British MPs expenses scandal

Some interesting points made by Moore:

MPs' expenses: The House of Commons is ours, not theirs. Don't ruin it, reclaim it
Charles Moore
Telegraph Comment
15 May 2009
Our thirst for revenge over the expenses scandal is understandable but there is an alternative

...

In the last 40 years, Parliament has given away much of its authority to the European Union, quangos, bureaucracies and courts. Since 1997, the Government has grabbed greater control of the legislative timetable and therefore almost always gets its way. The great function of Parliament – to make the right laws and decide the level of taxes – has become almost nominal. And so the motive for entering the place has changed. You start as a backbencher nowadays, only to become a frontbencher.

People complain about MPs having "second jobs". They do not realise that the most common second job – and the one which produces the biggest conflict of interest – is being a minister.

If you are a minister, you lose your independence. You have to take the side of the government rather than of Parliament and people. You are in a chamber physically shaped for argument (the word "parliament" means a place where talking goes on), and yet argument is what you want to suppress. For centuries, MPs fought for parliamentary "privilege". This meant the right to vote and debate without intimidation from the king. But "the king" – whose modern equivalent is the government – has regained control. Now, when MPs talk of their privileges, they mean things like the additional costs allowance and free sausage rolls.

To start making proper laws once more, MPs should have almost no allowances, and modest wages. In return, they should be free to earn money by other means, so long as we know what those means are. They will learn much more about the rest of life than if they sit in Westminster all day and all night. The privileges they should be granted are of power, not money.

Why, for example, can the Government appoint people to public bodies (all 43,000 of them) without parliamentary approval? Why is European legislation not properly scrutinised? Why should the whips decide who chairs which parliamentary committee? Why can an MP become a minister – and therefore take "on office of profit under the Crown" – without consulting his constituents? Until the early 20th century, any MP offered a ministerial job had to fight a by-election. If you brought that rule back, the Government would think twice about swelling its "payroll vote", and the public could put the needs of the Commons before those of the executive. All possible mechanisms should change to shift the balance of power and the focus of ambition.

...

The Man Who Sold the World (and caused the credit crunch)

David Bowie's 'back catalogue bonds' may have started the credit crunch

By Evan Davis

He’s always been a trendsetter. But could David Bowie have caused the latest fad sweeping the nation – the credit crunch?

It may sound like a ridiculous question, but it’s not as mad as it seems.

Even when it comes to finances Bowie leads the way – and back in 1997 he did something called “securitisation”.

He thought, “I have a lot of money coming in over the next 10 years from my back catalogue, but I’d rather have the cash now and not have to wait”.

He produced some bits of paper – Bowie Bonds – and said “whoever buys these gets my royalties”.

It meant he no longer had the money coming in but instead had a lot up front. His investors were guaranteed a good income. It was a good deal all round.

And the banks were catching on to the idea. They thought, “We have billions out there in mortgages which are going to pay us back very slowly. Why don’t we sell those and get the money now?”

So the banks started doing what Bowie had done – in a big way.

It was a complete rebuilding of what a bank does. Normally a bank borrows from people like you and I, then lends it out.

But now the bank was lending the money – and selling the loan on elsewhere.

For example, a bank loans out £100,000 for a mortgage, and does the same for 10,000 people. They’ve now lent £1billion and will be getting the cash back over the next 25 years.

So the bank creates a piece of paper, a security, and says whoever owns it will have the income from the mortgages.

It then sells the security – effectively the bundle of mortgages – for £1billion to perhaps a pension fund, which then has the mortgage income – and the bank has £1billion to lend out again.

Everybody is happy: the banks are able to lend more and more as mortgages, and there’s a conveyor belt where they lend a billion, receive a billion and sell the mortgages on.

Northern Rock were the market leaders in the UK for this kind of thing.

No one expects...

A rare return to impdec for me, but I feel the article below should be read by as many people as possible: (I've pasted some highlights; the whole article is here.)

We are all suspects in the new inquisition's eyes

A safety quango will vet one in four adults in the name of child protection. It won't stop predators, but it will corrode trust

Camilla Cavendish

"In these straitened times, it's good to know that jobs are still being created. A quango called the Independent Safeguarding Authority, which will open this October, already has a well-staffed helpline and is advertising for ICT (information and communication technologies) and finance specialists."
[...]
Under the Independent Safeguarding Authority, it will become a crime for any relevant employer to hire anyone without an ISA licence. Employers who make their own judgments about whom to trust will face a £5,000 fine. The only people to decide who is employable will be the unelected ISA board, which appears to be made up mainly of professional quangocrats and the children's lobby.

If this sounds impossibly Orwellian, look at what has happened in Scotland since a similar scheme was created three years ago. In East Renfrewshire a father whose son suffered from Asperger's syndrome was told that he could not get on the school bus to do up the boy's seat belt without a disclosure check. After an outcry, the local council announced that children would be taught to do up their own safety belts, and that no parents would be allowed on school buses.

Paedophiles have made the bureaucrats all-powerful - except in the small matter of keeping children safe. The massacre of 16 children at Dunblane Primary School, which is often cited in Scotland, could not have been prevented by vetting. Thomas Hamilton, the gunman, was not employed by the school. He had been sacked by a Scout group that was alarmed by his taking pictures of boys. That Scout group protected its boys by using common sense - not by box-ticking.

Common sense protects children better than bureaucracy. It's like crossing a road. You can never predict accurately which cars will stop. You have to teach children to make their own judgments about when it's safe to cross. Similarly, you have to teach children to judge whom to trust and what constitutes strange behaviour. The vetting schemes that we are creating tell children to suspect everyone, and encourage adults to retreat. So children who are actually in trouble have fewer and fewer people to turn to.

I still remember the kind man who grabbed my toddler in a park when he was heading full tilt for the pond. I was heavily pregnant and could not run. But I could see his fear that I might accuse him of something. I also remember the hostility I got from a mother when I thought her five-year-old looked lost. These experiences are chilling. Ask yourself if you would stop if you saw a small child on its own. A lot of people are suddenly less sure.

Oblivious to the corrosive effects on society, the bureaucrats keep upping the numbers to be vetted. The Independent Safeguarding Authority grows bigger and bigger. Its launch has been repeatedly delayed as more complex software is devised to cope with concerns about data security. Josie Appleton, of the Manifesto Club civil liberties group, says that the cost of setting up the ISA will far exceed the estimated £84 million - five times what was first envisaged. The ISA will be a monster that assumes every volunteer granny is a monstrous paedophile. And everyone who is vetted will have to pay £64 for the privilege - £28 to the ISA on top of £36 to the Criminal Records Bureau.

The road to political oblivion is paved with good intentions out of control. More than 80 per cent of attacks on children are made by people they know. A third of sex crimes are carried out by adolescents, who will not be vetted. If the Government really has £84 million to spare it should be treating sex offenders, not subjecting millions of decent people to a modern inquisition."