Whilst we doff our caps at the coalition, dominated by the banker funded Tories and it's cabinet of 19 millionaires, it seems the Greeks have woken up to the economic suicidal nature of 'plan A'. A senior economist expalined that they had taken the IMF and European Bank medicine and it had poisoned them - demand had collapsed and the economy was heading into the inevitable downward spiral of even lower revenues and a widening deficit. Taking more of the same medicine wasn't really an option in such circumstances. Yet that is exactly what is proposed as the only solution.
The Greek awareness of the real culprits of their plight contrasts very favourably with the collective brain erasure in England. Here the bankers and financiers escape blame for their mess, and with their media friends, convince enough useful idiots that it was a sudden reckless spending spree by Labour that led to a deficit. Nothing to do with bailing out banks and rescuing financiers from the results of their greedy folly.
The paradoxes are compounded by politicians with their generous benefits and pensions packages lecturing us on the need to cut those of ordinary people whilst theirs continue in unreformed splendour. Not to mention the public school educated elite who can't see the irony in saddling students with a lifetime of debt, blighting their chances of ever having a pension or owning their own house; supposedly in the name of not saddling our children with the 'debt burden'!!
A splendid comment to a Guardian report summarises both the absurdity of the Greek situation, and it's relevance to ours (http://www.guardian.co.uk/discussion/comment-permalink/11269655). It is repeated below in full:
"The Greek politicians don't represent the will of the Greek people. They represent an elite group of the Greek rich who have benefited from Greek tax evasion and the Euro.
The majority of the Greek people should not suffer for the greed of the few. And neither should they suffer for the greed of the bankers.
The bailout of Greece is not a bail out of the Greek state, it is a bailout of the reckless lending made by other European banks or the deceptive deals made to hide Greek public debt made by Goldman Sachs and other US banks.
The bankers took their bonuses and are now afraid to face the consequences of their risky decisions but happy to make the young people, the poor people and unemployed pay the price.
Sadly the situation in Greece is no different from the situation in the UK.
The Tory's dont represent the will of the people of the UK. They represent a narrow group of bankers who want to make the rest of the British population pay for their greed."
Wednesday, June 22, 2011
Wednesday, June 15, 2011
The Student Loan nightmare
Convincing you to go to University despite the massive cost: Apparently it's a 'no-brainer' despite the cost because over your lifetime you'll earn on average 150k more because of your degree.
Convincing you not to worry about the fees: Don't worry, you have to earn over 21k before you start paying and the loan is written off after 30 years - so many won't pay anything, or won't have to pay it all back...
So which is it? We shouldn't worry because we'll earn a lot more over our lifetime and it will be worthwhile, or we shouldn't worry because we'll probably never earn enough to have to pay it back!!!!
Some simple Maths: from Day 1 your loan attracts interest of RPI + 3%' so 7.5% at present. That is compounded up during your studies as you add more debt, and the interest incurs further interest. In rough terms an average 3 year degree will have created a debt of around 50k, interest on that will amount to a further 3.75k added to the debt at the end of your first year after leaving. Earn (for the sake of argument) 50k as a result of your degree and you will pay back 9% of 29k over the year - around 2.7k, Your effective marginal tax rate is nearly 50% on income over 35k(a rate you'd otherwise need to earn over £150k before paying) - and your loan debt has still grown, so you end up the year owing more than at the start!
All in all it is a financial car crash, reminiscent of something dreamt up by the geniuses that brought us endowment mortgages. Once again it looks like a vehicle for the money men to cream off from the rest of us - parents and students - and exactly the sort of nonsense Government should protect us from instead of inflicting upon us.
Convincing you not to worry about the fees: Don't worry, you have to earn over 21k before you start paying and the loan is written off after 30 years - so many won't pay anything, or won't have to pay it all back...
So which is it? We shouldn't worry because we'll earn a lot more over our lifetime and it will be worthwhile, or we shouldn't worry because we'll probably never earn enough to have to pay it back!!!!
Some simple Maths: from Day 1 your loan attracts interest of RPI + 3%' so 7.5% at present. That is compounded up during your studies as you add more debt, and the interest incurs further interest. In rough terms an average 3 year degree will have created a debt of around 50k, interest on that will amount to a further 3.75k added to the debt at the end of your first year after leaving. Earn (for the sake of argument) 50k as a result of your degree and you will pay back 9% of 29k over the year - around 2.7k, Your effective marginal tax rate is nearly 50% on income over 35k(a rate you'd otherwise need to earn over £150k before paying) - and your loan debt has still grown, so you end up the year owing more than at the start!
All in all it is a financial car crash, reminiscent of something dreamt up by the geniuses that brought us endowment mortgages. Once again it looks like a vehicle for the money men to cream off from the rest of us - parents and students - and exactly the sort of nonsense Government should protect us from instead of inflicting upon us.
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