30 December 2003


Child labour?

Old Grumpy has been taking a closer look at the County Council's £70,000 economic development website (www. choosepembrokeshire.org.uk)
I notice that, despite my pointing out the error of their ways (see Micky Mouse cowboy outfit), the website still informs potential inward investors that: "With 42,000 residents currently recorded as economically inactive there is a large potential labour force who can be tempted to join your organisation."
When I go deeper into the site I find, under "unemployment" that 73% of the working-age population is "economically active".
On the assumption that the other 27% must be the 42,000 who make up this "large potential labour force", would put the total population of working age at 155,000
But, as the population of the county is only 114,000, the assumption must be that these 42,000 potential recruits include my 9-month old grandson and the occupants of our residential homes.
Further evidence that this must be the case is found at another part of the site where the number of unemployed people in the county is recorded as 2,129.
According to choosepembrokeshire, another attraction for prospective employers is the relatively low rates of pay in Pembrokeshire with average wages, at 86.6% of the UK average.
This figure disguises an even greater discrepancy because it includes public sector pay at national rates.
With some 30% of the workforce in public employment, this means that it is the other 70% who must bear the burden of low pay.
This, I calculate, leaves those in the private sector on just 81.5% of the UK average.
The situation may be even more bleak than that because I remember some time ago councillors being told that, in order to increase spending power and boost the area's economy, it was the County Council's policy to pay its staff above the going rate. As I pointed out at the time, taking money off me in extra council tax and passing it on to a council employee in extra wages is a wash situation that has no effect on the aggregate spending power of Pembrokeshire residents.
Indeed, careful economic analysis suggests that hiking up the salaries of council officers might actually reduce spending power because, being bigger earners, on average, than the rest of us, they are more likely to pay higher rate income tax which is whisked straight out of the county and back to the Exchequer.
Oh, and I nearly forgot, the more we pay them the greater is the amount we pay into their pension fund.

Question time.

Back in the spring, His Leadership, Cllr Maurice Hughes, promised to hold an "open mic" seesion so that the good folks of Pembrokeshire could question him on his views about the issues of the day.
Old Grumpy was rather keen on this idea because despite sending him several emails about a press release he had issued in November 2002, I had not recieved a satisfactory reply (see Unanswered questions).
Perhaps, I though, if I can confront him face to face, he will be more forthcoming.
The summer came and went without any manifestation of Cllr Hughes' new spirit of openess but things perked up in mid-November when I read in the Mercury that His Leadership hadn't forgotten his springtime promise and that the long-awaited "open mic" session would be held before Christmas.
As it happens, just a few weeks earlier I had sent Cllr Hughes another email regarding a letter he had written to Cllr Michael Williams in which he accused me of making false allegations to the police about Cllr Brian Hall's expense claims (see Smear -leader).
Needless to say, I hadn't, and still haven't, received a reply.
An "open mic" session in the run up to Christmas seemed to offer the ideal opportunity to beard the Leader in his den.
Not unexpectedly, Christmas has come and gone and Cllr Hughes continues to keep his head below the parapet.
However, all is not lost because, during the holidays, I received a letter from solicitors acting for Dr Michael Ryan informing me that unless I retracted statements made on this website, and paid a substantial amount of money to cover Dr Ryan's legal expenses, within 14 days, they would be commencing proceedings against me in the High Court in Cardiff.
Who needs an "open mic" session when you can have the Leader (and other members of the county council nomenclatura) in the witness box, under oath?

Poverty trap

It is difficult to grasp the scale of the devastation caused by the earthquake that struck the Iranian city of Bam last week.
There is now talk of up to 50,000 dead - equivalent to the combined populations of Haverfordwest , Milford Haven, Pembroke Dock, Pembroke and Neyland - all wiped out within a few minutes.
A few days before the Bam disaster there had been an earthquake in California, almost identical in magnitude, which only claimed two lives.
The only rational explanation for this vast disparity in the number of casualties is the superiority of the design and construction of Californean buildings.
Already questions are being asked about the enforcement of building regulations in Iran.
That is fair enough, but the fact is that most of the buildings in Bam were built well before quake-proof technology was properly understood.
In any case, building houses to withstand earthquakes is an expensive business - well beyond the resources of a poor country like Iran.
When you have a choice between attending to the daily requirements for survival, and investing in protection against something that might never happen, like an earthquake, it is reasonable to concentrate your efforts on your more immediate needs.
In rich countries like the USA and UK, where we produce a surplus over and above our basic needs, we are able to postpone current consumption and invest in the future.
That possibility is not open to those who permanently live on the breadline.
Adam Smith proposed that the high road to weath creation lay in the accumulation of capital.
The accumulation of capital occurs when one generation refrains from consuming all it produces, leaving the unconsumed portion as a gift for future generations.
Of course, the accumulation of capital is impossible if you have consume all you produce merely to keep body and soul together.
I read in today's Daily Telegraph that the Office of National Statistics has come up with a value of 5 trillion for the UK, lock stock and barrel.
For those of you not used to handling large sums of money that is a five followed by 12 noughts.
Split equally this would give us £85,000 each.
Much of this is capital accumulated by previous genererations in the form of schools, hospitals, factories, houses, tranport infrastructure, public utilities etc etc.
Athough it might not seem like it when you go to buy a house at today's inflated prices, these assets come absolutely free.
That is because the cash you pay out for the house ends up in somebody else's pocket, so the transaction is a zero sum game in monetary terms.
The advantage of these inherited houses is that the economy as a whole doesn't have to expend scarce resources building them all over again.
Whatever resources are available can then be devoted to maintaining the existing stock and accumulating even more capital by building new.
This golden scenario explains why we are so well off.
And it is why, when natural disasters come along from time to time to destroy their accumulated capital, some societies remain forever poor.
Hopefully, when Bam comes to be rebuilt, the international community will contribute sufficient money to ensure that, the next time an earthquake strikes, not only will the terrible loss of life be avoided but that the survivors retain sufficient of their capital to carry on their lives relatively uninterrupted.

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