incredible £200 billion more than he claimed he would back in 2010. In fact, Osborne has created so much extra debt during his four years as chancellor, that he's added more to the national debt than every Labour government in history combined!

Given that Osborne is so evidently clueless about macroeconomics, it's no surprise at all that he seems to have another blank spot when it comes to uncertainly, which is a hugely important factor in economics.

Nobody with the slightest understanding of how important economic uncertainty is, would ever consider deliberately seeding the Scottish electorate with fear over the future of their currency with "hard man" threats like "No ifs, no buts, we will not share the pound if Scotland separates from the UK" as George Osborne has been doing.

The problem with uncertainty is that it doesn't just affect Scotland when ridiculous threats like this are made, it destabilises the whole United Kingdom economy because economics doesn't exist in a vacuum. If you introduce uncertainty about the future value of the pound, you're clearly going to destabilise markets either side of the border.

In order to minimise the effects of economic uncertainty, the two sides should have sat down together and negotiated a short-term currency union during the process of constitutional separation in the event of a Yes vote. This would have been for the best of both economies, but George Osborne and the anti-independence crew clearly give much higher priority to making threats in order to intimidate the Scottish electorate, than they do to minimalising economic uncertainty, and avoiding the worst of its economically destabilising side effects.

No plan B

With inept clowns like Alistair Darling and George Osborne behind the anti-independence strategy, it's no wonder that it's so absolutely hopeless. Neither is it surprising that despite the extraordinary bias of the mainstream media, the Yes campaign are winning the debate on the ground.

One of the biggest indicators of the strategic ineptness of the anti-independence movement is the fact that David Cameron's official spokesperson has openly admitted that the government has made absolutely no contingency plans in case the Scottish electorate choose independence because "The government’s entire focus is on making the case for the UK staying together".

That the government has absolutely no plans should Scotland choose independence other than "they ain't sharing the Pound, no matter how much economic damage it causes either side of the border" reveals their endless repetitions of the claim that "Salmond has no plan B" as the nonsensical and profoundly ironic nonsense that it is.

If these people had any strategic nous at all, they wouldn't be automatically assuming that they're going to win, they'd have a contingency plan that amounted to more than "hard man" threats over the future of the Pound, and they certainly wouldn't be using "No plan B" as a favoured propaganda narrative, when it's absolutely clear that they themselves are the ones without anything remotely resembling a contingency plan.

Conclusion

Alistair Darling and George Osborne are clearly two of the most inept Chancellors in history. One was responsible for the biggest display of "socialism for the rich" in economic history despite having once been a Marxist, and the other has created more debt in four years than every Labour government in history combined, and clearly hasn't the faintest clue about important economic stuff like uncertainty and elementary macroeconomics.

With strategic incompetents like this arguing the case for union, it's absolutely no surprise at all that despite all of their advantages, they've run an appalling campaign driving countless moderates and undecideds into the arms of the Yes campaign.

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More articles from
ANOTHER ANGRY VOICE    
    
How the Better Together campaign is failing
       
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Punishing the youth: More vindictive Tory-lite nonsense from New Labour

In 2008 the UK economy collapsed into a crisis from which it has yet to recover. Despite the endlessly repeated Tory rhetoric that this crisis was caused by the Labour party, the real cause of the crisis was a global spree of reckless financial sector gambling, often on extremely complex financial products that the buyer clearly didn't even understand.

The Labour party were somewhat to blame for not only refusing to undo the financial sector deregulations of the Thatcher era, but actually even further deregulating the financial markets themselves. But the only Tory complaints at the time that Labour were further deregulating the financial sector were that Gordon Brown's deregulations hadn't gone far enough, and that the UK should strive to be more like Ireland!

Reckless financial sector speculation caused the global financial sector insolvency crisis and necessitated the biggest state subsidies in economic history to prevent the UK banks collapsing into their own black holes of debt. The problem is that it doesn't matter how much evidence there is that deregulated capitalism caused the financial sector insolvency crisis, the Tories and the right-wing dominated press are absolutely determined to create the simplistic narrative that the Labour party, and welfare spending are to blame for the fallout from the financial sector crisis.

The Tory narrative is that the Labour party "bankrupted" the economy with their excessive welfare spending, and the actual facts of the matter are irrelevant.

Instead of attempting to offer an alternative narrative built on the actual facts, such as the fact that the bankers' bailouts cost more than the entire national debt that the Tories endlessly fearmonger about, the Labour leader Ed Miliband has decided to capitulate.

Instead of attempting to counter the "blame Labour" right-wing rhetoric with the truth, Miliband and the shadow Work and Pensions secretary Rachael Reeves have decided instead to try and out-Tory the Tories.

Their latest plan is to revoke social security for 18-21 year olds, and replace it with a pitiful benefit only payable if the youngsters do workfare or training schemes. No doubt the same alphabet soup of extremely dodgy corporate outsourcing parasites (A4e, G4S, Serco, Sudexo, Capita, Atos ...) will be lining themselves up to administer the Labour party workfare schemes, and provide the Labour party "training" schemes, just as they have cashed in for the last four years administering the Tory parties workfare schemes and the Tory parties "training" schemes (in which people are "trained" at the taxpayers' expense how to wipe their bottoms by these companies).

In my view a much more sensible strategy for the Labour party would have been to attack the Tories for the fact that long-term youth unemployment has risen 57% since the Tories came to power in 2010, and that this huge rise has come despite the ever increasing use of workfare schemes designed to artificially exclude hundreds of thousands of (mainly young) people from the unemployment figures, even though they still receive unemployment benefits throughout their term of compulsory unpaid labour.

This astonishing rise in the rate of long-term youth unemployment is by no means the first example of the gross incompetence of Iain Duncan Smith providing Ed Miliband with a huge stick to whack the Tories with, but Ed preferring to set about beating himself over the head with it instead.

Back in February 2013 the Cort of Appeals declared Iain Duncan Smith's Workfare schemes for the unemployed unlawful, but instead of using this humiliating court judgement to attack Iain Duncan Smith, Ed Miliband and the Labour leadership actually decided to collude with the Tories in order to help Iain Duncan Smith get a vile piece of retroactive legislation rushed through parliament in a single day. Not only did Miliband refuse to attack Iain Duncan Smith for his incompetence, he actually helped IDS to stick two fingers up at the courts by quickly  rewriting his own hopelessly botched legislation and applying the changes retroactively so that his workfare rules would have been lawful had they been written that way in the past.

Now Miliband is refusing to attack the Tories for the huge rise in long-term youth unemployment since 2010, and instead seems to want to further reinforce the Tory narratives that welfare spending and "scroungers" are to blame for the crisis through his new plan of attacking the pitiful amounts paid out to workless 18-21 year olds, instead of actively doing anything to actually help them.

Given that the economic crisis was undeniably caused by the bankers, a much better Labour party strategy might have been to highlight the huge rise in long-term youth unemployment since the bankers trashed the economy and to propose a new tax on bankers bonuses designed to fund paid apprenticeships for young people in real businesses (rather than ludicrous taxpayer funded "how to wipe your bottom" courses with A4e).

Instead of developing a strategy which highlights the reckless bankers and the incompetent Tories as the culprits, Ed Miliband's Labour party seem intent on painting the victims of the bankers' crisis as the guilty parties who are deserving of punishment for their "idleness".

Ed Miliband and Rachael Reeves seem intent on punishing a generation of youngsters who were still in primary school when the bankers were trashing the economy with their reckless gambling spree, because the economy still hasn't recovered sufficiently to offer these kids the prospects of real paid employment. This may seem like a sensible strategy from within the bubble of the Labour party leadership, but to countless thousands of traditional Labour voters it's bound to kill the last vestiges of hope that New Labour offer anything other than vindictive Tory-lite policies designed to appeal to readers of the Daily Mail and the S*n.

                
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Why bailing out RBS was a catastrophic mistake

As the banks were bailed out to save them from the consequences of their reckless gambling in 2008-09, the UK government repeatedly injected £billions into the Royal Bank of Scotland to stave of bankruptcy and liquidation. These vast cash injections left the taxpayer with an 82% share in the company, and potential liabilities of over £300 billion.

At the time, some economics commentators and politicians even dared dress up these unimaginably vast bailouts as some kind of good deal for the taxpayer, that could "make a profit" when the shares increase in value and are sold back onto the market.

 
Even at the time, these claims were spectacularly dubious. If state investment was so potentially profitable, where were the queues of private sector interests vying to get in on this "good deal" too? There weren't any because it was absolutely clear to everyone, that like vast swathes of the deregulated global financial sector, RBS was technically insolvent.


Unfortunately, the deal was negotiated so badly by the government, on the taxpayers' behalf, that the cash was given to RBS virtually without condition, and the shares the public ended up paying out £billions for were useless non-voting shares. This meant that despite saving the bank from certain bankruptcy, and assuming liability for a potential £300 billion worth of RBS debts, the state gave itself virtually no control over the actions of the board of directors. Hence their continuation of the ludicrous bonus culture at the bank, their engagement in various frauds and their operation of their Global Restructuring Group (which is little more than a meat grinder to turn struggling UK businesses into huge profits, by shutting them down, ripping off the creditors and asset stripping them).
 
The total amount handed out in bailouts to save the UK financial sector (from the bankruptcies they so richly deserved) absolutely dwarfed the total national debt at the time. The estimated £1.5 trillion in bailouts has been hidden off the official national debt balance sheet ever since (using the PSNB ex calculation), so whenever you hear politicians or economics commentators talking about the national debt, you need to remember that they are using misleading figures that artificially exclude the vast cost of the bankers' bailouts.

So lets have a look at how the Royal Bank of Scotland has fared since it was 82% nationalised in 2008-2009.

• Since the taxpayer backed bailouts, RBS has lost £billions every single year.


• Despite consistently losing so much money, the taxpayer subsidised bank has handed out hundreds of millions in bonuses each year.


• The £8.2 billion loss in 2013 means that RBS has lost every penny of the £46 billion in state subsidies that were pumped into the company in 2008-2009.


•  Despite losing £8.2 billion in 2013, RBS paid out £576 million in bonuses. 


•  Despite the bank losing £8.2 billion, the 11 RBS directors carved up a total of £23.5 million in bonuses between them.


• The RBS chief executive now admits that the enormous losses at the bank could continue until 2019.

These desperate figures illustrate exactly how much of an economic catastrophe the RBS bailout has been. They show how right those who stated that the bank should have been declared bankrupt were.

RBS should have been allowed to fail. This would have come at some cost as the government would have had to have compensated lost savings and to intervene in the financial markets to provide short-term liquidity. However, the tactic of propping up an insolvent institution to prevent these short term costs is a classic example of throwing good money after bad.

I'm not normally one to agree with the right-wing free market brigade, but back in 2008-09 they were absolutely right to say that the government shouldn't have poured over a £trillion into the financial sector to save the insolvent banks. They were absolutely right that "creative destruction" should have been allowed to happen (new, better, players enter the market to take over the market position of the insolvent entities), and absolutely right that the near unconditional bailouts would create "moral hazard" (the banks would continue with their risky speculative profiteering, safe in the knowledge that the taxpayer will bail them out the next time it goes wrong too).

Where I disagree with the right-wing free market brigade is on their opposition to all subsidies, and to all public sector institutions. I believe that subsidies are justifiable if the industry in question provides social utility, and that using democratically accountable public sector organisations to provide vital services (education, health, public services ...) is a vastly superior model to allowing private sector profiteers to use such vital services to extract vast profits, and pay themselves ludicrous executive salaries.

What the government should have done was to let the insolvent banks go bankrupt, then collected the remaining infrastructure to build a National Investment Bank, through which the government could disburse loans and subsidies to the "real economy", something which the private banks have abjectly failed to do since they were bailed out by the taxpayer.

The policy of bailing out insolvent banks has been an absolute disaster, but sometimes it is difficult to get our heads around exactly how bad a disaster it has been because the numbers are so big, so I'll leave you with a comparison to put it into better perspective.

In January 2014 the Tories shut down 10 London firestations, and laid off 552 staff. Their cited justification for these closures was a projected saving of £45 million. 

The cost of nationalising RBS was £46 billion, every penny of which has now been written off in losses.

This means that for every single pound the government dubiously* claim they have saved by shutting these firestations, they have thrown £1,022 into the RBS black hole of debt. And whilst these 522 firefighters and other skilled professionals have been forced onto the dole, the 11 executives that run RBS, gleefully carved up £23.5 million between them in bonuses for 2013, despite losing another £8.2 billion (which would have been more than enough to keep those 10 London fire stations operating for the next 364 years).

 Another Angry Voice is a not-for-profit page which generates absolutely no revenue from advertising and accepts no money from corporate or political interests. The only source of revenue for Another Angry Voice is the  PayPal  donations box (which can be found in the right hand column, fairly near the top of the page). If you could afford to make a donation to help keep this site going, it would be massively appreciated.

* = The cited savings don't stack up because they haven't factored in stuff like the loss in tax contributions from the 522 staff, the cost of providing those that don't find replacement work with unemployment benefits, the social & economic costs of increased risk of fire (due to the loss of 14 fire engines and so many staff) ...

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Floods, humanitarian aid & the far-right fringe

One of the essential aspects of publicising my work on this blog is the production of Infographics (or "memes" if you like). If it weren't for my infographics, the AAV Facebook page and Twitter accounts would never have become so popular, and you almost certainly wouldn't even be reading this.

Occasionally I come across a political infographic that really makes my skin crawl. You know exactly the kind of thing I mean, containing revolting extreme-right lies (like utterly ludicrous claims that illegal immigrants get benefits from the state for example), which have been shared by thousands of gullible and cognitively illiterate fools who don't seem to care that they are mindlessly spreading transparently fascist propaganda that would have their forefathers (that fought, suffered and died in order to defeat Naziism) turning in their graves.

One particularly offensive source of extremely-right wing memes is the English Democrats Facebook page. For those of you who are not familiar with this tiny extreme-right faction, they are yet another attempt to rebrand an overtly fascist agenda as some kind of acceptable "democratic" party for middle England. Now that "Tommy Robinson" of the EDL has been locked up for mortgage fraud and BNP front man Nick Griffin has been declared financially bankrupt (he was already morally bankrupt), the English Democrats are the "last man standing" on the extreme right-fringe.

One such infographic was posted on my Facebook wall and seems to have been motivated by the English Democrats, who are determined to use the fact that the UK has sent £600 million in humanitarian aid to the victims of the conflict in Syria, in order to publicise their own disgusting agenda.

They have been trying to contrast the absolutely hopeless government response to the January 2014 floods with the money spent on humanitarian aid to the victims of the Syrian conflict. This contrast is hopelessly wrong-headed. I'll outline a few of the main flaws in their argument.

The first and most obvious point is that £600 million (or £0.0006 trillion) is actually a tiny amount in the grand scheme of things. The bailouts to save the banks from the consequences of their own reckless gambling cost a Conservatively estimated £1.5 trillion (which is 2,500x the amount going to help the innocent victims of the conflict in Syria). Then the reckless speculator class has had the benefit of £375 billion in Quantitative Easing too (another 625x). Perhaps you're happy that the bankers and speculators that are guilty of wrecking the UK economy got over £3,000 for every quid that's gone to helping Syrian war victims, but I'm not.

Perhaps the extreme-right are happy to overlook the unprecedented cost of the bankster bailouts because the beneficiaries were mainly British? Who knows? Whatever the reason they overlook these vast payments to the guilty in order to shout about 0.03% of the amount going to help the victims of a terrible conflict elsewhere, they're clearly shouting their mouths off about the wrong issue.

The next obvious thing to point out is that the scale of flooding in the UK has been severely exacerbated by the austerity measures imposed by the Tory government, using the bankers' financial crisis as an excuse for it. Not only have the Tories ceaselessly spread the lie that welfre spending caused the crisis when they know damn well that it was the bankers that crashed the economy, they are also responsible for an economically illiterate drive to slash spending on flood defence schemes too.

The Tories lied about the causes of the crisis to obscure the culpability of the banksters (that fund the Tory party) in order to justify slashing spending on flood defence schemes. If this isn't enough to piss you off, then perhaps you might be angered by the story of SSE Engineers being diverted away from the effort to help victims of the floods and storms in order to turn David Cameron's electricity back on because he didn't know how to reset the trip switch in his fuse box!

It is absolutely clear that anger about the floods should be aimed at the reckless speculator class that wrecked the UK economy (and then received vast bailouts in compensation for the crisis they caused) and at the Tories, for having slashed spending on flood defence schemes despite the fact that every £1 spent on flood defences is worth £8 in avoided economic damage in the future.

The fact that the right-wing extremists would contrast the suffering of British people due to the recent floods with the much greater amount of suffering in Syria in order to assert that the British are somehow more deserving of support, just shows how little they actually care about human suffering.

If they can't tolerate the giving of a bit of charity to the victims of an unimaginably bad humanitarian disaster, that is a clear illustration of their own appalling lack of humanity, nothing else. Pretending that they give a damn about the victims of the floods just makes it worse. They don't really give a damn, if it was happening anywhere else in the world they would be squealing for the government not to help in the slightest, but because it's happening here they pretend to care. It is also easy to imagine how they would behave if they were in charge, they'd be demanding ethnicity and political loyalty tests be carried out before anyone is helped, and they'd simply leave non-whites and left-wing people to drown.

As appalling as their lack of human decency is, there are some rays of hope. For every follower the English Democrats have got on Facebook, I've got 3, and for every one interaction with their content (like, share, comment) I get 28 on mine.

They are a well funded political party that have a team of people to post a constant stream of cognitive dissonance inducing bile on their Facebook page (and their network of fake grassroots pages too). I'm just one bloke, working at it part-time (who perhaps averages four posts per day), yet my stuff is vastly more popular than theirs.

This somewhat restores my faith in the Great British public. We may have been lied to and misled by politicians and the corporate media in order to stop us rising up against the crony capitalist ideology of neoliberalism that has been the orthodoxy ever since Thatcher introduced it in 1979, but we can still easily see through the hateful lies of the far-right fringe, and there is clearly still a massive appetite for social justice amongst the British public.

Another Angry Voice is a not-for-profit page which generates absolutely no revenue from advertising and accepts no money from corporate or political interests. The only source of revenue for Another Angry Voice is the  PayPal  donations box (which can be found in the right hand column, fairly near the top of the page). If you could afford to make a donation to help keep this site going, it would be massively appreciated.

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