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Jonathan Sugarman versus UniCredit – an update

WhistleblowerIRL, AKA Jonathan Sugarman continues to fight UniCredit. One rather impecunious man fighting a trillion euro bank. But Jonathan is nothing if not …well I leave you to fill in the blank.

The update comes via a very good 12th Nov. editorial in Village Magazine in Ireland, “Blowing the whistle so hard it hurts”.

In December 2010 a risk-manager in the Irish unit of UniCredit, Italy’s largest bank, described in Village how in 2007 the Financial Regulator failed to intervene after he first alleged he falsified liquidity-ratio  figures. The risk-manager maintained he was specifically warned by senior personnel at the Irish subsidiary not to report the matter to the Financial Regulator

Jonathan Sugarman blew the whistle on the massive repeated breaches. This magazine received aggressive threats from McCann FitzGerald solicitors on behalf of UniCredit not to publish the information.

To the credit of its publisher and owner, Michael Smith, the magazine has stood by the story and refused to be cowed.  I recommend reading the whole story. You can follow any further developments at Jonathan’s blog.

One thing to keep in mind when you read the story. The Irish financial regulator, Matthew Elderfield, was recruited, fresh from his earlier success at being one of the three Heads of Department at the British regulator, the FSA who were overseeing…Northern Rock. Mr Elderfield, along with his two fellow Heads of Department, was specifically criticised in the official report into Northern Rock. His supporters, namely the people in Ireland who hired him, will say he was only in that job three months when Northern Rock imploded. What, and that makes his silence all right?! So if an aircraft inspector had only been at his job for three months it would be fine for him to say nothing about an unsafe aircraft? That would be OK would it?

That would be a double standard if one could call it any sort of standard at all.

So I have my doubts about Mr Elderfield. Which are made worse when you consider some of the people above him and the world view they seem to have.  You see there is an old guard In Ireland – as there is in most countries, mine definitely included – that has not moved on and has zero intention of ever moving on. Here for example you can watch Mr Bertie Ahern back in 2007 saying how he can’t understand why people who talk down the wonders of Ireland’s no-touch economy don’t just kill themselves.  Mr Ahern was never Elderfield’s boss. I mention Ahern simply as an example of a world-view which is still there, defended by people still in positions of power.

One such old guard is Mr Elderfield’s boss, Dr Brian Hillery.  Dr Hillery was appointed to be a Director of the Central Bank of Ireland which incorporates the Financial Regulators Office of Ireland, in May 2008. Before his appointment to be guardian of financial probity in Dublin, he was the Chairman of …UniCredit Bank Ireland at the precise time Mr Sugarman was there trying to report those financial ‘problems’ to the financial regulator (who at the time was Mr Elderfields disgeraced predecessor, Mr Patrick Neary). So definitely no conflict of interests there. Obviously.

I feel absolutely sure that Dr Hillery would be very comfortable with, and would fully support, a rigorous investigation of UniCredits’ behaviour and its attention to the law, and that the pressure brought to bear upon Village magazine when it chose to write about Unicredit and its breaches of liquidity are purely coincidental. I feel equally sure Mr Elderfield would feel fully supported in any investigation he undertook , which combined with his own proven track record of razor sharp and iron fisted regulatory zeal must make the Irish people feel warm all over. In good hands – as the priest/radio one DJ said to the boy.

Oh and it might be worth keeping in mind that  Dr Hillery was also Chairman of Independent Newspapers in Ireland. Whose papers have not covered this story with any great … regularity shall we say.


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26 Responses to Jonathan Sugarman versus UniCredit – an update

  1. The Dork of Cork. November 16, 2012 at 7:21 pm #

    I find it difficult to listen to Ahern.
    However my most fond memory of him was when listening to RTE Radio 1 on a LW radio in some Scottish bothy back in a very cold March 2008.

    When he backstabbed his secretary I knew he was politically dead.
    It gave me a warm glow inside that lasted for days.



    But in truth people need to understand their taxes don’t pay for services – the banking cartel (especially the “pillar banks” in each country) has had control of goverment fiat for hundreds of years.

    Whats important to them is not the value or productivity of their assets be it mortgages or fiscal debt but as Riche B. has said its all about the “cash flow” as they are ” not a pawnbroking business”
    This goes to the very heart of the problem – obviously the media will not discuss the implications of what Riche had said as this will destroy the very foundations of the modern republican myth.

    The bank assets were non – productive consumption sink holes because the assets serve as a mere conduit , they hold no real value to the banks – therefore whats the point in making the right investment when all these investments serve a different purpose from what is generally believed ?
    What has value is the legal right to farm the fiat – sometimes through the very indirect mechanism of mortgage provision.
    Hence you get a malinvestment crisis so big this time that they cannot create a fiction to hide the real truth.

  2. The Dork of Cork. November 16, 2012 at 8:01 pm #

    This is what happens when a goverment cannot print money tokens.
    Modern Irish energy policy 2012……..


    It best to print greenbacks that the banking system cannot farm , but now the domestic system cannot even devalue against other banking fiefdoms.

    These policies are to fulfill massive capital export out of the country to other banking fiefdoms such as their current Golden children in Germany and Poland.
    They do this as these countries can run down their capital base more efficiently but no new net capital is created as this would harm profits.
    The banks are in fact sweating out the debt value of all assets even if it means dark age entropy.

    The late great Tommie Weir said it best but in my words they are destroying productivity for the many so as to increase the efficiency for the few.
    Cattle transhumance was a labour intensive but productive business.

    They cleared the land for sheep which destroyed the productivity of the place but increased the efficiency via the destruction of labour inputs.


    Looks like history is repeating – maximization of profit for the few…….the Hanoverian few

  3. C. Flower November 17, 2012 at 11:51 am #

    Great post, and also choice comments from the Dork from Cork. Jonathan Sugarman thought his job was risk management, when in reality it seems his employers wanted him to be rubber stamping illegal breaches of liquidity. Bank bosses knew their banks had gone over a cliff and the whole strategy was to buy time to consolidate their personal wealth and pass debt over to the public. The role of insiders like Hillery in this is essential – in part in that they give an aura of probity, respectability, and officialdom (Hillery being the son of a past President of Ireland) to a rogue operation – and also in that they tie “officialdom” and the political class into a backstream of financial benefits. Hillery is discussed further here –


    • Golem XIV November 17, 2012 at 11:58 am #

      Thank you for the link. I did’n’t know he had also been on the board of Pioneer Investments. THAT is rather interesting. Thank you.

  4. FallingLeaf November 19, 2012 at 4:06 pm #

    Sorry to do this, but I have no idea how else to get in touch (David, maybe think of a forum or some such? Might be very interesting)

    Hawkeye/Phil & those going to Occupy tonight (with Rowan, hopefully): I’ve got the stomach bug and feeling particularly unwell today so won’t make it unless I’m drastically better. If I don’t please let us know how it goes and please do get in touch with me on sly_burner@hotmail.com so we can discuss it further and see if we can co-ordinate heading to the Occupy Economics Working Group more regularly


    • Hawkeye November 19, 2012 at 4:23 pm #

      Hi FallingLeaf

      Hope you feel better soon. Thanks for contact details. Will let you know how it goes tonight. I might be a bit delayed myself as still stuck at work.

      – Hawkeye

      • Jamie_Griff November 19, 2012 at 5:54 pm #

        Likewise – should get there for about 5.30pm…

  5. John Souter November 19, 2012 at 9:24 pm #

    An Extract of Optimism.

    Ultimate Happiness, True Democracy And That Fishy Omega-3
    16.11.2012 Words by Marc Vincenz

    The world continues to be impressed—nay, amazed—at Iceland’s return to some kind of semblance of normality. Employment is up, GDP is up, and according to TravelDailyNews.com, “For January—September, total tourism figures are up 17.2% since last year.”

    Tourism is, in fact, so damn good that Icelandic MP Þór Saari told the Icelandic radio show Reykjavík Síðdegis that he felt Iceland could not physically handle this many visitors. He said he was concerned about potential damage to the country’s pristine nature spots. In the next few years, Iceland is expected to receive over a million tourists in one season—more than three times the country’s entire population.

    Perhaps someone should consider replacing Bónus’ plastic bags with paper ones.

    Recently, it seems, Icelanders have had even more to write home about. For the fourth year in a row, Iceland has been listed in the Word Economic Forum’s Global Gender Gap Report as the nation with the highest level of gender equality in the world. And, as Robert Lavine pointed out in The Atlantic Monthly this month, “Icelanders are among the happiest people in the world—despite their 2008 financial crisis, volcanic eruptions, and the predominant winter darkness.” Apparently, based on his findings, Lavine seems to equate this incredible happiness to Icelanders’ high intake of omega-3-rich fish and fish oil.

    Why then aren’t we all jumping with wild, unconstrained, fishy glee? Why worry about pension funds, the cost of imported goods, about not being able to go on holiday in Spain, when we live in the happiest, most egalitarian, possibly most democratic nation in the world.

    Talking about democracy and praising Iceland’s recent referendum on the world’s first “crowd-sourced” constitution, Dave Maki at Opensource.com, says, Iceland “has taken a bold and very public approach. Understanding that the problems of the present are the results from the past, they are rewriting their constitution by crowd-sourcing ideas and suggestions via the internet.” Equating this open-door initiative with the constitutional aspirations of America’s founding fathers, he proposes wildly that should Benjamin Franklin be alive today, “perhaps there would be a deeper emphasis on government checks and balances or perhaps a sharper focus on social reforms.”

    I’m still smiling, but is there a potential glitch in the offing?

    Writing in ‘The Moral Liberal,’ author Max Borders is not as convinced that what he calls “hive democracy” is the solution to open government. Yes, he says, “We can sense an evolution happening, but the real pro-social changes are still missing. Digitally decentralising the means of centralising authority is not likely to help countries avert large-scale catastrophes, much less avoid illiberal policies.”

    David Meyer at gigaom.com concurs that this form of “crowd-sourced” legislation will never work on a larger scale (certainly not in the multicultural/multilingual EU): “And what happens when you have a mass-participatory system like this that few people are really paying attention to? You get a golden opportunity for lobbyists to game the system.”

    A word for the wise, perhaps?

    Besides, as the International Herald Tribune duly notes, “the [referendum] vote is not binding on Iceland’s Parliament, the Alþingi.” Oh well, if things go awry, I suppose we can always get our newly-re-elected president to step in again to uphold our bliss and right to free speech.

    And since the economy and the happiness and the general level of female to male satisfaction are supposedly soaring, should we not assume we’re on the right track?

    As I’ve mentioned in the last months, the international media and the Icelandic government in power seem to think so. Blogging for The Daily Telegraph, Ambrose Evans-Pritchard congratulates Iceland on its economic miracle. “Iceland’s economy is erupting once more,” he puffs.

    Yet Iceland’s new Minister of Finance and Economic Affairs Katrín Júlíusdóttir is not quite as optimistic. Iceland’s main problem—the same problem that has created this current boom in tourism—is its currency crisis. Katrín is as firmly convinced, as the great majority of Icelanders are not, that the only way to bring Iceland out of its currency isolation is to join the EU and adopt the euro. “Our currency is extremely volatile and sensitive towards external factors,” she tells Bloomberg.

    Then surely what Paul Krauth writes in Money Morning should have us carefully considering our happiness coefficient. Globally speaking (and let’s be honest, without the fall of Lehmann Bothers and Bear Sterns, the Icelandic banks’ 2008 loans would most probably not have been recalled), he says, “there’s still plenty to worry about—especially in the sordid world of finance.” Paul’s glum prophecies go on: “In fact, the world’s third biggest money manager said 71% of investors worldwide are afraid the next Lehman could strike within the next twelve months.”

    Icelanders, on the other hand, can all keep smiling. He says: “When the next financial shock comes, chances are good that they’ll [Icelanders] hold up better than most.”

    Stay happy then and for heaven’s sake, stay egalitarian. Oh, and don’t forget to take your omega-3-fish-oil pills!

  6. Frank Street November 19, 2012 at 9:54 pm #

    I greatly admire Jonathan Sugarman but wonder how he feels about the news today of the derisory fine levied on Ulster Bank for their financial breaches:


    There never seems to be a fine for bankers that matches the profits they made in the boom or are capable of making. Nor does anyone lose their job or face personal penalties. They are as unaccountable as politicians and civil servants.

    Should Jonathan Sugarman’s whistleblowing ever lead to an investigation, I predict that the outcome will, sadly, be a grave disappointment to him.

    — and while I’m on, any chance of fixing the RSS feed? Thanks.

  7. The Dork of Cork. November 20, 2012 at 9:19 pm #

    Interesting Graphs in this energy report although it has that special euro trash blandness about it all.

    It completely misses the point of course – with a obscene emphasis on efficiency over redundancy but if you equate efficiency with banking leverage and profits this makes perfect sense.

    The euro experiment can be seen as a series of onions with successive wage / money / energy deflations starting from the core pushing out to the PIigs and their credit / energy inflations and to the Brics now obscene overcapacity.

    This started a very long time ago with for example our domestic banks using core fiscal / agri money flows to increase their leverage / credit malinvestment base with a huge waste of capital during a major agri / car boom in the Ireland of the 70s which went bust in the early 80s.

    The article of course fails to understand that only national sov goverments printing money for local trade use can we relocalize rational domestic demand & investment and prevent this mindless capital export / destruction from one former nation to another.

    In this CSO graph you can clearly see the effects of the Suez crisis in 1957 and the capital destruction (capital going up into fumes as the banking system increases the credit money supply and destroys capital.
    New private Cars reg
    Y1971 : 51,803
    Y1978 :105,582 (peak)
    Y1987 : 54 ,341


  8. The Dork of Cork. November 20, 2012 at 9:20 pm #

    “series of onion rings”

  9. John Souter November 21, 2012 at 7:09 pm #

    An excerpt unproofed.


    Independence And The Westminster Paradigm

    (Excerpt from The People Business)

    “The role of Nature accepted, we then have to ask; whether in the affairs of humanity, any concept, system, practice or ideology which fails to improve the wellbeing, contentment, security and advancement of the majority of the species and its survival, has any claim to legitimacy or continuance by establishment or custom?”

    Governed or Controlled?
    Generally my rambles into the horizons of commentary are aimed more at the integrity or the lack of it that we presently class, or are told is democracy. It is a word easily claimed but hard to define and almost impossible to morph from theory into practice. Yet that ‘almost’ is the key that makes the impossible possible and should be the defining principle any government who claims to be democratic should be judged on.

    (Webster’s Dictionary)
    Part – In practice, control is vested in elected officers as representatives who may be upheld or removed by the people.

    If these words define the first principle of democracy, the Westminster model has failed to grow the legs in order to leap the first hurdle of representation. Perhaps the crawl of history has taken it to the start line but from then until now it has chosen to ignore the challenge of the democratic hurdles for the crawl and bum-shuffle comfort zone called politics.

    Politics – another strange word and one that’s almost indefinable as to its purpose. My favourite definition, again from the many included in Webster’s is – “To speak or act for political reasons; hence to scheme for an advantage.”

    Not exactly a characterisation most of us would be comfortable with but as a trait we have to admit it’s pretty generic within the human psyche and one we use at home, work and play. Yet in our everyday world the ‘take’ of advantage is usually balanced by the ‘give’ from the purpose behind it on the home and play front, though the work scenario is often less innocent and more materialistic in purpose. So if the latter applies to our everyday work what can we expect from politicians whose everyday work is politics –and in an environment where all of them are scheming for an advantage?

    Now if all their scheming was to whittle down that ‘almost’ and improve our democracy there might be a purpose to their posturing. But the constancy of cyclical failure has relegated their relevance to that of an annoying but potentially fatal distraction – like the wasp in a car, you need the grit your teeth till you can safely get rid of it then get on with your journey. Unfortunately the Westminster ‘wasp’ is far more cunning in its distractions and precise in its malevolence in order to prevent the journey to democracy.

    The Westminster paradigm is based on systematic deceits and statistical distortions nurtured off hysterical promises every few years when we are supposedly given a choice, but that choice and the promises that influence it rarely, if ever, materialise. The major reason for that failure is instead of democracy developing from the ballot box it ends at the ballot box and from then on becomes a manipulation so contrived it would make a tyrants mouth water.

    They call it ‘first past the post’ and claim it leads to strong and decisive government. It doesn’t. In truth what it leads to is lazy, sloppy, sycophantic self deluding hegemonies of free loading placemen claiming through the ‘majority’ of a minority and the sovereignty of a corrupted parliamentary system to rule and possibly – no, make that probably – ruin the lives of the majority for the years they hold power. The sad reflection on this is the fact they rarely hold power through what they have achieved but on the amount – hopefully little – damage they’ve done. Meanwhile the loyal opposition goes into hibernation on an undeserved sabbatical of rest, recuperation and networking their lobbyists and career prospects.

    This might be a comfortable way to run a gentleman’s club for ideological tyrants but it’s not a way to run a democratic government designed to enhance and prosper a democratic nation.

    Their next failure is when they sold out the nation – they used a euphemism to disguise it as smaller less intrusive government. Since then it hasn’t got any ‘smaller’ or less intrusive, just less democratic; and where the government takes less responsibility for the results of their actions – or more often inactions. It started small with the privatisation of BT and the utilities of gas, water and electric and sold it by selling shares to the middle herd in £1.5 thousand lumps. Suddenly Britain was in the grip of a sure fire gamble until the middler’s grew disenchanted with their £12 dividend cheques and cashed in the shares for ten days of Sun in Majorca. Then the circle of deceit was complete and the promise of cheaper utilities could be morphed into the profits of the conglomerate and financiers by socialising the costs while leaving the conglomerates and financiers free to juggle their corporate hierarchies and create cartels they euphemistically call ‘free markets’.

    Take British Gas as an example. Shortly after the bulk of middler’s had sold off their shares, Centrica was formed and the extraction facilities and their marketing were handed over from British Gas for Centrica to raise capital from the money markets against its assets and potential earnings. British Gas was now in effect no more than a domestic gas distributor and one where its profit or loss is largely controlled by the amount it has to pay Centrica and the free market cartel. That’s not to say they’re not still fused together in the maze of conglomerate relationships, (they had to be otherwise Centrica would have had to pay a fortune to BG when the assets were transferred – which they didn’t) but for the purposes of profit manipulation they had to be seen as separate entities. Now the purposes behind this are varied but in essence they boil down to – any excuse is good enough – once a cartel can operate as a monopoly. And when the price of oil goes up for equally mysterious and irrational reasons, then the price of gas must follow to keep the moneymen happy. The result British Gas buys from its monopoly supplier then claims it has no option other than to pass on the increase to its customers in the game of pass the buckin –profit. The fact two hundred or maybe that many thousand of their customers will have to freeze through the winter is not their problem.

    This is the world of capitalism where the only responsibility is to raise the ratios of profits and maximise the exploitation of resources rightfully owned by a nation, and that’s before adding insult by evading or avoiding tax on the profits earned to the injury of overcharging for the products use; and all the while, they whinge on and on like demented sirens about the restrictions of regulation. They’re not worried really, it’s just a tactic of distraction – and neither are the politicians, who lighten the load of regulation then turn a blind eye to the paucity of their tax payments, taken in by it – they’re more interested in safeguarding their seat on the board of a subsidiary or the consultancy fees they’ve been promised.

    If we leave the surreal world of Tyrannical Oligarch Capitalists for a moment and return to the mundane of their political acolytes and the effect they have on our governance, we’re faced with a bit of a conundrum. These business type/plc representatives we have – the millionaire cabinet governing our nation – seem to apply a different set of rules to the job they do for us than those they would use in their businesses. I’m referring here to marketing.

    Market share is the Holy Grail of business. No businessman will be a businessman for long if he ignores the marketing of his business. Especially when he’s only captured 26% of the potential market and 40-45% of the market isn’t interested in his or his competitors’ product. For any business capturing this potential is a must – any business that is except the political business. There the political CEOs seem to be quite happy leaving that potential dormant. I wonder why that is?

    Take Labour as an example. At the moment they’re quite worried they may not have in the near future, forty or so acquiescent lumps coming down from Scotland. But were they to entice half of that 45% into their fold it would more than make up for the loss – perhaps that wouldn’t apply proportionately to bums on green leather due to the systems distortions but it would certainly be relevant to the vote share. And wouldn’t you as a CEO, marketing director or lowly salesman be desperately researching to find out the style, capabilities, cost and performance they wanted from your product that would entice them into your fold?

    Any body else would, but not the politico’s, they’re quite happy playing musical chairs with majority prizes prized from minorities. It’s the mud –thick-mindset- of conservatism that is the cholesterol sludge that slurps through the arteries of Westminster and its establishment, and in the lexicon of business – the products crap – not fit for purpose – fit for neither use nor ornament. So the true majority of the populace have made their mark by ignoring their product and the demographics of democracy demand change.

    This week in Newsnet Scotland one of the contributors had an article where he attributed the SNPs election result to the “Feel Good Factor” he then went on in some detail on the percentages of unemployment being down and job vacancies up etc – the differences weren’t large, a couple of points here a fraction of a point there. In my opinion the differences were too subtle to contribute to a ‘feel good factor’; but I agree with him that that factor does exist. In my opinion Scotland ‘feels good’ because it has re-established the democratic link between its people, and the people they have chosen to represent them; in a government that is not there to lord it over them but to serve them.

    It’s pretty heady stuff. Will it last? No reason why it shouldn’t. But one thing I’ll tell you as fact – at the moment Westminster’s looking as attractive as a sour faced whore sucking a sour plum. But enough of that – though more later.

    So enough of the partisanship. As a proponent of democracy what do I reckon Westminster has to do in order to win back legitimacy?

    Well if I were to start from a dream, I would say start building a parliament up round Stoke on Trent. God knows it needs it and you know who caused that need. Who knows, it might wean you off the notion of London Centric and give you a feel for the country you govern, and the separation might re-form a backbone to control and discipline the banks and see through – and recognise the people already do- the glitzy bling of the financial shamans.

    Sell off the palaces of the establishment, without depressing the market, they are too steeped in tradition and reminiscent of upstairs –downstairs, and the broom of the past needs to be replaced with the cyclone vacuum of the future. But if, as I suspect, that’s too radical, then simply put the people who have awarded you the privilege of their governance above all else.

    On a contemporary side note, stop telling lies Mr Cameron – we know you love the NHS but it’s not in the way you insinuate. You love it for the opportunities it brings to the market of privateers and the profits they’ll leech from the public purse.

    It may be a grimed diamond on top of a tarnished crown but you take the chisel to it Cameron and you’ll be out with a very thick ear.

    But here’s my suggestion on what you can do. You extend the development of democracy from the ballot box by reforming the make up of the government and the cabinet.

    Stick to first past the post and whichever party wins the most seats its leader becomes the PM, but from then on the share of the vote is matched to a cabinet position in the acknowledgement that whole areas of the country would have preferred your opponents to win. Obviously there will be more potential candidates than there are cabinet posts. But with considered consultation with the other party’s leader (who incidentally should have no place in the cabinet) over the choice of region and the experience and qualities of the candidate, would at a stroke by balancing the cabinet to the ballot, give credence to the voters choice.

    My reasoning for not allowing other party leaders a role in the cabinet is as follows. Since taking office through coalition in 2010, the mantra constantly touted by both of the parties is –“Once we got into office and discovered the position left to us by Labour we had no alternative other than to take the measures (austerity) we have.” This pathetic position is not only a vacuous excuse it’s also an indictment on both the parties involved in the coalition. Where were you Messrs Cameron and Clegg and your cohorts from 97 to 2010? Weren’t you all on the public payroll, with some acting as shadows as HM’s loyal opposition. What did you achieve during the whole of that time, and by argument and persuasion of logic, social, moral or purely ideological which, if any, policies did you force change on in any meaningful way?

    Did you attack, or even question the commitment to Iraq, Afghanistan, The Trident Adventure, the PFI Debacle, The Gold Squander, The Pensions Raid, The Money from Nothing Spivs? Just what the hell were you doing Messrs Cameron & Clegg during these thirteen years – what lies were exposed or ministers forced to squirm during the course of your sabbatical from responsibility?

    Seemingly each MP costs, on average, quarter a million per year. Let’s say three hundred are not in the governing party that takes us to £75 million per year as a handout to ineffectual losers. Multiply that by the years in opposition and it comes to £975 millions – call it a £1billion because in all probability it’s more than that – that’s a lot of cash to shell out on a concept that creates no return and falls short in the role of checks and balances. And that’s before we add in the ermine club of the ludicrous second chamber. What is it they get – £180 per day plus expenses and there’s seven hundred of them, what do they costs each year £40 – 50 million? Gee, Messrs Cameron/Clegg that’s a thousand swindlers a year costing on average £125,000 each and all that’s required of them is to play by the rules, not rock the boat and keep quiet about it. And that’s before we add the far greater costs directly attributable to their apathetic incompetence.

    Perhaps you should install a ‘hotline’ for the reporting of representative swindlers? That apart, it does show there are more ways than one of skinning a cut.

    So in order to achieve an effective opposition the one party rule should go and in its place a shadow cabinet formed, equal in number from firstly, all the regions not covered, then from every party that’s won a constituency. Now all this may seem like rearranging deck chairs, but here’s the crunch, every one of these shadow ministers has to have an office in the ministry he/she is shadowing and all the information made available to the minister has to be made available to the opposition shadow. Never again do we want to hear the whinge of ‘not knowing’ as an excuse for lies and deceptions and promises that will never be kept.

    Again there is no role in the shadow cabinet for the party leaders. Their role is to keep their ministerial colleagues on top of their game and to fight for their positions in parliament.

    And, no more party whips. If MPs in general haven’t the commitment to attend to their responsibilities without being bullied they should be sacked. Equally MPs who through conscience disagrees with the position adopted by their party should have the same freedom of choice as enjoyed by any free person to vote against it.

    Finally, direct Lobbying would be banned. If any special interest group or lobbyist’s want to present their case to parliament they should submit a request for a hearing to an administrative department and if the request is granted the MPs (minimum three) should be randomly chosen to consider the application.

    To bring this section of essay to a close I would add. Neither as individuals or political bodies are you our leaders or mentors. You are in fact our representatives and to carry out that function competently it’s time you grew up.

    It’s that ‘growing up’ we intend to initiate in Scotland.

    John Souter – 18/06/11

  10. me November 22, 2012 at 1:12 am #

    “A few powerful men have hijacked our economic, financial and political structure. They aren’t socialists or capitalists. They’re criminals.”


  11. backwardsevolution November 23, 2012 at 10:11 am #

    Golem – excellent report. I admire Mr. Sugarman. In a right world, people would be in jail over this, but it appears the rules have been changed. Here’s a guy with integrity versus men with none. It’s going to take the people to rise up, but like I was trying to say last week, they won’t until they feel some pain, and most likely by that time it will be too late. When things are not right, we know in the back of our minds that we should step forward, but we don’t, we think it’ll all get better, but of course (anyone out there with this experience?) it doesn’t. It usually gets worse.

    Conquer Through Money, Not Bayonets:


    • GordonDonald November 23, 2012 at 1:11 pm #

      Perhaps we should support local currencies?

      “…Scotland’s oldest and most successful local currency, the eko… circulates among shops and businesses in the Findhorn eco-community in Moray. Established in 2002, the eko has proved remarkably resilient: about £20,000 worth of currency is currently in circulation. The notes have a set life-span, usually between three and five years, at the end of which they can be redeemed for new issue ekos or, in rare cases, sterling. Capital raised by each eko issue is used to fund low or no interest loans to community projects such as wind farms and affordable housing.
      …In the wake of the financial crisis, local currencies have gained traction elsewhere in the UK. In 2009, the first urban local currency was launched in Brixton, London. The Brixton pound has been one of the success stories of the area’s regeneration: more than 70 local businesses accept the stylishly designed notes, which have become a symbol of the area’s burgeoning cultural confidence. The Bristol pound is due to launch soon.”

      Plans for such a scheme here in Edinburgh appear to have stalled but many arguing for Scottish independence (in particular The Scottish Green Party) want to look at how we can unhitch the Scottish monetary system from rUK.


      (p.s. did you check out the organisation behind that money vs bayonets clip, thrivemovement.com? It’s a real hoot, cheered up my morning no end)

  12. backwardsevolution November 23, 2012 at 7:16 pm #

    GordonDonald – local currencies are a great idea. Charles Hugh Smith’s (who I often quote) strongest message is to get back to “local”, building strong local communities. This is I think what has been lost in the years of globalization.

    Re my above link entitled “Money vs Bayonets”, G. Edward Griffin wrote “The Creature from Jekyll Island”. Jekyll Island is an island in Georgia where the financial elite (J.P. Morgan, Rockefeller, Vanderbilt, etc.) secretly met and came up with the idea for the Federal Reserve. It is a well-researched book. He has been interviewed by many people/associations. Just listen to what he says; don’t worry too much about who did the interview.

    Here’s another extract from a speech he gave to another organization where he talks about the “banking cartel,” how they always couch everything they say in terms of “helping the people,” yet what they do has nothing to do with the people. It has everything to do with the banks. It’s a good listen.


    • GordonDonald November 24, 2012 at 12:12 pm #

      Thanks for the links. G. Edward Griffin is obviously an interesting character and makes some astute observations about the dominance of the finance sector. However, he is marshaling his facts and his reading of history to support a right-wing libertarian/conspiratorial narrative which I find both unconvincing and unnecessary.
      One weakness in particular of this focus on the money supply and central banks (and I think this is shared with the reformist positivemoney position) is in explaining the ballooning of public and private debt after the 1970s in developed capitalist economies.
      There are alternative narratives which attempt to locate the current crisis in the context of economic and political developments since the Second World War: the growing dominance of transnational corporations and monopoly (oligopoly) capital, a return to economic stagnation after the post-war boom and the resulting financialisation of capital, and the triumph of neoliberalism both in the opening of global markets and the movement of capital, and also in redefining the aims and priorities of governments. Correct me if you think I’m wrong here but it seems to me that while both narratives see the banking and finance sector as part of the problem, beyond that there is little shared ground.
      I think the libertarian right are ideologically unable to countenance a problem with capitalism because, for them, it represents the ultimate freedom for individuals, and so they are forced to explain crises and obvious examples of lack of freedom and justice as the result of conspiracies. The search for the guilty conspirators can begin reasonably with banking cartels, but soon ends up including Jews, communists, freemasons or giant lizards (or some permutation of all five!).

    • GordonDonald November 24, 2012 at 5:46 pm #

      This Analysis programme for BBC Radio 4 last year by Paul Mason looked at the ‘left’ (post-Keynesian/reformist) response to the financialisation of capitalism and the debt crisis:

      Radical Economics: escaping credit serfdom

      Mason lays out the narrative of financialisation and neoliberalism concisely and includes some interesting contributions, although his selection does not include anything from the anti-capitalist left or those concerned with acknowledging limits to growth (economic or ecological).

  13. The Dork of Cork. November 24, 2012 at 12:30 am #

    Local currencies will not work when the banking sector has control over the Government (taxable) fiat money supply.

    The banking sector is farming the value of the fiat and not their “capital” investments which were net negative over time.
    The truth is out now.
    Its becoming very difficult to hide but you have to give it to them – they have been milking peoples stupidity for so long now it comes naturally to them.



  14. backwardsevolution November 24, 2012 at 6:25 pm #

    GordonDonald – I don’t belong to the libertarian right, but I do see their point of view. They argue, for example, that if the government in the States had not guaranteed all student loans and not kept rates ridiculously low, then the banks would have been more prudent in who they lent to. As the banks no longer had to worry (being backstopped by the government), they went wild.

    As the students flooded into courses, the prices started to go up. What used to be a reasonable price for an education has increased exponentially. Good old supply and demand, which has now resulted in over a trillion dollars in student loan debt and millions of students who now have degrees of some sort, but cannot find jobs.

    This is but one example (housing is another) of where, when the government gets involved, prices go up, we have booms and busts, and this, Libertarians argue, is not a so-called “free market”. It’s a market to enrich a few at the expense of the many, but all under the guise of “helping the people”. We all end up paying in the end, ordinary people’s lives get ruined, but a few people are enriched beyond their wildest imaginations.

    Follow the money. Who benefited? Now, this does not explain a conspiracy, I know, but merely illustrates the thinking of Libertarians. I think they’ve got a point, don’t you, that this isn’t capitalism at all. It’s manufactured enrichment of a few to the detriment of the many.

    As for a conspiracy, let’s look at a definition: “A secret plan by a group to do something unlawful or harmful.” Probably “harmful” fits in with what’s occurred, but “unlawful” doesn’t as, like G. Edward Griffin and others have pointed out, these guys write the laws to make sure that what they do is not unlawful, or they change the laws retroactively.

    “The action of plotting or conspiring.” Now the plot thickens. Are you saying there is no plotting and conspiring? Really? Gulf of Tonkin, weapons of mass destruction? TARP? The list is endless.

    If you haven’t already ready Naomi Klein’s “Shock Doctrine” or “Confessions of an Economic Hit Man,” please do. To open your eyes and see the world as it really is, not haphazard or willy nilly, but as a well-oiled machine is like getting smacked on the side of the head with a 2 by 4. To see your government as not out (not at all) to help you, help the little guy, is I believe to begin to get some semblance of the truth.

    • GordonDonald November 24, 2012 at 7:45 pm #


      Yes I agree with much of what you say, and I almost put in a reference to the Shock Doctrine myself earlier. States have certainly played a significant part in facilitating and encouraging the developments we both criticise. The point where we diverge I think is the belief that the solution to all this must be a more purer free-market capitalism with much less government control/interference/regulation. I say this not because I am in favour of big, centralised government (quite the opposite in fact), but because I believe the idea of rolling back capitalism to either its 19th century competitive phase or its post WWII social democratic form (the projects of the libertarian right and the post-Keynesians respectively) is unrealisable even if desirable. In this sense they are utopian.
      Yes, absolutely, we have to follow the money and point out the systematic redistribution of wealth from poor to rich going on (‘accumulation by dispossession’ as David Harvey puts it). But I would also point out that we have arrived at this position not simply due to the actions (conspiratorial or not) of a few ‘greedy’ bankers (although they surely exist). Any explanation needs to take in the way capitalism has itself developed over the last two centuries (further and further from the model idealised by the libertarian right but never in fact actually existing): the move from competitive to monopoly capital, from monopoly to global monopoly capital and then to global financial monopoly capital in the late 20th century, i.e. one that exposes how the laws of motion of capitalism has itself led to the dominance of finance over industrial capital and shift to profits from speculation and asset inflation..
      I agree totally with you that the world is not haphazard or will-nilly. I just think the solution is less capitalism rather than more, banks owned and controlled by the people who use them rather than better behaved bankers.

  15. backwardsevolution November 24, 2012 at 7:26 pm #

    Libertarians say that IF we had a “free market”, then interest rates would have increased (yet they were held down artificially by the government and Federal Reserve), and as they got higher and higher, it would have automatically put an end to the Ponzi (as the lower end would no longer have been able to afford to get the loan, and the richer end would have thought twice). They argue the “free market” would have ended it, if left to its own devices.

    The government also manipulates the cost of inflation by changing the rules on how it’s measured. They change what they measure every few years so as to give the impression that inflation is not that great. I read something the other day where it said that if inflation was measured the way they measured it in 1980, current inflation would be around 10 to 12 per cent. Instead they tell us it is 2 to 3 per cent. Nice, if you can get away with it. That way no one gets a raise, and yet we’re paying 10 – 12 per cent more.

    Libertarians argue that we are being lied to and that, if we weren’t, things would take care of themselves, they would naturally end. They make sense on many, many issues. When I think about it sometimes, I wonder if they don’t care the most about the common man. Does anyone think going through continual booms and busts, constant inflation is fun? I don’t, and I don’t think it helps the citizens one bit in the end. It just leaves a trail of destruction.

  16. backwardsevolution November 25, 2012 at 6:18 am #

    GordonDonald – “The point where we diverge I think is the belief that the solution to all this must be a more purer free-market capitalism with much less government control/interference/regulation.” Yes, that is where I part from Libertarian thinking. I too agree government could be much smaller, but to have little or no regulation? Insanity. Sure, we’d probably have unbelievable growth (something we do not need more of), but at what cost? There’s already been way too much fun. Any more, and the planet is going to roll over.

    Your point is that during the last few hundred years we’ve had competition, which eventually always leads to monopoly, and that one group just takes over where another left off (industrialists to finance, for example). I’d agree with you there. It hasn’t always been “greedy bankers”; they’re just the ones in the driver’s seat at the present moment. But it’s the same type of people, people who appear to want something for nothing, whether it’s an industrialist raping some far-off land of its resources, the bringing over of slaves, etc., and they always seem to find politicians who look and think a lot like them, just wearing a different job description.

    These people always gravitate to the top, they make and pass the laws, and it hasn’t changed one iota (from feudal lords on down to present-day corporations). I fear another form of capitalism is not going to help at all, just more of the same. We must come up with something that benefits all people, not just the ones at the top.

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