NatWest fiasco: the meltdown, the impact, and the aftermath

The botched software upgrade at NatWest and RBS has affected millions of people

The drama began on the night of 19 June when Royal Bank of Scotland discovered what was described as a computer glitch, which was preventing payments to and from accounts at NatWest, RBS and Ulster Bank. The botched software upgrade has affected millions of people, both the bank's own customers and those expecting payments from accounts held by these banks. The problems have affected savings and offset mortgages as well as current accounts.

The Guardian's investigations suggest things began unravelling when the bank updated a key piece of software called CA-7.

The bank was quick to deny suggestions that the "offshoring" of IT jobs to India had led to the problems. However, technology website The Register claimed a serious error committed by an "inexperienced operative" – who may be based in India – caused the meltdown.

RBS/NatWest/Ulster Bank customers The unprecedented meltdown meant millions of customers were unable to see how much money was in their accounts and whether bills had been paid. It left a defendant behind bars over the weekend after his bail money failed to arrive, and resulted in at least one family being forced out of their home. Some customers said they had no option but to take out payday loans to cover costs.

On 28 June, with the crisis into its 10th day, it was clear that while normal service had resumed for some, other people's finances were still in chaos.

Customers continued to relate their tales of woe on NatWest's website forum. "Anyone know what is happening? A cleared balance of £400 but my available balance is nil? I'm panicking as my mortgage is due to be paid and my hubby's wage is in tomorrow [29 June]. Things seemed OK at last, and now this?" said one poster from West Yorkshire. Another, in Nottinghamshire, said: "I have just been to the bank and yet again for the second week no wages, so is the problem not fixed …"

A customer in Brighton added: "I just called the hotline to find out why the cheque I paid in Monday was not showing and was told that anything paid in at the start of the week was stuck in a backlog and they hoped the money would be in my account some time late next week."

On 27 June, the bank said "the vast majority" of customers' account balances should be up to date, and that the "small amount" of outstanding unprocessed transactions was continuing to reduce.

It said future payments, such as salaries, should also be processed as usual.

But it emerged that as many as 100,000 customers with Ulster Bank have been told they will not have access to their money until Monday 2 July at the earliest.

Non-customers Many of those caught up in the fiasco aren't even NatWest/RBS/Ulster Bank customers, but have been hit financially because their employer banks with the group, and their wages did not appear in their account on time.

There have been reports of people unable to buy food or pay their rent. Some people have told of direct debits being returned unpaid because of lack of funds, triggering late payment charges.

Which? says other banks should treat customers who have been affected by the problems "positively and sympathetically". Anecdotal evidence suggests this has been happening, with reports of charges being waived where late salaries had resulted in payments not going through and charges being incurred.

One high street bank told Guardian Money it was keeping a tally of these costs and would be passing them on to NatWest/RBS. The bank, which didn't want to be named, said there had been cases where people hadn't been able to complete their house purchase, so it had stepped in.

"The funds didn't come through but we knew they were there, so we covered it in the knowledge that we will get the money back from NatWest. There were quite a few cases where that happened on Friday [22 June]."

Another high street bank told Money that tens of thousands of its customers had been hit by the technical issues.

"We did see some increase in call volumes from customers late last week and over the weekend, but call volumes have now returned to normal," the bank told us on Wednesday.

Small businesses NatWest alone has almost one million small business customers, and it emerged that some were paralysed by the RBS/NatWest fiasco, finding themselves unable to pay salaries or invoices.

The 200,000-member Federation of Small Businesses (FSB) says people running small firms that bank with the group, and who have experienced problems, should first of all go to their branch or call the bank. 

They may later want to approach the Financial Ombudsman Service.

"Throughout this process, it is also advisable that small firms check with those who are expecting money to see if they have received it," adds an FSB spokeswoman.

What the bank is doing NatWest/RBS this week extended opening hours in hundreds of branches. Many will be open on 30 June from 8am until 4pm.

The banking group said it had arranged for customers to be advanced cash over the counter in cases where they had run out of money and needed to make payments.

Current account customers with a NatWest, RBS or Mint credit card "in good order" have been able to withdraw up to £100 over their limit without incurring fees or charges – although some will be levied but then refunded.

Complaints, refunds and compensation The bank promised that "no customers will be out of pocket as a result of these issues", adding: "We can confirm that any fees and charges incurred by customers will be fully refunded. This includes charges levied by a third party – for example, if you were late paying a non-RBS credit card or mortgage because your account wrongly showed there wasn't sufficient cash."

But as Money went to press, the bank hadn't said much about whether it will be compensating non-customers.

A spokeswoman told the Guardian: "We have been talking to other banks about how to cover any costs incurred by non-customers. We have agreed that anyone affected should speak to their own bank in the first instance."

NatWest/RBS customers who want to make a complaint should go to bit.ly/QrQvnF or bit.ly/N75xL2. If you are not a customer, go to bit.ly/N75Ghx or bit.ly/QrRbta

Consumer body Which? advises those affected to lodge a formal complaint "as soon as possible". It adds: "Give the bank a detailed account of any costs that you have incurred and payments that have been missed, both to and from your account. Also, be sure to stress the impact on you of any distress or inconvenience."

The bank has up to eight weeks to resolve your complaint. After that, you can go to the Financial Ombudsman Service.

When the ombudsman upholds a complaint, its aim is to put the customer into the financial position they would have been in. There is no automatic entitlement to extra compensation for disruption caused, and nothing in the rules that requires the bank to pay for non-direct losses, such as someone missing the chance to buy flights at the price they wanted.

In some cases the ombudsman will make an award for "non-financial loss", that is for "pain and suffering, damage to reputation, distress or inconvenience".

The impact on people's credit ratings NatWest/RBS claims that there should be no adverse impact to credit ratings. But those caught up in the fiasco may wish to check their credit record over the coming weeks to make sure their rating hasn't been damaged.

Those about to apply for a loan or mortgage should be especially vigilant.

Credit reference agency Experian says the banks have promised that any adverse data caused by the IT problems will not be sent to them. However, in the case of non-NatWest/RBS customers, creditors might not spot the root of the problem before data is sent to the agencies.

It costs £2 to get a copy of your credit file, and it is unclear whether NatWest/RBS will reimburse these fees. An alternative is to sign up for a 30-day free trial of the credit monitoring service offered by Equifax or Experian – but remember to cancel your membership before the 30 days are up, or you will incur a monthly fee.

View the original article here

Syrian tanks amass near Turkish border, rebels say

Reuters
Friday, June 29, 2012

A general in the rebel Free Syria Army said on Friday that Syrian government forces had amassed around 170 tanks north of the city Aleppo, near the Turkish border, but there was no independent confirmation of the report.

General Mustafa al-Sheikh, head of the Higher Military Council, an association of senior officers who defected from Syrian President Bashar Assad’s forces, said the tanks had assembled at the Infantry School near the village of Musalmieh northeast of the city of Aleppo, 30 kms (19 miles) from the Turkish border.

“The tanks are now at the Infantry School. They’re either preparing to move to the border to counter the Turkish deployment or attack the rebellious (Syrian) towns and villages in and around the border zone north of Aleppo,” Sheikh told Reuters by telephone from the border.

He said the tanks were mostly from the 17th Mechanized Division.

Full story here.

View the original article here

Saudis forces mass on Jordanian, Iraqi borders. Turkey, Syria reinforce strength

DEBKAfile
Friday, June 29, 2012

The Syrian crisis was Friday, June 29, on a knife edge between a Western-Arab-Turkish military offensive in the next 48 hours and a big power accord to ward it off.

DEBKAfile’s military sources report heavy Saudi troop movements toward the Jordanian and Iraqi borders Thursday overnight and up until Friday morning, June 29, after King Abdullah put the Saudi military on high alert for joining an anti-Assad offensive in Syria. The Saudi units are poised with tanks, missiles, special forces and anti-air batteries to enter Jordan in two heads:
One will safeguard Jordan’s King Abdullah against potential Syrian or Iranian reprisals from Syria or Iraq.

The second will cut north through Jordan to enter southeastern Syriam, where a security zone will be established around the towns of Deraa, Deir al-Zour and Abu Kemal – all centers of the anti-Assad rebellion. The region is also the home terrain of the Shammar tribe, brethren of the Shammars of the Saudi Nejd province.

The Saudi units deployed on the Iraqi border are there to defend the kingdom against potential incursions by Iraqi Shiite militias crossing into the kingdom for reprisals. The Iraqi militias are well trained and armed and serve under officers of the Iranian Al-Qods Brigades, the Revolutionary Guards’ external arm.

Full story here.

View the original article here

Report: More People Killed By Bees, Drowning In Bath Than From Terrorism

Independent review of terrorism legislation points to government exaggeration of threat for political gain

Steve Watson
Prisonplanet.com
June 29, 2012

An independent review of terrorism legislation in the UK notes that government rhetoric regarding terrorism is “exaggerated for political or commercial purposes” and that many more people are killed each year by bee stings.

The report by barrister David Anderson QC, highlights the fact that the average number of annual deaths as a result of terrorism or at the hands of terrorists in the UK this century is just five.

“During the 21st century, terrorism has been an insignificant cause of mortality in the United Kingdom.” Anderson writes.

“The annualised average of five deaths caused by terrorism in England and Wales over this period compares with total accidental deaths in 2010 of 17,201, including 123 cyclists killed in traffic accidents, 102 personnel killed in Afghanistan, 29 people drowned in the bathtub and five killed by stings from hornets, wasps and bees.”

Anderson also points out that not a single person in Britain has even been injured by a terrorist for over two years.

The report notes that in the year to March 2011, arrests of individuals suspected of being terrorists numbered just 141, the lowest figure since 2001/2. In addition there was only one conviction in a UK court on charges related to terrorism.

A d v e r t i s e m e n t

“Those figures compare with a total number of arrests for recorded crime in England and Wales alone of almost 1.4 million in 2010/11, including some 431,000 for offences of violence against the person, 37,000 for sexual offences, 34,000 for robbery and 93,000 for burglary.” the report notes.

The report suggests that the threat from terrorism is hugely over exaggerated and that draconian terrorism related laws should be reassessed.

“Terrorists are first and foremost criminals. Where possible and as a general rule, they should be prosecuted under the ordinary criminal law, to underline the fact that no special laws are necessary for the purpose and to prevent them from glamorising or politicising their offences…” the report states.

“The values of a liberal democracy deserve support from laws against terrorism, but the same values require that those laws be subject to strict scrutiny.” Anderson writes.

The report comes in the same week as a rare keynote speech by MI5 head Jonathan Evans in which he stated that the ‘Arab Spring’ could radicalize British muslims and breed new terrorists, that a dirty bomb attack in the UK was a realistic possibility, that Iranian sponsored terror was a significant threat, and that economic hardship could see the rise of more “lone wolf” terrorists in the vein of Anders Breivik.

As we have previously noted, statistics show that more people die from intestinal illnesses, being struck by lightning, accidents involving deer, and allergic reactions to peanuts than they do from terrorism.

Despite these facts, billions is spent on “homeland security” while Americans are hit with crippling austerity measures. In addition, sweeping laws are undermining core liberties, all in the name of countering a monolithic terrorist threat. Furthermore, research has shown that more people are being killed or putting themselves in more danger owing to the heightened perceived threat of terrorism.

As reports such as Anderson’s continue to highlight, in reality the security industry cash cow is based on little more than hot air and fearmongering. The war on terror, and the onslaught of domestic repression that has accompanied it, is based on the completely phony pretext that terrorists pose any more threat than bowel complications, rare weather events, or wandering animals.

—————————————————————-

Steve Watson is the London based writer and editor for Alex Jones’ Infowars.com, and Prisonplanet.com. He has a Masters Degree in International Relations from the School of Politics at The University of Nottingham in England.

View the original article here

Propagandists Sell “Vigilante” Solution for Syria

Sidestepping entirely the history of the current conflict, both in Syria, and in a broader regional context, as well as inconvenient facts regarding the driving factors behind the violence Dobos seeks to end with his proposal, he maintains that there is a “moral imperative” for nations to act outside of the “paralyzed” United Nations.

Dobos conducts a rambling pedantic philosophical defense of what is essentially a unilateral act of war built on patently false pretenses, as NATO has already done in Libya, and as the US has done in Iraq and Afghanistan at the cost of millions of innocent lives.

Dobos concludes by stating:

“Champions of the UN often fail to see or acknowledge that the obligations of a state’s international commitments are equally prima facie, and that in some cases a perfectly good justification for their transgression will be available.

Syria is one of those cases. The global body entrusted with the task of preventing human rights abuses is, once again, paralysed by politics. For any state that is able and willing to act unilaterally, the imperative to defend people against murder, torture and rape trumps fidelity to international covenant. A vigilante that defends the innocent when the police can’t or won’t is not a villain, he is a hero.” - “Syria needs a vigilante to save its people” Ned Dobos, SMH.

The Truth Drowns Western & Dobos’ Flights of R2P Fancy

Unfortunately for Dobos and his ivory tower academia, the truth about the violence in Syria not only mires his proposal in the unpleasantries of reality, it drowns it. The “murder, torture, and rape” Dobos claims unilateral military intervention will stop, was in fact premeditated, planned, staged, funded, and the forces carrying it out entirely armed by the West in an effort not for “preventing human rights abuses,” but to admittedly overthrow the government of Syria and install a compliant, pro-Western client regime, as the West has done in Tunisia, Libya, Egypt, and is attempting to do elsewhere from Northern Africa to Southeast Asia and beyond.

Since the early 1990's, US Army General Wesley Clark was aware of a plan drawn up by the forces of corporate-financier special interests to overthrow the “old client regimes” of the Soviet Union. General Clark would again be made aware of plans post-9/11 to invade and overthrow the governments of seven specific nations, Iraq, Syria, Lebanon, Libya Somalia, Sudan, and Iran. General Clark would later present this information at the Commonwealth Club of California, October 3, 2007.

It was also in 2007 that Seymour Hersh of the New Yorker would publish a lengthy report titled “The Redirection” regarding US, Israeli, and Saudi plans to destabilize Lebanon, Syria, and Iran using sectarian extremists with direct ties to Al Qaeda with the foreknowledge they would wreak terrible havoc, committing horrific atrocities as they carried out the West’s proxy war. Upon reading Hersh’s report and viewing the events unfolding today, the West’s plan has clearly been executed with a fair degree of exactitude and precision, obfuscated only by the West’s impressive dissembling enabled by their immense corporate media networks.

The Arab Spring was also being engineered in this period, years before it would actually unfold, with the US training “activists” in the US, providing them with equipment, funding, and directives in the lead up to one of the largest, if not the largest coordinated political destabilization in human history. Regarding Syria specifically, the US State Department would admit that it did indeed train and fund “activists” abroad with the explicit intent of sowing chaos once they returned to Syria.

In an April 2011 AFP report, Michael Posner, the assistant US Secretary of State for Human Rights and Labor, admitted that the “US government has budgeted $50 million in the last two years to develop new technologies to help activists protect themselves from arrest and prosecution by authoritarian governments.” The report went on to admit that the US (emphasis added) “organized training sessions for 5,000 activists in different parts of the world. A session held in the Middle East about six weeks ago gathered activists from Tunisia, Egypt, Syria and Lebanon who returned to their countries with the aim of training their colleagues there.” Posner would add, “They went back and there’s a ripple effect.”

With the CIA, Saudi Arabia, Qatar, and even elements in Lebanon now openly admitting they are funding, arming, and otherwise enabling terrorists operating in and around Syrian territory – and with these terrorists accused by even the West’s own “institutions” and “international arbiters” of carrying out systematic atrocities of their own, including kidnapping, torture, and murder, Dobos’ narrative is exposed further as absolute, baseless, politically-motivated propaganda unmoored by even what is admitted in headline news.

With Libya serving as the ultimate example of just how disingenuous the West is regarding “responsibility to protect” (R2P), a political ploy contrived by modern neo-imperialists to mask naked military conquest, promoting a similar campaign in Syria is admittedly a hard, if not impossible sell. Libya’s “freedom fighters” have turned out to be sectarian terrorists now carrying out a brutal campaign of nationwide torture, harassment, illegal imprisonments, and genocide. Entire towns have been wiped out with ethnic and religious minorities fleeing the country for their survival. Even the handpicked proxies installed by NATO have been subjected to the violence, threats, and general chaos that has predictably prevailed in Libya.

In fact the only success story that can be told coming out of Libya, is its emergence as a military logistical hub serving similar NATO destabilizations across Northern Africa and across the Middle East. With an entire nation serving as a safe haven for terrorism, a nearly endless supply of weapons and fighters can be propagated to multiple theaters of conflict. Ironically enough, eastern Libya (Benghazi, the epicenter of 2011's destabilization) had served as a terrorist recruiting center for fueling sectarian violence in Iraq that effectively neutralized a joint Sunni-Shi’ia insurrection against Western occupation.


Selling Unilateral Military Conquest – a Crime Against World Peace


Wittingly or unwittingly, Dobos has committed a crime against world peace by promoting crass, unfounded, irresponsible propaganda aimed solely at defending not only the continuation of violence in Syria, but also by attempting to prepare the ground for a larger act of overt military aggression, which he himself admits violates international law – a Nuremberg offense.

Dobos and the corporate-funded policy makers he parrots almost certainly do not believe the rhetoric they are promoting – as even the most elementary research into the topic exposes immediate and significant flaws in the premise of “unilateral intervention” based on a “moral imperative” to alleviate violence of the West’s own premeditated creation.

Dobos has also played a role in destroying the credibility of not only his own university of New South Wales, but the reputation and credibility of Western academia in general, which has now become an easily purchased stamp of approval to lend credence and employ an “academic” defense to the otherwise indefensible. Australian academia in particular has been almost entirely infiltrated and co-opted by the forces of Western special interests, in particular by the Lowy Institute.

For the very real principles and ideals the West once stood for, we must expose and denounce entirely the hackery of “academics” like “Dr.” Dobos, protest the recognition of his credentials, and give pause for thought to those employing him and allowing him to continuously abuse the good name of their educational institutions for transparently self-serving political agendas. Failing to do this will only accelerate the fall of the West’s institutions, and once credibility has been lost, it will be difficult if not impossible to ever regain it.

Suggesting that the West should unilaterally intervene in Syria, without a UN mandate has been on corporate-financier funded policy makers’ wishlist for months. Neo-Conservative ledcorporate funded think tank (beginning on page 18, .pdf), the Henry Jackson Society, has openly declared NATO’s plans to do just that. Of course, to do so, it must be thoroughly justified in the court of public opinion – a court Dobos just so happens to have testify before with his pedantic, fact-devoid, intelligence-insulting diatribe.

With Libya and Iraq as two very prominent examples of how the West couches military conquest within “humanitarian” pretexts still fresh in the public’s mind, it will take much more than an obscure ethics PhD from Australia parroting corporate-funded talking points to convince the world that it is necessary, let alone justified to expand upon these grievous crimes against humanity and suffer another blight upon our collective conscience.

View the original article here

Department of Defense Caught Lying About Use Of Domestic Spy Drones

Offices of two US Senators contradict statements of Special Operations Command

Steve Watson
Prisonplanet.com
June 29, 2012

The U.S. Special Operations Command (USSOCOM), part of the Department of Defense, has denied operating surveillance drones in two different states, issuing statements that have been proven to be completely false.

Headquartered at MacDill Air Force Base in Tampa, Florida, USSOCOM is the Unified Combatant Command charged with overseeing the various Special Operations Commands of the Army, Air Force, Navy and Marine Corps.

As reported by the open information advocacy group Public Intelligence:

Following our publication last week of a map of current and proposed Department of Defense drone activities within the U.S., several journalists with local publications around the country wrote articles regarding drone activities that were listed in their area.  David Brooks of the Nashua Telegraph wrote about the listing of New Hampshire’s Mt. Washington as the site of a USSOCOM drone activity involving small unmanned aerial vehicles including the Raven and Wasp.  Corey Pein of the Willamette Week wrote about a planned USSOCOM drone activity in Portland that was listed as utilizing the same types of drones.

The drone activity map was constructed using public U.S. Air Force presentations from 2010 and 2011 (image below). Portland, Oregon was listed as as a proposed drone site controlled by USSOCOM.

Public Intelligence notes that when the reporters contacted USSOCOM for clarification and further details, they were told that the information on the map was inaccurate and that USSOCOM does not operate drone bases in either area.

However, further investigation revealed that activities and exercises using surveillance drones in both areas were indeed carried out under the authority of USSOCOM in 2010 and 2009 respectively.

Furthermore, the use and storage of drones was confirmed by the offices of Senators in both states:

In New Hampshire, a local newspaper has now confirmed with the office of Senator Kelly Ayotte that in 2010, Navy Special Operations Forces utilized areas around Mt. Washington to conduct training operations using Wasp and Raven drones.  David Brooks of the Nashua Telegraph was further able to confirm via Army Lt. Col. James Gregory that similar exercises were also conducted in 2009 using the same types of drones.

In Oregon, the Willamette Week was able to confirm with the office of Sen. Ron Wyden that drones are currently stored in Portland for several military units in the area.

“If the military wishes to counter controversy from the increasing integration of drones into domestic airspace, then it may help to not make statements to press that are inaccurate or disproved by publicly available congressional reports.” the group notes, adding that USSOCOM “denied or misrepresented” its involvement in domestic drone activities and actively sought to shut down any exchange of information on the matter.

A recently uncovered Air Force document raised alarms over military use of spy drones in US skies. The document outlines how to circumvents privacy laws and clears the way for the Pentagon to use drones to monitor the activities of Americans.

—————————————————————-

Steve Watson is the London based writer and editor for Alex Jones’ Infowars.net, and Prisonplanet.com. He has a Masters Degree in International Relations from the School of Politics at The University of Nottingham in England.

View the original article here

House could arrest Holder with inherent contempt power

Stephen Dinan
The Washington Times
Friday, June 29, 2012

Despite voting to hold Attorney General Eric H. Holder Jr. in contempt ofCongress, there’s little House Republicans can do in the short term to compel him to turn over documents — unless it wanted to revisit a long-dormant power and arrest him.

The thought is shocking, and conjures up a Hollywood-ready standoff scene between House police and the FBI agents who protect the attorney general. It’s a dramatic and unlikely possibility not least because Congress doesn’t even have a jail any longer. But in theory it could happen.

Republicans say it’s not even under consideration, with House SpeakerJohn A. Boehner’s spokesman flatly ruling it out.

But the process, known as inherent contempt, is well-established by precedent, has been confirmed by multiple Supreme Court rulings, and is available to any Congress willing to force such a confrontation.

Full story here.

View the original article here

Iran Oil Embargo Goes Into Effect: Crude Up 8%

Zero Hedge
Friday, June 29, 2012

Following a 3-sigma fall yesterday, WTI crude has rebounded exuberantly amid the European ecstacy and the Iran Oil Embargo. Up almost 9% from late yesterday’s lows (a 6-sigma jump), it appears yet another squeeze is in play (perhaps from demand-pull on the back of Hillary’s unyielding national policy – oh yeah apart from China and Singapore). While the WSJ notes: “There’s no material price premium from the Iran issue”, it seems the potential for an epic short-squeeze – as Iran’s largest importer of Oil (cough China cough) is now exempt (and continuing to hoard) leaving refiners potentially tight on supply – as macro tail-risk is seemingly removed from the downside by the ‘nothing’ summit we just experienced.

WTI swings of outrageous fortune…

as WTI reverts (like every other risk asset) to last week’s end of week levels as Europe’s imminent demise is demoted to a one month problem…

We can only assume that all those airlines hedging and gas stations are timing these moves perfectly to make sure that the ‘tax rebate’ of lower gas prices stays with us and creates a self-sustaining recovery

 

View the original article here

Where Does Money Come From? The Giant Federal Reserve Scam That Most Americans Do Not Understand

Michael Snyder
The Economic Collapse
Wednesday, June 27, 2012

How is money created?  If you ask average people on the street this question, most of them have absolutely no idea.  This is rather odd, because we all use money constantly.

You would think that it would only be natural for all of us to know where it comes from.  So where does money come from?  A lot of people assume that the federal government creates our money, but that is not the case.  If the federal government could just print and spend more money whenever it wanted to, our national debt would be zero.  But instead, our national debt is now nearly 16 trillion dollars.  So why does our government (or any sovereign government for that matter) have to borrow money from anybody?  That is a very good question.  The truth is that in theory the U.S. government does not have to borrow a single penny from anyone.  But under the Federal Reserve system, the U.S. government has purposely allowed itself to be subjugated to a financial system in which it will be constantly borrowing larger and larger amounts of money.  In fact, this is how it works in the vast majority of the countries on the planet at this point.  As you will see, this kind of system is not sustainable and the structural problems caused by such a system are at the very heart of our debt problems today.

So where does money come from?  In the United States, it comes from the Federal Reserve.

When the U.S. government decides that it wants to spend another billion dollars that it does not have, it does not print up a billion dollars.

Rather, the U.S. government creates a bunch of U.S. Treasury bonds (debt) and takes them over to the Federal Reserve.

The Federal Reserve creates a billion dollars out of thin air and exchanges them for the U.S. Treasury bonds.

So why does the U.S. government go to all this trouble?  Why doesn’t the U.S. government create the money itself?

Those are very good questions.

One of the primary reasons why our system is structured this way is so that wealthy people can get even wealthier by lending money to the U.S. government and other national governments.

For example, last year the U.S. government spent more than 454 billion dollars just on interest on the national debt.

Over the centuries, the ultra-wealthy have found lending to national governments to be a very, very profitable enterprise.

The U.S. Treasury bonds that the Federal Reserve receives in exchange for the money it has created out of nothing are auctioned off through the Federal Reserve system.

But wait.

There is a problem.

Because the U.S. government must pay interest on the Treasury bonds, the amount of debt that has been created by this transaction is greater than the amount of money that has been created.

So where will the U.S. government get the money to pay that debt?

Well, the theory is that we can get money to circulate through the economy really, really fast and tax it at a high enough rate that the government will be able to collect enough taxes to pay the debt.

But that never actually happens, does it?

And the creators of the Federal Reserve understood this as well.  They understood that the U.S. government would not have enough money to both run the government and service the national debt.  They knew that the U.S. government would have to keep borrowing even more money in an attempt to keep up with the game.

That is why I call the Federal Reserve a perpetual debt machine.  The Federal Reserve was created to trap the U.S. government in an endlessly expanding debt spiral from which there is no escape.

And the Federal Reserve is doing a great job at what it was designed to do.  Today, the U.S. national debt is more than 5000 times larger than it was when the Federal Reserve was first created.

Another way that money comes into existence in our economy is through the process of fractional reserve banking.

I originally pulled the following simplified explanation of fractional reserve banking off of the website of the Federal Reserve Bank of New York, but it has been pulled down since then.  But I still think it is helpful in understanding the basics of how fractional reserve banking works….

“If the reserve requirement is 10%, for example, a bank that receives a $100 deposit may lend out $90 of that deposit. If the borrower then writes a check to someone who deposits the $90, the bank receiving that deposit can lend out $81. As the process continues, the banking system can expand the initial deposit of $100 into a maximum of $1,000 of money($100+$90+81+$72.90+…=$1,000).”

When you put your money into the bank, it does not say there.  The bank only keeps a relatively small amount of money sitting around to satisfy the withdrawal demands of account holders.  If all of us went down to the banks right now and demanded our money, that would create a major problem.

If I put 100 dollars into the bank and the bank lends out 90 of those dollars to you, now it looks like there are 190 dollars floating around.  I have “100 dollars” in my bank account and you have “90 dollars” that you just borrowed.

The new debt that you have taken on (90 dollars) has “created” more money.  But of course you are going to end up paying back more than 90 dollars to the bank, so more debt has been created than the amount of money that has been created.

And that is one of the big problems with our financial system.  It is designed so that the amount of debt and the amount of money are supposed to be perpetually expanding, and the amount of debt created is always greater than the amount of money that is created.

So is it any wonder that our society is swamped with nearly 55 trillion dollars of total debt at this point?

A debt-based financial system is unsustainable by nature because it will always create debt bubbles that will inevitably burst.

Are you starting to see why so many Americans are saying that we need to abolish the Federal Reserve system?

Our founding fathers never intended for our financial system to work this way.

According to Article I, Section 8 of the U.S. Constitution, the U.S. Congress is supposed to have the authority to “coin Money, regulate the Value thereof, and of foreign Coin, and fix the Standard of Weights and Measures”.

So why has this authority been given to a private institution that is dominated by the big Wall Street banks and that has actually argued in court that it is “not an agency” of the federal government?

Thomas Jefferson once said that if he could add just one more amendment to the U.S. Constitution it would be a ban on all government borrowing….

I wish it were possible to obtain a single amendment to our Constitution. I would be willing to depend on that alone for the reduction of the administration of our government to the genuine principles of its Constitution; I mean an additional article, taking from the federal government the power of borrowing.

But instead, we have become enslaved to a system where government borrowing actually creates our money.

The borrower is the servant of the lender, and we have allowed our government to enslave us to the tune of nearly 16 trillion dollars.

There are alternatives to this system.  Things do not have to work this way.

Unfortunately, the vast majority of our politicians consider the Federal Reserve to be good for America and steadfastly refuse to do anything to change the status quo.

So if you are waiting for “solutions” to these problems on the national level you are going to be waiting for a very long time.

The debt problems that the United States and Europe are experiencing did not come into existence by accident.  They are the result of fundamental structural problems with the financial system.

A debt-based financial system is always going to fail in the long run.  Unfortunately, most Americans still do not understand this and so we will all get to suffer the consequences.

Tags: Financial

View the original article here

Whistleblower Reveals Plan To Evacuate London During Olympics

200,000 casket linings on standby says undercover journalist who infiltrated security team

Paul Joseph Watson
Infowars.com
Wednesday, June 27, 2012

An undercover journalist going by the pseudonym ‘Lee Hazledean’ has blown the whistle on astounding revelations about how he infiltrated the G4S – the company responsible for security at the London Olympics – and discovered shocking plans for the evacuation of London, 200,000 ‘casket linings’ being on standby, along with botched security procedures that leave the Games wide open to attack.

Hazledean’s interview with Tony Gosling, Bilderberg.org editor and host of BCFM’s Friday Drivetime, has gone viral on the web over the last few days. Hazledean is an undercover journalist for a television program in London and has worked with news agencies on hard-hitting subjects, but when he approached the mainstream media with his bombshell story, they showed no interest.

When Hazledean asked Channel 4 News Home Affairs Correspondent Andy Davies if he would run the story, Davies said he wasn’t interested and days later Channel 4 ran a puff piece about G4S which portrayed the organization as competent and trustworthy.

“I sent him an email, I called, he wasn’t interested and he said there’s a media blackout on this kind of story, that nobody would be interested in running it,” said Hazledean.

In the interview, Hazledean divulges how he merely had to fill in an application form to get a job with G4S, the private company providing security for the Olympics, that he underwent no background check whatsoever, and that his personal references were not checked.

Employees are given just two days of training to run airport-style security checkpoints which include body scanners, which Hazledean said “would be turned off completely” at peak times, meaning terrorists could just walk straight into the event with ammunition or explosives and have an excellent chance of remaining undetected.

“In fact, I was asked to be a would-be terrorist on the final training day and I was given a knife, a gun and an IED, and on all three occasions throughout the day I got through the metal detector and I also got through the x-ray machine scanner,” said Hazledean, adding that terrorists could quite easily stage a “massacre” given the lax nature of the security.

“They’re not training them properly…it’s quite open to a terrorist attack very easily and I don’t say that lightly,” said Hazledean, adding that he witnessed G4S members doing drug deals while training classes were taking place, while others were taking surveillance photos on their cellphones of supposedly secure areas. Hazledean said a lot of the security staff were poorly qualified and that many of them could barely speak English.

Hazledean also revealed how the large contingent of soldiers being brought into London for the Olympic Games included “a lot of UN troops being posted in and around London,” including American and German troops.

The whistleblower also revealed how unauthorized personnel were being handed G4S uniforms and that uniforms had been stolen.

Hazledean’s most chilling revelation was how he learned about preparations to evacuate London and how, “The security guards used for the Olympics will be at the forefront of getting the public out of London.”

“They seem quite serious about it, they’ve spent a lot of time on this,” said Hazledean, noting how G4S spent two hours talking about the evacuation of London in comparison to just half an hour talking about security screening procedures for the Olympics itself.

The whistleblower also noted how the 100,000 plus troops that would be stationed in London during the Olympics would be enough to carry out such a large scale evacuation.

Another chilling facet Hazledean learned was that 200,000 casket linings (temporary coffins) were being shipped in to London that can hold four bodies each. The whistleblower expressed his amazement at why security guards working on mundane screening procedures would need to be told such information.

The whistleblower also revealed how he was told Predator drones would be circling London in readiness for terrorist attacks, and that G4S employees were shown a video of a drone killing a group of people in Afghanistan.

Hazledean noted how G4S leaders saw the public as “the scum of the earth” and also told their employees that the police had no authority over them. He also related how one of the leaders told him that an event after the Olympics would be a “defining moment” for London but when pressed, refused to divulge what she meant.

Hazledean is not the first to blow the whistle on G4S. Earlier this month, data input clerk Sarah Hubble revealed that she was fired by G4S after complaining that G4S was cutting corners in their security preparations for the Olympics and that she herself had not been vetted.

Speaking with Infowars, Hazledean said that he had been making contingency plans for if his life was put in danger or if he became a target for the authorities in any other way after blowing the whistle on the scandal.

Asked about a meme circulating the web that conspiracy theories about a false flag attack occurring at the London Olympics are being deliberately allowed to proliferate in order to make ‘truthers’ look paranoid after nothing happens, Hazledean stressed that merely getting the story out was necessary as it could derail any planned attack.

Lee Hazledean will appear on The Alex Jones Show tomorrow at 1pm CST.

*********************

Paul Joseph Watson is the editor and writer for Prison Planet.com. He is the author of Order Out Of Chaos. Watson is also a regular fill-in host for The Alex Jones Show and Infowars Nightly News.

View the original article here

Barclays chief gives up bonus over £290m fine

The very meaning of 'corporate citizen' is to do what Barclays has done: fleece the world and demolish the poor. Corporations should not even exist in the way in which they do. Their evolution is purely in order to scam more and more money and power and capital to reign over us all.

It always makes me laugh when these sick people like Bob Diamond 'give up their bonuses' after their corporation has effectively cheated thousands of people out of money. Surely they shouldn't be given the choice to do this but they should be rounded up and shot? Perhaps then they would think twice about conning honest people out of large amounts of cash...

Bob Diamond has pledged to make Barclays a better corporate citizen.

Barclays has been slapped with total fines of £290m for its "serious, widespread" role in manipulating the price of crucial interest rates in a move that has forced chief executive Bob Diamond and other top executives to forgo any bonuses for 2012.

The £59.5m fine from the Financial Services Authority is the largest penalty ever levied by the City regulator, which found that Barclays contravened its rules for a number of years and involved "a significant number of employees".

The other penalties paid by Barclays are to settle with the US authorities, the department of justice ($200m) and the Commodities Futures Trading Commission ($160m), as part of an industry wide probe into the way that interest rates traded between banks were set.

The investigation covered the London Interbank Offered Rate (Libor) and the Euro Interbank Offered Rate (Euribor) both of which play a critical role in setting the rates of interest that households and major companies pay to borrow.

Libor is used as a benchmark for setting financial contracts and interest rates around the world and is overseen by the British Bankers' Association. The BBA is conducting its own review which will be published later on Wednesday. Banks are asked which rate they think they will be able to borrow from each other for periods of time ranging from overnight to 12 months in currencies including sterling, dollars, euros, yen and Swiss francs.

The FSA found that Barclays had been making submissions to the process that were intended to allow the bank to make profits through its traders speculating on interest rates and reduced the price it submitted during the financial crisis because of management concerns over negative media comment. The FSA said that Barclays' top management was concerned that the higher prices it was saying it expected to borrow at were making it appear that it had liquidity during the crisis – and so the bank ended up submitting lower prices than it would otherwise have done.

The FSA made a damning criticism of Barclays and warned other banks that more cases were to come. Tracey McDermott, acting director of enforcement and financial crime, said the misconduct was "serious, widespread and extended over a number of years".

"Making submissions to try to benefit trading positions is wholly unacceptable. This was possible because Barclays failed to ensure it had proper controls in place. Barclays' behaviour threatened the integrity of the rates with the risk of serious harm to other market participants," said McDermott.

"The FSA continues to pursue a number of other significant cross-border investigations in this area and the action we have taken against Barclays should leave firms in no doubt about the serious consequences of this type of failure."

Diamond, who has been pledging to make Barclays a better corporate citizen, is giving up his bonus for 2012 as a result.

"The events which gave rise to today's resolutions relate to past actions which fell well short of the standards to which Barclays aspires in the conduct of its business. When we identified those issues, we took prompt action to fix them and co-operated extensively and proactively with the authorities," Diamond said.

"Nothing is more important to me than having a strong culture at Barclays; I am sorry that some people acted in a manner not consistent with our culture and values."

The boss of Barclays Capital (the investment banking arm) Rich Ricci; the chief operating offer Jerry del Missier and finance director Chris Lucas are giving up their bonuses too.

View the original article here

Twitter joke humorous not menacing, high court judges told

This is a total waste of tax payers' money to the courts. The guy wrote a joke on Twitter and now is being seen as a terrorist. Give it a break. The only terrorists in our country is the secret services and the armed forces who bomb the crap out of countries all over the world with no provocation. This kind of rubbish must stop...

Paul Chambers at the high court in February: the case has become a cause célèbre for those concerned about freedeom of expression.

A message sent on Twitter threatening to blow up a snowbound airport unless it reopened was not "menacing" and was like a comic cracking a joke on stage, the lord chief justice was told at the high court.

In the latest appeal by Paul Chambers against his criminal conviction on Wednesday, in what has become known as the Twitter joke trial, John Cooper QC told a panel of three senior judges that the punishment for a tweet sent to about 600 followers in January 2010 should be overturned because a district judge had misapplied the law and the conviction was in breach of human rights laws relating to freedom of expression.

When Chambers sent the tweet that landed him a £1,000 fine and a criminal record, he had arranged to fly from Doncaster to Northern Ireland to see a woman he had just met. He wrote: "Crap!

Robin Hood Airport is closed. You've got a week to get your shit together, otherwise I'm blowing the airport sky high!!"

A week later the message was found by an off-duty airport employee and Chambers was arrested. He was later convicted at Doncaster crown court of sending a message of a "menacing character" under the Communications Act 2003.

The case has become a cause célèbre for those concerned about freedom of expression and the way the courts police social media, as well as attracting the interest of top comedians. Chambers arrived in court accompanied by Stephen Fry, Al Murray and Graham Linehan, who have supported him throughout his legal battle.

"This was not a message he sent to the gentleman who accessed it," Cooper told Lord Judge, Mr Justice Owen and Mr Justice Griffith Williams. "The appellant had around 600 followers who had deliberately elected to follow his account.

"His account was mainly humorous in tone and touched on a developing relationship. All those who followed him would have known this and would have realised the perspective from which this man was communicating."

He said the case might turn on a judgment of whether the tweet was of "menacing character" and Judge agreed, saying: "That rather is our view and that is what we have to address".

Cooper told the court the message was in the context of an "informal discussion and a humorous discussion".

He highlighted the exclamation marks after "Crap!" and "sky high!!", adding: "the expression 'you have a week and a bit' is hardly indicative of a threat intended to be menacing.

He said Chambers had not sought to hide his identity and said this was "certainly not a message sent by a terrorist and it was wrong of the crown court in Doncaster to make a connection between this case and terrorism".

Cooper said in Chambers's case the test for whether a message was menacing was significantly higher than whether it was a threat and that this was shown in its definition in laws relating to theft and blackmail. He said a menacing threat should cause "the mind of an ordinary person of normal stability and courage" to be "influenced or made apprehensive" and that the person sending the message must intend to threaten the person to whom it is likely to be conveyed. Chambers's tweet fell short of these tests, he said, adding "not all threats are menacing".

Cooper said the conviction failed to take into account human rights legislation relating to freedom of expression. He employed a well-known legal analogy relating to shouting "fire!" in a theatre.

"The analogy is not of a man in the audience shouting 'fire!' but of that of a comedian on the stage shouting the same thing and the context in which he shouted 'fire!' would be understood would be well known – a joke," said Cooper. "The whole rationale of the Communications Act was not intended to take into account this sort of [media] platform."

He added: "It is society that will rule on whether that joke is acceptable and not a criminal code … There is a right enshrined for people to make jokes that others may regard as offensive." He said if jokes were vetted according to a criminal code, Betjeman would have had cause to be concerned when he wrote "come friendly bombs fall on Slough", adding "and Shakespeare when he said 'kill all the lawyers'".

Judge replied, "That was a good joke in 1600 and it is still a good joke now," following laughter in court.

Chambers's legal team argued the tweet should only be considered a "message" under law when it was sent to the followers for whom it was intended. When it was later searched for and discovered, as by the off-duty airport security officer, it should no longer be considered a message sent by an individual, not least because it might be shorn of its context.

"Messages on the public timeline are capable of being searched but the practical reality is that it is highly unlikely that they are outside the core follower of a particular tweeter," said Cooper.

Robert Smith QC, appearing for the director of public prosecutions, did not accept this argument. "By any view he was foolish to do what he did," he said. "The question remains by whose standards and what members of the society would view this as a joke or humorous given that members of society who had access to the message may not or would not have knowledge of the circumstance which led Mr Chambers to send the message."

He said a message is menacing if a person of reasonable fortitude feels it to be. The hearing continues.

View the original article here

Queen shakes hands with Martin McGuinness – video

The irony of this moment is compelling. However, I really wouldn't be surprised if the whole Sinn Fein v British monarchy wasn't all just a pantomime dumb show. Considering that so many bombs were planted by 'undercover' agents in the IRA it sounds like a clear case of fake terror brought to you by MI5 and MI6. Anything to make the English workers despise the Irish, who incidentally live in a colony of our Queen's ruling. Absolutely insane...

In a historic moment for the Northern Ireland peace process, the Queen meets the Sinn Féin deputy first minister Martin McGuinness, a former IRA commander. The two shake hands at an arts event in Belfast as part of the Queen's diamond jubilee tour. McGuinness was a senior member of the IRA when it killed the Queen's cousin Lord Mountbatten in a bomb blast in 1979

View the original article here

Nick Clegg announces extra help for young jobless in 20 troublespots

The extra help that Nick Clegg is referring to is: a bike with no wheels, and a piece of paper with his childish scrawl on it stating: 'get on yer bike'. In other words: 'get fucked. I don't care about you. I've got a job through my background and people pulling strings for me. So tough luck kids.' It amazes me the politeness the working class shows to the scumbag ruling elite of Britain. The ruling elite is the most hypocritical, decadent and greedy control freaks the world has ever seen, but still people just accept it. Blows my mind...

Hartlepool is one of the first 20 areas to benefit from the reduction in the youth contract qualification time.

Unemployed young people in areas where it is hardest to find work are to get extra government help under plans to be announced on Wednesday by the deputy prime minister, Nick Clegg.

Clegg will say that the problem of youth unemployment is a "human tragedy" which defines "who we are" as a society when he announces the extra help in a speech to the employers' organisation, the CBI.

"How we help these young men and women says something, says everything, about who we are," says an advance copy of the speech. "These are our children and they are in their hour of need."

The Cabinet Office and the Department for Work and Pensions have calculated the 20 worst areas for youth unemployment in the country, all of them in the north of England, Scotland and south Wales.

The Liberal Democrat leader is due to say that the government's youth contract scheme will be speeded up in these areas, cutting the time a person of 18-24 has to be unemployed to qualify for help in getting a job from nine to six months. Employers will then get more than £2,000 to help pay their wages for six months, although the company still has to contribute at least as much again.

The national £1bn scheme to help 160,000 young unemployed was announced in April, so it is too soon to assess its success in helping people get permanent jobs. However, a spokesman for Clegg said: "Hopefully, they see this person has been productive, they have spent a lot of time training them and they'll give them a job."

The first 20 areas to benefit from the reduced qualification time will be Blaenau Gwent, Hartlepool, South Tyneside, Merthyr Tydfil, Clackmannanshire, Redcar and Cleveland, Kingston upon Hull, Middlesbrough, Wolverhampton, Sunderland, Sandwell, Walsall, Rotherham, North Ayrshire, Dudley, Birmingham, Caerphilly, West Dunbartonshire, Barnsley and Northumberland.

"The sensible thing, if it works, is to extend it out the next 20 or 40 [areas], rather than say it should be the same nationally across the board," said Clegg's spokesman.

Clegg will claim the recovery of the economy will create more jobs, but this alone will not be enough to tackle the "long-term, structural" problem of youth unemployment, which has been rising since 2004. The government needs to provide "targeted support to the youngsters who struggle to break into the workplace", he will say.

View the original article here

Top Scottish university says poorer students don't make the grade

Because the poor are considered worthless, why should they be given an education by the ruling elite? They will never be accepted by the society in which they wish to become absorbed...

The town of St Andrews, whose university said only 200-300 teenagers from Scotland's most deprived areas got the requisite grades in 2011.

One of the UK's top universities has estimated that only two or three out of every 100 school-leavers from Scotland's most deprived areas are getting good enough grades to win places at elite universities.

St Andrews University said it believed the greatest barrier for children from deprived areas getting into top universities was long-term poverty, and a lack of educational and social support from a very early age.

Prof Louise Richardson, St Andrews' principal, said its analysis suggested only 200 to 300 teenagers from deprived areas got the results to reach St Andrews. Recent criticism by NUS Scotland was unfair and over-simplistic, she said. The student union said the university had a "truly awful" record after it emerged that it had only accepted 13 people from deprived areas.

"The issue isn't one of highly selective universities not having an interest in attracting kids from deprived backgrounds," Richardson said. "It's quite the reverse. The problem is that so few kids from deprived backgrounds meet our entry requirements. We go to enormous pains to try to attract them."

NUS Scotland found that in 2011 only 13 students of all ages from Scotland's most deprived areas won places at St Andrews, amounting to just 2.7% of places there. Just 91 won places at Edinburgh (5% of all its undergraduates) with 51 at Aberdeen (3.1%).

NUS Scotland's data did not show how many poorer teenagers overall got the grades needed to reach St Andrews, or highly competitive elite courses such as law or medicine. Unlike in England, the Scottish government does not publish detailed data on grades achieved by children from different social classes.

Ranked as Scotland's top university, St Andrews requires three As at Highers – the year-long Scottish qualification that is roughly equivalent to A-levels – as its minimum entry requirement.

St Andrews carried out its own analysis and estimates that between 200 to 300 of the 11,000 teenagers from the poorest 20% of Scottish neighbourhoods who left school got three As in 2011. By comparison, 5,555 pupils across all social groups achieved these grades in 2011.

St Andrews argues that the top universities across the UK compete vigorously with each other to attract the best-performing candidates from poor backgrounds: they are far more likely to be offered places at St Andrews than those from richer backgrounds.

Richardson said St Andrews had recently increased its scholarships and bursaries, and put on summer schools. Some scholarships set up for such applicants went unfilled because the candidates were not there.

"It's a much more complex problem," she said. "This annual cycle of criticising universities for not taking enough kids is getting us nowhere. We don't want to admit kids and set them up for failure. We can only admit kids who've a reasonable expectation of success here."

Robin Parker, the president of NUS Scotland, said he did not recognise St Andrews' figures but said it needed to "get real".

"Of course Scotland has deeply ingrained poverty issues, and no one is asking universities to solve all of society's ills. However, just because universities can't do it all doesn't mean they can't do more," he said.

"They should instead be looking at how they can start offering opportunities to talented young people they are currently overlooking."

Earlier this month, Oxford announced it would offer Scottish students from deprived backgrounds up to £22,000 over three years to take up courses there. Baroness Helena Kennedy, a Glasgow-born lawyer now principal of Mansfield College, told the BBC: "I want to make sure these opportunities are not the preserve of the elite. I want these opportunities to be available to the brightest and best everywhere."

Scotland's elite universities face statutory measures from the Scottish government to widen access in new legislation expected later this year, in return for a new funding package. St Andrews has led calls for graduate contributions to replace Scotland's free tuition for Scottish residents.

St Andrews' analysis was backed by Prof Lindsay Paterson, a sociologist and an expert in educational policy at Edinburgh University.

"It's not St Andrews' fault," he said. "We know that the social origins of inequality go far further back, right back to early childhood. It actually goes to the differences in language and brain development.

"There's a limited amount that schools and universities can do about this. It's actually about inequalities in society. If we continued tackling poverty, that would get to the heart of it or targeting children at the point at which it would have the biggest impact – about the ages of three to five."

Aberdeen University said it could not comment on St Andrews' figures but said the issue needed far greater investigation. "We would argue that by turning this into a quantitative metrics exercise for higher education institutions, we avoid addressing serious issues of deprivation that will have impacted on the student's experiences for the first 17 or 18 years of their life," a spokeswoman said.

A Scottish government spokesman said it was "strongly committed" to improving educational standards through its Curriculum for Excellence reforms, and was developing new strategies for teachers to improve outcomes.

View the original article here

Inequality "worst since second world war"

This seems to show that since the fall of the Soviet Union, the welfare state in Britain is being systematically demolished, and with that, inequality has grown exponentially. It is down to the anger and organisation of the working class. Right now class struggle is as miniscule as a gnat's cock and so the elite crush everyone for the working class sloth...

In his Beveridge Memorial Lecture to The Royal Statistical Society, Sheffield University's Danny Dorling says that an expert in inequality, says the richest one per cent of people in the UK take home fifteen per cent of all income, compared to 6% in 1979.

Professor Dorling, an expert in inequality, said: "If we look back about 100 years, we can see that inequality in the UK did drop significantly in the 70 years from 1910-1979. More than half of that drop in inequality took place prior to 1939. Since 1979 these inequalities have risen dramatically and continue to rise.

"The last time the best-off took as big a share of all income as they do today was in 1940, two years before the publication of the Beveridge Report, which became the basis of the UK's welfare state after the Second World War."

Professor Dorling says that to get into the top one per cent now requires an income of about £120,000 and this super elite have been awarding themselves huge pay rises in part to offset sterling's depreciation against other currencies.

"The super-rich ompare themselves to a global elite and sterling's depreciation has meant that compared to their peers in Europle or the US they are losing ground. Hence we see bankers and top CEOs getting big pay rises. It does not have to be that way beacuse in Switzerland and the Netherlands the top one percent take 6% of national income not 15%. It's our elites that are greedy."

Importantly the top 1% are pulling away from the rest of the rich. To get into the top 10% of incomes requires about £60,000 a year.

Professor Dorling said: "Even looking at the next-most well-off people, the gap between them and the richest is growing. In the early 1940s, the 'nine per cent' - the rest of the best-off ten per cent less the richest one per cent - were paid an average salary of 2.4 times average incomes, the same as in 1959, 1969 and 1973. But as inequalities rose, by 1990 this 'nine per cent' were paid three times average incomes and that continued until 2007.

"However, for the last five years their share has been dropping towards that 2.4 historic average. As each year passes, and the richest one per cent get richer still, the rest of the best-off ten per cent increasingly have a little more in common with the remaining nine-tenths of society, and less and less in common with those at the very top."

His lecture also addresses how fair Britain is compared to his past

Up until 1989 this is the best-off tenth of households (or more strictly 'tax-units'), after then it is adults. After 1975 it relates to all income declared for tax purposes (so tax dodging is excluded) and after 1920 what became the Republic of Ireland is excluded. More important than all these caveats is the fact that missing data has been interpolated so that when one line in the graph appears to exactly follow another, that is because it is estimated from that other (which figures are interpolated and which are not is shown in Appendix Table 1)

Inequalities by the measures shown here peaked in 1923, the year after the (1922) Great Gatsby summer (Fitzgerald, 1925). Then the best-off tenth of households in the UK took almost half the national annual income. Almost a quarter was taken by the best-off one-in-one-hundred, leaving 'just' a quarter of all income for the remaining nine tenths of the best-off tenth to share between them. The richest 1 in 1000 households in that year took home almost 6% of all income, but that share had been sliding since it had hit its maxima of almost 7% just a year after the Titanic sank (1912) which also happened to be the year in which the play 'The Inspector Calls' was set. The richest 1 in 10,000 households still took a staggering 3.34% in 1923, more than twice their share even today.

A key turning point, in hindsight, was 1936. It was then that the income of the best-off 1 in 1,000 peaked again at a lower point of 4.68% before falling fairly continuously to a minima of just under 1.00% of all income between 1977 and 1979 inclusive. The share of the richest thousandth's then rose to reach a new peak of 4.61% in 2007, before appearing to fall again in the two most recent years of data. I say 'appearing' as this is income declared for tax purposes and many of the richest people in Britain say they are no longer domiciled in Britain and do not pay tax here ( "tax is for the little people")

View the original article here

London bus drivers to vote again over possible strikes

Considering how much money the kuntz in charge have made out of the Olympics scam I think £500 bonus is more than reasonable for the bus drivers...

London bus drivers seek a £500 bonus for extra work during the Olympics.

The Unite trade union is to reballot London bus drivers barred from striking over Olympic bonuses by a high court injunction, as transport bosses criticised "deplorable" protests that disrupted bus services in the capital on Wednesday.

The union will hold a new poll for 4,000 workers at three operators that had secured an injunction over ballot irregularities last week, although thousands of drivers at 17 other operators went ahead with strikes last Frida over a £500 Games payment .

Unite confirmed the move as groups of supporters staged protests outside depots used by the three operators involved in the high court ruling.

Transport for London, which runs the capital's tube and bus networks, said the impromptu protests had disrupted 33 services.

"Any disruption to transport services for Londoners is simply deplorable especially in circumstances where the employers' offer has not even been put to the bus workers themselves," said a TfL spokesperson.

Unite is preparing to announce further strike dates as it steps up demands for a £500 Olympic Games bonus for its 21,000 bus industry members, although the payment could ultimately extend to around 29,000 staff.

It is understood that bus operators have calculated the union's demands as equating to a payment of around £21m – more than double the £8.3m on the table from the Olympic Delivery Authority – and is considerably higher than the widely publicised number of £14m.

Once extras such as employee tax and national insurance contributions are added in, bus operators claim, the £500 payment rises to a gross payment of up to £700.

Unite's regional secretary Peter Kavanagh said: "The overall figure is not the primary issue. It is not a huge sum of money compared with the tens of millions of pounds that TfL will be earning in extra bus revenues during the games."

It is also understood that bus operators have sounded out TfL about a contribution towards an Olympic bonus, but TfL has made clear that the ODA fund will be the limit of any taxpayer-backed contribution.

View the original article here

Shanghai barrs additives in restaurants' home-made beverages

This would never happen in Britain. No one gives a damn about the quality of food here, let alone give this any time in the national news.

All additives will soon be banned from beverages and fresh juices made in Shanghai restaurants under updated food safety standards.

"The regulations concerning beverages, hot pot soups and restaurant groups' central kitchens will be publicized after technical details are perfected," Shen Weitao, director of the food safety supervision department of Shanghai Food and Drug Administration, told China Daily on Tuesday.

No additives will be allowed in beverages or fresh vegetable juices from catering businesses, Shen said, and water may be added only when it is necessary.

A detection method will be adopted to ensure there are no illegal additives in hot pot soups, a food inspectors have always given special attention.

"It has been a headache for a long time to determine whether banned ingredients were added to the soups, but we've found an accurate and practical approach to detect the amount of residue from illegal additives," Shen said.

The authority said the standards will further safeguard food safety, and it will require restaurants to monitor their compliance with the regulations.

View the original article here

SOEs urged to prepare for tougher times

This is not a good sign. If the state-owned enterprises are being dismantled then it is going the way of the Soviet Union just before it collapsed. Immiseration and vast inequality followed, with gangster capitalists owning everything and the masses deeply impoverished.

State-owned enterprises must make more efforts to cut costs and improve efficiency in order to face the harsh economic conditions in the next three to five years, China’s state assets watchdog said.

“After 30 years of rapid development, the Chinese economy has come to a period of contraction,” Shao Ning, vice-director of the State-owned Assets Supervision and Administration Commission (SASAC), said at a recent meeting in Chongqing.

“During a contraction, cost factors play a more obvious role in a company’s development,” Shao said.

The SASAC said the global economy will suffer from a long-term depression due to the eurozone crisis and shrinking demand in international markets.

Meanwhile, domestic issues of unbalanced and unsustainable development remain, and an increasing downward pressure on economic growth is highlighting more potential risks.

As a result, SOEs must be fully alert of the gravity and urgency of the current situation and prepare for “winter conditions” in the next three to five years, it was said at the meeting.

So far, 106 SOEs have established special offices to improve the efficiency of their management activities.

View the original article here

Wen advocates South America trade deal

A free trade deal between China and Mercosur, the South American trade bloc, was proposed on Monday by Premier Wen Jiabao.

Analysts said that the deal, if signed, will carry a number of benefits for the highly complementary economies.

"We share extensive common interests and we have great potential for further cooperation, which will increase the power of developing countries," Wen said in Buenos Aires where he met Argentine President Cristina Fernandez and held a video conference with the presidents of Brazil and Uruguay.

"We should carry out feasibility studies on a free trade area between China and Mercosur," Wen said.

He also set a target to raise trade between China and the bloc to $200 billion in 2016, double the trade value of 2011.

All the regional leaders agreed on the benefits of a trade pact.

Brazilian President Dilma Rousseff said that boosting relations can keep any contagion from the financial crisis at bay and stop it "provoking unwanted consequences in employment and incomes that would hurt economic growth".

Fernandez said increasing links between China and Mercosur will inject economic vitality into the member countries, and boost Mercosur's development.

Uruguayan President Jose Mujica highlighted the need for Mercosur to add value to exports of raw materials and create more jobs.

Mercosur, also known as the South American Common Market, groups Argentina, Brazil, Uruguay and Paraguay.

Trade links have blossomed in the past decade between China and Mercosur.

China is Mercosur's second-largest trade partner and export market.

The bloc is the major exporter of agricultural products, such as soybeans and meat, to China, with total trade between them reaching $100 billion in 2011.

Qi Fengtian, an expert on Latin American studies at the Chinese Academy of Social Sciences, said that free trade offers new opportunities, not just in financial terms.

"Considering the rising influence of Mercosur's member nations, I think cooperation with China will contribute more to a fair and rational international trade order," Qi added.

Xu Yicong, former Chinese ambassador to Argentina, said increased cooperation will not only promote China's trade with the bloc but allow for a better understanding of various issues.

The proposed free trade deal could be discussed during Mercosur's meeting in Mendoza, Argentina, this week.

"You can see leaders are aiming at a long-term plan. They expect that working with China will drive their growth," Qi said.

Trade analysts cautioned that Brazil and Argentina share concerns over any trade deal as both nations have adopted measures to boost home industries.

While members of Mercosur have certainly tried to safeguard their national interests, growing global interdependence can also benefit economies, Qi said.

He Shuangrong, a specialist on Latin America at the Chinese Academy of Social Sciences, pointed out there is no significant barrier to the development of China-Mercosur ties.

Wen held talks with Fernandez at the Rose Palace in Buenos Aires on Monday.

Argentina ships about 80 percent of its soybeans to China, with trade between the two countries reaching $14.8 billion in 2011.

Contact the writers at qinjize@chinadaily.com.cn and wangchenyan@chinadaily.com.cn

Cheng Guangjin and agencies contributed to this story.

View the original article here

Ministry urges schools to stop corporal punishment

So corporal punishment is still acceptable in schools in China...

The Ministry of Education is proposing that schools wipe out corporal punishment, according to a proposal for public discussion published on the ministry's website on June 25.

Comments are being requested by e-mail until July 10.

According to the proposal, schools should guarantee and avoid the violation of students' rights, root out corporal punishment or disguised forms of corporal punishment, as well as avoid illegal restrictions of personal freedom and arbitrary charges.

A series of cases of violence against students has caught public attention recently.

On May 20, a primary school teacher in Shaanxi beat one of her students in front of 50 other students because the student didn't take his ID card to school.

Also on May 20, a 3-year-old in Hunan died with heat stroke after being locked in a school bus for seven hours because her teacher forgot she was there.

Also in late May, the Xinhua News Agency reported that a kindergarten teacher in Hangzhou used ultraviolet lamps to punish 12 children who didn't brush their teeth.

View the original article here

Military to strengthen ties with US

Beijing calls for proper resolution of US surveillance flights issue

Top Chinese military officials on Tuesday pledged to strengthen communication and cooperation with the United States, but also called for proper resolution of the issue of US surveillance flights near China.

Defense Minister Liang Guanglie and Deputy Chief of the General Staff Ma Xiaotian of the Chinese People's Liberation Army made the remarks during meetings with visiting Commander of US Pacific Command Samuel Locklear.

This visit comes one day before the largest-ever Rim of the Pacific naval exercises, scheduled from Wednesday to Aug 7 in Hawaii. It involves 22 nations, including the US, India and Australia, but not China, which was not invited to participate or observe.

China-US military ties have great potential as overall bilateral relations have been developed in a stable manner, Liang said, adding that establishing new, equal and mutually beneficial military relations is the inevitable need of both militaries and the common expectation from the international community.

China would like to boost military exchanges with the US and deepen cooperation in the fields of non-traditional security, said Ma. "This is in the best interest of both peoples, as well as the region and the whole world."

The two Chinese officers expressed concerns over the US strategic shift to the Asia-Pacific region and its frequent military surveillance close to China's coast. They urged the US to resolve related issues as soon as possible.

As a Pacific country, the US hopes to improve cooperation with all Asia-Pacific countries, including China, said Locklear, and he called for more dialogue and less misunderstanding.

Despite differences over some issues, China and the US share common interests in many fields, and the two militaries should enhance exchanges and cooperation to safeguard such interests and build a safe international environment, he said.

Closer ties between the US and its Asian allies are widely interpreted as a measure to contain China. Shortly after concluding the US joint drill with Japan and the Republic of Korea, Washington is scheduled to kick off the largest-ever Rim of the Pacific naval exercises with 21 other countries on Wednesday.

Russia, India, Mexico, the Philippines, New Zealand, Norway and Tonga are participating in the exercises for the first time, according to the Stars and Stripes, a Washington-based newspaper.

It is notable that China was not invited to participate or observe the exercises that involve most of the Asia-Pacific countries, analysts said.

"We had 14 countries participate in 2010. We've got 22 this year, so I think that's an indication of the interest that countries have in participating in it and the value they see in this kind of unique training opportunity," Charlie Brown, a spokesman for the US Navy's 3rd Fleet, was quoted as saying.

In 2006, the former head of US Pacific Command William Fallon invited the PLA to observe the exercise "Valiant Shield", said the newspaper.

Professor Li Daguang with the University of National Defense said the exercise echoes the recent statement from US Defense Secretary Leon Panetta that US naval power in the Pacific will increase and the US will enhance ties with its allies in the region.

The US carries on bilateral cooperation with China while at the same time continues building a strategic circle to contain China, Li told Beijing-based China News Service.

"I think everyone recognizes that (the maritime security environment) is where either we learn to live and work together, because we do have considerable shared interests, or this is where we get in each other's way and potentially start to stare each other down," Brad Glosserman, executive director of the Pacific Forum Center for Strategic and International Studies in Honolulu, told the Stars and Stripes.

Contact the writers at zhaoshengnan@chinadaily.com.cn and chengguangjin@chinadaily.com.cn

View the original article here

Xisha residents get free TV channels

This is bizarre. So far behind in terms of communications...

Residents of the Xisha Islands in the newly established Sansha city will be able to watch 48 satellite TV channels for free by the end of August, Hinews.com, a news portal run by Hainan Daily Press Group, reported on Tuesday.

Zhang Yuqi, section chief of the broadcasting and television technology administration of the Department of Culture, Radio, Television, Publication and Sports of Hainan province, said that they have set a TV and radio station on Yong Xing Island of the Xisha Islands, and provided 1,000 radios to residents on the Xisha Islands.

According to the report, the department is working on a service that will enable fishermen to watch TV while working at sea.

View the original article here

Officials punished for NW China forced abortion

XI'AN - The city government of Ankang has announced punishments for officials involved in a forced abortion in northwest China's Shaanxi province.

Feng Jianmei, 23, was forced to terminate her pregnancy over seven months in a hospital in Zhenping county on June 2. That violated her rights late in her pregnancy, according to the investigation report released by the Ankang municipal government on Tuesday.

Several government officials in Zhenping, which is administrated by Ankang, and its Zengjia township violated the laws of central and local government on population and family planning, said the report.

The government said its has decided to subject Yu Yanmei, deputy county magistrate of Zhenping in charging of family planning, with administrative demerits according to national and provincial policies and regulation.

Jiang Nenghai, head of the family planning bureau of Zhenping, has been removed from his post. Some other officials of the township, county government and the county hospital that aborted Feng's pregnancy, were also punished.

According to the investigation, while persuading Feng to receive the abortion, some staff of the township government used crude means to violate her intentions.

There was also no legal basis for the township government's demand that Feng and her family pay a deposit of 40,000 yuan (about 6,228 U.S. dollars) for a certificate allowing her to have her second child.

Feng, a non-agricultural resident born on December 25, 1989, gave birth to a girl in 2007 while she was 17, said the report.

Under family planning laws, Feng was not legally entitled to have a second child.

The investigation showed that Feng lied in claiming to be an agricultural resident and entered her birth date as January 21, 1985, on the marriage registration.

In March 2012, local family planning authorities found Feng had entered her third month of pregnancy and asked her to migrate her 'hukou' -- household registration certificate -- to her husband's account and obtain the necessary certificate for a second child.

Feng and her family offered no response to the township government's request and did not pay the deposit.

Details of the case, including several photos showing the remains of the fetus lying next to the mother on her hospital bed, were posted on online forums and have shocked and angered many people nationwide.

Ankang municipal government had already ordered the Zhenping county government to offer Feng's family compensation.

View the original article here