Daily Archives: November 21, 2011

Petrol on the Flames

Nick Clegg today is proudly announcing a coalition housing policy which is perhaps the maddest thing the government has come up with yet (though that is a tough competition). Apparently the answer to housing problems is to find ways to enable people to take on yet more debt, being helped by government to find deposits which they will however ultimately have to repay in addition to the ordinary mortgage.

In effect the government thinks that the only problem with the housing market, is that it is not as it was in early 2008. The government supports ludicrous inflated house prices, giving the economy an entirely fictional huge monetary value asset base, sustained by mortgages of 100% or more on the inflated value, amounting to many multiples of the debtor’s income.

The answer to housing availability is not for the government to find ways to enable young people to take on unrealistic amounts of debt so they can afford fake prices. The answer in the owned sector is for house prices to crash down to realistic levels which people can actually afford.

These government proposals are the precise opposite of what is needed.

The primary answer in the rented sector is for local councils to build public housing and rent it to people at genuinely affordable prices. There are a huge number of brownfield sites which can be utilised and a huge number of empty buildings ripe for conversion – including many of those empty shops. 50% of the “printed” money created by the Bank of England in the last round of Quantitative Easing exercise, and given to the banks, would have built 400,000 family homes if given to local authorities for that purpose. Think of the employment that would have created.

The UK is every bit as indebted as Greece, both as a per capita absolute and as a percentage of GDP. The difference is that Britain has more private and Greece more individual debt. But it is equally impossible to pay it back in the long term. That incredible mountain of personal debt is what has sustained Britain’s ludicrous house prices. Just as the bamks have had to take a 50% haircut on Greek debt, so also they are going, in the end, to have to take a massive haircut on their UK mortgage portfolios.

The extraordinary thing is, that those mortgages – based on totally unreasonable house valuations – constitute not liabilities but “assets” on a bank’s balance sheet, and the banksters have been able to “leverage” those assets to make speculative financial transactions – or bets – to the valuse of 12 times the “asset”.

These are some my policy prescriptions:

Give local authorities money to build 400,000 new council houses for truly social rent levels, using cash from quantitative easing
nationalise all housing association property and give to local councils as council housing
wipe off 50% of all outstanding mortgages
watch house prices crash, and cheer!

That may sound extreme to some of you. But I promise you it is infinitely more sensible than the incredible folly the government has just produced.

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Death in Kabul

I contribute to this BBC Radio Scotland programme which goes out at 14.05 today. It tells the story of Alexander Burnes, of whom I am currently writing a biography. It will hopefully give you some idea of why I am so devoted to the project. I presume that outside Scotland you can listen to it online – can anyone give a link?

Given the appalling level of recent fatalities in our current doomed and pointless occupation of Kabul, I think you will find the story quite haunting.


I think you should be able to hear it live here

or on Sky channel 0116

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Having through military force assisted in the overthrow of Colonel Gadaffi, the British government cannot absolve itself of responsibility for the fate of Seif al-Islam, and for ensuring that he is neither tortured nor killed. The government of Libya is legally within its rights in trying him in Libya rather than at ICC, provided the trial covers the charges before the ICC. The evidence of Seif al-Islam’s guilt of war crimes is not immediately apparent. Certainly the charge of hiring mercenaries on one side of the civil war rather pales in comparison to the devastation wreaked by NATO in bombing cities on the other.

But Gadaffi’s son is just one man. There are many who must be held accountable for torture, rape and murder, and at the moment there is no compelling evidence that these crimes were more prevalent from one faction in the civil war than another. You will not ehar that from a British government spokesman. Their view of responsibility for what happens next in Libya focuses on ensuring that the owners of British corporations and banks benefit.

Which brings me back to the question of the Malyshevs, deported by the British government as failed asylum seekers back to the hideous regime in Tashkent.

Six weeks later, the British government has still not given any substantive response to the public and MPs who wrote to them expressing concern at their disappearance. The last news that we had was that Nina’s daughter Helena, who remains legally in the UK, contacted her local MP in great distress asking that all campaigning stop and no more questions be asked. I am afraid that is almost certainly a sign that Nina and Mikel – who nobody has yet sighted – are still under great threat from the Uzbek authorities and the usual means of pressure are being applied.

I am told that three more deportations to Uzbekistan are in the pipeline. The British government cannot demonstrate that deportees will be safe – because they will not be. It is completely irresponsible, indeed deeply shameful, to deport people back to Karimov in these circumstances.

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