Thursday, 31 March 2016

Steely stuff

UK Steel is screwed. That is the long and the short of it. Like coal before it and shipbuilding, the heavy industry we once had is going the way of the dinosaur. “But what will the workers do?” comes the cry “The government must step in and save the industry!” Their hearts may be in the right place, but who pays for it?

Somebody trying to persuade for Remain was saying the other day that "45% of UK exports go to EU but only around 7% of their exports come to the UK". Maybe so, but that is spread across 27 other countries. It would be physically impossible to trade equally with a population 8 times our size. For instance, if we exported 50% of our production to 5 other countries and they each exported 10% of theirs to us we’d have an overall trade balance yet a massive trade surplus with each of them if we mix and match our ‘facts’ to make our argument, the way socialists do.

Socialism is complicated; take housing... (See how I am changing the subject so as to appear knowledgeable while still nevertheless changing the subject – it’s the dialectic, or something.) I want to buy a house, except I can’t afford a house. But if I demand that the state just gives me one it is only going to upset the bloke next door who has scrimped and saved to buy his. So the state will build me a house (probably a bit bigger and better than the one next door because, you know, standards) charge me a subsidised rent, then pay me that rent back in housing benefit. They’ll have to cover the council tax as well and pay my national insurance, so I get a full pension and obviously cover my general running costs because I’m boracic and I certainly can’t afford it.

The bloke next door is looking at me in a funny way now. He’s envious because he thinks I have more than he has. That’s silly; we have the same, but I don’t pay for what I’ve got as I don’t have a job. That’s not my fault because I don’t have any qualifications, which is because I could never really be arsed at school. Anyway, unlike me, he doesn’t have time to get really annoyed because he is greedy and has a second job to go to. Me, I have plenty of time, which I spend on Twitter, complaining about the government and the fact that those bastards want me to suffer austerity so they can keep the NHS going or something.

So the state taxes low earners to subsidise no earners. And it taxes companies so they need to keep their costs down, so they import cheap workers from poorer countries – who want to come here because the wages my neighbour can’t live on are still much better than theirs. Then they get to live here, pay virtually no tax – even though the government pretends that they do - while receiving tax credits and housing benefit and child benefit and so on – and send money home so that in a few years they can buy a house of their own in their own country; unlike me, here at home.

My neighbour can't afford to retire in England as he has a mortgage to repay, but he's thinking of moving to one of the poor countries made even poorer by the migration of all their workers, where he can buy a cheap house and live off his savings and his UK state pension. People like him take money out of the UK but spend frugally so don’t really do much for those poor countries they move to except to encourage more Brits to move abroad and buy cheap houses, so pushing up the prices which means the workers in those countries still have to migrate to Britain to earn enough to buy a house...  

Anyway, in the socialist utopia all this is normal.  The state should make everybody happy. The way to do this is to spend money. We haven’t got any money and you would think we can’t spend money we don’t have, but you’re not thinking, my friend. We can either earn money – oh no, evil capitalism – or we can do it the kinder way. To build our dream home we just have to borrow money we will never be able to repay but that’s fine because the state can just print more to make what we borrowed worth less, so that eventually repaying it becomes pointless anyway. Other countries have to do the same because we‘re not paying them back, so they have to borrow more and so on. In the end, everybody owes everybody else so much that I think we just write off the debts and shake hands.

Could it be overmanning?

As a socialist I’m a bit hazy on the finer details, but I trust a future Labour government to sort it out and say no to brutal ‘Tory Cuts’. Save the steel and solve the problem, I say. Then do the same with energy, housing, transport, trade, jobs, education, health, defence... On balance, though, maybe not today, maybe not next year but sooner or later UK steel is still screwed.


  1. Anyone suggesting either:
    State intervention to 'save' steel
    Import tariffs

    Needs to answer the question 'Why should we ALL pay more for everything by buy which contains steel or is made from steel?'
    'Why should the UK's exports of anything made from, or containing, steel, suddenly cost more than anywhere else?'

    Why not scrap EXISTING tariffs and see those same products get cheaper? And exports therefore rise?

  2. Oh - and scrapping the National Minimum Wage and anything and everything to do with 'Greenery', such as the insane CCA and all 'carbon emission targets'.

    There's only ONE requirement on any and every home, business and industry: to produce the highest quality product at the lowest possible price - and so sell more of their output product, both at home and abroad.

    the more HMG/EU interferes in any market, the less free it becomes and the more sclerotic development & innovation becomes and the more screwed the customer is.

  3. Socialists, the EU , UK government and Keynes and other economists like him you really do not need in your life. They either cause the problems and/or implement the wrong solutions to solve them. Left alone free markets capitalism would not have allowed the steel industry to get into the state it is in in the first place or if it had would be able to find the way to fix it.

    Those interferers I named above caused the steel industry to become uncompetitive with their policies that have driven up costs beyond that of our steel industry's competitor. So now even though they caused the damage they do nothing to undo that damage by changing their policies.