Larry Elliott and Dan Atkinson have just published The Gods that Failed. This is what the publisher says about th book:

In Britain and the United States a very strange sect has seized power. They believe that we can all reach financial paradise, if only certain sacrifices are made. There must be deregulation, there must be privatization, and markets must be left unmolested, the better to perform their magic. Democratic governments, unions and professionals will all have to accept that there is no alternative. Meanwhile job security, affordable houses and decent public services must wither away in the white heat of financial engineering. A new class has been presiding over this wonderland – the New Olympians. Since the late forties they have been planning their next move in mountaintop meetings that would make Ian Fleming blanch. Now private jets take them where they want to go as they tell the world the good news. But, in the wake of the Northern Rock collapse and the credit crunch, good news is in short supply. In this hilarious and shocking expose Elliott and Atkinson reveal the dogma that has brought us to the brink of disaster, and show us how to escape from the coils of faith-based thinking. The New Olympians have already done huge damage on both sides of the Atlantic. Miners, farmers and industrial workers have so far suffered most. But as market forces bear down on health, education and the professions, the middle classes are starting to feel the squeeze. Markets are not magic. Debt is not freedom. The Gods have failed. It is time to live without them.

http://www.amazon.co.uk/Gods-That-Failed-M...0210&sr=1-1

Thank God I'm an atheist.

The 'market' is the most irrational place I know.

Sounds good.

Adam Smith, David Ricardo, Friedrich Hayek and Milton Friedman...Godheads.

And one mustn't forget Generalisimo Pinochet, for his role in turning Chile into a freemarket petrie dish, at the behest of those good ole Chicago boys.

As I have said on many occasions: I am a financial numpty.

This makes me feel a little less stupid (though only a little.. )

The market works just fine as long as the failing are allowed to fail. That sadly is not the case at this point in time.

Markets always fail. It is built in. And they are never permitted to operate freely. They are alway manipulated by someone. It is better that they are managed in the interest of the greater good than the benefit of a small clique.

Ah, so YOU and yours can manage it better. And what exactly is the "greater good"?

to determine the "greater good" as determined in rational democracy, its time for "the common mans LAWYER"

good benchmark for Iraq, too.... (below)

http://news.yahoo.com/s/csm/20080729/cm_csm/yborer

tell that to Mastercard, Visa, Diners & American Express

I actually agree with Craig here. the Market is doing EXACTLY what its supposed to do.

Then, Jan, we are in full agreement.

There is an interesting story on pages 20-21 of the book. Angelo Mozilo, the chief executive officer of Countrywide, America’s biggest mortgage lender, took home $120 million in 2006. Even so, he complained about the government “over-regulating the industry”. On 10th August 2007, Mozilo had changed his tune when he called for government help because demand for its home loans had evaporated. He argued that the monetary authorities should step in with unlimited quantities of financial assistance.

Exactly what does Mozilo's pay have to do with this John? Class envy?

Market is as market does.

This is far more to do with rampant hypocracy than Marxism. When the going is good for the majority of ordinary citizens, most couldn't give a fig how much our corporate elite pay each other. its their absolute refusal to share in the bad times that turns the stomach. Today, for example, British gas announced a staggering 35% rise in the price of retail gas to the customer, this is the second massive hike since January, and means that gas prices have risen by 50% in most cases, since last Christmas, all other retailers are expected to announce similar rises over the next week, At the very same time the company unvailed a 1 billion pound (nearly 2 billion dollars) half yearly profit.

Let me see if I get your point. A company exists to make a profit for its shareholders. The cost of the product they sell increases in price at the wholesale level and as such they increase the price at retail. They strive to maintain their profit. Whats the problem in this picture? None that I can see, but then again I 'm a businessman and I understand profit and loss.

Just let see if I'm understanding what your saying, its fine for a company to increase prices by over 50% to its ccustomers, customers who have little choise in using the product (gas) and then post profits of two billion dollars in a six month period? I suspect your answer will be yes, thats not just fine, but what they owe their shareholders, and to hell with the millions of Brits, many old and on a pension, who will be pushed into deciding whether to heat their homes this Winter, or eat.

Yes, its fine, thats what companies do. How may of those "old brits" are shareholders? What right do you or anyone else have to say they are not entitled to the profits from their investments? If the price of a product increases at wholesale, what right do you are anyone else have to tell someone that they can't raise their prices to cover the price increase and to keep thier profit margin?

I don't know how it works for you but here the utilities are regulated by the state. If they want a price increase it must be approved.

And f you don't like the price of gas, switch to electric.....or wood or geo thermal or solar or wind.....

Craig, we are so diametrically opposed on matters economic, and social that their is little point in debating, the fact that you put a few shareholders "rights" over the rights of millions to be able to heat their home and eat is, and I fully understand, you ideological belief. But really, switch to electric, its more expensive to heat your home using electric than gas...Wood, geo thermal, solar, wind, how the hell would someone on a limited wage, or pension be able to utilise these facilities, it would end up costing much more than Gas Or electric, but I suspect you know this, and its your way of saying "Let them eat cake" Have the final word if you like, arguing with you is bad for my blood pressure.

WOW! Now people have a "RIGHT" to heat thier homes? How silly of me. I thought they paid someone to produce, store and then deliver natural gas. Shame on me for thinking that profit on this process was evil and heartless. If you want wealth distrabution, fine, do it at everyones expense, not just those you THINK are making more profit than YOU deem proper. Even better, get together with a group of like minded people and pool your funds to give to those who you think deserve it....

Steve Craig does have a point here. Gas prices should be regulated but perhaps after decades of Tony Thatchers, Margret Blairs as PM's that was done away with.

If a private (or even public) company has a monopoly on an essential service they should not charge abusive prices, only the most extreme free market proponents would disagree with this. Steve never said the companies should not be allowed any profit only complained about abusive profit.

IMO if a company offers a nonessential service or product and doesn't have a monopoly (or colude with its competitors) it can charge what ever it wants.

What qualifies as abusive profit and who gets to decide? Like I said I can't speak for the Brits, but here if the gas company wants a price increase they must apply to the state for permission. On the other hand, I can purchase my natural gas from a number of suppliers and I can purchase it on a futures contrat and lock in my price. I can also choose not to purchase gas and use any number of other energy sources instead.

There is a lot of talk about excess or abusive profits. For the second quarter EXXON posted $11.68 billion in profits on sales of $138 billion or less that 9% profit. Is that excessive or abusive profit? It should also be noted that EXXON also paid $32.36 BILLION in taxes for the same period. In other words they paid almost 3 dollars in tax for every dollar in profits. Is that abusive or excessive TAXATION?

The most reasonable solution would be for a state agency to decide, factors would be the utility's profit margin, the hardship that increases would cause its customers.



And what would be the cost of converting? This might not be a viable option for many consumers.

One could also argue that they receive various indirect subsidies such as motorists only being charged a fraction of the cost of marinating roads and the rest of the infrastructure and services needed for driving and military protection in the Persian Gulf and other regions. I also wonder about Exxon’s accounting. Oil companies tend to buy from and sell to subsidiaries or companies they partially own.

You can argue until the cows come home but the fact remains they paid nearly 3 bucks in tax for every dollar of profit. I don't know about you, but that level of taxation on a personal basis would cause me to be quite upset. Yet there are those you maintain that 9% profit is considered a windfall or excessive or abusive. Would you feel the same if it was your business?

Thats the case where I live, but I as I stated I'm not sure what the situation is Stephen case.




The cost is really a non issue. You wanted to compare the gas utility to a monopoly. They are clearly not. Other energy sources are available and the consumer has a wide range of choices. That part of your arguement fails. Secondly there are alternative sources to purchase natural gas, at least here, which also defeats the argument that there is a monopoly.

This is nothing but class envy......

Can't let this one go....how does a road taste when properly marinated?

Chicken

Imagine the President called the heads of the oil companies in for a meeting and proposed halving the taxes they pay but told them in return they would be billed for "military protection in the Persian Gulf and other regions" and drivers would be taxed to pay the full "cost of MAINTAINING roads and the rest of the infrastructure and services needed for driving", do you think they'd accept?

$11.68 billion in profits per quater comes out to $156 per American/year and thats just one company. I also wonder if that isn't the result of funny accounting. I taught executives from Phillips Brasil*, the buy components from Phillips subsidiaries in other countries and other parts of Brazil. Obviously they count these purchases as cost but Phillips of course earned a profit on those sales. How does Phillips report this to the Dutch tax authority? Exxon likewise buys from and sells to subsidiaries which leaves plenty of room for fudging numbers.

* It's spelt with an "s" in Portuguese.

If users can't afford to convert or converting is not economiclly viable AND there is only one provider the gas company has an effective monopoly because the consumer has 2 options pay or suffer in the cold.



Perhaps one of the UK members of the forum can fill us in on the situation there.

The problem with all of this is that you can't just single out one industry. Everything is intertwined. Quite the strawman you tried to build there Len. Your problem is that you still can't overcome the simple fact that EXXON paid almost 3 dollars in tax for every dollar in profit.

Which brings us back to this point, is 9% profit excessive? DO YOU pay nearly 3 dollars in tax for every dollar of profit?

The cost of converting and the viability of the conversion is clearly NOT the responsibility of the gas company. it is the PERSONAL RESPONSIBILITY of the customer. Other options exist for the consumer. One cannot hold a monoply when other choice exists.

The Gas Company is responsible to its shareholders, not society at large.





That would be of interest.