Editor’s
Column
|
Man had always assumed that he was more
intelligent than dolphins because he had achieved so much ... the
wheel, New York, wars, and so on, whilst all the dolphins had ever done
was muck about in the water having a good time. But conversely the
dolphins believed themselves to be more intelligent than man for
precisely the same reasons.
|
Douglas
Adams
|
May
2008
As
I write, the price for crude oil has soared to 120 dollars per barrel
and
continues rising. If we look back to the prices before the tanks
crossed the
border to the oilfields in Iraq, we read of about 34 dollars and this
was
already considered too high at the time. After the first shots were
fired in
anger the prices made a quantum leap to the 62 dollar-margin and
continued climbing.
This
is not
a natural progression. It’s also not connected to the depletion of
resources.
This is not the market’s way of telling us that we run out of fuel. On
the
contrary, right now we have more access to more oil than ever before.
Even if
we consider the demands created by the increasing fuel consumption in
China,
the prices should never be that high - there is enough oil around for
generations to come. So what does this mean? It means that the global
market is
facing a new monopoly. What is new, you may think, the OPEC has been
around for
quite some time now, right? Well, this here is different. Bush senior,
in his
address to Congress about the state of the nation, had spilled the
beans: “We
cannot allow Saddam Hussein to control 40% of the world’s oil reserves.” In the aftermath of “Desert Storm”
Saddam was
prevented from exporting oil but guess what, the oil prices stayed
comparably
low, less than thirty dollars. So the very moment the oilman in the
Oval Office
gave the go ahead to invade Iraq it should have been clear to everybody
what is
going to happen next.
There
is a
bright side: the steep increase in fuel prices will accelerate the move
into
alternative energy technologies, and the Europeans are leading the way;
Americans better watch out, they could be in for surprises. I expect in
the
foreseeable future Europe to be completely weaned off from fossil
fuels,
although oil will keep its place as raw material for the chemical
industry.
China will continue to monopolize the demand and it will tighten the
screw on
American investors who turn to Asian lenders for cash injections. But
in the
long term this is not going to be of any good for the Chinese as well.
Their
technology is still developing and if kept dependent on oil will
eventually
fall behind. And should the Chinese investor feel the need to recall
his
investments, he may find it a tad difficult to reach into a naked man’s
pocket.
On the other hand, the Chinese space program is just gearing up, so,
who knows.
We look ahead to interesting times.
One
side
effect of all this is already hitting the poorer countries. At present
there is
no famine and no drought, but there is a serious food shortage.
The
much
vaunted climate change has nothing to do with it, the globalization of
the
economy does. In forty countries, 32 of them in Africa, the masses of
low
income earners are no longer able to afford the prices at the grocery
store.
Food is there, but out of reach. The biggest producer of wheat on the
market is
not Canada but Kazakhstan, and at present Kazakhstan has closed its
borders for
the export of food stocks completely, so has Indonesia for the export
of rice.
Other food exporters like Russia have hiked up the prices by 40% and
rising,
and in the rich countries who depend on imports like Singapore, the
building
contractors have a smile on their face. Singapore is increasing her
storage
facilities. It’s a good time for hoarding food stocks and increasing
profit
margins.
In
this day
and age, subsistence farmers have become a dying species; they migrate
in
masses to the slums of the big cities where a miniscule income in the
sweatshops is beating hands down no income in the fields. But now $1.50
a day
is not nearly enough to feed an average family of six. And why is that
so?
Because the poorer countries have trusted the promises of globalization
and
therefore boosted investments in industries for export instead of
investing in
their own agriculture. After all the world market would always be there
to
supply the food stocks, wouldn’t it? Well, not anymore. (And they dare
telling
us that Marx is passé.)
And
what
are the rich countries doing about it? They agonize over “saving the
planet.”
Or
so their
governments say. It’s an opportunity to scare the taxpayer into
hitherto
unheard of tax-hikes and in the media the mill of daily misinformation
is
keeping busy coining new terminologies like “carbon footprint.”
Newspeak is
alive and kicking. But climate changes happen, in geological terms they
happen
all the time; our life span is just too short to notice. Climate
changes have
happened in the past and right now we are on a cycle towards the next
one.
Greenland has its name from a time when the Viking settlers really sunk
their
plows into a green land. That was less than 800 years ago. And right
now it is going
to happen again. Then, the climate changed and a thick glacial sheet
buried all
the arable land under ice. Viking settlers who failed to adopt the
lifestyle of
the Inuit died of scurvy.
500
years
later the French poet Francoise Villon (1431
–
1463) grew up under a blood red sky. He never saw anything else
in his
entire life. It was a short life. The red menace in the skies lasted
for 80
years, but it didn’t come out of the medieval chimneys of the stinking
and
polluted Paris where a drink of fresh water was as life threatening as
admitting to be an atheist. The chemical signature of core samples from
the
glaciers in Greenland clearly indicate that it was the fallout of a
volcanic
eruption elsewhere on the planet, an eruption at least five times
bigger than
Krakatoa. So, it happened before, and it is going to happen again. And
nothing
we do will prevent it. Volcanic activities (Yellowstone is a disaster
waiting
to happen), sunspot activity, the release of methane in the farts of
our cattle
(yes you heard me right, it is far more serious than the emissions from
our
cars), changes of the salinity in the oceans and the volatility of the
Earth’s
magnetic field are factors of far greater impact than our own
contributions to
the carbon cycle, which on the upside by the way, is making the trees
grow
faster.
Now
the glaciers recede again, the Greenlanders are looking forward to a
more
comfortable life of plenty and easy access to their natural resources,
the wine
growers of Scotland will bask in lavender scented air like Southern
France did
before, and only a son of a bitch baking in the Sun of the planet’s
more
central regions is begrudging them their good fortune. So we may just
as well
enjoy ourselves as long as it lasts and in the meantime learn from our
space technologies
how to survive in the soon to be more hostile regions of our planet. We
have
the know-how, we have a trump card - genetics - but we misdirect our
resources
and what is worse continue catering to the wrong kind of expectations.
I know
it titillates our vanity to think about our presence in terms of a
“stewardship” over creation. Come on people, get real! Neanderthal-man
survived
two ice ages by adapting to the circumstances, not by trying to arrest
his
environment in the comfort zone of his own expectations.
Instead
what is it we are actually
doing?
The
English
taxpayer is asked to subsidize the numbskull idea of “bio-fuels” which
in
actual fact will increase the “carbon footprint” and in countries which
already
can’t afford the loss of arable land it is going to accelerate the
destruction
of our rainforests. The much maligned “bureaucrats in Brussels” are
fully aware
of it and therefore call for a moratorium on the whole idea, and
rightly so.
But will Gordon listen? I mean, all we would be doing here is blow
“sustainable
fuels” instead of fossil fuels through our exhausts and what comes out
of the
pipe in terms of emissions has exactly the same effect on the
environment; the
environmental costs of introducing it are devastating and the effect
this will
have for the prices at the pump, which is the rationale behind the
whole
exercise, remains to be seen. Not to mention that we remove an
incentive for
the car manufacturers to actually come up with alternatives to our
engine
designs. The moon-rover did not run on bio-fuel.
Where
is
the optimism of the fifties gone?
We
didn’t
know then exactly how to do it, but in our fantasies we were already
conquering
the stars. We dreamed of cities at the bottom of the Sea, of
genetically
optimizing ourselves, of spaceships lifting off with the elegance of an
albatross from the magnetic rails of kilometer long tunnel ramps
drilled into
our tallest mountains. All this is doable now, we have the means and
the
know-how. We now can design from the genome up new plants, new foods,
even a
new self replicating architecture. We can conquer the Oceans in ways
never
thought of before. Should the Sun be burning to hot then we may look at
it from
beneath the water. A new breed of microorganisms may even restore a
pristine
atmosphere, not just on Mars, but in the place where we are actually
breathing
- here. But our politicians and the Cassandras of the scientific
community only
know how to cower the level of our expectations and impose a kind of
green
misery, smelly, unhygienic, ugly, unfunny, conservative and groaning
under an
hitherto unheard of tax burden. Things need to change, no doubt, but we
can do
it. This is a new frontier. But clinging to the pastoral of a Garden
Eden is
misapplied nostalgia and a selfish attempt of the privileged to deny
the rest
of us the prospect of a brighter future.
© – 5/19/2008 – by michael sympson, 1,800
words, all
rights reserved
July
2008
As I write, the German
state has reached a crucial phase in the demolition of its system of
state
pensions. The betrayal of the elderly is now official, and here in
Britain the
victims of Margaret Thatcher look on somewhat bewildered how these
efficient
Germans can be so stupid to make the same mistake. Before Thatcher,
Britain,
too, had a working system of state pensions. It was not as good as the
one on
the continent, but it kept the wolf at bay and even offered the
pensioner the
occasional holiday at a spa. A thing like the current poverty trap of
the
elderly was not a prospect one would even imagine. And in Britain this
is
aggravated by the housing situation on the English Isles, but let us
stay with
the pensions.
The
misinformation of the public in this matter is staggering.
In
economical terms every country in Europe had lost WW II. Whether
victorious
Great Britain, or the defeated German rump state(s), the countries came
out of
the war dead broke, the currency was barely good enough to wipe your
ass with a
banknote. So instead of tying up reserves in retirement funds and so
intercept
a much needed cash flow, the lifeblood of every economy, the “contract
of
generations” was introduced, which means that the people contributing
to the
gross national income pay towards their own retirement by paying for
the
elderly now and here, and when it is their own turn to retire, will
receive
pensions by the next generation to follow. Whatever you may think, this
is
fair. One day, you too, will be a pensioner and then somebody has to
forward
the funds for a pension covering 74% of your last income before the
legal
retirement age, with tax advantages. Should you have a private
insurance, this
will be deducted from your state pension. So your private insurance has
to be
very good indeed to exceed the 74% of the generation’s contract, and
given the
level of average income for salary earners, even in a rich nation,
there is not
a single pension scheme the private sector has to offer that would be
able to
deliver.
The
payout
to the pensioner is not linked to the number of contributors paying in
but to
the gross national product, that is the productivity of the
contributors in
pay. If fewer people are working, that does not mean their productivity
in a
modern economy is lacking, in fact it might even be higher and still
produce
economical growth. If on the other hand, despite of full employment the
overall
productivity is falling so will the incomes earned. 74% of a small
income is
still 74%. The pensioner will feel the pinch, but a difference between
a higher
and a lower pension is beating hands down to be on social welfare with
no pension
at all.
The
overhead of this type of state pension is minimal. With all the
disadvantages
of an overbearing bureaucracy it is just 1.5% of the contributions.
There are
no obscenely high salaries to be paid to CEOs and there will be no
salespeople
on commission crowding your doorstep. There are no promotional budgets,
only
public servants on a regular salary. And the money is transferred
directly
without taking a detour through investment funds and assemblies of
stockholders
keeping an eye on their profit margins.
In
other
words if the gross national income is the cake, the pensions are the
big wedge,
admittedly a large wedge, from which every slice and every crumb is
paid
towards the pensions. But the private sector wouldn’t be what it is if
it wouldn’t
try getting its paws on the wedge; at least a slice of it. And when I
speak of
private sector I mean sharks like the biggest Insurer in Europe if not
world
wide, the Alliance, who in 1974 was capable to sell a front end loaded
product
they had the audacity to label as “life insurance” where the insured
after
having paid in 12,000 got the princely lump sum of 8,500 paid out,
because he
had failed to read through the obtuse prose of twenty pages in fine
print. Not
the insurer's fault, is it? The last time I checked they still sold
life
insurance. So, the industry’s spin doctors went to work, and they
employed the
services of statisticians and mathematical wizards.
The
first
thing these people did, was to put a linguistic muzzle on the term
‘gross
national product’ and instead talk at great length about the
“bell-curve.” In
fact they talk about nothing else. What is this supposed to mean? It is
the
demographic ratio between people paying contributions and the number of
elderly
and their rising life expectancy.
Whatever
BS
the sales-pitch is giving you, don’t be led to believe that the bell
curve has
any bearing whatsoever on the size of the wedge. (The distribution and
redistribution of this wedge to an increasing clientele of elderly with
a
growing life expectancy, that would be a different story and for the
politician
in charge it is a hot potato that has the potential for ruining his
career.)
Even if only one person is actually working and producing all the gross
national income, his productivity is the link to the pensions, not the
fact
that he is the only one paying contributions (from a presumably
insanely high
salary - remember he or she is the nation’s last working person). The
percentage of a pension in relation to the last income may change
according to
strains or improvements of the overall productivity, the annual growth
is a
necessary buffer for little matters like inflation, even the 74% margin
is not
hewn in stone, but it has nothing to do with the number of people who
pay
contributions.
But
that’s
not what politicians and sales-agents are saying.
They
dare
telling us with a straight face that the state, meaning the tax-payer,
all of a
sudden can no longer carry the burden of the bulging bell-curve. What
do Mr.
Brown and Mrs. Merkel think the state is for? Despite Kennedy’s sound
bite, we
have the state to protect us and to serve, nothing else. Would it be
different,
then in 1789 the thousands of aristocratic heads would have sneezed in
vein
into the bucket under the guillotine. This is not a cost cutting
exercise for a
company in receivership, this is the state, the sharp edge of the
people, who
pay for it with their taxes to be protected against those in their
midst who
take undue advantages and gamble with our future on the market for
futures. If such
individuals don’t quake in their boots with fear what the state can do
to them,
then something is very wrong. To say that the developing geriatric
curve on the
bell-shaped graph of our demographics would force us to add to the
wedge from
our own contributions if we wish to secure retirement, is a sales
pitch. The
pitch of an unholy alliance of insurance sharks and Tories. It is a
downright
lie. Don’t get me wrong. If you can afford it then by all means do add
privately to the allocated percentage of your future pension, which may
very
well be lower than currently expected, and I am all for reducing
overheads, but
there is everything wrong with giving up custody over this wedge of the
big
cake and handing it over to the private sector to be sliced up and sold
peace
meal to the dorks - us - who don’t have a clue about insurance
mathematics if
we don’t work in the industry ourselves.
This
is not
“minimizing the state” and adding “choices” to how we wish to live our
lives.
This is high treason and a blatant betrayal of parents and grand
parents who
had fed us, sent us to school and guided our steps into what they
thought would
be a better future.
They
didn’t
anticipate Margaret Thatcher, they didn’t anticipate Angela Merkel,
both of
them by the way people with a background in the sciences who get
infatuated not
just with their own political slogans, but with figures and graphs of a
neat
looking mathematical theorem. Incidentally Mrs. Thatcher is now a peer
and her
income has lifted her way above the margin where her only hope of
survival
would be that state and people honor the contract of generations. What
does she
know about people cheated out of their pensions? Is she even aware that
it was
she and her advisors, who was the scam artist?
Because
that’s what it is: a scam.
In
Britain
the “reform” has almost come to a close, Germany is still busy working
towards
it. Now as then the employer is paying a percentage of the employee’s
retirement contributions, but the money no longer is carried towards
the state
owned wedge. Instead uncounted slices of private insurances and company
insurance schemes are supposed to secure you in old age. You are made
to
believe that it is your own money that will secure your own retirement.
As it
turns out however, the cash you think you are paying towards your own
pension
has a fatal tendency to disappear entirely in a black hole - there is
no such
thing as stability for company pensions in the volatile world of boom
and bust
- and the insurance industry who has caused the debacle has the nerve
to call
on the state to pitch in. In other words, you, the tax payer, is made
to pay
twice for services not received. But should you by some miracle succeed
in
seeing it through and the company or the receivership has not had
sticky
fingers with these funds, it will be paid out to you in form of a lump
sum
which the pensioner then has to reinvest again in order to live on the
monthly
interest. After a lifetime of working and paying the old state pension
had
offered retirement and enjoying old age with the occasional spa visit;
instead
the poor soul is now left with a fistful of cash he can’t afford to
spend and
is expected to shop around and go through the chicaneries of endless
paperwork
written in legalese.
This
is
where the much vaunted “choice” is coming in, and it comes in the form
of
brokers and insurance salesmen all of whom with a finger in the pie. If
you are
naïve, you may think they are here to advise and help - get real:
they are here
to make money from your money.
Since
most
of these pensions fall considerably short of the margin that allows to
relax on
the interest payments, the pensioner who enjoys the miracles of modern
medicine
and lives well into his nineties and beyond, inevitably will face the
day when
his pension scheme is running out of funds and the insurer will ask him
to
advance more contributions. But then it will be too late. The state has
no
longer any obligation to help.
The
overhead is enormous. The wedge has been divided in countless slices,
each
slice ending up in some or other money scheme in the speculator’s big
casino,
like trading “futures,” which is still waiting to be branded for what
it is, a
criminal activity, that so far has driven up oil prices by 40% and is
the
current cause for world wide food shortages. Considering the salaries,
commission margins and profits skimmed from the pool for the investors,
the
average overhead for every front end loaded single slice is nearer to
between
28 and 45% than the 1,5% administration costs of the old state pension.
It
is a crying shame. And they dare telling us Karl Marx is passé?
© – 7/7/2008 – by michael
sympson, 2,000 words, all rights
reserved
November 2008
We have
something to celebrate! It really happened. We have a colored president
and it
is not in a Hollywood movie. He also is going to be one of the most
powerful
presidents in America's history, if the supporting cast in the two
houses is
not suddenly possessed by a death wish. He has a lot on his plate. When
Kennedy
entered the White House he said in an interview: "We always said that
things are bad under the previous administration, but we never imagined
how bad
they really were." For now only this: it is such a shame that Mr.
Obama’s
grandmother didn’t live to see her grandson’s success. I can’t even
imagine how
he must be feeling. My commiseration to Mr. Obama.
© – 11/5/2008 – by michael
sympson, 150
words, all rights reserved
