Tax! (2)

Let’s think about taxes in a different way. Let’s consider what happens to money in the real World. I put up a comment on Zen’s post about taxes that pointed out that just one major company in the UK contributed half as much, on it’s own, to scientific research as the Government did in it’s entirety. But there’s more. Private enterprise at all levels does one thing successfully, (or goes out of business,) it takes money and adds value to it. It provides things to the community, money, yes buckets of of it, and lots of them, to the families of the people who help them make it all happen (known as employees); and as if that’s not enough, they pay more than a third of all they get after that to the people of the nation (its called tax). The things the enterprise provides also generate more added value as they are moved and traded, providing benefits to the peopl who do the movin’ and tradin.’ More than that they increase the social stock of the country by developing people, educating them and training them – or, more correctly, providing the opportunities for education, training and development.

And Government? More, unfortunately, often than not, Governments subtract value from the money they take in. large parts of it are diverted into unproductive – even counter-productive – activity: subsidies for the political poster-boy of the moment, windmills, sending the Armed Forces to bomb people in Serbia or Libya, (why not Yemen, or Syria?) or transferring money from poor people in one country to rich people in other countries, (the CAP, or much of the money paid out in foreign ‘aid.’ More is wasted on the employment of hundreds of thousands of people in non-essential and non-productive non-jobs, (just read the appointments section of the Grauniad,) and, of course, paying all those non-productive bureaucrats inflated wages justified only by vague, verbose and in many cases, laughable, role profiles, (check the appointments section of the Grauniad again, or consider ‘bin inspectors,’ ‘smoking wardens,’ ‘climate change managers…) and all of this money is subtracted from the pool of common goods.

So what happens. Worst case. Shareholders realize that they need to move to nations with lower tax rates (almost anywhere outside the EU), and the last few consumers of UK goods switch to buying Chinese things from factories powered by cheap labour and low taxes*. Meanwhile foreign investors flee to places where there is not so much sovereign risk, like Chad, Guam, and Venezuela, and the UK sharemarket slowly deflates. Formerly successful companies employ fewer people, those sacked — poor sods – spend less, and even their friends with jobs spend less, because they know they could be next for the chop. Next, all the items those now-unemployed-consumers could have bought, stay on the shelves, to be discounted for a sale-with-no-end, and then to top it off, some more companies go bankrupt. Where are our next generation of nuclear power stations going to come from? Hint, anywhere but the UK.) How much more of our productive industry is going to migrate to China – and where will the taxes confiscated funds to keep the flabby buttocks of the bureaucrats in their £1,000 office chairs come from then? (Hint, think USSR, or EUSSR.)

The prosecution rests.

*I believe in a high income, low tax economy, but, having spent all those years in Hong Kong, I would, wouldn’t I?

38 thoughts on “Tax! (2)”

  1. Industry is not moving quite that quickly to China anymore, Indonesia, Vietnam, India, and Bangladesh have been getting a greater share as it is cheaper. Indonesia is competently run economically and the others are just teeming with cheap labour and governments eager to bring jobs into their countries. Eventually I think that things will get better in the UK, simply because they can’t only get worse forever. It’s also fairly bad in the USA, the only reason why there is any industry left is because some states are better at running their economies than others.

  2. Christopher – the point is valid, though – Africa next? And who says they can’t only get worse – take away cheap and abundant energy by littering the landscape with chidrens’ toys while the Chines and those others you mention put their money into actual energy production plants…

  3. Bravo: quite right. China is working on developing thorium energy — cheap, safe, and extremely efficient. It won’t be long before India, Japan, Taiwan, Indonesia, usw follow suit. Even France has bowed to the inevitable and has started research into it. Windmills are simply wastes of money and blights on landscapes.
    I’ve noted that there have been some products made in Kenya for sale in stores. It seems that as soon as Kenya started working on its infrastructure — technologically and financially — it has been able to make some progress.

  4. christophertrier :

    I’ve noted that there have been some products made in Kenya for sale in stores. It seems that as soon as Kenya started working on its infrastructure — technologically and financially — it has been able to make some progress.

    There’s a surprise – while our politicians plan to run our infrastructure down.

    I’ve always enjoyed Kenco coffee.

  5. Trust me, Africa poses no threat whatsoever with regards to manufacturing. Agriculture, mining, tourism, alternative energy, entertainment are all areas at which Africa (Sub-Saharan Africa) can excel. But it will never seriously compete with other nations as far as manufacturing goes.

  6. May I ask what’s wrong with windmills? They seem like a good idea to me, but I know I don’t know much about the pros and cons.

    As for taxes, we’re doomed either way. Westerners are psychologically fat and lazy, we’ve had our day and have no motivation to conquer the world any more.

  7. cuprum426 :

    May I ask what’s wrong with windmills? They seem like a good idea to me, but I know I don’t know much about the pros and cons.

    They don’t work.

    Average output from wind was 27.18% of metered capacity in 2009, 21.14% in 2010, and 24.08% between November 2008 and December 2010 inclusive.
    There were 124 separate occasions from November 2008 till December 2010 when total generation from the windfarms metered by National Grid was less than 20MW. (Average capacity over the period was in excess of 1600MW).
    The average frequency and duration of a low wind event of 20MW or less between November 2008 and December 2010 was once every 6.38 days for a period of 4.93 hours.
    At each of the four highest peak demands of 2010 wind output was low being respectively 4.72%, 5.51%, 2.59% and 2.51% of capacity at peak demand.

    http://www.jmt.org/news.asp?s=2&nid=JMT-N10561

    Betz’ Law

    The square cubed law.

  8. And they’re bl**dy ugly!

    I get annoyed when I see a line of electricity pylons blotting our landscape (particularly in National Parks.)

    I’ve often wondered about the cost of sticking the ugly things underground vs up in the air!

  9. It’s outrageously expensive, Soutie, but it may be a better thing to spend taxpayers’ money on than useless windmills.

    Installation costs for underground transmission lines can cost up to 10 times as much as an equivalent overhead line.

    Discussion here: http://www.atcllc.com/IT5.shtml

  10. Thanks for the prompt reply! I must be missing something though – aren’t they at least vaguely useful for that small amount of time that they’re generating? We have a few around here – I don’t mind them visually and they seem to be rotating everytime I go past.

    Please, don’t mistake me as a greenist, I’m not, but when I saw all the Nimby signs saying no to windmills my natural instinct is to think they must be a good idea!

    And it seems all the ones round here are private companies with no subsidies from government, allegedly.

  11. Do not let the people get to happy, keep them worried and skint, that way the government can keep you where they want you, under control.

  12. Soutie :

    And they’re bl**dy ugly!

    I get annoyed when I see a line of electricity pylons blotting our landscape (particularly in National Parks.)

    I’ve often wondered about the cost of sticking the ugly things underground vs up in the air!

    And they kill dicky birds and interfere with ATC radar. Also, they never work when you need them most, i.e. cold still days.

  13. Cuprum,

    1. Are you prepared to trust your supply of power to ‘vaguely’ or would you prefer to have the light come on when you flick the switch?

    2. Just because the blades are turning doesn’t mean they are generating anything – did you know that, if there is not enough wind to turn the blades they draw power from the grid to keep the power train from seizing up, (or something like that, I’m sure one of our engineers will correct me.)

    3. All alternate useless power generation systems receive wodges of taxpayers cash generated from Renewables Obligation Certificates – £3 bn a year by 2020 – FT article here:

    http://www.ft.com/cms/s/0/7addffb4-d2a1-11dc-8636-0000779fd2ac.html#axzz1JaWGVPp3

    Wind farm operators raking in the green from taxpayers while providing sod-all in exchange, which, on topic, is part of my point. Cyrrent Rate £36.99 per Renewables Obligation Certificate (ROC). (1 mw.)

    Not just us…

    Danish electricity bills have been almost as dramatically affected as the Danish landscape. Thanks in part to the windfarm subsidies, Danes pay some of Europe’s highest energy tariffs – on average, more than twice those in Britain. Under public pressure, Denmark’s ruling Left Party is curbing the handouts to the wind industry.

    http://www.telegraph.co.uk/news/worldnews/europe/denmark/7996606/An-ill-wind-blows-for-Denmarks-green-energy-revolution.html

    And then there’s the rip-offs. Apart from solar power operators in Spain generating power 24 hours a day (!) you have stuff like – an example at random – http://www.wind-watch.org/documents/two-oil-companies-use-wind-farm-tax-breaks-to-shelter-profits-from-income-tax/

    And…or, in conjunction with #8, is that enough to be going on with?

  14. The alternative energy sources that actually work have never been encouraged because they work small scale and cannot be controlled by big companies making profit. I know several people in Wales that keep their homes completely powered by small scale pelton wheels in streams with big accumulator cells and using geothermal energy for underfloor heating.
    Being simple engineering there is only a profit installing the systems, there are virtually no running repairs and costs and the recipients no longer need the grid, so no longer add to corporate profits.
    Wind turbines are big high cost, government subsidised scams.
    How they hate you having your own wells too! Can’t charge for water! They tried but were defeated by the courts. In Wales they have even tried to take children away becasue they were on well water, supposedly this constituted abuse. If you have an infant in the house you have to produce certificates of purity for your water supply. They also tried this on me when the boy was dying believe it or not! Needless to say I fucked them off good and proper!
    (You cannot have a dairy herd in the UK without using mains water in your milking parlour either)

    This may not be totally germane to the blog but illustrates how they will gouge you for any and every thing they can. They hate you not paying out continually to the big corporations and the government. Slip through the net and they will try every which way to have you on something!
    Never, never give access to your property to anyone who looks vaguely official! Refuse point blank to admit them.

    Long live the revolution!

  15. oldmovieguy :

    Do not let the people get to happy, keep them worried and skint, that way the government can keep you where they want you, under control.

    There you have it in a nutshell OMG – ensure that for every step forward anyone might make they have to take two steps back.

  16. CO. Precisely, I have never said a word against wind and solar as small scale, point applications – my water in Cyprus is heated for most of the year, including most of the ‘winter – by a solar water heater.

    By ‘geothermal,’ do you mean a heat pump?

    Boa, spot on – how’s your lying PM coming on with her plan to carbon-tax Australian industry into total uncompetitiveness?

  17. I’ve given up watching the circus, Bravo. She’ll get it through courtesy of a few independents and Bob Brown the Green. One b***y Green is running the show. The price for Julia being PM will be paid by the rest of us. Still, that’s OK – the Left love to keep everyone poor.

    Of course, all those at the ‘bottom’ will be compensated by tax cuts and increased welfare payments – so we’ll have another merry-go-round of tax-payers’ money being taken from one lot to give to another, and that, needless to say, will require even more public servants.

  18. Bravo, yes.
    And pipes laid either horizontally over quite a large area or the vertical loop system that is very effective, does not need the garden dug up but is more expensive to install.
    I checked that out here about $20,000 but didn’t think we would live here long enough to get our money back!
    Our electricity is cheap here, all hydro in the mountains. The bill is only $90 a month or so, less than the cable and internet!

  19. Ta Bravo, I see what you mean. Seems mad to me that it’s all so complex and corrupt. Never mind, that’s normal I guess.

    What about wave thingybobs and solar panels? Is is a old wives tale that the cost of the technology means you need a solar panel for decades before it pays for itself?

    I am a nuclear fan myself since being shown round a plant as a kid in North Wales, but you have to be careful who you say that to it seems. Almost as bad as being anti-royal!

  20. Cuprum, I hear what you say 🙂

    The trouble with wave-generated power, as far as I can see because it has drifted out of the picture a bit, is sea-water and its effects on the machinery – I’m sure or sailors can tell you more about that than me. Solar panels only work where the sun shines. I can’t give you exact numbers of the top of my head, but pay-back time, in the UK at least, is something like 18-20 years, except that they wear out before that time.

    Despite my opposition to alternate useless-as-far-as-large-scale-is-concerned technology in large scale power generation, I am a fan of wind and solar power for point applications – where the wind blows consistently and the sun shines, of course, like my house in Cyprus.

    You can build a basic wind generator yourself for a couple of hundred quid using scavenged materials, but the wind doesn’t blow much around my place in Cyprus. 🙂

    There is only one way, using current technology, to make solar power worthwhile – put the collectors in orbit and beam the energy back to earth.

  21. Beam the energy back to earth

    You have to be joking!
    Calculate the losses and the danger to aircraft, then think again – unless, of course, you’ve rediscovered Tesla’s secret. 🙂

  22. Calculations all been done, Bearsy, power is transmitted in the microwavewave band. Here’s a group that seem to be going ahead with it. Think I’ll buy some shares.

  23. B and B It’s a close run thing as the Iron Duke might say.

    Back of the envelope calculations.

    Solar energy density at Troposphere about 1400 w/m2 (about two times that at equator, but available 100% of time vs 50% best at equator)

    Efficiency of best Microwave generator 65%

    Transmission efficiency 95% best

    Efficiency of best Rectenna (Google it?) 80% (could be improved)

    Net from troposphere 700w/m2

    Net from equator 350w/m2

    Same solar cells in both places so net energy is 50% cost of terrestrial, infrastructure expensive, energy cost still about 3 times nuclear costs.

    Link follows

    http://www.kentlaw.edu/…/PowerPoints/Wireless%20Power%20Transmission%20-%20Soubel.ppt

    Low energy density in transmission beam (several square km) would not be harmful.

  24. Bearsy: Tesla gets a mention in the link. The story still circulates that some “Government Officials” removed all of his research papers from his New York apartment when he died, never to be seen again.

  25. LW. One indicator. This is a private enterprise – no subsidies, so I would hazard a guess that they’re all scribbling furiously on the backs of their fag packets…

  26. Now come on guys, you’re talking to a retired systems engineer. Can I sell you the Sydney Harbour bridge while you’re here?

    Get real. Put a few practicalities into the equation.

    • The effect of weather on the transmission path
    • The reliability of “solar cells” in high cosmic ray environments (wrong side of the atmosphere)
    • The weight of the equipment to be put in orbit
    • The cost of maintenance
    • The size of the receiving ‘rectanna’

    to mention just a few – I’m sure you can think of more if you try.

    And don’t forget the contribution to global warming from all that energy lost from the inefficiencies of the system – it has to go somewhere, chaps. 😆

  27. Oh, here we go, the old “I’m sure the engineers on the team know more about it than some old retired fart in Brisbane …” argument.

    Bollocks!

    How about ‘cold fusion”? How about ‘carbon sequestration’? Put your thinking head on, Bravo mate.

    All this project is doing is converting the frequency of the radiation that reaches the ground from infrared (from the sun, free, gratis and for nothing) to either microwave (think about how weather radars work) or ‘laser’ (alternative frequencies close to the original). All the problems associated with “normal” solar power generation are still present, you’ve merely added an extra link into the path with additional inefficiencies at enormous cost with a high potential failure rate.

    Do I know more than the engineers employed on the project? Yes, and so do you. 😀

  28. No, mate, I din’t say that at all, nor did I mean it. I would not argue with you about engineering matters at all. My point is that this is a private enterprise, which means that someone is putting money behind it and I am sure that there are some pretty hard-nosed calculoations going on…

    I first read about this as a young man in this book: http://www.amazon.co.uk/High-Frontier-Human-Colonies-Space/dp/189652267X/ref=sr_1_1?s=books&ie=UTF8&qid=1302987707&sr=1-1

    Caught my imagination then and never really left it.

  29. Bearsy: Many years ago to my great shame I worked for Shell Oil, in their terrestrial photovoltaic operations, after much learned and expensive study we determined that if the solar cells were provided free of charge the rest of the system costs would make the energy produced uneconomic as against other more conventional sources. I still stand by that finding. 🙂

  30. Thanks, LW.

    There are so many other factors to be taken into account. The dc produced by the receiving array needs to be changed into ac for transmission and distribution (oh, yes it does, Bravo), and at the power levels we’re talking about that means big clunky motor-generators.

    How much simpler to have a terrestrial solar/steam system. Much, much, much cheaper, no iffy installation in geosynchronous orbit, no increase in global communication white noise, overall system efficiencies at least as good if not better. K.I.S.S.!! 😆

  31. Just in case anyone’s missing the point (or one of the many) – the opponents of terrestrial solar generation talk about cloud cover, “which isn’t a problem in space”. But the silly nanas forget that the microwave transmission of power is still buggered by clouds. Come on, lets have some absorption against frequency graphs! It’s all em radiation. 😎

  32. On tax again. Jerry Pournelle made this comment on his blog.

    Control of the purse is the fundamental curb on monarchy, and is the oldest of the rights of Englishmen.

    He is writing about the US, but it is an equally apt point as far as the UK is concerned. Now that the Parliament is, to all effects and purposes, the monarchy, who can control the public purse?

    Worth reading, there are some interesting discussions.

    http://www.jerrypournelle.com/view/2011/Q2/view671.html

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