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Retrenching under false pretence

Today we see (at https://www.theguardian.com/business/2017/mar/01/len-mccluskey-ford-unite-tariff-free-single-market-access-bridgend), how Ford is moving its needs and its projections towards other places. It fill the pattern and projected promise that have been set in motion a few years ago. The US is moving parts back to the US and some parts to Asia. Australia had been feeling this for some time. Ford left Australia in 2016 when in October the last Falcon XR6 came of the belt. Now we see the beginning of their exodus from the UK and in this the title ‘Unite blames Brexit as Ford prepares to cut 1,160 Welsh jobs‘ is as they call it, a total load of bullocks! You see, this is the other side of a one market and tariff free access. You see, as these costs fall away, making these 4 wheeled thingamajigs in America becomes profitable again. Now, let’s be fair, Ford is an American company. For American companies to move back to their home turf makes sense, it could even be seen as patriotic. But in all this, Ford remains a business. So they need profit to soar and that can be done by having their factories in America and Asia. Brexit was never a factor, Australia never had a Brexit.

Is there a chance that Brexit was any factor? I do not believe so, the UK is not yet in a completed Brexit and it would take a few years before all would be complete, so there is no Issue for Ford, in their camp it was already planned, the entire pressure on Brexit is just tactics, because the US is scared of what comes next, so for the US, in light of the upcoming French elections, the anti-Brexit pressures are essential. The game is changing in France. President Francois Hollande is not seeking a second term, according to the BBC the first French president to do this in modern times (at http://www.bbc.com/news/world-europe-39130072), he is that unpopular and as such France is seeing several different issues and power plays in place. With one in four under-25’s is unemployed. So even as all parties agree that massive changes are needed, the Socialist failure gives rise to additional voices moving towards Front National. In all this, we see additional moves. We could even consider that this is a partial discriminatory ruling. The EU claims to be all about the freedom of speech and freedom of opinion, yet they will happily lift parliamentary immunity for the French prosecution to take legal action. We can argue the validity here in two ways. One: Marine Le Pen did break French law. Two: how many other French people have been prosecuted for ‘publishing violent images’? I would really like to see the numbers on that one. So as we will see big data mining on transgressors, I wonder how many have not been investigated, which shows that the EU is very willing to upset the sanctity of a fair election, especially as those deciding on this are likely to lose their jobs when Frexit becomes a reality.

So as we see through the (what I personally regard to be) blatant lies by Ford, or better stated by Len McCluskey, and in this as Ford is not forthcoming they get to be tainted by the very same lie. The quote “UK’s biggest trade union has urged Theresa May to guarantee car makers tariff-free access to the single market“, in this I would state ‘Mr McCluskey, are you usually just facilitating for big business?‘, you see, as I see it, Ford is using Len McCluskey not for the plant, not for the single market access ‘need’. No, they want to sweeten the deal! They need other concessions, like the ones they had in Australia. ABC Australia (at http://www.abc.net.au/news/2015-12-17/tax-transparency-report/7036708) gave the people a Tax Transparency report. Where: FORD MOTOR COMPANY OF AUSTRALIA LTD, had a Total income ($) of 2,940,670,099 (so basically almost $3 Billion), a Taxable income ($) of a mere 7,057,051. This means that 99.9917% of the income did not need to be taxed. So as we see: Tax payable, Tax payable as percentage of total income, as well as Tax payable as percentage of taxable income. These numbers become zero (that means $0.00 and 0.00%). So is Len McCluskey going to open his eyes? Is he going to realise that he is made the bitch of big business that requires the UK government to give away taxable income in the form of free labour? Perhaps Len McCluskey remembers what slave labour is? All valid questions, more important, if this is the path Ford wants, why not let then fuck off to merry old America? Let’s be fair and honest. America is in dire need of actual jobs and an actual economy. They are bleeding currency value and as such, if American companies decide to retrench in the US to save their home country, than that should be regarded as a noble action. Yet, these companies are run by boards that have one need, dividend and bonuses. Let’s also be honest here, these people don’t make any massive coin, not compared to a few other fortune 500 companies. The top executives, have an income ranging from $5.2M to $17.7M, which in Wall Street terms might be laughingly little, yet the retrenching has the danger of those people losing 28%-42% of what they are getting now. You see, as the US has a collapsing infrastructure, the strain the US is getting by having these manufacturers move back to the US is going to cause a few infrastructural gaskets to blow. It will not happen overnight, but within 24 months they setbacks will hurt Ford, there is no doubt in my mind on that. The level of setback will be anyone’s guess, I do not have any wisdom that could state to any degree of certainty how much the impact is. Yet, when you consider that Ford is working on a 3.9% operating margin (2014 reported numbers) and they walked away from an Australian 99.9917% non-taxation, we should wonder on how they tend to do economically more terrific in the US. It seems to me that the US retrenching has either massive kickbacks, or will come at the consequence of short sightedness and long term hardship. The numbers do not makes sense to walk away from either, but the clarity is that fingering Brexit was not the reason. But then, Ford did not do that, they got

Len McCluskey to do just that. It is the part “McCluskey also demanded that Ford provide “legally binding guarantees” of future production at the plant”. It made me giggle. You see if they had not before, why would they do that now? It seems to me that McCluskey, not unlike Kim Carr in Australia, was either in on part of it for a time, or I need to consider them both to be massively incompetent. A legal binding guarantee after the fact. It is just too hilarious! Of course, when the issue collapses and Ford moves, then we get the real issue, because at that point the blame game starts. In Australia, Kim Carr got to play his game and got the reprieve, so when his labour team got replaced by the Australian Liberal Party (the Aussie Tories), he stood back and got to stand playing with his beard thinking ‘not my problem anymore!‘, yet Len McCluskey does not get to be this lucky, when Ford leaves it will be on his plate and the Unite members will have a massive amount of questions, I wonder how many actual answers Len McCluskey will have.

So all these revelations and facts brought to you because someone decided to blame Brexit and I have actually had enough of those blamers. The fact is that there would always be consequences to Brexit, so when I see another ‘bremainer’ demand a Brexit without consequences, I wonder just how stupid some people tend to get. Another side linked to this is seen in the Independent (at http://www.independent.co.uk/news/uk/politics/britain-will-not-contribute-to-eu-budget-if-no-brexit-deal-is-reached-says-lords-report-a7609526.html), here we see ‘Britain will not contribute £50bn to EU budget if no Brexit deal is reached, says Lords report‘, the subtitle is even more descriptive ‘The UK appears to have a strong legal position in respect of the EU budget post-Brexit and this provides important context to the Article 50 negotiations‘. The reason to go here is seen in “According to the Lords, EU budget payments – likely to be a contentious issue throughout the Article 50 negotiating period – would not be enforceable and the UK would be in a “strong” legal position to not pay a penny if talks ended with no deal“, so all the hard play we have seen has been absent of a proper analyses of the articles, something the House of Lords was not about to let go. The quote “Theresa May has warned her European allies that the UK is prepared to crash out of the EU if no reasonable Brexit deal is agreed on. In this case, the Lords add, Britain will not be liable to make any further financial contributions to the budget” also implies that there is a two stream issue within the conservatives. You see, when we see the quote of Theresa May against “David Davis, the Brexit Secretary, said earlier this year that the Government would not rule out making future payments to the EU’s budget in order to secure favourable access to Europe’s markets“. The two streams are ‘let’s be flexible about it all‘ and ‘we have had enough of this‘. The point being that large corporations have been souring the cream pushing European politicians to take emotional stands whilst others are trying to muzzle Mario Draghi and his need to spend a trillion no one has. This now pushes back to the Automotives of the land (including the exiting Ford), I think we need to see that the approach that has been used for too long a time, making some industries holy and non-taxed is not the way to go. Now, there are plenty of people who want certain markets to push forward and to have trade deals in place tends to be a good thing. Yet the part that the media seems to ignore again and again is that these deals benefit large corporations to a massive degree, but others tend to fall between the cracks losing out on all those fringe benefits. It is an injustice that has been seen several times and Brexit would allow for a change that gives a level of fairness to it all (allow does not mean it will happen though). So whilst we can agree that there would possibly be an impact, there are still too many waters stirring, so any level of Brexit blame is very premature. That evidence is given additional support when we consider Reuters news from 2015 (at http://www.reuters.com/article/us-autos-ford-asia-idUSKBN0O625Y20150521), it was already forecasted 2 years ago that “When I take a look at Ford’s growth over the next five to 10 years, we believe roughly 60 percent of the growth will be in the Asia Pacific region,” said Dave Schoch, president of Ford’s Asia Pacific region“, which was the first sign that the Ford plants in Australia were at risk. In equal measure, the slowing economy in China saw Ford sales drop, a similar event has been happening in Europe, where the drop is three times higher and here we get the issue. It had a rise for a while and the European numbers looked really good, that is, until you realise that Russia was the only strong contributor to the Ford sales. Yet the Russian slump has been in play and it is now also hurting Ford, whilst the news of ‘rapid recovery unlikely‘ to be at the head of the forecasting table. So when we see Ford media give us (at https://media.ford.com/content/fordmedia/feu/en/news/2017/01/18/ford_s-european-sales-rise-5–in-2016–strong-ford-transit–rang.pdf), “Ford sales rise 5 percent in 2016 to nearly 1.4 million vehicles in its 20 traditional European markets*“, with the reference to Austria, Belgium, Britain, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Netherlands, Norway, Poland, Portugal, Spain, Romania, Sweden and Switzerland.

Giving us now the one part that the papers were missing. The fact that the sales are not sliding, but the revenue is set to better profitability, in that the element becomes that the UK is only one of 20 nations for Ford and when we add the Ford Authority quote to it from February 20thIn all, the closures terminated nearly 6,000 jobs, although some number of those were merely shifted to lower-cost countries like Spain and Turkey“, as well as “Ford Europe has continued to pare down its workforce, offering “voluntary separation” packages to some 10,000 employees since early last year to help save an estimated $200 million annually” a valid tactical move by Ford going back to well before 2015. So as we see this facts, the entire Ford issue has been playing for a while and a lot of it has been out in the open. So at this point I would ask Len McCluskey where he got the idea “workers had been “kept in the dark”“. I would like to know what actions he had undertaken since December 2015 when this was already underway, more important, the move in Australia should have really woken him up. Did it do that? Because certain facts, clearly given by several sources, some of them openly Ford themselves. It is there where we now see a reason to doubt the existence of both Kim Carr and Len McCluskey (but that is just my view on the matter). Len had the option of making a clear speech to the workers in wales starting by ‘the party is over, there will be massive changes in the future, but we do not know the exact setting, but the worst case scenario is that the plant will seize to exist‘. Did he make that speech? I reckon not, most people like that tend to avoid bad news, especially when events like Brexit can be blamed and that is exactly what he did in the end.

As a final point I need to refer to the quote “We have had, as I said, dialogue with Ford. We will continue to have a regular dialogue with Ford about the ways in which government can help to make sure that this success continues“, which was exactly was happening in Australia, with the happy ending not becoming a reality. There, certain players decided to blame the newly elected liberal government, whilst we clearly see that there is plenty of evidence that Ford had already decided, and the decision was ‘vacate!’

I wonder what McCluskey does next, perhaps blame the Welsh weather?

 

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Finding inspiration

The act to incite, perhaps even a form of stimulus. Yet, when we go back to a more theological page we see: ‘a divine influence directly and immediately exerted upon the mind or soul‘. So what is wrong with inspiration? You see whilst inciting could be seen to encourage a positive term, incitement is for the most ALWAYS negative. When we see incitement we see: ‘the action of provoking unlawful behaviour or urging someone to behave unlawfully‘, why not see incitement an act as to encourage positive change? Even stimulus is now nearly always seen as a negative. The stimulus package being a foremost example.

In an age where hardship rules, we could use a positive force, yet when we see that projection of feigned wellness is combined with managed bad news, what positive force could be atoned? This is the thought that has been in the back of my mind as I am completing my current assignment. A choice I made in the past, whenever I get one step forward, the next instance I am facing two steps back. This is perhaps just a situation that exists between my two ears (as we refer to mental issues).

Greece is not even the foremost example on my mind. There are other issues where we see a change on what is for some and will never be for most. The next part seems a little repetitive as I have mentioned these parts in the past.

  1. How is it possible?

Here we see a side of the world that seems out of context as per last year. Forever the oil prices were going up and up until it went beyond $120. Profits were astronomical. Now, as prices are just below the lowest basement, we see the following parts (at http://www.theguardian.com/business/2015/apr/26/bp-profits-down-still-in-deep-water). “It’s a big week for big oil, with both BP and Royal Dutch Shell reporting results. Despite crude prices hitting a 2015 high at the end of last week, they are still almost 50% down since last June, which means continuing trouble for the businesses“. Now consider the reality. Take a litre of crude oil, ½ becomes Petrol, one third becomes Kerosene and the rest goes into dozens of other products. Now consider the history of your shopping. Since 2008 (and since the oil drop of 2014), when did your petrol price go down and by how much? Jet fuel should go down, yet Virgin, Qantas and others are keeping the Jet fuel surcharge in place. So at present we have accounted for almost 85% of the crude oil, the rest goes into products like soap, Vaseline and other carbon based artefacts.  None have ever made a decent downgrade in price. However, the article claims on such hardships even though the price of the raw resource is still lower than ever. So what stories are we being told? Are the oil companies guilty of incitement to exploitation?

  1. How are we in this position?

Here are 8 mergers for last year, several more are to come and hundreds more have passed and a fair amount of mergers are set at mega billions, several in the pharmaceutical industries.

Lets take a look at a few of the 2014 mergers: Value: $67.1 billion, May 18, 2014, Value: $46.8 billion, June 15, 2014, Value: $46.8 billion, April 7, 2014, Value: $25.3 billion, February 18, 2014, Value: $23.6 billion, March 11, 2014, Value: $19.4 billion, February 19, 2014, Value: $17.1 billion, April 30, 2014, Value: $16.01 billion, January 13, 2014. Total $262 billion. Now consider that these mergers are for the most tax-free when they are seen “as reorganizations through acquisition. Under this model, companies must swap, rather than outright sell, assets and equity such that the two companies end up becoming one new company with an agglomerated store of assets and equity“, that is very nice for the boards of directors and as multiple borders are broken, many options (highly complex ones) open up to maximise non taxability. Yet, many governments have done next to nothing to curb this form of greedy exploitation at the expense of the local governments whose protection they enjoy and the exploited workers who are left at the short end of the stick in many cases, again and again. There is often little consequence for the acquiring party will soon find themselves in an upward reorganisation, but the other party is more often than not in a less positive position, which is the way of the world, I will not oppose the issue of reorganisation and acquisition, yet the laws have been bend beyond reasonable. In the near past there was a level of equilibrium, as the governments got a slice of that pie. Now, as too many levels of non-taxability are offered, we see a completely unbalanced view of life, to a smaller part in regards to rich industrialists, but to the largest extent to a whole score of enabling politicians with a limited sight to the future whilst blind staring to what was in the past the ‘now’ and never to adjust the future of what should be.

We are all feeling these shortcomings now, Greece a lot more than the others I might add!

Now we get back to Greece for one simple example. The one thing Greece had to do for well over a decade is the step only taken (if we can believe the press) only last week (at http://www.newsweek.com/greece-launches-frantic-crackdown-tax-evaders-ahead-repayments-324927), here we see the story of Leonidas Bobolas, arrested and not to be released until back taxation had been paid. Some might think it is a solution, for me and many others it is a final desperate act by a government that did not take things serious until it was too late. This must be a laughing moment for Kostas Vaxevanis, whose list must be very important at this moment, but there is every chance that the truly big rollers are getting away with it all and more important, the money that will be gotten here is nowhere near the amount required for the payments over the next 16 weeks. It is the final spasm of a nation that has every real danger of becoming extinct a second time. New Greece might soon join Ancient Greece as it becomes forgotten, slowly but surely.

OK, I admit that this future is unrealistic (not to mention vastly exaggerated), but is that not how the Greeks currently feel? A system so broken that the people are suffering. The place where Democracy was born by the mind of Aristotle. It was the foundry where the Olympic Games were devised, yet in all its social paths, the one path forgotten was the safety of the Greek future. Why will this tax evasion path fail? Well, consider that Leonidas Bobolas is ‘regarded’ as one of the large evaders, now consider that his due taxation was less than 2 million Euro and add to this the following quote: “Government data suggested that some €70bn was owed in unpaid tax at the end of 2014. Transparency International found the country’s opaque tax code and corruption of tax collectors meant evasive tax arrangements could be set up for as little as €100“. To get to 70 billion, they would need at least 55,000 tax evaders, all due 1.5 million, now consider the Kostas Vaxevanis list that covered less than 2100 names. The amount due cannot be met, not even close through this way. In addition we see even more posturing of inaction. This comes again from Yanis Varoufakis who stated: “one of the key reforms the government was proposing was the creation of a fully independent tax commission to tackle the problem“. I would personally translate this into a delay of up to 24 months with no actual actions at all. This one arrest is just for show as I see it, a few more will make headlines, but in the end, the funds will not be there on time and we can state that clear evidence of inaction from the Greek government is a mere display of fact.

Why mention Greece?

Greece is at present the extreme example, but not the least of the issues. It shows a governmental failing that is present all over Europe. Greece in its position is only the first one to visibly no longer manage its upcoming bills. The majority of European nations have maintained an inability to manage budgets, which is the second tier in this. As these governments make new mentions of ‘stimulus’ as a solution, it only masks an inability of forward momentum, whilst on the other side of that formula we see governmental spending sprees that cannot be covered in any way, shape or form. One example is the Dutch Stimulus package of 2009, one document (at http://ec.europa.eu/economy_finance/economic_governance/sgp/pdf/20_scps/2009-10/01_programme/nl_2010-01-29_sp_en.pdf) forecasts a GDP growth of 2% in both 2011 and 2012, a number that would never be achieved, in the end, the growth would be -0.2% and -0.6%, the year after that it was -0.8%, we can speculate that without the stimulus it would have been worse, which is a likely result, but the fact remains, how well are the people off? Let’s not forget that stimulus packages are basically loans, the interest on those billions go somewhere, so in the end the people pay! France with its 26 billion package in 2008 would not see a positive jump until late 2013, then only 0.6%, after that until 2014, France only marginally kept its head above water. Italy does not even get close to those numbers and only had one moment in 2013 where they were positive at 0.1%, the rest is all negative. They pushed in a mere 9 billion. So with three nations, Europe has spent 44 billion and no real results to show. It could be debated as I stated earlier that the state of affairs for those nations would be a lot worse, I could agree with this on the mere premise of the thought. Yet, the one issue that should have been done, namely proper budgeting has not been achieved by any of these nations for over a decade and debts are stockpiling. This has been at the centre of my considerations for a long time.

 

Whether this is mere bad budgeting or a completely unbalanced system where corporations have been uber enabled, whilst their rights are not questioned is another matter entirely. In that regard we have the HSBC view (at http://www.theguardian.com/business/2015/apr/24/hsbc-warns-it-could-leave-uk-over-eu-referendum-uncertainty), where the option of the UK leaving the Eurozone would make HSBC move offices to other shores. Yet, when we google this bank we see articles on how they pay millions and millions less than expected. Now, these articles are not the ones you should have too much faith in, but with this much smoke, the question becomes, were tax bills burnt? I am willing to partially ignore the Swiss scandal as this is only one instance, it is the overall picture that goes far beyond just the HSBC. When we consider Libor, the fines of billions that followed with banks all over the world, we see that populations all over Europe, even on a global level are denied the funds for their support that they should be entitled to. Yet, the paths taken now are also questionable. I support to the larger extent both the Conservative path as well as the Australian Liberal party. Here we see a protection against naming apparent tax-dodgers. My reasoning? If a company engages in legal paths for revenue and investments whether on shore or offshore where the tax laws allow for it, the companies who are creative enough to exploit the loophole shouldn’t be punished. This is at the core of the issue, the tax system has to be fixed and altered. Yet, as we see with HSBC, politicians are often too scared for their own political hide (as I personally see it) and will push forward any tax change. This has gone on for over a decade and many changes are yet to be properly addressed. This is at the heart of the matter.

In the end, what is the wisest of actions? To cater to HSBC and mind liking parties that seem to pay the minimum in taxation, whilst at the same time, the millstones of debt are dragging down all European nations? The UK might have the highest European debt (1.7T), yet the path that the conservatives have taken its population has the best options to lower the debts whilst offering a modest growth. The inability of the other European nations to adhere to this is only one of several factors. Greece is now becoming a larger issue as their timeline of pushed from April to May and now we see the mentioning of June by Yanis Varoufakis: “We wish to merge the current review with the June agreement“, which is now a more pressing issue as the voters in May would steer fast into a direction many will not like, this is the danger, as emotion drove Greeks towards Syriza, that same dangerous move could push the UK voters stronger towards UKIP and the Euro exodus that could follow. Another version where we see a legal incitement away from the Euro, there is no inspiration, just a need for what could be regarded as ‘false sense of security‘. That danger only increases when we consider the next quote: “Tsipras said he was optimistic an interim agreement would soon be reached. But Greeks know another bailout will be needed even if the short-term €7.2bn is secured“, that part and the inability of the Greek government to seriously commit from day one is at the heart of all this.

A need to incite a tax system that works more honest towards the nations that give ‘free’ protection to the corporations that seem to shun a moral refinement is needed. Not just for the UK, but for all European nations. Yet, will this happen? This is the question we should ask when we look at the papers from the IEA (Institute for Economic Affairs), where we saw on December 1st 2014 the following quote: “Despite the Conservative’s pledge to raise the threshold to £50,000, over 5 million taxpayers will pay the higher rate of income tax by the end of the next parliament. Indeed, it is likely that the number of higher rate taxpayers will continue to increase even if the threshold is raised“. I question the spirit of this. You see, the groups are 24.1 million in the basic rate and 4.5 million in the higher rate (source: UK Statistics Authority). I do not deny these numbers, yet, raising the threshold will force other measures too. A more immediate and more just move would be to increase the 0% rate from £10.6K to £13K, which will also benefit the higher rate to some extent (£2.5K less taxable), after this I personally advocated raising both groups, the Basic rate +1% and the higher rate +2%. he reasoning is simple, in the end a budget has to be met, even though we see these ‘holier than thou‘ groups all moving for more tax breaks, yet, in the end, until tax loops and tax havens are dealt with, the tax coffers will remain massively underfunded. Let’s not forget that the UK has to meet a 1.7T issue, all using official bank notes with the ‘£’ symbol (replacing IOU’s in place). If the IEA really wants to push certain tax shifts without properly balancing the equation, we will see a push for drastic austerity sooner rather than later. It is not a mere guess, it is an outcome of mathematical certainty. Only after a serious dent has been made in the total debt, then it would be possible to consider a change. All this is now endangered when we see ‘promises’ by Ed Miliband as he states: “Labour will pledge to deliver a surplus in the current budget as soon as possible in the next parliament. This could allow the party to borrow to fund capital investment for infrastructure projects“, so a surplus and MORE borrowing? So basically he will likely spend his budget and the budget of the next administration in one go. The UK is still dealing with the borrowing acts of a previous governing labour. I see at the heart of ANY government at present, the need to borrow ZERO, whilst still reducing the overall debt to some degree (not possible to state by how much), this is the only way to incite true growth, to inspire a growing economy and to stimulate some version of ‘quality of life’. There are a few steps that any of the elected parties could do, but that requires vision, I have some answers, but filling that solution will take a different view, not one of borrowing, but one of an adapted vision that allows for new growth by changing the equation of costing, a different approach to a changing world where the UK moves ahead stronger still, which will be good for the entire Commonwealth at large!

An act to incite stimulus through Inspiration, a positive wave not based on pre-spending.

 

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