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Bbc Radio 2: Jeremy Vine: Windfall Tax For Older Generation.

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Jeremy Vine - Wed, 30 Sep 2009

Jeremy asks if a newspaper can influence the way we vote, looks at a windfall tax on the older generation, supervised homes for teenage mothers and retuning Freeview TV boxes.

Broadcast on: BBC Radio 2, 12:00pm Wednesday 30th September 2009

Duration: 120 minutes

Available until: 2:02pm Wednesday 7th October 2009

Category: News

http://www.bbc.co.uk/iplayer/episode/b00mz...ine_30_09_2009/

Edited by ChesterCopperpot

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Indeed. Funny to hear 50/60-somethings try and defend:

Lack of free higher education

Unaffordable house prices

Pitiful pensions

Huge debts being left behind for the coming generations just to prevent a housing bubble bursting

The 30-year erosion of British industry

Selling off anything and everything that was in public ownership

I'm 37 so I can't laugh too hard.

In contrast with the selfish stupid boomers, the far-sightedness and fully-funded sustainable lifestyles of today's young will make following generations look up to them with respect, admiration and affection...

:lol:

Edited by huw

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It is funny.

Indeed. Funny to hear 50/60-somethings try and defend:

Lack of free higher education

Unaffordable house prices

Pitiful pensions

Huge debts being left behind for the coming generations just to prevent a housing bubble bursting

The 30-year erosion of British industry

Selling off anything and everything that was in public ownership

I'm 37 so I can't laugh too hard.

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I blame the parents.

:lol:

What was quite interesting was that many of the older callers and the guest in the studio agreed that they had probably lived though a 'golden period' with no large wars, and a reasonable standard of living (cheapish housing, eduction, energy, etc).

Obviously impossible to say what the next 50 years are going to be like, but few expect them to be as rosy as the last 50.

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It's clear the guy had a point. The boomers who phoned in admitted as much by saying the best years are behind us.

However, the best years are JUST behind us. To that extent his age target was way off the mark.

The debt bubble and asset price inflation, the chief reasons for his anger, have been blown mostly since the population got used to the new safe world. That's when the rot set in. If you want to pinpoint the beneficiaries, ie those who have been living the good life to the full extent and longest, don't go looking at 70 somethings. These peope knew hard times and have continued to live as such. They did not, in general, blow this debt bubble to its unsustainable heights.

Instead look at the generation who knew they had it good and wanted it all right there and then. The sorts who, after graduation thought, "f**k work, I wanna express myself, drop out and expand my mind with drugs" (note the use - not the glue-sniffer-disaffection we see nowadays). Look at sorts who have pics of themselves in their youth with flowers in their hair, declaring "revolution" against society. These were people who had it so easy they could tell their director dad to stuff the family firm job: they had the world to mould about themselves!

And even if he did get the right age group, he'd still have been way off the mark. His idea of a windfall tax for those who had benefitted from circumstance made as much sense as taxing a blind man for having had the benefit of living in a world where digital cameras became affordable to all.

Edited by Sledgehead

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I thought most of the banksters were in their 30s and 40s with many in their 20s earning silly salaries and stealing bonuses.

How old was Andy Hornby? Fred Goodwin is barely 50 so would have been early 40s when he cut loose.

Seems to me it's the 20-40 somethings of the last decade most to blame (+Greenspan).

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I thought most of the banksters were in their 30s and 40s with many in their 20s earning silly salaries and stealing bonuses.

How old was Andy Hornby? Fred Goodwin is barely 50 so would have been early 40s when he cut loose.

Seems to me it's the 20-40 somethings of the last decade most to blame (+Greenspan).

Ask yourself... when was the first mortgage backed security issued? That is the root of the current problems (although capitalism as it stands now is also a major contributor).

I think the point is not so much about blame, but about the younger generation paying, while another gets the lions share of the benefits (which it seems will not be bestowed upon future generations).

The biggest problem for the current crop of 50, 60 & 70 year olds is that younger generations do not owe them a debt of gratitude. Whereas you can look at a random chap in his 90s and think "he helped to save us from Hitler's facist regime", younger people look at the current 60 yr olds and think "they had full employment, final salary pensions and an unprecedented rise in property prices but what have they done for us?"

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Few of them seemed very wrinkly to me ;)

I think you'll find the vast majority of the beneficiaries* were though ;)

* Those who sold their mortgage free property for an astronomical amount to a some youngster who has to take on enormous debts in order to afford a home for their family.

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:lol: Yeah - who invented capitalism? It's their fault.

The problem all ageing societies with a tax system have is how do you get the young to voluntarily pay up - theres no real way of the old forcing the young directly.

Normally theres some moral argument that can be used.

"I had a great time now pay my bills" doesn't seem to cut the mustard, somehow.

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All I know, is that the boomers experiment in consumerism has only lasted for 50 years. Not great really.

Just think of all the tat that this lot have bought to try and keep the old insecurity at bay. It never worked. :rolleyes:

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Ask yourself... when was the first mortgage backed security issued? That is the root of the current problems (although capitalism as it stands now is also a major contributor).

Also ask yourself, how old were the people who were committing/complicit in the actual fraud, i.e. the EAs, mortgage sellers, financial advisers and the like?

How about the property-porn cheerleaders?

Few of them seemed very wrinkly to me ;)

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EDIT: And if it wasn't for boomers many of us wouldn't even be here. Is the root of all this really parent hate?

I'm happy to look after my own parents... but tell me why I should be looking after yours (or you if you're old enough to require it)?

The state pension scheme is an undisguised pyramid scheme. That works when I feel I owe the elderly - as a whole - something. When I don't, it falls down flat.

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Ask yourself... when was the first mortgage backed security issued? That is the root of the current problems (although capitalism as it stands now is also a major contributor).

Bankers have a product to sell. Money. Money is like any product. It needs a selling point. People have such poor imaginations just telling them "hey, come get your cheap debt" simply won't shift sufficient paper to pay bonuses. To shift the kind of paper banks wanted to shift, you needed a) something to show just what that debt could do for somebody, and B) that something had to be pretty darn pricey. Frankly there was only ever gonna be one "something" that ticked both boxes : property.

If you agree that property was cheap money's USP, to blame capitalism you then must ask:

1 ) is the property market a free market (absolutely not);

2 ) were the mortgage debt markets transaprent (again, clearly not);

When people criticise free markets they often point to liquidity and thence price discovery / efficiency. Those same people often then endorse market management (eg, banning short selling), which merely compounds inefficency / opacity. They never seem to ask whether the market was really free in the first instance.

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Bankers have a product to sell. Money. Money is like any product. It needs a selling point. People have such poor imaginations just telling them "hey, come get your cheap debt" simply won't shift sufficient paper to pay bonuses. To shift the kind of paper banks wanted to shift, you needed a) something to show just what that debt could do for somebody, and B) that something had to be pretty darn pricey. Frankly there was only ever gonna be one "something" that ticked both boxes : property.

If you agree that property was cheap money's USP, to blame capitalism you then must ask:

1 ) is the property market a free market (absolutely not);

2 ) were the mortgage debt markets transaprent (again, clearly not);

When people criticise free markets they often point to liquidity and thence price discovery / efficiency. Those same people often then endorse market management (eg, banning short selling), which merely compounds inefficency / opacity. They never seem to ask whether the market was really free in the first instance.

When I said "Capitalism as it now stands" I was referring to the system we have now.

i.e. the current and next generation of workers being forced to bail out bankrupt banks, in order to keep the illusion going for another few years.

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When I said "Capitalism as it now stands" I was referring to the system we have now.

i.e. the current and next generation of workers being forced to bail out bankrupt banks, in order to keep the illusion going for another few years.

Ah, okay, fair point. You were talking about that kind of socialism , sorry, I meant capitalism! :P

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I think you'll find the vast majority of the beneficiaries* were though ;)

* Those who sold their mortgage free property for an astronomical amount to a some youngster who has to take on enormous debts in order to afford a home for their family.

The evil STRs, you mean? :P

Debts are only enormous until the borrower defaults. My own view is that if the money was lied into existence then the savings are lies too -- as we see now. To the extent that money/debt was forged to pay for the houses, the sellers have been the victims of a counterfeiting operation.

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....

* Those who sold their mortgage free property for an astronomical amount to a some youngster who has to take on enormous debts in order to afford a home for their family.

Are you saying that if you had the chance to sell an asset for a high price you'd say 'no, your offering too much, pay half'? The property bubble was caused by lax regulation by the state and reckless and greedy behaviour by the financial system.

And the youngster probably assumed that the 'price of property can only go up' and would make a bundle themselves.

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Also ask yourself, how old were the people who were committing/complicit in the actual fraud, i.e. the EAs, mortgage sellers, financial advisers and the like?

How about the property-porn cheerleaders?

Few of them seemed very wrinkly to me ;)

+1

I think it takes a certain mentality to take the risks that have caused the current bubble. Its roots are firmly entrenched in a generation who knew very little of risk - and that involves the guy who was on the radio. It wouldn't surprise me if in his childhood, he played in one of those playgounds where tarmac had been replaced by rubber chip, or practiced BMX aerials into a foam pit. Just look at the hordes of the last twenty years who took up extreme sports or dabbled in dangerous drugs. This tells you something about their attitude to risk. When somebody offered them a student loan or a big mortgage they simply didn't see the problem.

Clearly it would be unreasonable for young people to see these risks. However, they did have parents who should have warned them, and moreover, they had one hell of a freekin childhood. My advice: sue your parents, not mine.

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The property bubble was caused by lax regulation by the state

No, the credit bubble had its roots in lax regulation. Th eproperty bubble had its roots in over-regulation. Planning regs are well known to have caused supply shortgages.

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