The Pig Society Part II


The Big Society grows ever stronger, and support grows ever wider, charity bosses and workers applaud it and sing its praises, because it is a wonderful plan that is definitely not a cover for a mass of Corporate tax cuts.

That is what delusional Conservatives believe.
Except, it’s bullshit.
The voluntary sector is being absolutely gutted of funding.
As the previous post pointed out. But to make it clear, the Guardian today featured a story of a lady named Denise Marshall. She is Director of Eaves and also the Poppy Project. These charities work with victims of domestic abuse and sex trafficking. She has dedicated her life to this cause. She has fought some pretty high powered members of the criminal underworld across Europe. Eaves provides housing and counselling for victims of abuse. They offer up to 35% savings on gas and electricity and other necessities for vulnerable women. In short, Denise Marshall is a heroine. She was recognised for this in 2008 by being given an OBE. She is one of the very few who actually deserve the honour.

Denise is now handing back the OBE, to David Cameron personally, because she has said that the extreme and needless cuts to funding for charities and organisations like Eaves, means she will no longer be able to support and fight criminal gangs who traffic women for the sex trade. She feels that she would be hypocritical and unworthy of an OBE when she can no longer protect the women she has the award for protecting.

Marshall said:

“I received the OBE in 2007 specifically for providing services to disadvantaged women. It was great to get it; it felt like recognition for the work the organisation has done.

But recently it has been keeping me awake at night. I feel like it would be dishonourable and wrong to keep it. I’m facing a future where I can’t give women who come to my organisation the services they deserve – I won’t be able to provide the services for which I got the OBE.”

“If you run a refuge where you don’t have the support staff it just becomes a production line, where you move people on as quickly as possible to meet the targets. You’re not helping women to escape the broader problems they face. They may get a bed, but no help with changing their lives and moving out of situations of danger.”

“I’ve worked in this sector for almost 30 years. I don’t want to sound melodramatic but I don’t think I have ever felt as depressed and desperate as I do now,”

How then, do the Big Society advocates justify the fact that on the same day as a true heroine feels she can no longer protect very very vulnerable women in her care, the Tories are trying to stop an EU law on the banning of naked short selling (which I shall try to explain as much as possible shortly)? The EU law, if the Tories get their way, will not affect the UK on naked short selling. Germany have banned it, the U.S have banned it, Australia have banned it, Hong Kong have banned it, Japan have banned it. We have kept it. It makes a very small elite group of speculators very rich, whilst risking money that is not theirs. How are these people protected, yet the vulnerable women like those that Denise Marshall represents have their funds slashed. The Government and its banking friends and business associates are sitting sipping champagne, whilst Rome burns. Nero would be in awe.

Short Selling (not naked short selling) is a little confusing, and utterly absurd. It has no social use. It is not to the benefit of any of us. It is dangerous and it should be banned. When you buy shares, you buy them in the hope that the price will rise and you can sell them some time in the future, to make a nice bit of money. It is all to do with how you obtain shares. You and I would buy shares. Naked short sellers borrow shares in the hope that the price will fall. So, if for instance I was to borrow 5000 shares from Broker A. I will then sell them at £1 a share, so £5000, hoping the price falls. Say the price falls by half. I now buy back all the shares, at £2500. I have netted myself a nice little £2500 and I give the 5000 shares back to the Broker A.

Naked Short Selling is different, because you don’t even borrow the shares you’re selling. You don’t have them. You’re selling a promise that you will obtain the shares that you’ve just sold, at some point in the future. You may as well walk into a bank, take all of their money, and promise to give it back at some point in the future. There is then an incentive for short sellers to wreck companies, because the share price has to fall for them to meet their promise. On a grand scale, this can lead to massive crashes.

This little practice lead necessarily to the 1997 Asian Financial Crises, that left millions in poverty. This wasn’t the fault of too much Government interference in people’s lives, or too many people on the dole. It was a direct result of unproductive short sellers and a massively deregulated financial sector.

The law looks to ban naked short selling in the EU. The UK will be trying to exempt itself from that banning.

This of course comes days after the announcement that there would be vast changes to the offshore tax laws, which mean that large and medium sized businesses who offshore their profits and then move them back to the UK, no longer have to pay the difference between the tax they paid in their tax haven and the tax they pay in the UK. They no longer have to pay any tax on profits that are made outside the country and brought back to the UK. Not only that, but they can claim expenses against tax they pay in the UK, to fund their overseas departments. That represents one of the biggest changes to Corporate tax law, and a massive shift of wealth from the poorest due to cuts, to the very wealthiest on a level far beyond anything Margaret Thatcher could have dreamed of. Suddenly the veil of an omni-benevolent Tory government is falling off, to be replaced by a face stamped with the logos of Diageo and Barclays.

On the 9th February, George Osborne told the House of Commons:

Those entrusted by us to regulate those bankers and run our economy washed their hands.
Meanwhile the rest of the country is left paying every day for their failures.
The government has to pick up the pieces.

It would seem that what Osborne believes is “picking up the pieces” entails giving away massive tax cuts, destroying the voluntary sector, and inviting the World’s naked short sellers to come and set up home in Britain.

Welcome to the Pig Society.

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