A Scottish tale of woe
In May '99 our esteemed chancellor(now to be pm) sold half of Britain's gold reserves for less than $280 an ounce, to reduce our reserves to just 7% held in that metal. It is trading today at $473 an ounce.
With the proceeds, he used 40% to buy Euros then trading at around 0.69, more or less exactly where they are now. He used 40% to buy U.S. Dollars at around 1.62, 10% or so above where they are now. He used the remainder, 20%, to buy Yen at around 195, More or less exactly where they are now.
The Euro especially performed very poorly against sterling in the 3 years following this decision (do you remember exporters complaining about the Pound's strength?), so the performance of this sale of gold should be seen as a disaster. If I did something so fundamentally wrong for my clients, I would be bent over by the Financial Services Authority and buggered 'till my arse looked like a wind-sock and I thought I'd been fucked by a train (metaphorically speaking, of course). And quite right too.
Let's look at Gordon's Record.
Operational independence for the Bank of England. His one and only master-stroke. By removing decision-making from the treasury, he has prevented himself from making a hash of things as far as interest rates go. Thank Gord!
Capital Advance Tax: One of Gordon Brown's first acts was to remove a tax credit for dividends paid into pension funds. At the time, Britain had the most solvent pensions system in the developed world. This has cost British Pension funds (and, by extension, you and me) £50bn. He didn't think that the stock market could perform so badly under his watch.
The Public finances are at the worst they've been for a long time at this stage of a financial cycle, due to a huge increase in the public sector salariat and the Government's desire to spigott ever increasing floods of cash at totally unreformed public services. No amount of tinkering with start dates will change the fact that Gordon has broken his golden rule and taxes will have to rise soon. Heaven forbid that a Labour Government will ever cut spending.
There has been a massive increase in the regulatory and administrative burden imposed on, especially small, firms. With firms now expected to both collect tax, and administer much of the tax credit system, small firms have had to employ on average one extra administrator per 50 or so employees. This is a huge overhead on firms which often work on thin margins. No wonder private sector employment (the productive bit, that pays for gender outreach co-ordinators and diversity taskforces) has stalled under this government.
The unemployment rate has stayed low, despite not because of this government. Private sector employment has not grown since about 2000 (when labour abandoned Tory spending plans). Instead the slack has been taken up by the public sector, most of them administrators, not the sainted Policemen, Nurses and Teachers that the Government gloats endlessly about recruiting. The civil service has become a means to get useless people into non-jobs at our expense. The disability benefits system has remained another handy fiction to get people off the Jobseekers register. There is more to economic performance than the headline jobless rate. Look at the percentage of the population who are "economically inactive".
As a result of this stagnation of the private sector, tax revenue has not grown as fast as Gordon Brown expected. Though his economic growth forecastss have surprised many economists, this is due mostly to massive public sector spending increases. Furthermore, announcements that the economy had met Treasury forecasts (to much crowing from the prudent one) in 2003 and 2004, were superseded by revisions which indicated that they, in fact, did not meet treasury forecasts. (ThePresbyteriann thingy was a little quieter about that).
The much vaunted tax credits have proved to be hugely expensive to administer. Overpayments to low income households, followed by demands for repayments have caused huge hardship and stress to those people who are trying hardest to break the cycle of welfare dependency. Why take the tax off them in the first place? Many of Gordon's other taxes cost nearly as much to administer as they raise in revenue. See here for the solution...
A broken promise to not raise income tax. Well it was "national insurance", but the effect is exactly the same as a penny on income tax. A baseball bat feels the same as a cricket bat, when smashed into ones lower jaw, which is what I want to do to Gordon Brown. especially when he does that inhale thing when he speaks. You know the one, when he's spoken for too long for a breath, and he pulls his lower jaw back and breathes in with his mouth open and his bottom lip pulled up over his teeth....
Gordon Brown is going to break his "golden rule" because he spends to much, and weighs down the bit of the economy that pays for his spending with tax, costs and red-tape. When we look back we will see a squandered opportunity. He inherited the best-performing economy in Europe. He will leave it in no better shape than unreformed Germany. And he's lauded by a supine press as a successful chancellor.
The labour party have screwed things up more subtly, but more insidiously than last time. History will judge them very harshly indeed.
and this is the only Jock Tw-t with a braincel