John Ward August 5, 2013 The myth of deregulation

“Get rid of regulation, and everything will get better” by Aneo Liberalist

A useful Idiot….accused of Friedophile tendencies

The Commodity Futures Trading Commission (CFTC) is probing 15 banks over allegations that they instructed brokers to carry out trades that would move ISDAfix, the leading benchmark rate for interest rate swaps. Royal Bank of Scotland also said it was co-operating with authorities regarding the investigation. (The game plan was to screw the pension companies, thus leaving older folks destitute)

While Amazon was banging the drum last week about its new warehousing centre ‘creating’ 5,000 jobs (the Black Dude turned up to get some camera action and add soundbite rhetoric to the august occasion) the company’s global efficiency programme was quietly wiping out 25,000 potential and actual jobs resulting from its growth. (Amazon is twice the size of retail giant TJX, but is 80 times more profitable. Pause here while the accountants reading ejaculate. It can do this because it has no greeters, after-sales staff, staff welfare programmes of any note, or retail sites. Although still massively profitable, TJX employs 179,000 people and make the shopper experience on of the best. The remote, impersonal, and at time infuriating Amazon employs just 89,000. In other words, the President just gave his approval to a hypocritical scam)

Zhang Ruimin, CEO and founder of China’s largest appliance maker, Haier Group, recently remarked to journalists that ““I’ve been thinking how we could change the operations into a new model that ties R&D directly to the markets, while manufacturing would be taken care of via outsourcing.” What Mr Zhang means, of course, is moving even Chinese jobs offshore….as he gave away by adding, ““We have production plants in 24 locations all over the world,” he said. “But production costs are currently higher only in Japan, the United States, and Italy, compared to China.” China’s advance towards Western living standards is becoming a rake it keeps standing on….all because Zhang Ruimin wants more savings, more money, more efficiency, and more achievements to make his dick feel bigger. (Mind you, he is right about the West meeting China on the way down. And of course, Signor Draghi at the ECB is preparing to deliver Zhang the slave labour he craves).

Neoliberalism destroys the lives of the many, and enriches the materially obsessed few. It feeds on unelected power while screwing the electorate. Milton Friedman was a dried-up old jerk who knew three-fifths of f**k-all about anthropology – social or otherwise. The sooner we all wake up to this – and stop proclaiming that either Marx or Keynes has the answer – the stronger will be our ability to kill the Beast, and move on.

Last night at The Slog: We didn’t get today’s jewels by being neoliberalist yesterday

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1

Jim on August 7, 2013 at 10:10 pm

Sheep ID chips don’t allow you to find them, they are just read only ones, like pets can have. It’ll help tell you whose sheep it was when the snow thaws and the bodies are found, not much more.

As for ‘deregulation by regulation’ I’m afraid you’ve got me there, your grasp of logic is not the same as mine.

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Richard on August 6, 2013 at 3:55 pm

+1 (but, to be pedantic, ‘gnashing’ your teeth)

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Whoflungdung on August 6, 2013 at 1:35 pm

It’s a greater individual responsibility position.

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thesurlybeaver on August 6, 2013 at 1:13 pm

John,

I sometimes find myself knashing my teeth with frustration at some of the guff you type, much of it appearing to be the product of sloppy thought processes.

First of all, as others have already pointed out, we don’t suffer from a shortage of regulations. We may suffer from a shortage of EFFECTIVE regulations, but that is a different matter entirely. Take for example the banks. What we need is enforcement of the Fraud Act and several dozen mid-level and senior banksters cooling their heels in jail. Complicated new laws and regulations concerning capital requirements which will never be enforced in any meaningful way will do jackshit to prevent the next banking crisis.

The fact is, large corporations LOVE regulation – being large, they have the resources to deal with the additional burdens imposed on them by regulations and can pass the costs onto their customers whilst smaller competitors may struggle to do so. Regulations are a handy way to reduce the competition in any given industry and bar the door to new entrants.

And please don’t describe this alliance of Big Business and Big Government as Neo-Liberalism – it’s really a degenerate form of Corporatism.

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the ghost on August 6, 2013 at 11:48 am

Foucalt Tudoux Wimay
So hundreds of sheep found in the snow by using their chips to locate them was inefficient & never saved farmers money
So Asbestos regulation haven’t saved lives many of them children when it needs removing
So when regulations are ignored horse gets into the system,it may not improve quality but it hinders the decline in quality ,so am sorry Arsenic or pesticides,fertilizers are also hindered from getting into the system all that regulation to stop Jim from being sued
It might be costlier to produce,but safer & probably cheaper than keeping lawyers in work for eternity
But without legal aid who’s going to sue ,it only leaves about 10% of the population with the means & while i do not wish to make judgements of the quality of Jim’s products which i obviously haven’t tried,am sure their very good & hope they do get into the best kitchens in the land,there is a good chance they do not
Paperwork maybe rising,but it’s not the regulations but the expensive parasites who need them to extort their living from them,who are to blame,deregulation by regulation

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the ghost on August 6, 2013 at 11:25 am

Phil that is why Hayek when forming his ideas,claimed the markets & money should be inclusive,whilst labour should not
In essence taking the old bailey it should be the sword & the scale but without the old lady that holds them up
This was always going to fail for that reason alone

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thesurlybeaver on August 6, 2013 at 10:15 am

testing

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Phil on August 6, 2013 at 12:07 am

Did you see the letter Thatcher sent to Hayek? When she told him that a British government could not possibly do what Pinochet’s death squads were doing because Britain had democratic traditions?

The man was a class warrior. His and Von Mises appearance at the Mont Pelerin meeting in 1947 were about overturning the gains made for ordinary working people by the various labour movements in Europe. They were very explicit about this. Von Mises had even remarked: ”It cannot be denied that Fascism and similar movements aimed at the establishment of dictatorships are full of the best intentions and that their intervention has for the moment saved European civilization. The merit that Fascism has thereby won for itself will live on eternally in history.”

Let’s just get it straight, Libertarianism (having of course stolen the name from Anarchists) is about the defence of private property. The ideal Libertarian state is one which has its core functions stripped back to the armed forces, the police and the courts. Or as Adam Smith said: “Civil government, so far as it is instituted for the security of property, is in reality instituted for the defense of the rich against the poor, or of those who have some property against those who have none at all.”

They talk all the drivel they like about ‘voluntarism’, ‘free markets’ and ‘freedom of contract’ – it’s a fantasy. There are hundreds of millions of people in this world, and billions throughout history, whose personal circumstances forced them to sell their labour to wealthy employers for wages they couldn’t possibly live on.

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Phil on August 5, 2013 at 11:55 pm

This is an interesting thread.

I think the point is that for the 99% regulation has increased, whilst for the 1% and the transnationals whole swathes of the economy and labour markets have been opened up (deregulated) for their profit.

If you accept the argument of people like David Harvey, then you see Neoliberalism not as a revival of pure laissez faire, but as an incredibly successful attempt to use the state to advance corporate / financial interests. Hayek was very clear that capitalism needed a strong state hence his dash to Chile as Pinochet’s death squads set about an elected left wing government. Or indeed as Adam Smith said: ”“Civil government, so far as it is instituted for the security of property, is in reality instituted for the defense of the rich against the poor, or of those who have some property against those who have none at all.”

I’m reading a very interesting book at the moment called, ‘Capitalist Realism: Is there no alternative?’. I fear it’s a bit too left wing for most people on here but it makes the point that we are living in Control States. Thus as successive governments try to open up schools and universities to marketisation, so more and more testing and oversight comes in.

This drive towards ever more rules doesn’t of course just come about by the corporate-government nexus alone but also out of a desire to avoid being sued or caught in the headlights of a media-driven scandal. We live in an adversarial society – politics, the courts, the media are all adversarial and the desire to apportion blame – and consequently to avoid it – is very strong. The need for control becomes like the weather almost. The panopticon doesn’t actually need anyone in it in order for us to behave as our masters would wish.

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Phil on August 5, 2013 at 11:25 pm

Hard to say isn’t it?

But I suspect Hannan knows better – the reason being his family are landowners in Peru. They know damn well what regulation means for them – less power over their poor tenants and workers.

I LOATHE these people.

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Phil on August 5, 2013 at 11:19 pm

Is that a Libertarian position or an anarchist one?

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Foucalt Tudoux Wimay on August 5, 2013 at 11:02 pm

Jim, I agree with you.
The only thing this red-tape does is create unproductive jobs for pen-pushers. It certainly doesn’t improve quality, safety, efficiency or monday.

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Whoflungdung on August 5, 2013 at 10:41 pm

““Get rid of regulation, and everything will get better” by Aneo Liberalist”
Get rid of most of government and everything will get better. There fixed it.

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Tom on August 5, 2013 at 10:28 pm

You’re right. I’m never sure whether he is actually as naive as he appears or whether he is trying to pull the wool over people’e eyes – I actually suspect the former. Like Boris Johnson, he prattles on about how positive immigration is while himself no doubt having the pick of jobs and housing.

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Phil on August 5, 2013 at 9:59 pm

What does my nut about the likes of Hannan is that they have NEVER done a real job in their lives. I bet he just loves ‘flexible labour markets’ – without of course ever having to live on a zero hours contract or the minimum wage. Just as that New Labour shitehawk, Lord Browne never had to go into hock to pay for his university tuition. I loathe these people.

Hannan went from University straight to a Think Tank and then to the Telegraph / Spectator > he’s a theologian.

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Cornelius Townedge (@seti2342) on August 5, 2013 at 7:45 pm

Chinese living standards have risen to the point that the Chinese are looking elsewhere. Yippee.

Since when was the benchmark of good living being fecking Chinese? Didn’t we used to bemoan their horrific human rights record? ( before Chairman Cam decided to ask them over to install Europes first censorchip filter)

The only upside of becoming like are automaton’esque, oppressed, capitacommie brethren would be running people over with tanks, and all the people I fancy running over are the types who actually have access to tanks.

ps. Amazon don’t do loss-making. Only a total clown reads their books and thinks anything other than ‘where did they decide to hide the profit this time’

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Richard on August 5, 2013 at 6:01 pm

Mises and Hayek were not neoliberals (in the Wardian sense). For what it’s worth, they were indeed “Austrians” (i.e. of the Austrian School), while Friedman belonged to the Chicago School, the chief difference being that Milton Friedman was far more of a believer in state intervention than the Austrians.

The point about Wardian neoliberalism, surely, is that it invokes the language of free markets and deregulation (and often of regulation in the same breath) while promoting completely unfree and monopolistic or oligopolistic practices, supported by government regulation which favours the ruling establishment’s corporate cronies or sponsors (aka crony capitalism). Such regulations are most often designed by the very sectors supposedly to be regulated (because they are seen as having “expert knowledge”, or indeed as being the only ones who can be consulted), and then licences to operate under those ‘fixed’ regulations are sold to the highest bidder, who has conveniently already been given an inside track to the tendering process by his buddies in government.

The inevitable outcome of such regulation (or indeed deregulation masquerading as regulation – remember that corruption of language is the first weapon of the deceivers) is that privatised industries like, for example, the railways become less efficient, less competitive, and ever more costly to the users. Of course the publicly-owned systems which preceded them had their own inefficiencies and corruptions, but there was not this feeling of being totally fleeced while being told that we are in the best of all possible regulated and deregulated worlds.

Such outcomes are as far from Mises’ and Hayek’s libertarian and Austiran principles as it is possible to be. Of course, a true libertarian economy requires ethical principles and decency, which – in Britain at least – went down the tubes with ‘the Thatcher revolution’ and its New Labour progeny.

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Hugh Creighton on August 5, 2013 at 5:35 pm

however they could probably spell

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Hugh Creighton on August 5, 2013 at 5:33 pm

JK Galbraith’s ‘The Afflent Society’ is an interesting. Amongst other things he posits the idea that economic theory, be it Friedman or Keynesor whoever does not keep up with the changing face of capitalism and is obsolete

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Jim on August 5, 2013 at 5:16 pm

I’m not arguing that any of those regulations are pointless, or that they should be repealed. There are eminently sensible reasons behind many of them (not all). I’m pointing out that they exist now when they didn’t 20 years ago, so the concept of some ‘neoliberal’ conspiracy to ‘deregulate’ everything is, frankly, bollocks.

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the ghost on August 5, 2013 at 3:48 pm

You must be busy Jim so branding wasn’t about 20yrs ago,you see you can not believe what you see on TV,Am sure i saw loads of cowboy films based on branding & stealing of cattle & sheep
i wonder how many sheep would died last year in the snow if it wasn’t for the chip
I know it is inconvenient that Asbestos was sold & used like tobacco in the past ,but are you really arguing that with just flat cap it should be dismantled & you can dispose of it has you seem fit
am also sorry that having worked 12 shift in the field the tractor driver tacho is up and in a tired state can not drive on the roads
PS i had a work colleague killed by a tractor pulling out onto a road during the peas season,the driver had not had a rest for over 24 hrs lucky that was back in the 1970’s
I’ll wait for a reply before moving on to burn’t fields,pesticides,fertilizers but i will leave the manure to you

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the ghost on August 5, 2013 at 2:28 pm

Go on Jim be honest,what would you do in each of the rules you mentioned do,if those rules were no their,be frank & open

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Jim on August 5, 2013 at 1:43 pm

So the existence of hugely more amounts of regulations covering just about everything any business could possibly think of doing is actually proof that we are living in a deregulated world?

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Jim on August 5, 2013 at 1:37 pm

How long ago since you actually ran a business then? Do you have any idea how many regulations apply to businesses today that they didn’t even 20 years ago, let alone 40?

Just a few things off the top of my head that have all been imposed on my business area (farming) in the last 20 years: waste management regs, new fire safety regs, asbestos management regs, stricter rules on towing trailers (requirements for tachographs etc), environmental regulations (covering use/storage of pesticides and artificial fertilisers (nitrate vulnerable zones) and controls on the application of manures), rules on the use of farmed saved seed, rules on public access to the countryside (and landowner liability for it too), the banning of straw and stubble burning, the banning of large numbers of pesticides, huge swathes of paperwork with regards to the keeping of livestock (every cow now has its own passport, every sheep has its own electronic implanted ID device). None of this existed 20 years ago when I left school.

And thats just farming. Ask anyone who runs a business if they spend more time now dealing with paperwork derived from State regulation and they will tell the same story. My friend is a chef and he tells me the same tales, my teacher friend ditto, my friend who is a tree surgeon the same.

If you think we are living in some deregulated neoliberal heaven you’ve obviously been reading too much of the Guardian. Try living in the real world for a bit then come back to me.

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Mark Deacon on August 5, 2013 at 1:36 pm

Personal thoughts on this … not tarring anyone on this it is where we are at as a failed species.

Through austerity, trying to make ends meet you do not just shed job you are driven to employ new efficiencies meaning you end up employing far less people forever. The likes of Amazon employing far fewer staff drives all its competitors to do the same they are just in front of the curve for the moment. Catches them up later though because Amazon as an online store like the high street still needs people consuming and your competitors will do the same eventually.

Speechless at times as people reckon so much part time work is wonderful but then you get this. Work 20 hours a week because that is all there is going if you can find it. It may pay current needs, saving for a future it does not if you “never earn an excess”. Under such an economic scenario, the best you can hope for is stagnation being positive and optimistic but the reality is likely an underlying deflationary model.

So topped up with lashings of QE / leverage in loans. The interest rate for savers, still out of the same economic pie, raising this? Not a problem watch the increasing amount of QE / leverage needed though thereby negating any interest rate move for savers anyway. Sure you can save if you have an excess the majority are not going to be in this position and to make it work a haircut on savers deposits, you may as well have let it deflate in your hand.

Everyone will shout oh so wrong, but … but … the entrepreneurs will save us. The chasing of a minority of entrepreneurs will not be able to support the mass of a population in such an economic position because they will need to operate at Amazon’s efficiency level.

The economy is screwed and sweet FA to do with economics, more the level of efficiency has been reached and you can’t hide the problem it is way to big now.

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the ghost on August 5, 2013 at 12:28 pm

Stephen Stephan Stephan
1) the Libor guilt rate was manipulated,so millions were ripped off
2) a valid point until tax comes into play,both corporate & local being lost
3) even by using the threat of moving work around to keep profits high wages low,the turmoil that creates worldwide is very poor economics,many cities in China like Detroit have built roads railways & all kinds of infrastructure to facilitate the growth of business if those business move around the world every time workers standard of living increases then we will just have cities being built & knocked down for the sake of keeping people in poverty & extracting the maximum profit to which the next lowest denominator gets their chance to build their infrastructure to appease the mercantile corps,until you reach a standard of living that restarts the process

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KJH on August 5, 2013 at 12:25 pm

ISDAfix, is a benchmark in the $379 trillion market for interest rate swaps, which corporations and governments use to fine-tune their borrowing costs. ISDAfix prices affect everything from pension annuities to commercial real estate investments.
http://www.businessweek.com/articles/2013-04-18/meet-isdafix-the-libor-scandals-sequel

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John Ward on August 5, 2013 at 11:41 am

Very interesting. Are there any more comments from the rear-view mirror?

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D.L. (@DarkLochnagar) on August 5, 2013 at 11:37 am

I came across this John and thought you might appreciate it. http://thecolemanexperience.wordpress.com/2013/07/09/barry-george-jill-dando-jimmy-savile-bbc-paedophiles-cliff-richard-alan-farthing-nick-ross-and-britains-dirty-secrets/

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Per Kurowski on August 5, 2013 at 11:17 am

Below the letter sent out to the banking community by the Basel Committee announcing Basel II. If you consider that to be de-regulation and not miss-regulation then I do not know what regulation is.

Basel, 26 of June, 2004

Dear Mr. Banker

If you lend very little, at high rates or risk-premiums, and on very short terms, to those perceived as “risky”, like the medium and small businesses or entrepreneurs, then you are required to hold 8 percent of that loan in capital-equity, which means you are allowed to leverage your equity 12.5 to 1 times… sort of like it has always been.

But, now, if you lend as much as you want, at as low rates or risk-premiums you want, and for as long as you wish, to those considered “absolutely safe”, like to your Infallible Sovereign or to the AAAristocracy, then we will allow you to hold very little capital-equity, 1.6 percent or less, which means you are then allowed to leverage your equity 62.5 to 1 or more, and which of course means you can make humongous returns on your equity.

Yours sincerely

A concerned bank regulator (like Mario Draghi or Lord Turner)

http://subprimeregulations.blogspot.com/2013/07/my-opinion-in-journal-of-regulation-and.html

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the ghost on August 5, 2013 at 10:52 am

Jim there maybe streams more paper in existence covering god knows what,but if it can not be implemented or enforced then it is not a regulation at all
Writing more & more only allows then to cut implementation or enforcing what they have written
So all the onus falls on the worker, particularly on zero hours for example,Boss “do this” worker “that is Dangerous” boss” do it or go home” Worker gets injured or killed & he broke H&S Rules,it is designed to pressure workers into doing tasks often unsafely,yet protecting those who apply the financial & lack of job security pressure to the worker
De regulation through regulation

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the ghost on August 5, 2013 at 10:41 am

Today’s neoliberals are the slave owners of yester year,they can not make a living without others having to suffer(exploitation) for their gain
Making a honest living of the backs of their endeavours & hard work is beyond them

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John Ward on August 5, 2013 at 9:03 am

Jim
Earth. You?

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Jim on August 5, 2013 at 8:53 am

So you think there are fewer rules and regulations today than there used to be? What planet are you living on?

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oxtapus on August 5, 2013 at 8:50 am

Reblogged this on Oxtapus *beta.

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bill40 on August 5, 2013 at 8:47 am

OAH

+1

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oldasiahand on August 5, 2013 at 8:19 am

Never heard of TJX but am an occasional user of Amazon even though they are one of the great evils of the internet age as shown by Channel4 the other night with their Victorian working practices. On the evisceration of what the Americans call the middle class, and we would call the aspirational working class, the attached article by John Mauldin and Charles Gave from Hong Kong is superb.

http://www.mauldineconomics.com/frontlinethoughts/a-lost-generation

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chrisb on August 5, 2013 at 8:11 am

“TJX … make the shopper experience one of the best”. Yer what? You’re getting too much in touch with your feminine side.

The internet is popular with people, who aren’t looking for an experience but just to buy something, because you can investigate what’s available and buy what’s most suitable. That it’s also cheaper is a bonus. However many people TJX employ, I doubt that any of them are ever going to tell a customer that a competitor offers just what they want. And if you can’t wait for delivery, then there’s always Argos, who have found success by straddling the advantages of online and high street.

That doesn’t mean that I am blind to the faults of Amazon; I am just explaining its success. It seems to be easier to build up a monopoly or near-monopoly online than it is on the High Street or in a shopping centre. I suspect that Amazon has a vested interest in maintaining non-profitable stores in the street or shopping centre, in order to hide its monopolisation of profit-making.

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John Ward – “Get Rid Of Regulation, And Everything Will Get Better” By Aneo Liberalist – 5 August 2013 | Lucas 2012 Infos on August 5, 2013 at 7:38 am

[…] http://www.hat4uk.wordpress.com / link to original article […]

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Professor Dr BigWig on August 5, 2013 at 7:14 am

Milton Friedman followed on from Von Hayek, who himself continued the development of the neo-liberal ideology of Von Mises and what today is generally known as the Austrian School of Economics.

Friedman had no answer or hypothesis to support trickle down theories. It was and is survival of the fittest. Possibly the end of this era is coming, but it may take another 10 to 20 years. The oriental model may ultimately emerge as the economic dominant system. This model should be a separate subject to reflect upon.

The current EU policies and the track set by the USA is leading towards greater confrontation over markets and resources.

In the UK we are not just poodles, but in the grip of the financial markets which are shaping the terrible polarization of our society.

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bill40 on August 5, 2013 at 7:05 am

Sadly, Zhang Ruimin has little authority as he spent too much time being successful at business and not enough rising through the Party ranks. I’m afraid people like Zhang are only ever one step away from treading on their own knackers. So far he has resisted state recruitment “targets” and there are many examples of retribution against those who put business before Party.

The neo liberals are despised in China and even the moderate views on the IMF unprintable. This blog may be blocked in China but the contents circulate freely or so I’m told.

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john carey on August 5, 2013 at 7:03 am

agree too many people – I am sure they are working on it – some strain of Avain flu perhaps?

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Stephen Tye on August 5, 2013 at 6:59 am

Oh Dear, what a load of totally self-contradictory bollo*ks.
1. LIBOR rate setting doesn’t screw pensioners- pensions are set off of gilt rates. Artificially low interest rates screw pensioners.
2. Amazon provides what some people want – cheap good quality goods in a no-hassle way. TJX (I presume) provides a shopping experience, what some people want. Don’t mix up the two, they are different retail models. And to cap it all, Amazon has been a marginally profitable/loss making organization for many years, running at a tiny profit margin based on massive sales. Did you look at the annual accounts before spouting off?
3. Having spouted off about nasty big business stuffing the workers, you then go on to make the point that Chinese standards of living have risen to a point where the Chinese businesses have to look for cheaper labour elsewhere. What has improved Chinese income levels – yes it’s the same bad old businesses out to screw the workers.
So if you don’t like Marxist or Keynesian economics what model do you lean towards – the Austrian school maybe, of do you subscribe to chaos theory? I could weep, if I wasn’t laughing so much at this drivel.

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The Real Ms Gemz on August 5, 2013 at 6:42 am

Fear not, the advent of computers and robots will make people superfluous before the end of the century. Too many people – problem number one.

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