Sunday, 5 July 2009

Capitalists take the profits, the tax payer takes the losses

Reuters reports today that:
The British government is to delay the publication of a report into the collapse of carmaker MG Rover in 2005 pending an investigation by the Serious Fraud Office, British media reported on Sunday.
It would appear that much of the money that was pumped in to Rover ended up in the pockets or pension funds of the "Phoenix Four" - this is the fraud. Yes, that was an accusation - please sue me John Towers, John Edwards, Nick Stephenson or Peter Beale.

Last week, we heard that National Express, or rather its specially constructed subsidiary, had abandoned or been stripped of its loss making franchise, while keeping the profitable ones. So clearly, it is fine to bid for three franchises and then walk away from the one that is going to cost you money.

A brief analysis of Lloyds Bank's dividend history, would appear to indicate that that the bank had been paying around 12% to its shareholders for a substantial period. So once again, the capitalists take the profit and now the tax payer is saddled with the losses.

In all of these cases we see that the government is simply incapable of preventing the capitalists from screwing the tax payer. Alternatively, we could assume that the government is intent on supporting these people and giving them money, while taxing the more honest worker.

Mind you, British Airways and British Telecom seem to be taking this in-house and giving the earnings to the shareholders and executives in times of plenty and then asking the employees to bail them out when they hit trouble.

This is just unfair

Capitalists will tell you that they are paid huge returns because they take risks. This is clearly not the case in the current climate. The public have been transfixed by the MPs' expenses scandal, and seem to have forgotten the much bigger cockspiracy to support incompetant capitalists.


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