Wednesday, 17 February 2010

Essex Envy Economics

Is this guy for real?

What is good for companies need not be good for savers, borrowers, taxpayers, employees, or local communities.
Take companies away and see how many savers, taxpayers and employees you are left with. Take away the banked profits and where are borrowers to find a lender with a generous pot to play with? And is he seriously suggesting that local communities will function without a major source of employment?

There is an increasing disparity between the people's need for jobs, economic stability, quality of life and human rights, and corporate obsession with private profits.
No, this is backwards thinking. The obsession for private profits drives the supply of jobs and, therefore, the accompanying uplift in economic stability, quality of life etc. (more on human rights later).

This harsh lesson is once again evident in the aftermath of the takeover of Cadbury by Kraft. Workers had no vote or say in the take-over of Cadbury, and soon afterwards Kraft announced factory closures. This may make profits for shareholders, but does nothing for workers or local communities.
Firstly, why the fuck should employees, who have invested nothing in a business, be given a vote on economics they will almost certainly not understand? And secondly, if closures happen, this is more to do with a poor environment provided by the state than any imagined malfeasance by the business itself.

Christ! This is economics 101, isn't it? If infrastructure and conditions are advantageous to any company, they will not only remain there, but also avail themselves of the resources therein. Including creating jobs and spreading goodwill.

If Kraft close their operation, it's because they can get the job done more efficiently and economically elsewhere. They're not doing it out of spite. The one thing that businesses never do is reduce their profits to make a point, simply because they are accountable to their shareholders ... the very demons Prem Sikka appears to despise.

Diageo, Unilever and a number of other companies are threatening to move their headquarters to offshore locations unless the government shifts taxes away from corporations and their rich executives to ordinary people.
Bollocks, quite frankly.

The state has a balance to maintain with regard to taxes. Place the burden too high on employees and yield decreases at the expense of the welfare state (some tax receipts are better than none at all). Shift it unevenly onto companies and staff are shed extremely quickly ... again at the expense of the state's coffers.

Long run companies, such as those mentioned by Sikka, have an easy way out of such lunacy ... by moving to other, less financially restrictive, countries. Offshore locations is cleverly worded sleight of hand for his Guardian readership, hinting at connotations of being tax free. Of course, there are very few locations which can offer tax free status and probably none where such large operations can function optimally.

They will pay taxes. Just not here.

Of course, they still want to make profits in the UK and expect the taxpayer to pick up the tab for providing them with the legal system, policing, security, subsidies and an educated and healthy workforce.
COMPANIES ARE TAXPAYERS! It's not given free. Again, if the public want all those trappings of a successful country, businesses are needed to supply taxes, along with their suppliers who also pay taxes, and the companies' employees who pay more taxes, and the taxes of the companies who sell stuff to the employees.

Without the originator, the rest goes missing and savage cuts are required in the legal system, policing, security, education and health - all of which rely on massive injections of entrepreneurial cash.

The widening income and wealth inequalities are literally killing people.
Then why the fuck are you arguing in favour of driving businesses away and feeding poverty, you hideous prick?

An increase in the national minimum wage would go a long way towards achieving this. Company executives are still drawing mega bonuses, but they are not happy about the prospect of an increase in the minimum wage.
Again, no. An increase in the minimum wage will place pressure on job creation, pushing some employed people into the position where it is not economically viable to employ them. As far as I understand it, the wage is very carefully monitored to prevent exactly that, and so it should be. Raising it for the purposes of ideological fantasy will harm exactly the people this dolt wishes to protect.

Conflating the average anchored community worker with a highly mobile wealth creator, eminently capable of relocating elsewhere, is just gross laughable and based on nothing but envy.

Lose the wealth creators, you lose the, err, wealth. Capiche?

There is an urgent need to align corporate practices with social justice and democracy. Rather than being tossed aside in the takeover bazaars, workers should have a vote on all mergers and takeovers. Before moving to newer pastures, corporations should be required to return all public subsidies and grants and make good any environmental damage that they have caused. They should be required to ensure that after their departure the local community would not be worse off.
A whole lot of rhubarb which will merely result in no company worth a carrot bothering to invest here.

The tumbleweed would whip round poor areas as quickly as the government's social security reservoir dries up. Where's your fucking human rights, which have a cost themselves oddly enough, in that scenario, cocktard?

Therefore, they should be required to contribute to the retraining of the workforce and help with the development of small-scale workshops. The government should enact legislation to ensure that trade by UK companies is compatible with the universal declaration of human rights.
Small businesses would be crucified, thereby restricting further the employment options of local communities, whilst the large corporations, the ones who attract the subsidies mentioned for their huge advantage to any nation, piss off never to be seen again.

This guy is apparently a Professor of Accounting at the University of Essex. I pity the poor undergraduates that ever come into contact with such a hare-brained cunt.

Sikka talks of the UK government 'urgently' having to adopt such a ridiculous policy. If implemented unilaterally, the damage to the country would be disastrous.

Of course, there is one way the daft goals of which he speaks could be delivered, and that is to apply these rules globally through the UN, IMF, or some such body.

It would still mean a worldwide employment catastrofuck, but at least we wouldn't be alone in accommodating businesses paying incredible tax margins, to employ a minority proportion of the public, in order to finance the majority to sit on their arses in comfort.

They'd soon be fucking bored though, as investment in innovation would die on its arse in such an environment. Who would invest in producing an improved X-Box if the targeted consumer isn't able to afford the huge price which would be placed on it?

Isn't it about time these socialist idiots started recognising the comforts that capitalism has provided them, instead of being mealy-mouthed and jealous dickheads?

Eat this, Sikka.


John Pickworth said...

Is this guy for real?

I think someone needs to check his qualifications.

TheFatBigot said...

Sometimes one feels the last 30 years never happened.

The piece you fisked, Mr P, is classic student union stuff from the late 70s / early 80s. The purpose of business is to employ people, all employees must receive a state-mandated wage whether or not the company can afford it, but the company can always afford it because companies have magic money trees, employers all make a fortune, strip the wealthy of their money and everyone will be comfortably off. It's all complete nonsense.

One day these idiots will learn that jobs are a consequence of businesses being profitable.

Neal Asher said...

Unfortunately our universities are full of tossers like this. They believe the state can make things better, that wealth distribution is a zero sum game, and, frankly, all the rest of the lefty fuckwittery. Cast an eye on the UEA, which ain't that far away from his university. What's it famous for? Climate change bullshit and Marxist tracts. But then I guess lefty fuckwittery is going to be more prevalent in places where everyone is sucking on the state teat and disconnected from real world concerns.

Letters From A Tory said...

As soon as I saw 'human rights' pitted against 'evil corporations' by this idiot, I switched off.

Anonymous said...

Another stupid twat writing in ?
You guessed it, the Guardian.
They should rename it IZVESTIA.

Bucko said...

There is nothing worse than an anit capitalist -
"I see you have a lot of money"
"I choose not to see how hard you had to work for it"
"I see that I am incapable of achieving your wealth"
"I choses not to see the reason for this is that I am a lazy fuckwit"
"I find it easier to blame you for my own failings. I find it easy to make demands of your money rather than make my own. I find it easy to villify you and demand that your money be redistributed to me"
"Many people like me will find it easier to join me than to work hard and dedicate themselves to their own sucess"
"It is a lot easier for me to bring the wealthy and successful down to my level than to bring myself up to theirs"

Bucko said...

I meant "Anti" capitalist.
I'm not sure what an anit capitalist is?

Mark Wadsworth said...

DP, completely agreed. I didn't realise you did economics :)

On a historic note, this distinction between 'workers', 'businesses' and 'consumers' (conflicting interests are best sorted out by the free market) is entirely artificial

The disinction was invented as a smokescreen by landowners (on a 'divide and conquer' basis) who thus neatly took themselves off everybody's radar screen when it came to taxation.

Dick Puddlecote said...

TFB: My thoughts exactly.

Bucko: That just about encasulates the mentality AFAICS

MW: "I didn't realise you did economics"

As a small business owner, I dabble occasionally. ;-)

This particular article came on a day where I finished interviewing for a new position worth £25k and made an offer which was accepted. In Sikka's world, that job would simply not have been affordable - we'd have carried on 'getting by' as we were.

Bucko said...

Call me green but what does AFAICS

Sam Duncan said...

“As far as I can see”, Bucko. Dates back to the dim and distant days of Usenet, that one.

You've hit on the central weirdness of modern Leftism there, Dick. They seem to think major corporations are run by space aliens or robots or something. Certainly not people, because they attempt to pit one against the other. It's all very odd, and as difficult to argue with as the addled rantings of your average wino.

(WV: Obooksio. Everyone's favourite clown's better-read brother.)

Bucko said...

Cheers Sam

Anonymous said...

Don't know why you bothered, Dick. It's the Grauniad FFS.

You'll probably find that Mr. Sikka is somehow related to any of the great Indian Capitalists - the Hindujas, Ratan Tata or that lying piece of shit Pachauri.

w.v. = sperf. How "spoof" is pronounced in Hull.