The Plastic Hippo

January 24, 2016

Chilly con Carney



The chill winds blowing around the picturesque streets of Davos during this last week can be considered as a balmy zephyr compared to the El Nino event likely to thunder along Threadneedle Street and possibly remove the unfixed roof of number 11 Downing Street. Slowly but surely, the almighty con trick of austerity is beginning to unravel.

At 1,560m, Davos is officially the highest town in Europe and the good burghers of Graubünden canton must have been delighted to discover that the town was even higher following the arrival of George Osborne for the World Economic Forum. Taking a well deserved break from his masterful stewardship of the UKs long term economic recovery, George understandably deserves to relax and experience the excitement of off-piste hard white powder.

We can only assume then, that the sugar rush of too much time spent at the chocolate fountain prompted the Chancellor to heap praise upon the Chancellor for securing a taxation deal with a notorious tax avoiding search engine. We can rejoice that £130million will be donated to the exchequer in lieu of 10 years unpaid tax which works out at £13million per year or an average tip for a Davos chalet maid after services rendered. The notorious search engine pulled in £4.6billion in 2014 alone. Search for “fairness” online and you will find a definition that is far too simplistic and subjective to be applied to the complex and confidential world of international taxation law.

It should be stressed that none of this clever avarice is actually illegal and the search engine along with the purveyors of dreadful coffee, the South American river that has destroyed bookshops and the social media bear pit catering for sociopaths are obeying all the rules. However, if a government can change the law to redefine people with disabilities as scroungers, then a government can change the law to redefine greedy, heartless bastards as merely being bastards and make them pay their bloody tax thereby ending the invented and addictive dependency on austerity.

Unfortunately, having increased borrowing, debt and deficit and missing every fiscal target he has set for himself, Osborne has realised that simply telling lies is not, along with his long term economic plan, actually working. Running out of ideas and excuses, he has bet the nation`s shirt on China just as the Chinese economy has tanked and the price of oil has fallen off the ski slope without troubling the judges. Continuing to exclusively blame Gordon Brown for the crash of 2008, the Chancellor now blames China, Europe, the Middle East, Gordon Brown and unforeseen avalanches for his own manifest incompetence. There will be another financial crash because bankers, hedge fund managers, brokers and greedy heartless bastards are allowed to continue working within the rules. That great big rock being dragged up the mountain on the ski-lift – that`s a vote of no confidence in the Financial Conduct Authority that is.

Osborne, of course, was not alone in huddling around the cosy après-ski fondue cauldron. Cameron was there looking relaxed and talking about “my referendum” with all the confidence of a slack bowelled gibbon about to be launched down a 90m ski jump. Professional fall-guy, former Harvard ice hockey goalie and currently Governor of the Bank of England, Mark Carney also attended the Alpine retreat. Like Osborne and Cameron, Mr Carney has a tendency towards snow blindness.

Having suggested that low or negative economic growth was “temporary” and dropping massive hints that interest rates would rise, growth is non-existent and interest rates remain at the “emergency” rate of 0.5 per cent introduced in 2009 when, according to Osborne, Gordon Brown destroyed the planet. The Governor has set three conditions for an increase in the bank rate. Above “average” economic growth – currently at 0.5 per cent, wage growth to fuel the economy and core inflation at 2 per cent – currently at 0.2 per cent; in other words complete, utter and abject economic failure. Mr Carney seems to be at a loss in explaining the lack of wage increases when, again according to Osborne, we are approaching full employment. Both seem to be blissfully unaware that part-time working, zero hours contracts, dubious apprenticeships and the sanctioning of claimants might reduce unemployment figures but they do not increase economic activity.

For this expert fiscal husbandry, the treasury pays Mr Carney an estimated £880,000 per annum including £5k per week for accommodation which is mercifully spared any tax on a spare bedroom or six. This is only marginally less than the notorious tax evading search engine pays in yearly taxes. As a migrant worker and given the government`s proposal that migrants should earn no less than £35k per year, Mr Carney`s salary for last year means that he will not be deported for at least 25 years. One can only hope that his wife and children are not French Canadian otherwise a refusal to learn English will result in deportation on charges of being terrorist sympathisers.

As the not so good and the not so great leave Davos by limo, helicopter and executive jet, the message is clear. Keep them poor, keep them hungry and keep them frightened. If hell freezes over, next year we`ll meet in Damascus

1 Comment »

  1. Blaming Carney for this mess is futile and a little unfair. Rather like asking a plumber to sort out fluvial and sea flooding.

    The Bank of England simply does not have the tools for the job. It has no real control over anything other than interest rates. As we know, this particular bolt is well and truly shot.

    Other fiscal implements remain firmly lodged in the Screwfix repository formerly known as the Treasury.

    All the not-so-poor bugger can do is to stick up a few post-its about free-market economics in the vain hope that the Branch Manager, whose behaviour increasingly resembles that of David Brent, might pay some attention.

    Comment by The Realist — January 26, 2016 @ 10:42 am | Reply

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