Google brings us a wonderful New Year's Eve gift, finding this story of the brave foot soldiers of Forest of Dean Against the Cuts protesting Government cuts in the heart of Lydney. You couldn't make it up.
I'd pay good money to watch these Occupiers take on the only capitalist pigs in the Forest of Dean.
It seems that not all the Irish taxpayers are enamoured with the policy of standing behind their banks' losses. To be sure, this piece in the Guardian is written by a media studies lecturer and the director of the Centre for the Study of Wider Europe (the Guardian columnist stereotypeometer just melted down) but their basic point is what I've been expecting to hear for a while - why should the Irish voter be expected to pay for the profligacy of its banks and the stupidity of European banks in lending to speculative property buyers?
The money quote:
The far-reaching implications of the fiscal compact will surely outweigh political anxiety about volatile public opinion, and result in a referendum.That's not going to work out too well for the debt-holders if it happens. If I were the Irish leadership I'd be using articles like this as a sword of Damocles over the heads of the debt-holders. "Nice bonds you've got there; 'twould be a shame if anything were to happen to them." I wonder if there are going to be some quiet re-negotiations and write-downs in the months ahead. If not (supposing for instance that the central European banks are so leveraged that any significant write-down on the debt would seriously hit their numbers) I can foresee a particularly bloody confrontation.
I particularly liked careenage's comment:
This isn't about rewarding Ireland, it's about protecting the world banking system from the consequences of its bad lending decisions. The question you should really be asking is, if Ireland were to default, would the consequences be any worse than what is currently happening? What would the EU do? Park tanks in the centre of Dublin? Tell the EU and the banks to get lost. Things will be painful for 18 - 24 months but it can't be much worse than it is already.I wouldn't like to play him or her at poker.
My thanks to the Grauniad for a heart-warming tale of Computer Sciences Corporation (CSC) admitting that it might have to write down a cool £1bn as a result of the ongoing epic saga of failure that is its Lorenzo software for the NHS.
To be scrupulously fair to CSC, Lorenzo was originally developed by iSoft, whom CSC acquired in August 2011 (after the FSA had given a well-deserved kicking to four directors of iSoft whose accounting practices turned out to be somewhat more murky than is considered proper). By my reading of the many threads in the story, Lorenzo was a key element in CSC's delivery which it had subcontracted to iSoft; once the latter was holed below the waterline, CSC's only real option was to acquire iSoft and hope to make the damn thing work well enough to at least approach the project milestones.
In another warm and fuzzy development, CSC itself is being sued by the Ontario Teachers' Pension Plan due to alleged concealment of the disasterous financial results of its participation in the NHS National Programme for IT.
The Guardian notes a whistleblower's mail to the CSC CEO:
"The project is on a death march where almost as many defects are being introduced as are being fixed."For those of you who have not read Ed Yourdon's Death March, you really should. In essence, once a project is on a death march, the chance of completing it is essentially zero unless a) you can hold your engineers' families hostage or b) you have a near-infinite amount of money to hose at the problem. Looks like CSC has neither of those options.
If CSC writes down 40% of its market value, that really screws the pooch for all its management and senior engineers who no doubt have a very substantial equity and/or equity options holding. Then the OTTP's legal action drags the share value down further - if not curtains for CSC, it's certainly the end of the world as they know it.
This situation of a Government IT supplier actually getting its come-uppance is tragically rare, but I intend to enjoy it while it lasts.
Via Longrider who spent some time in National/Network Rail and has some more depth on the matter, the Scottish railway signallers are striking for 72 hours because they don't like a proposed change to promotions. Let's leave aside the cynicism of choosing 3 days across Christmas as the strike dates, and look at the underlying grievance.
Contrast the Guardian's take on the reason for the strike, which is far from clear:
The Rail, Maritime and Transport (RMT) union claims Network Rail managers have ripped up an arrangement which had been in place for more than 30 years where staff were "slotted" into a post when it became vacant.with Longrider's much clearer explanation, that currently promotion is based on seniority and that Network Rail have the temerity to demand that some measure of competence be substituted for this:
Network Rail said the union wanted a signaller removed from his post before it would negotiate. It said resolving a dispute before the Christmas rush was made "impossible" by the stance of the RMT.
The unions didn’t much like the idea of competence based promotion back in 1994 and it seems they still don’t. It does surprise me that there is still dispute about it getting on for twenty years later, though.
What's really concerning about this is that there is nominally no financial impact on the union membership as a result of this policy change - the same posts exist for the same salaries, and union members occupy them. One union member's loss is another's gain? So why strike? It seems pretty clear that the union is very sensitive about any toe-in-the-door relating to paying or promoting people based on any form of measured performance. Heaven forbid that any unionised workforce should be paid by result.
In the spirit of today's Festivus Day, I'd like to wish everyone a very happy Festivus.
With that out of the way, we come to the Airing of Grievances:
On the bright side, we were delivered a genuine Festivus Miracle today: nuclear sector workers being paid to spend more time in meetings. Something to warm the cockles of one's heart.
Over the past month I've noticed a lot more trouble with my OS X machines; networking (especially Airport) being much more reluctant to connect even to perfectly good networks, and several cases where my laptops just won't wake up after being opened. Safari (5.1.2) is also troublesome with various UI glitches and, if open for long enough, it refuses to load any new pages: a close and re-open is required. Notable that Firefox on the same machines doesn't have the same difficulties.
I've seen something analogous at Apple stores during 2011: the "can't do enough for you" attitude can still be found sometimes, but other times it feels like you're just intruding on the employees' time. Perhaps these are the slackers attracted to a successful company like ants to honey.
With Jobs' passing, has the quality mania at Apple started to disappear and be replaced by "just good enough to ship"? Are they going to do a Microsoft? Enquiring minds want to know.
Update: Just after I posted that, my Wifi icon started strobing as if it were trying to find a network, despite being very clearly connected to and posting through a perfectly good one. WTF?
I'm choosing to get my 2012 predictions in early, and hope (possibly in vain) that events in the next week or so don't render them redundant.
Tony Shearer, who saw the incompetence of the FSA first hand, writes of how they regulated minutae and completely missed the big picture failings at RBS, HBOS and Kaupthing Singer & Friedlander. He was chief exec of Singer & Friedlander as it was acquired by Icelandic behemoth Kaupthing in 2005 - three years later, after to Kaupthing's implosion and seizure by the Icelandic FSA, everything went foom and the FSA was forced to step in.
As Shearer notes of then FSA chairman Callum McCarthy:
I invited him to visit Singer & Friedlander to see at first hand how the FSA regulated what I called "trivia and minutiae" and paid no regard to the possibility of "systemic failure of the banks" (which was one of only two of the FSA’s objectives).It was, in hindsight, inevitable. If you staff the FSA with moderately intelligent but unimaginative drones and then micro-manage them, they're going to focus on the ticking or crossing of many small boxes on pages and pages of forms, with a short summary essay at the end. They're not going to take the time to look at the big picture and ask "what if" despite the fact that this is exactly what a national-level financial services authority should be doing. Where's the personal job security and professional advancement in that? They have no skin in the gain. After all, no-one was going to be fired even if half the UK banking sector went "kablooie".
If you want effective regulation you need to hire really good people, pay them very well, but defer most of their pay over 5-10 years and have it at risk in the case of failure or significant fraud in the institutes they regulate. Maybe even pay them in restricted share units of the institutes they regulate. I want very sharp regulators who feel that their testicles are on an anvil, and that the taxpaying public is nearby with a large hammer. In the case of Hector Sants, I'd like this to be literally true -- assuming that he can find the organs in question.
Philip Rubio defends the US Postal Service claiming that the only funding crisis results from that gosh-darned Congress making them pre-fund retiree health benefits:
So how did an organisation that actually earned a $6131m revenue surplus over the last four years – which included the worst recession since the 1930s – get so deep in debt, with a $10bn deficit this past fiscal year?(my emphasis). Hmm, so that looks like a $4.5bn deficit to me even ignoring the prefunding issue. I wonder why he thinks prefunding health benefits of current retirees is so objectionable - just where does he think the money is going to come from in future?
The USPS is the victim of an invented crisis. The 2006 Postal Enhancement and Accountability Act forced the postal service to unnecessarily prefund its retiree health benefits 75 years into the future at the rate of $5.5bn a year over a ten-year span.
At least CiF is diligent about giving writers' backgrounds (albeit through a link):
Philip F Rubio is a retired postal worker and an assistant professor of history at North Carolina A&T State University. His second book, There's Always Work at the Post Office: African American Postal Workers and the Fight for Jobs, Justice and Equality (2010), won the 2011 Rita Lloyd Moroney Award for scholarship on the history of the American postal system
So not an entirely disinterested party then. He also seems to regard a major role of the USPS as a job factory. As Mr. Worstall is fond of saying, jobs are a cost, not a benefit.
For what it's worth, my experience of the USPS's efficiency made me look favorably once more on the Royal Mail, and its delivery of junk mail is particularly objectionable -- wrapped around real mail so you have to take particular care to ensure you're not throwing out your bank statement along with the flyers from shops you have no wish to ever visit. It may be that prices of letters have to rise substantially - it wouldn't surprise me if 1st class stamps doubled or even tripled in cost to reach break-even - but UPS, Fedex and co. have successfully eaten the USPS's lunch for parcel delivery, and USPS have no-one to blame but themselves.
Remember how Jerry Seinfeld screwed up USPS postie Newman's chance to go to Hawaii when he covered for Newman's round:
Newman: Too many people got their mail. Close to 80%. Nobody's ever cracked the 50% barrier.
Jerry: I tried my best!
Newman: Exactly. You're a disgrace to the uniform.
A heartwarming Christmas tale in the DT of striking Unilever workers going without their Christmas hampers.
Approximate sequence of events:
Unite national officer, Jennie Formby, said it was "spiteful" of the company to cancel Christmas perks for staff on strike. She said: "First Unilever slash pensions, now they're cancelling Christmas celebrations."
This, Jenny my love, is the downside of strike action. You did realise that there was a downside when you were encouraging your workers to strike? If you remove goodwill from the worker side (an absolute right, along with the absolute right to withdraw one's labour) then you don't have room to complain when the employer withdraws their goodwill too.
Fortunately, there are still winners:
Unilever has chosen to cancel striking workers' Christmas parties, hampers and bonuses, instead opting to give away thousands of hampers to charity, along with £15 gift vouchers.What's wrong Jenny, do you feel your members are more deserving of the hampers and money than charities? Whatever happened to concern for the poor?
Unilever, I like your style - if not your Marmite.
Argentina is saber-rattling about a blockade of the Falkland Islands and various pundits are speculating about a re-attempted invasion, now that the British military have down-sized.
Just one question: has anyone in the press looked at the ORBAT of the Argentine military? Never mind the land forces, what ships would escort troop-carrying craft and what aircraft would provide air cover?
According to Wiki the Argentine Air Force order of battle shows 2 squadrons of Pucara light ground attack prop craft (about 24), 2 of Skyhawk A-4AR (about 20), 3 of Mirage variants (about 20). The Argentine Navy has 4 destroyers of early 80s vintage (most delivered around the end of the Falklands war), three diesel subs that should be in a museum, and 9 corvettes with no apparent SAM equipment.
Assuming a generous 75% availability rate, that would give the Air Force 15 Mirages against the 4 Typhoons on Mount Pleasant. That's not going to cause the Typhoons to even break a sweat. On the naval side, the destroyers wouldn't stand a hope in hell against a Trafalgar-class SSN, let alone an Astute-class (HMS Astute seems to be on track to be in service in early 2012).
This is all about Cristina Kircher trying to willy-wave, but the problem with this is that she doesn't actually have a willy.
The clowns at the FSA have published their latest report on borderline criminal financial advice given, in this instance, by HSBC advisors to elderly retirees in nursing homes.
You'll note that it's the HSBC entity paying the fine, not any of the scumbag advisors who were, presumably, paid on commission and have now moved on to non-HSBC jobs safe from retribution. You'll also note that all of the advisors would have to have been FSA-certified as fit and proper persons to offer investment advice.
As the summary says:
The advice and sales were unsuitable because in a number of cases the individual's life expectancy was below the recommended five-year investment period. As a result customers with shorter life expectancies had to make withdrawals from these investments sooner than is recommended. The combination of withdrawals and product charges led to faster reduction of capital than should have been the case if customers had received the right advice. A review by a third party of a sample of customer files found unsuitable sales had been made to 87% of customers involving these types of investments.
An unsuitability rate of 87% isn't accidental. That's a planned and focused campaign. It may not have been HSBC management planning the details, but they sure as heck didn't do much checking on suitability as the money rolled in. The entity doing the dirty deed was NHFA - acquired by HSBC but separately regulated for most of the period in question.
The Companies in the UK website helpfully lists the directors of NHFA up to 2010 showing the office in Eynsham just outside Oxford. Picking one scumbag at random, it seems that Andrew Cheesewright is now at First Direct Investments and one can only speculate at what guidance he is giving to the sales force there.
For all the sound and fury of the FSA's announcements, there are still 2000+ pensioners who have been ripped off by NHFA (and, by proxy, HSBC) with no comeback to those who made the mis-selling. It is hard to see how, in the circumstances, the FSA can claim to be an effective regulator of financial advisors. One wonders how much further their performance could degrade given, say, a 40% cut in their funding and immediate ending of any final salary pension scheme for their members.
Update: (6/11/11) the Daily Mail actually performs a public service and goes after the directors of NHFA. Good on them
Some moderately appalling behaviour at the individual and corporate level with BAE Systems employees slandering the Medal of Honor-winning marine Sgt. Dakota Meyer. While consulting for BAE Systems he expressed his objection to BAE Systems planning to sell thermal optic scopes to Pakistan, pointing out that this would give the Pakistan army (and therefore, in short order via ISI help, the Taliban) better scopes than the American forces over the border in Afghanistan.
The reaction of his supervisor McCreight was a classic "play the man, not the ball" tactic, claiming that Meyer had a drink problem, and worse:
Sgt Meyer's lawsuit alleges that Mr McCreight "berated and belittled" him after he objected to the sale.Just for that comment about the MoH nomination, McCreight deserves to have every soldier who passes by his house take a leak in his front yard. McCreight is not fit to tie the shoes of a man like Dakota Meyer, or Leroy Petry, or Salvatore Giunta (which I'm sure feeds a huge inferiority complex).
Mr McCreight mocked his Medal of Honor nomination as "pending star status" and took exception when he went on a business trip for a more senior boss.
Now I'm not blaming BAE Systems for employing assholes like McCreight; I'm sure he's not the worst employee of BAE Systems either. What I note in their response is that they don't even try to deny or justify the sale that Meyer objected to. For sure you can't stop your weapons ending up in the hands of undesirables if they're determined enough, but you could at least bloody well try not to make it easy for them.
