The price of crude oil has dropped more than 25% in the past two months. Obviously consumers responded to the price spike by cutting back and very gratifyingly the principal of supply and demand has shown itself to be alive and well in one of the world’s biggest and most liquid markets. It is interesting to watch Saudi Arabia, whose economy is almost entirely based on producing and selling oil, starting to prepare for a very different future. The latest to catch our attention is a project called The Line. This is a 170km dead straight chunk of building stretching across the desert. They have a lot of that in Saudi. Then there is their foray into buying up the world’s supply of professional golfers in the so-called LIV Golf project. Aside from a great supply of bunker material the connection is not obvious, but the world’s golfers are starting to mock IPL cricketers for their meagre income!
The rest of the planet can only admire the incredible fearlessness shown by the Biden administration when it comes to dealing with planet’s bully. Not only did they defy the conditions and threats by China about what the USA had better not do, but they sent perhaps the least diplomatic and intellectually impressive politician in the US Congress to do it. Excepting for Gaga and Giggle themselves. China have responded with a firestorm of live ammunition which significantly so far has not actually hit anyone. But this sabre rattling by two nations with nuclear arsenals is not soothing
News from the USA is that the government there is planning to employ a further 87 000 tax collectors. This is perfect evidence for the fact that their leaders prefer to increase state income over the alternative of cutting spending. It also shows that the rules about who must pay how much in tax are irredeemably complicated and punctured with loopholes. The implicit notions held by politicians (who, don’t forget, are always the first in line to dip into the collected taxes) is that somehow tax is a noble and welcome duty embraced by taxpayers everywhere. The other lethally incorrect assumption is that politicians and bureaucrats will spend our money far more effectively and wisely than we will ever manage to do.
Here in SA, there has been a revival of the mantra about “Tax the Rich”. As usual the supporters of this funding strategy have yet to identify who they think is “rich” and how much excess liquid wealth do they have. Undeniably SA has an utterly shameful and horrifying number of people who are unarguably poor. But dividing the wealth by the number of desperate outstretched hands yields a surprisingly tiny once-off per capita distribution amount. And that’s before one factors in the cost of this country’s premier skill and skimming off say at least 15% (hollow laughter) in commissions and facilitation fees. While the hand-out might buy a few votes in the forthcoming elections, it will not be a big number. And soon both the money and folk who were squeezed to provide it will be gone.
Tidemarks proposes that a fiscal solution worth testing would be to perform a swift and formula driven cull of at least half of those who live off the public purse, but crucially, at the same time, lifting most of the impediments that inhibit private sector employment. The formula (which would be fascinating to devise) would exclude from the cull only the lowest ranked and paid. The top and highest paid echelons will bear the brunt of the downsizing. Subsequent promotion and pay increases would increase one’s chance of being culled We need not worry about the people who are “let go” as the state has obviously already decided that they have superior skills, so presumably the private sector can’t wait to get them on board. Luxury goods stores might feel a bit of a squeeze for a while.
The bokke host the All Blacks in Nelspruit this weekend and the war of words has already reached a crescendo. It will indeed be a nail biter and Tidemarks is sure the bokke will win. The nice victory of our women’s netball team over the Scots last night (a family derby) is a good harbinger.
James Greener
Friday 5th August 2022
