Saturday, 12 March 2011

Are we being kept in the dark?

Is the presentation of data to the public hindering our democracy?

Ask yourself what was the state of the national debt before the credit crunch. Remember the credit crunch? That's what we called the crisis before we called it a recession, which was before we called it the deficit.

Dear Prudence

Okay, so you could be excused for not knowing what the national debt was before the credit crunch because it wasn't big news. In fact, as far as I understand, it was news, just not big news, because I seem to remember that Gordon Brown was well on the way to paying it off. (These days they refer to the deficit but deficit is just the shortfall in money available to a government in any one year whereas the debt is the accumulation of those deficits over years, so they are different ways of expressing the amount of money the country owes.) They used to refer to Gordon Brown's famous war chest and he would talk about prudence in government spending. I'm interested in this because I get a bit tired of the current government saying that the previous government is responsible for the financial crisis due to of profligate spending. I'd like some figures to back up my admittedly alcohol befuddled memories. (See my blog for my thoughts on responsibility for the financial crisis.) But can I find any figures on this? Before the May 2010 UK election I looked on the UK Office of National Statistics web site and I could find nothing.

Okay, here's something else. A little over twenty years ago my father retired. Ever since I was a child he worked as an electrical fitter in a factory that made aircraft components. However, he had always been interested in the stock market and finance. Over the decades he built up a substantial portfolio. He  also paid into his pension during the high growth years from the sixties to the eighties until his retirement just before the turn of the decade. He died a few years later in 1993 enjoying just a few years of his hard earned retirement.

At some point during his short retirement I remember a conversation when he described how the pension funds of large businesses, in the early nineties, were massively in surplus. From what he told me the boom times of the eighties, various market crashes notwithstanding, had left many large company pension funds with huge sums of money that seemed to be far more than they required to fund the pensions of the members of the schemes. From what I understood the payments into the funds had been so wisely invested that the members would be very well provided for in their retirement.

Raids on pension funds

However, he then went on to explain that the companies that ran these schemes, on behalf of their employees, had persuaded the government to change the rules so that the companies were able to claw back substantial amounts of the pension surplus to be spent by the company. Weather that money went into investment in the company or was handed out to shareholders is something I don't know but I'm pretty sure my father had an opinion on the matter.

If company pension surpluses were raided in the early nineties then that is something that should be pointed out for we are now being told that pension schemes are all in massive deficit and that we should take a cut in our future pensions. It may be true that there is a demographic time bomb in pensions but we should probably know how it came about. If this is the case we have all been robbed by the government headed by John Major. (Remember him? No few people do.)

So I've looked on various web sites to try to find the truth of the matter but can I find anything about this? Can I fuck! Of course my father may have been wrong but I'd like to check his facts myself.

What does it cost our government to borrow money?

So today I read an interesting article by Paul Krugman about how the economic debate is dumbed down in the US. (No surprise there then.) He says '...the nation is not, in fact, “broke.” The federal government is having no trouble raising money, and the price of that money — the interest rate on federal borrowing — is very low by historical standards.'

So I wondered what the case is with UK borrowing and I dutifully went to the Office of National Statistics web site. I've searched and I've browsed and I've searched some more. I've searched on 'cost of borrowing', 'cost of national borrowing', 'historical interest rates' and many more terms. Of course I'm not an expert, I don't even have an economics degree. But I do have a vote and I have an opinion that I'd like to check instead of behaving like some jumped up fundamentalist who doesn't care if he is right, wrong or just an ignorant twat!

In a world where we are all connected, where we are tweeting and blogging, facbooking or just talking down the pub, we should be entitled to know the truth. I know, I can hear you all laughing as you read this but that shows what a crappy situation we are now in. The truth is out there but we should not have to be an expert in economics just to be able to ask the right questions.

I'm not asking for a total dumbing down of data for that would be ironic in the light of Krugman's article. However, an averagely intelligent and enquiring individual should have access to information to check what we are being told by those that have their own agendas.

A graph paints a thousand words

I don't know how we do this because economics is an arcane and difficult art. However, a first step might be for official statistical compilers to present data in a way that an averagely intelligent individual can find, without having to read a dozen esoteric reports that may not turn out to contain the piece of data required, anything less is obfuscation. Further, if the government is repeatedly telling us that the last government created the deficit through its economic mismanagement perhaps we should be able to find some data on this. That information needs to be presented in a way that it can easily be found, perhaps with multiple key words pre-empting the sort of questions people will search for. That means not presenting the visitor with bewildering numbers of links and multi page reports that the average Joe can't understand. A simple graph displaying the deficit or the national debt for the past few decades would suffice, perhaps sets of well presented and easily found data for the items currently in the news. I'm not an idiot, no really I'm not, but I'd like an idiots guide to the data rather than what we have now.

I'm brighter than a mushroom and I don't like the taste of bullshit. Basically I'd like to check my facts please. I'd like to have access to the truth.


  1. With the UK's brand of L v R party politics, sadly are wilfully misled and pissed about by governments of either hue, with further obfuscation from a print media that often veers much sharper to the right than genuinely represents the balance of the country's feeling as a whole.

    Add the figures together and divide by two, maybe? Split the difference?

    Or don't look on the internet. Find a serious printed periodical which chimes with your instinctive political inclinations. That way you are more likely to believe any statistical analysis it offers. Maybe it's not a matter of finding the truth, but instead discovering and accepting an explanation that offers (you) some hope for the future.

    Economics as religion?