UK election: Winner will be out of power for a generation

According to US economist David Hale, he said "I saw the Governor of the Bank of England last week when I was in London and he told me whoever wins this election will be out of power for a whole generation because of how tough the fiscal austerity will have to be"

Edmund Conway in the Daily Telegraph, who quotes this says that few understand the scale of the deception that politicians are engaging in on the amount of austerity needed.

In essence, if you believe the state should NOT grow, it means drastic spending cuts, which will have to include education, welfare and probably health.

If you don't care about the size of the state, it would mean some of that, but also tax increases that will deeply affect the competitiveness and image of the UK internationally.

Conway continues:

We have been insulated from the full pain of the financial/economic crisis so far by unprecedented low interest rates and by the bank bail-outs. At some point, the anaesthetic will wear off and we will face a period of austerity that may well make the ruling party so unpopular that it effectively becomes unelectable for decades. There will be strikes; there will be stagnation; there will probably be a double dip of some variety. But this time the pain will be unmistakeably imposed by the politicians.

Gordon Brown should bear most of the blame for this. He ran deficits in the "good times", ran up massive increases in state spending with little to show for it, and cheered on an economy propped up by cheap finance, property speculation and state spending. Now it's all the fault of the greedy bankers, and we should all feel lucky he was in charge.

No Gordon, you screwed up. The only fair result is that the Labour Party comes a distant third to the Conservatives and the new leftwing major party, the Liberal Democrats. It is only because it spreads such fear among those it has made dependent on its big state, that it has any chance of power today. If the Conservatives win, and have to engage in massive spending cuts, Labour will take the opportunity to moan about it, and offer nothing in return.

Gordon Brown's place in history will be one of utter disgrace.

(Hat Tip: Edmund Conway, Daily Telegraph)

UK election : Vote BNP if you're not white British?

The Independent reports that the BNP is proposing to GIVE £50,000 in resettlement grants, per person, to "non white British" residents of the UK to leave. I suspect the BNP feels its core vote of racist envy dripping malcontents is drifting away.

As someone who would undoubtedly be classified as "white British" given my parentage, I'm outraged.

For if the BNP ever got into power, I'd happily want to take £50,000 and flee to a country that wasn't being run by knuckle dragging, semi-articulate, barely literate incompetents. Of course, if that was a real possibility, the £ sterling would already have plummeted to parity with the Kiwi drachma.

UK elections: So how about UKIP?

I have seriously flirted with voting for UKIP, until tonight.

Why UKIP? Well it helps that Googling UKIP comes up with "Libertarian, non-racist party". Beyond that there are many policies consistent with wanting less government:

- Flat tax of income tax of 31% and income tax free threshold of £11,500;
- Abandon the European Union, but retain free trade and investment with the EU;
- Reject carbon taxes or carbon trading as it rejects interventionist policies on climate change;
- Allow people to opt out of the NHS with a tax credit scheme;
- Introduce school vouchers and allow free schools to be established;
- Abolish regional assemblies.

OK, not too bad. However, then it gets a bit more tricky. It isn't just the typical war on crime stuff or the rather odd massive increase in defence spending, it means policies that frankly are contrary to freedom:

- Amend takeover code to prevent "foreign interests" gaining control of "strategic British companies". In other words, outright socialist nationalism;
- A socialist style public works programme of nuclear power stations and high speed rail lines;
- A 5 year freeze on ANY immigration for permanent settlement, effectively shutting out the world's best and brightest regardless;
- Zero tolerance on crime, "three strikes and your out" without removing victimless crimes;
- Expand NHS coverage and keep it free;
- Ban BAA (a private company) from expanding Heathrow runway and terminal capacity;
- Build more social housing, ban greenbelt development and introduce democratic planning controls;
- Ban the burkha and veiled niqab in"certain private buildings" (quite why you need to on private property is a bit odd)
- Oppose GM food production and retain farming subsidies.

Of those, it is the amendment of the takeover code, the ban on immigration, irrational ban on GM food production and the belief in more state spending that make UKIP unpalatable.

On top of that, I asked my local UKIP candidate how he would cut the budget deficit. He said, among other things, that withdrawal from Afghanistan would help. Apparently Afghanistan reverting to the Taliban and the Taliban spreading to Pakistan shouldn't be a concern! In addition, the other answers were partly trite (cutting the ID Card while laudable wont save money already spent!).

The ONLY reason to vote UKIP is a protest vote to rattle the Conservatives, which is safe since UKIP really only has a chance in one seat (not mine). UKIP says to them to not take their core voters for granted, and that for many the European Union remains an issue. However, do I really want to be associated with a party that is so vehemently anti-immigration? Do I want to be associated with being hardline on crime, including drug and censorship "crimes"? Do I want to give moral support for public works programmes and banning some foreign investment? Finally, more specifically, do I want to support a candidate who opposes UK involvement in Afghanistan (and doesn't know the UK has already withdrawn from Iraq)?

My conclusion is, no. The candidate himself is not worthy of my moral endorsement.

So I am left with the Conservative candidate, of whom I know little. He's next in the questioning...

UK election: All three parties to thieve some more

The Institute for Fiscal Studies has published a presentation outlining its conclusions on the plans of the three main parties for tax and spending. The conclusion?

ALL of them propose more tax.

The Liberal Democrats propose on average an extra £760 per household in tax, Labour £610 and the Conservatives £390.

So vote Conservative for more tax? Hardly the choice if you want LESS government. Indeed, the Conservatives are better for low to middle income earners than Labour, as their tax rises hit the wealthiest the most.

So since I wont be voting Labour or Liberal Democrat (what do you think I am?), is it Conservative as the least worst of the parties likely to hold power, or do I go for the only other option in my constituency that isn't about more government - UKIP?

The NZ$ vs the £ Sterling... correction time?

The NZ$ is at a record high against the British Pound. Travelex are currently selling NZ$2.05 for £1. This is almost a record low for the Pound against the dollar.

City AM is arguing that a long run correction will be on the way, and the right thing to do is long selling of the kiwi vs the sterling. In other words, the Pound is likely to rise after the election (assuming the uncertainty built into the price is corrected), and that the NZ$ will be on a track to fall because of pressure from the Reserve Bank of NZ.

What does this mean for kiwis in the UK? Bring your money here. The pound is unlikely to ever be this cheap against the NZ$. The NZ$ strength is driven in part by the relatively high interest rates, but also naive belief by some currency traders that the NZ$ has parallels with the $A. City AM dismissed this link a few months ago, as the A$ is driven by rising commodity prices around minerals. The NZ economy is not driven by this, and in fact has a tourism sector being hit by the drooping Pound, Euro and Yen.

Meanwhile, kiwis wanting an overseas holiday should book trips now - it will never be this cheap to visit the UK and Europe, whilst the pound remains low and the Euro gets damaged by the PIIGS (Portugal, Italy, Ireland, Greece, Spain). Unless, of course, you believe in reducing CO2 emissions in which case keep yourself on NZ soil or else you can be readily accused of blatant hypocrisy.