The Welfare Time Bomb

Last week I mentioned that we are sitting on a massive Pension issue here in the UK and that it isn't going to get any better as this year, for the first time in the last 10, our population grew because the rate of births exceeded that of deaths and overtook immigration as the primary cause of population expansion in Britain.

We now have 61.4m living here and 791,000 births took place in the UK last year, with a trend, for the first time in a while, that younger people are contributing more. As an increasing share of the population gets older and so drains the Welfare State on health grounds and burdens us with paying state pensions for longer, we have other issues at the new born end to contend with.

Not least, that many births puts its own strain on the NHS and other parts of the Welfare System. But an interesting fact is that a quarter of all those births were from parents who were not born in Britain so immigration was, in fact, again the largest contributor to population growth after all. William Hague famously fought and lost an election campaign on the immigration issue and tried to make it a political, not racial, debate. He failed and was laughed out by the Blair spin merchants who claimed he was barking up the wrong tree. But how wrong was he?

Studies show that the optimum population for Britain to get sensible well being is between 17m and 27m and this is based on studies, albeit mainly subjective, across the globe of countries who enjoy relatively low density pockets of population. The US came top rather oddly as you wouldn't think their inner cities showed a great deal of social well being or the murder rate wouldn't suggest such either. As with many pieces of Government funded, utopian work, the study is a bit previous unless we want to embark on a program of selective extermination as there are roughly 2-3 times the optimum number of people here already. And the population is rising - at around 0.7% per annum and this is three times the rate of the 1980's.

So as our tax take drops, in recent months by as much as 20%, as corporates currently make less and less people are working, and this figure is expected to fall further as unemployment homes in on 3m, we have a massive time bomb ticking at both ends of the spectrum. More babies are being born at a faster rate than before while we are living longer. The Welfare State as it stands and is funded today, simply will fall over in the very near future. Oh, and there is another, minor problem, that may disappear in 2032 - we have much increased borrowing as a nation as we have pledged so much into the failed banking system, which wasn't exactly planned for.

Put in those simple terms, we have a major problem facing Britain. It's all very well to moan about immigration being an issue but it's a done deal. In fact, if anything, more people are leaving than arriving now. Perhaps they can see the problem better than the rest of us. The Welfare System will implode - and we are not that far away.

We talk, this year, of a lost generation of youth as young people have been disproportionately been hit harder by the recession in terms on unemployment than older people. We are also talking of raising the retirement age, as we cannot afford the state pension payments for longer living people, to 68 and even 70, which only postpones the problem. But it creates a huge problem for young people arriving on the job market - what chances do they have of getting a good start to their career and what chance do they have of progression if older people stay in senior roles progressively longer?

The answer may actually see Britain suffer a 'brain drain' much as Ireland experienced some years ago. But it is different for Britain as we have a dense and ageing population and we don't have generous payouts by the EC to help incentivise companies to relocate here. In fact, we are becoming a less attractive proposition as our employment laws fall into line with Europe and greater strain will go on employers to retain, potentially, less flexible staff for longer who will require senior levels of pay and benefits. Meanwhile, at the bottom end, we will see a greater onus on employers to put greater provision aside for pensions for new staff as time goes on. What happens next may already be occurring as this week BT, one of the largest employers in Britain, announced that it had suspended its graduate entrant scheme - while many others have cut back the number of graduate entrants.

There is now the standing joke that the best prospects of a career start for many new graduates are call centres - what a training ground for Britain's best talent.

What the credit crunch and recession has done is to bring the underlying issues into stark focus for us all but we have yet to understand the implications. It comes to stupid things like this - as we fight two major wars in Afghanistan and Iraq, we have stopped our Army Reserves, the TAs, from training with live rounds while regulars also have seen their training with live ammunition be cut back in order to cut costs. We have systematically reduced the Armed Forces and its capability at a time when it has been most utilised since WWII. But such stupidity is now prevalent at all levels with retirement ages increasing while unemployment in the young is peaking.

What it all boils down to is that the Master Plan set out by this Government, underpinned by a Fiscal Policy that relied out a banking system that had to continue to grow way beyond the actual growth of the nation, was fundamentally and catastrophically flawed. I don't know if any other Political Party could have done or will do any better - in fact, I severely doubt it given their absurd utterances - but I do know that the whole New Labour Project was built on bright ideas by 'champagne charlies' who thought if they talked a good story rather than execute the plans sensibly, the whole world would just go along with them.

Well, they have got us into a hopeless situation that isn't going to get any better until they get their priorities right and they address the real issues of this nation rather than pandering to the whims of a small number of incredibly wealthy people because they only want the world set up to serve them.

It could not be further from the make up of the Labour Party. It could not be further from what this country needs.

The High Price of Oil

You will notice, over this Bank Holiday Weekend, that prices at the petrol pumps are around £1.05 per litre, the highest price for fuel since October 2008. The price of oil has over doubled since that time and retailers would have us believe that they are merely passing on the rises. In fact, they will go higher as a new fuel duty increment is due to come into effect at midnight tonight, adding a few more pence per litre.

But there is a much, much higher price to oil. The weekend papers have revealed, in shocking detail thanks to leaked letters, the suspicions I voiced on my blog last week that the Lockerbie Bomber's release was part of background negotiations by the Government in exchange for oil. The papers go into much detail about Blair's visits to Tripoli on behalf of a £15bn contract for BP and Jack Straw's letters to Kenny MacAskill about how the Bomber's name could not be excluded from a Prisoner Transfer Agreement (PTA) between Britain and Libya, effectively overruling any sentence imposed by the Scottish Legal System for his crimes, as negotiations had reached a 'delicate stage'. We all know what happened next - the bottleneck was removed, the contract was signed and BP had their oil.

This left the nasty issue of Megrahi and how to repatriate him under the agreement. Technically, the Government denials are right - Megrahi's release was not part of the PTA agreed with Libya under the terms of the BP deal. He was released on compassionate grounds, so they can all stand piously - Brown, Straw and Mandelson - and say they had nothing to do with it; it was a decision by Scotland's Justice System with no pressure from the Government. Indeed, any such inference was a heinous crime in itself - the Government 'Thought Police' were going into overdrive.

Everyone was at pains to point out to aggrieved American officials that this was not a prisoner transfer but a compassionate release, even though for many of us it was the first time we had ever heard of a Prisoner Transfer Agreement.

Medical experts have lined up to question whether Megrahi was 'terminal enough' as the grounds for compassionate release should be only 3 months left to live. I think many were pretty shocked at the rather healthy looking individual being hugged by Saif Gadaffi and his father, the Dictator. I may be being a little callous here as new pictures were released over the weekend of the Bomber in hospital in Tripoli, but I cannot shake the belief that Megrahi's release came as part of the price of agreed trade between Libya and Britain. All the leaked evidence now points to the fact that Megrahi's release was part of the deal and what is actually different about his release was that Britain (with Scotland very much part of it) used Megrahi's illness as a convenient cover.

Would the public mind if he lived longer than 3 months and show a miracle rejuvenation like the other compassionate release recently, Ronnie Biggs?

Oil is a demon of a commodity. The West rode roughshod over the Middle East to get it. When these states fought back by reclaiming their territory and voice, we have systematically split the Middle east into friends, foe and people we don't care about - the latter being those who do not have oil. Iraq was amongst the biggest of the foes. After 9/11, George W Bush famously labeled Iraq the 'Axis of Evil' suggesting that the 9/11 attacks emanated from there while asserting that Iraq had Weapons of Mass Destruction (WMD) and was refusing to comply with international law by handing them over. The Second Gulf war proved many things, the most poignant being that Saddam was a spent force, he did not have WMD and that 9/11 had nothing to do with Iraq.

What it did achieve was to rouse just about every would-be terrorist to rally around a cause and a visible enemy.

Oil has a very high price indeed. The few extra pennies of duty we will see tomorrow morning no doubt pays for the commission required by Ministers who helped negotiate the deal with Libya, the state responsible for shooting a Policewoman, Yvonne Fletcher, on a street in London and for blowing 270 people out of the air over the sleepy town of Lockerbie.

The British Government, in its infinite wisdom, went along with Libya's ruse to get us all to accept the country by telling us it was dismantling its nuclear program in return for the prize asset, oil. But there was a far greater price to pay as, somehow, Libya had all the negotiating chips in this international reconciliation process despite supposedly having a rogue capability to bomb us with nuclear devices.

No, we sat down in tents, listened to Gadaffi fart and burp and then did exactly as he wanted.

That is the price of oil. Several names in the Government will be slightly embarrassed about all this but as Jack Straw said about the leaks, they are 'academic'. You see, the clever ruse of compassionate release deflected the blame for such negotiations as the most helpful of all things made sure the Government could point its finger elsewhere - cancer. How convenient that has supplied a neat smokescreen, a disease you would be hard pushed to get consistent care for in Britain today.

The letters prove otherwise. The unhealthy relationship between Gadaffi's son and Peter Mandelson is another to be behold with splendour while the obsequious entourage of background negotiators made sure a British company gets the ability to continue to find enough oil so we can be taxed heavily on it.

Drinks all round - the Government could not have hoped for a better result.

The Pension Game

A report by PriceWaterhouse suggests that the public sector has a very generous pension scheme. Well that was money well spent to find that out.

However, it isn't as simple as it seems. The average annual retirement income for an NHS worker is only £6,500 and the average local government worker gets around £3,800. The reality of all pensions is that only 4% of the retiring population get the nirvana of two thirds of their final salary income when they retire. That's because most people do not stay in a single job long enough, even in a final salary scheme, to qualify for full benefits. The vast majority either change jobs or enter public service late or leave early. So PWC's assertion that is causing a block to talent moving from the public to private sector and vice versa is a myth. You have only to look at some of the salaries on offer in public service jobs to understand that they are very generous pay packets to be earned as well. True, below management grade the salaries are lower but when you look at the incredible pension scheme, the draw to public sector can be strong. Private business salaries do tend to be higher and this keeps the lure of this sector going but that is because Britain has become a society of low savings and even lower planning for the future - we are a live-for-today society.

It is believed that as much as 35% of salary contribution would be required to match the generous public sector pensions for private sector workers - that is because they are back-ended. We accrue on average 6% of our salary at any time to toward our pension but our salaries grow and we pay the higher contributions for a proportionally shorter period and that is why we have huge shortfalls on what is required to live on even if we are diligent savers. In the public sector, this disparity is taken care of by the generosity of the taxpayer - we pay disproportionally more for public sector pensions than the pensioners themselves. That's a simple fact. In other words, we probably pay as much to fund other people's generous pensions as we do for our own over the course of our careers - you would have to check the sums but it cannot be far off the truth with nearly 1 in 4 jobs in the public sector.

There has been controversy lately as companies like Barclays and especially RBS have cut the payouts from their pension schemes after culling staff in the wake of the financial crisis. For RBS workers, it was particularly galling after the fabulous payout and topping up of ex-CEO's Fred Goodwin's pension which he can draw early anyway. At Barclays it comes as a hard blow as staff have been cut and traders are again courting controversy with more bonus payments worth the pension saving in a single year while new teams of 'talent' arrive with amazing packages worth the salaries of hundreds of low end staff individually. It seems very curious that these companies are not saving cash on bonuses and putting it into pensions schemes or, indeed, why have they not been doing this in the past?

Pensions is a looming time bomb for us all and the Government. Our good friend Lord Turner found time between his many jobs to put his name to a report that someone else wrote, I dare say, as he has to earn multiple salaries, which urged pension reform in public service and a potential switch to average not final salaries as the basis for pension entitlement calculation, which would make sense. Pity he doesn't look at other problems with such diligence but as with many high level business people they are great at cost cutting but poor on working out how best to deal with profit as most of it goes to a very narrow band of people leaving little to be invested in pension funds for staff.

It is a question in the private sector that the Government tried to address with the pathetic implementation of the dreadfully poor and ill-thought out stakeholder scheme. It got us nowhere but hit the soundbite machine as usual. Reading Niall Ferguson's Ascent of Money, it shows how our Welfare System has been so badly thought out compared to even under developed nations in South America as we are the most highly insured nation in the world by individual cover yet we have so little benefits at the tail end. It seems the money just goes into a massive sump - much of which and more was consumed in the bail out frenzy but a great deal of which funds a very uneven balance toward the public sector remuneration.

There isn't a great deal of time to sort the issue out. This year the population grew to 61.4m in Britain and for the first time in a long while it was births which accounted for the growth rather than immigration as mothers gave birth, on average, slightly younger than usual to far more babies than the rate of deaths in the UK. The old are growing older.

The problem of pensions, benefits and, now, unemployment are issues which are right at the head of the agenda but no one can see it.

"A Socially Useless Activity"

I don't think the FSA has done its job properly. I lay that responsibility directly at the feet of its Chairman, Lord Adair Turner, and his inept and idle CEO, Hector Sants. That said, it is a bugger's muddle to sort out the banking industry and get it properly regulated.

Why? Because it is so powerful and the people in it are powerful. So when Lord Turner finally speaks his mind and shows he actually has a modicum of understanding of how the general population feel about the kinds of bonuses people earn by simply pushing our money around, without a jot of accountability if they lose it but incredible bonuses if they gain some profit, he gets castigated by the industry as if he has suddenly put a pile of fresh horse manure on their dinner table.

Turner has suggested that some investment bankers perform 'a socially useless activity'. The industry was deeply offended but frankly it was a comparatively minor insult. For a few years, each morning I used to listen to some of the inane and positively insulting talk that bankers come out with when I attended a City gym. The locker room conversation was all about measuring manhood in terms of how much money they could blow in champagne bars, restaurants, on new cars and holidays while their lack of knowledge and understanding of the markets they operated within was clearly limited and each was looking for a lead from the other to actually do their jobs. You have only to read or listen to the disparity in opinions on the markets by so called analysts to know that much of the City aura is, in reality, guesswork and controlled by strokes of the buttons on computers.

That much was proven in particularly the UK's response to the financial crisis. We have burned money and printed more as if it were old wallpaper to save the financial system at a cost of real things like jobs and manufacturing. And now here's the rub.

The Telegraph yesterday printed an 'apology' for the bankers after Lord Turner's insults which included charging banks a 'special tax on pre-remuneration profit' (he must read my blog as I proposed the same, less elegantly) and they illustrated a heartstring-twanging litany of why we should feel sorry for bankers. You see, the financial sector employs about 1m people or around 5% of the workforce and 13.9% of the tax take came from the financial sector in the form of around £25,000 per employee, £12bn in Corporation Tax, £15bn in income tax and £3.2bn in National Insurance Contributions. The tears are welling up.

But before they start to tell us how important they really are, let's also remember that the financial sector only contributes 7.1% of the UK's GDP. And here's the reality - in the financial crisis triggered by the credit crunch, we are set to double our Sovereign Debt in order to pay for the losses incurred in the sector, which could take borrowing as high as 99% of GDP by 2014 if you believe some figures. To date we have printed £175bn of new money to heal the wounds caused by the industry while it is thought as much as £1.3trillion in capital, loans and guarantees has been used to prop up their industry, yet their net annual contribution to the tax budget is just £30bn.

We have helped them deskill their jobs even more as we have now fully guaranteed their future losses and given them virtually zero-cost money to replenish their cash and to go and play their games again as the markets bounce back. And once again earn the billions they feel they so richly deserve.

People argue that such taxes proposed by Lord Turner would drive 'talent' away from the City and I have argued 'good riddance'. If that is the cost of picking up the tab for them, then let them go. Reality will catch up with the financial industry - there is no such thing as zero sum accounting for taxpayers. When we lose money, we have to pay for it - there is no magnet that brings it back.

I think it is time we got some perspective here. These financial so-called gurus are not as brainy as they think. They have had the best jobs in the world which have catered to their greatest whims of making money. They are ordinary people, with no real intelligence who just have an unfathomable lust and greed for money. We have set up a global system for them to skim off a share in the profits of simply moving money around and placing bets and we have propped up the system with more money then we have for them to keep doing it. In doing so we have not checked the system for flaws or weaknesses or even bothered to understand it - we have just pledged money because they asked for it.

Enough with their sob stories of what they do for us - it's time they paid the cost for what we have done for them. If Turner is finally growing some teeth and claws, then let's hope he has the courage to use them this time around as last time he was just an ordinary guy who failed dismally to do his job, just like all those who pursued in 'socially useless activities' - the investment bankers.

It's heartwarming to know that while we would not give such people the time of day, Gordon Brown pays them £millions for their advice as to how to solve the financial crisis they got us into. Hasn't got us very far yet, has it?

Different Strokes

China will spend around 2% of GDP on Fiscally Stimulating its economy this year and the same next - USA exactly the same this year, dropping to 1.8% next while Germany will spend 1.5% this year and 2% next. Britain will spend 1.4% this year and zero next.

Germany's biggest issue is that the money it has pledged to stimulate the economy is not being used fast enough, as much of it is for driving renewable energy into public buildings, building more, refitting old buildings and other projects. Such projects are big public spends and their laws mean that tenders have to be written and due process observed. This has bottlenecked public spending and so they have introduced ranges of laws that say spend of less than €100,000 does not have to go to public tender, just a few quotes while some projects up to €1m can avoid the old tender process. In just 14 months, they need to spend €10bn in education alone and the rumour now is they will spend that money on anything that disperses the cash quickly meaning that German schools could become showcases for interactive learning for all Europe. The main thrust is that instead of just a few large construction or IT companies benefiting from the spend, literally thousands of small firms will benefit from the spend.

Along with direct Government subsidies to firms to pay wages in the recession, Germany has deadened the impact and unemployment has not risen appreciably despite spectacular insolvencies like Arkandor. Britain, meanwhile, has seen unemployment rise to over 2.4m and it continues to rise with predicted peaks at over 3m. In the same breath, we have seen tax receipts drop 20% in the last quarter, 3 times the level of drop predicted by the Chancellor, meaning higher borrowing again - rumours abound about Britain's ability to pay for all this debt which could see our credit rating moved down.

For Britain, it was all about saving the banks and stimulus has come only from the VAT decrease which is temporary. Credit was seen as the major issue and so it had to get flowing again. Instead of seeing more Fiscal Stimulus going directly to save jobs, we have seen new money pumped into the banking system via Quantitative Easing to the tune of £175bn and precious little has got down the line. In fact, credit has never been so expensive and hard to get with banks missing their lending targets consistently, loans at multiples of base rate not points above, fixed rate mortgages at a huge premium and loan criteria at their most stringent in years. Yet banks are awash with new cash from taxpayers and money markets again at the cheapest price in years.

What has happened? Why isn't the money getting into the economy at the points where it is needed? The answer is simple - banks are at their high risk games again, with cheap money and an unlimited guarantee against losses underpinned by the taxpayer - they cannot fail to make money, so why give it to us where they would earn comparatively less?

While even Adair Turner is now mooting a windfall tax to prevent excessive bonuses, and bonus schemes are getting a bit tighter but no one is regulating new salaries and inter-bank headhunting of new 'talent' with lavish guarantees and other perks. The fact is that while bonus schemes may look more difficult to attain the old heights on what is certain is that clauses defining that traders MUST get paid even if the banks are making losses are being set in stone. We actually will come out worse, not better thanks to the lack of thought being into the process by non-bankers.

The end result is that technically France, Germany and Japan have all exited the recession while we suffered a further 0.8% shrink in the same quarter. It seems Britain is more focused on fining and locking up music downloaders than tackling unemployment or real crime - it seems we are more keen on bank rolling the real criminals in banks who robbed us of billions to support their high risk gambles and we have allowed them to do it all again with impunity. Meanwhile, the money getting to the parts of the economy where it is needed is minimal, expensive and late.

We have paid the best part of £100m in fees to numb skull bankers and lawyers to plot a way out of trouble that has put money right back into the hands of those who broke us, and they are keeping it to spend on their lavish high risk derivative gambles to earn mega-bucks to lose again later.

It is anticipated that Angela Merkel will breeze the forthcoming election in Germany and she has around 83% of the anticipated votes in polls. Gordon Brown may take real note as she fought him hard on Fiscal Stimulus and bank bail outs at the G20 as did Sarkozy of France. They have been proved to be right, Brown wrong despite his belief he 'saved the world'. They thought about specific programs and directed spend to stimulate the economy and get money into all businesses while we focused billions on banks and the financial system which are failing us yet again as we did not set rules and regulate properly.

Despite the smug, self-congratulations, Brown has been proved to be lacking in real skill in economics and Britain will pay a very high price as a result.

Run That By Me Again - Are You For Or Against?

The PM is back on form. Renewed and invigorated after his break, he is on top of his game.

A person blows 270 people out of the sky - a mass murderer in anyone's understanding of the term. There are few more dreadful crimes a person can commit. Yet the PM did not have an opinion on whether the man should have been released or not - for compassionate or any other reason. The one thing he was relieved about was that someone else - namely the Scottish Justice Minister - could be blamed and so the PM was at pains to identify him and the 'fart in the space suit'. The man no one wants around them.

You see, he was keen to congratulate Andrew Strauss and the England boys for regaining the Ashes. Proud moment - positive press - good association - people will remember it was on his watch whereas Blair claimed the glory last time - MBEs or something all round for the lads - popular move for a hip PM. But when it comes to commenting on the release of the Lockerbie bomber he hangs back despite the country he was born and bred in actually had their flags waved outside the plane that delivered a mass murderer home. According to the TV last night and expert opinion, the Lockerbie Bomber did not even fall within the guidelines for compassionate release as his 'terminalness' was not within a 3 month window.

Whatever - the man did not deserve to be released. Not one of his victims was treated with a singe jot of compassion when he made sure his suitcase full of explosives was put on board. What makes his life worth anything more than a single one of theirs?

The standard excuse is that we are a compassionate society and have a similar judicial system. I'm sorry but that's rubbish. More and more crimes will be punished in the eyes of the Police with fines in the future without the judicial system being involved, denying the right to habeas corpus for a range of offences right up the harming other people or stealing. There is no compassion there - wallop, guilty, serve your sentence, pay your fine. At one end of the spectrum we are actually being harder on minor offences giving no right of compassion but are being compassionate to the worst offenders.

Where is the sense in any of that?

You commit crime - you are punished. It seems the more severe crime you commit, proportionally the less of the sentence you will serve. It's a stupid, stupid position to adopt and shows how twisted our whole justice system is. You are disproportionately hit harder, without recourse to proper law for the least harmful of crimes like parking, speeding or smoking dope.

But, hey. At least we won the Ashes and it was on Gordon's watch. Eat dirt, Cameron.

The High Price of A Free Holiday

Oh, Peter. You are so obvious but that's why everyone loves you so much.

Yes, it is old Lord Mandelson again up to his old tricks. After a lovely, free, holiday on a yacht moored in Corfu (yes another expensive yacht near Corfu) courtesy of David Geffen, co-owner of Dreamworks who has a major axe to grind on pirate copies of media being downloaded on the web, Peter has personally intervened to beef up the new laws governing downloads in the new Digital Britain initiative.

Once again, the war on piracy has been taken to the consumer not to those who put the content on the web who actually stole it in the first place. Those characters are much harder to chase as they are slippery, elusive and getting as rich as David Geffen - so maybe someday they will have expensive yachts and free holidays to dole out. Consumers? No, they are weak, puny and easy to catch, particularly as the new legislation governing security allows the Government to question the ISPs who provide our internet services for records of every movement, word and message we send. Welcome to Digital Britain - who knows, maybe blogs like this will be illegal soon as I mention a Politician's name.

In Sweden, a whole Political Party has sprung up ostensibly to tackle the download issue but has leapt to prominence by gaining an MEP seat when it tackled the issue of excessive security laws. It will be a direct consequence of laws, supposedly intended to safeguard us from terrorist attacks, that allow Governments to monitor everything we do on the web, that will be able to find out who has wantonly downloaded music, software, films etc and violated copyright so that they can be fined.

Yes, that's right - fined.

It's all about money. But then again, you don't have to follow Peter Mandelson far to find money. He met Gadaffi's son twice this year, once on that very yacht, and guess what? Yes, the Lockerbie Bomber is freed to a hero's reception in Tripoli and we get more trade with Libya - just wait and see.

This isn't rocket science, you know. It isn't even subtle. This is rich people scratching a power-hungry Minister's back, who is unelected, who correspondingly does their bidding in Government - accountable to no one.

Once again, Welcome to Digital Britain.

Who Regulates The Regulators?

You know one of the big problems with the whole concept of regulation, whatever it may be for, is that it is a fat cat job with virtually zero responsibility and no accountability.

Of course, Lord Adair Turner of the FSA may tell you otherwise but let's face facts, on his watch 5 high street banks went belly up and more had to be bailed out as he presided over the worst financial disaster since The Great Depression. As if that was not bad enough, he gets to write and implement the new regulatory plans, called Macroprudential Regulation to help us understand it more easily, and these are little different to before.

Meanwhile, some £17m in bonuses have been paid to the 2,500 staff of the FSA while they have also received substantial pay rises of up to 10%. It is a huge price for abject and total failure to the do their jobs.

And while their own snouts are in the trough, the City is right back to its old habits. Not only has the issue of massive profits from high risk deals already raised its head as we still dole out more money for the whole collapse of the little game last time, but also we are actually talking of paying incredible bonuses to City staff just a few months after we all thought the whole concept was both wrong and risky. In fact, it's worse.

The bounce back to profitability by banks was inevitable - they couldn't go down again after we propped them up. So the banks and their traders are actually taking profits on a massive scale on the back of our money, lent to them at virtually no cost, with a blank cheque underpinning any losses they may incur in the future.

In that environment, they cannot fail and they still have the chin to ask for bonuses and the regulator stands back as if this is the way it should be. It is still paying for failure, as some take their employer's to court for bonuses they think they should have earned when they clocked up the losses. We are paying for failure and the bounce back - we must be absolutely stupid. We are - in fact, the City relies on it.

It seems crazy, yet when you delve into what the regulators get out of keeping their heads down and saying nothing in their part time jobs, you get a sense of why it is not good practice to stick your neck above the parapet and criticise the obvious. For one simple reason, other than the obvious rewards, is that each and every one of them are part of the same fabric and system. Lords, Dames, Sirs and the right education and backgrounds and the single biggest qualifier of all, a portfolio of Non-Executive Directorships to prove you can stand the heat and pressure of part-time jobs and know how to make a few bob out of them.

And they do. Lord Turner is on umpteen quangos and whatnot as well as boards - at the FSA alone he earns over £200,000 a year for a few days a month and he even gets that unbelievably wrong. Then you have the other regulators like Lord Mogg at Ofgem where he does a marathon at 3 days a week regulating the energy market. He claimed over £35,000 in expenses last year to do that job alone and that included a £5,300 plus for a first class season ticket and a £5 canteen meal as well as a subscription to the Financial Times. His CEO, Alistair Buchanan, lives in Egham just a few miles from London and the office but he managed to clock up £5,700 for 23 overnight stays in hotels in London amongst his £28,000 of expenses. Lord Mogg gets £145,000 a year for his part-time job, of which this is only one, while Buchanan gets a derisory £260,000.

The story is not pretty at Ofgem as they all are at it. Mogg managed to do £18,765 in travel in 14 months on 30 trips abroad (why??), and that's going some as I travel almost every week to somewhere in Europe and can't challenge that spend. Buchanan's curious 23 nights in London hotels included £826 for just a single two night stay.

The point here is that these bodies are there to supposedly protect us from these industries but in both cases all they do is to consume money and we foot the bills - and they are huge. There seems to be no rules by which they have to work and they can clock up vast expenses, salaries and bonuses without a jot of accountability as there is none required. The FSA stands watching as the City again squabbles over headhunting and acquiring staff with vast new salaries, bonuses, golden handshakes, earn-outs and guarantees to bolster the 'talent' in their trading areas while they cull vast swathes of staff in the only consistently profitable parts of their businesses.

And, yes, we pay for it as it is all funded by taxpayers' cheap money, capital and guarantees and, of course, new cash from Quantitative Easing.

If someone had said 6 to 9 months ago that we would allow all this to happen again then they probably would have got lynched but thanks to the regulators once again being unaccountable and standing to one side to let the industry get on with getting back to normal, we have just let all happen again.

And it may just get worse when it collapses next time. Not until we get wholesale reform and proper regulation in with the right people at the top, who are not part of the system and not just cash sumps, will we actually get some change. And, boy, do we need it.

Can It Look Any Better?

Well, frankly, it cannot look any worse. Or maybe it can?

I am talking of the clamour by Scottish Ministers to try to justify the decision to release the Lockerbie Bomber. It doesn't matter how you read the statements or how they try to make the USA's position weaker by saying they were offered a choice and indicated compassionate release was preferable which does not seem to fit in with the Director of the FBI's recollection.

Then again, everybody is distancing themselves from the Scottish decision. Col Gadaffi praised his 'good friend, Gordon Brown' while Peter Mandelson dismissed suggestions of a deal, 'offensive'. He should know.

You see Gadaffi's son is now recanting, via spokespeople, that he actually said that the Bomber's release was on the negotiating table when it came to trade. It is very interesting as Gadaffi's son and Mandelson met while in Corfu recently as Mandy took the sun on David Geffen's yacht.

William Hague has called on the Government to clarify its role in the release of the Bomber, since Gordon Brown is now known to have written to Col Gadaffi beforehand to plead for restraint on the welcoming committee that the Bomber would receive on his release. This is a very clear sign that the Government was fully aware of the release and knew what the Libyans would do. It was almost as if Brown was reminding Libya of the terms of the deal and it really indicates that Brown knew much more about it than he would like us to think.

They say there is no smoke without fire. Follow the trail. Mandelson has a history of intervening on behalf of rich friends he meets in exotic locations, particularly on swanky yachts. If nothing more should come of this, someone ought take Mandelson aside and remind him that the Blair era of freebie holidays with dodgy characters like Silvio Berlusconi or Gadaffi's son are over.

It has been the Hallmark of a Government that is increasingly looking corrupt and bankrupt of decent values.

Compassion or Dispassion?

The sight of a Scottish flag being waved outside the plane carrying the convicted Lockerbie bomber home to Libya amid ecstatic welcomes only worthy of a national hero must gag in the throat of every member of a family who were directly affected by the actions of the man, let alone the rest of us who still remember exactly where we were the terrible night it happened.

President Obama found it 'Highly objectionable', Alistair Darling found it 'Distasteful' and Prime Minister Brown had even pre-begged Libyan Leader Colonel Gadaffi to act with restraint on the bomber's return but it did not stop his son personally leading the celebrations and hugging the mass murderer or the Colonel himself later greeting him as a long lost relative.

In some respects, you reap what you sow. After the events of 9/11, for no obvious reason, the US' perennial nemesis, Libya, was invited back into the mainstream despite it being a clear hotbed of terrorism and anti-Western activity with the Colonel himself right at the centre. But as with all things in Politics, everything is negotiable and there was lots to be gained by healing the weeping sores caused by Gadaffi in the US. So they stopped bombing him and started loving him. Repeated visits and ceremonious meetings have occurred since and there was even a Royal visit scheduled this year - a momentous year being the 40th since Gadaffi ceased power.

There are fundamental issues at stake here. On the one hand we have the Political grandstanding as Menzies Campbell took the opportunity to criticise an inexperienced SNP Government who he clearly feels are not fit to rule a nation yet. It brings into stark question whether Britain should have so avidly pursued devolution and allowed Scotland to govern itself. It brings into fuzzy focus the reasons as to why George W Bush and Tony Blair decided to allow Gadaffi back into the global race and take a seat like a true statesman at places like the UN.

On the other hand we have the issue about a compassionate legal system that allows sick prisoners to go home to die amongst friends and family or get a hero's welcome for having blown 270 people out of the air above Lockerbie. In a week which saw Ronnie Biggs go home to make a remarkable recovery, we now see another piece of compassion be thrown right back into our compassionate faces and watch in shock as a mass murderer became a national hero.

There is the final aspect and perhaps the Libyan view. This man was a scapegoat and had the blame for the horrific events pinned on him in the absence of no one else obvious to blame. That is something that may well have run through the Scottish Justice Minister's mind when making this incredible decision.

In terms of homecomings, it was a very different hero's welcome afforded to the 4 fallen heroes returning from Afghanistan who got the now customary slow procession through the streets of Wootton Bassett. But somewhere in all the froth of politics and self-interest there is a connection.

Wars and terrorism start with politics and they are a direct consequence of bad politics.

In this instance, there was always going to be some ulterior motive as to why a convicted mass murderer would be allowed to go home to die. Now we see it - trade. Gadaffi's son is now reported to have said that the Lockerbie bomber's release was always on the negotiating table when it came to trade and back in 2007, Tony Blair wafted through a huge deal on behalf of BP, the sort of favours that get you seats on boards of investment banks. As late as a few weeks ago, Lord Mandelson met Gadaffi's son on the fancy yacht in Corfu and by some odd coincidence within a short space of time we see the bomber released.

Miliband has rather defensively said that it would be a 'slur' to say the Government was involved in the release of the bomber so that Scotland can be isolated as the floating 'turd in the swimming pool' here. But we would all be very naive to think that a man who put a bomb on a plane and blew 270 people out of the sky gets released just because he is dying.

You can bet your shirt that there are some politicians, back room mandarins and investment bankers who might just have been a little embarrassed about all this and the their involvement. Compassion was the last thing on their minds - they will rather dispassionately get on with the business of making money to morrow when the furore dies down and gain as a result.

For there is one thing you can be sure about, the Lockerbie bomber was a pawn in a much bigger game where the stakes are very high.

You want to know the biggest reason why I say that - go read Gordon Brown's letter to Col Gadaffi. That was the clearest sign that this was a pre-planned exercise and that he also knew that Libya would make great mileage out of it.

As usual, we will never get to the bottom of this matter. Politicians will point fingers but there are no better people at covering their tracks. For certain, the one body of people who were never consulted on this whole 'compassionate affair' were the relatives and loved ones of the victims of Lockerbie. They were the last people on the minds of the people who were complicit in this decision.

As they did that fateful night, I am sure our hearts go out to them and we all bow our heads in shame that they should relive the terrible pain because someone, somewhere wanted more trade with Libya - and once again, bad politics.

For shame on us all.

Why Should I Care?

You may be a sceptic or a true non-believer but let's assume for the moment that climate change is happening and that due to human intervention things are not going too well for the future for Planet Earth. The question is: should we modify or change our behaviour accordingly?

I read a letter in New Scientist from a Tom Dixon of Bristol in the UK. It was concise and well written - his answer was basically, why should he sacrifice his lifestyle for the good of the future when he has only a small window of time in which to live? In short, why should he care? And for the record, he doesn't.

It's an interesting point as I am a believer that in the brief history in time that man has lived on this Earth, we have impacted the environment in an extraordinary and unprecedented way. I am sure in my own mind that since the dawn of industrialisation we have done things to our environment which have profound and long-lasting effects on the Earth and particularly its atmosphere. I also believe that it is likely that we are actively shortening the potential opportunity for life, as we know it, to endure on Earth.

An asteroid may hit tomorrow. Super volcanoes may erupt in California and lay a black cloud over this earth for a century. The poles may swap ends. Something natural will occur to wipe us out anyway or change the environment we live in so profoundly that we will not survive. Or the incredible 'balancing act' that is nature is going through one of her long cycles and will 'right herself' again and the effect that humans have within it will be but a pimple on a gorilla's backside.

Both assessments could be true. One argues that we should look at how we live as it is humans who are having some kind of effect on the Earth while the other argues - hey, that's nature so make the most of what you can while it all lasts.

To have a concerted effort to change the way in which humans live would be a monumental task and it also pre-supposes that everybody agrees with the changes, thinks there is a problem and feels any kind of conscience that implores them to join in. This assumed 'Brotherhood of Man' may well not exist and it will be very hard to get widescale support to drive any such large-scale 'Green' policies to be implemented effectively to make the changes we think will help.

One thing that cannot be argued with is that we are depleting the earth's resources very quickly. Fossil fuels, on today's estimates, will last less than a few decades. There are no really good alternatives on offer - wind energy harnessing is both unsightly and equally damaging to the environment as well as not yielding enough energy to suit our needs. Nuclear energy has been descaled and now contributes less than 20% of the electricity to the National Grid. Solar energy is seen as the domain of cranks who deface their homes for no real gain.

Yet so much of our time, effort and brain power goes into sustaining or bettering our lifestyle in the present at a time when wealth in the developed world is at it a new height - and after a minor technical blip, will be back on course to grow. Profit and growth comes from exploiting the needs of the people now - having long term 'Green' strategies will inevitably mean that profit opportunities decrease and economic growth is limited, even negative. Many economists believe that you can sustain economic growth and have 'Green' policies but I am as sceptical about that as most climate change denyers.

Of this 'Brotherhood of Man' that Tom Dixon talks of which he asserts does not exist, you do not have to look far to see stark evidence of what he means. As the gobal financial crisis unfolded, it was pretty much every man for himself despite talk of concerted global action. Countries pumped varying amounts of money back into a system they understood as much about as they do nature itself and hoped for the best while other countries focused their cash on specific things that they estimated would help sustain them through the crisis. The results have been obvious - those who invested less in the global money system and more on their internal economy, have survived this crisis better. Look after yourself and things will get back to normal in a while.

When 9/11 occurred, almost without thought of the enormous financial, environmental and human impact the West engaged in two major wars which it still fights, eight years later. People will argue the reasons for the war but one obvious comment about Iraq was control of the region which supplies the most oil globally at a time when China is about to overtake the United States as the largest consumer of fossil fuels. It was 'aggressive' protectionism as Iraq's ability to wage war on anyone other than its own people had all but ended. Conflicts arise because countries believe their interests are compromised - there is no collective consciousness when it comes to seeing your lifestyle or freedom being threatened.

And as the developed world clamoured to pile trillions of dollars into sustaining its way of life into a system that had nearly ruined it, the developing and undeveloped worlds sat there and looked on incredulously as a mere fraction of all that wealth might have helped feed its starving inhabitants.

When it comes to understanding human nature rather than nature itself, we are still basically animals for all our intelligence. Survival of the fittest is the underlying culture and for all our altruistic ideals and thoughts, in reality there are very few of those who extoll them who are prepared to really sacrifice their way of life to ensure that everybody benefits. Indeed, from a political viewpoint even those with a scocialist ideal believe there is no issue in having people incredibly wealthy while others suffer. They have no issue with the exploitation of the less fortunate when it becomes personal but their ideas and ideals win votes and give them power because 'spin' is just plain old marketing when you analyse it and has little to do with real values and ways of life.

Yesterday, between meetings, I took a trip on a boat around the harbour in Hamburg and saw the vast empty dry docks of one of the former largest shipbuilders in the world. One new boat was being built of any consequence - it was 170m in length, had its own submarine and cost to date around €500m to build. It was a private yacht, commissioned by one man, who already has one of the largest private yachts in the world plus his own football club in the Premier League. There is incredible wealth in the hands of an incredibly small percentage of the population of the world while billions are below the poverty line, are mired in disease and can't feed themselves. And we just went out and saved them by propping up a financial system that rewards exploitation and penalises those that stop growing to look after others.

In the US some 47m people cannot afford medical care at all. The President is having to tour his country to persuade people it would be a nice idea to somehow provide for them when the same people are happy to pump $billions into sustaining a foreign policy that has made the US look like the world's school bully rather than the prefect.

I could go on but frankly when we live in a world where the impact of non-delivery of the latest iPod will have a more dramatic effect than more food to starving Africa, then you know that Tom Dixon in Bristol is right. 'The Brotherhood of Man' is no more than a former Eurovision pop group - a totally dreadful concept at that.

I could ask Tom Dixon and his followers why do we change anything? He did not invent the IPod yet he has one. He would not be pleased if he used a toilet where the previous users soiled the seat and did not clean up after them. He would not be pleased if there were no laws in this country stopping people just walking up and taking your possessions whenever that person feels like it. He would not be best pleased if Sky Sports was not made available to homes in the UK because Rupert Murdoch suddenly thought only Australians were worthy of it. He would not be happy if when run over by a car and he lies bleeding in the gutter that an ambulance is not available to help him.

All these things actually come from a collective drive to make the place in which we live a better place - without them our lives would not be the same and we would be worse off. Taming the Wild West was necessary for everyone to get a fair crack of the whip but Jesse James might have disagreed.

So what of the future? Do people like Tom Dixon not have children? Maybe not - if so, there is no point in providing education for them as well as nuturing them and giving them rules and culture if we do not believe that we have a role to play in the future. What is the point of doing all that and even providing them a legacy in a Will if we really do not care? The fact is that we actually do care. As animals, our biggest instinct beyond survival is to procreate new life. In fact, just about everything in nature prepares current life to create new life. Nature understands that our time in this world is very short and so it has set itself up as a long-term survival mechanism and each unit of life has a function to create new life while it lives.

Tom Dixon is not right - humans have enough intelligence to know that we can change our ways and it will have an effect on the chances of survival of our offspring. We can change the conditions in which we live today to make a future for our next generations - our own descendants.

In fact, as any good parent, it is our responsibility to do so as we owe our children the same chance to live as we got, if not more.

Would it kill us if we did not get the latest iPod every year or more of our fantastic brain power which goes into to designing ever greater and more complex risks in the financial market were channelled into finding the cure for cancer? Would it kill us or him if Roman Abramovich did not have so much money that he can commission the biggest private yacht in this world and the money were sent to Africa to help feed people? Would it kill us to have less lights on at night, less electrical devices in general, slower but more efficient cars, to not have electric advertising hordings in Times Square or Piccadilly Circus or Virtual Reality?

It probably wouldn't kill us. But it may kill our children if we don't do something about it.

Putting Money In The Right Places Not Where Your Mouth Is

A study by IAB labour market has concluded that Germany will not suffer the same scale of job losses as the UK. The main reason is that Germany pumped money into wage subsidies which supported employment.

It's more than that. I sit here having spent this and the last few weeks in Germany and it is clear there is a profound difference to the way in which Germany has spent money to stimulate its economy and how the UK has. There are obvious things - Germany and France are pulling out of recession and there are signs that it is sustainable. Germany put money into wage subsidies for firms to help stop widescale, automatic redundancies which has been the first port of call in the UK in response to the recession. Germany and France put around €5bn into the car scrappage scheme to stimulate sales rather than dither over helping mothball factories and then go to scrappage in the UK at a paltry £300m. Angela Merkel pledged €6bn into the wage subsidy scheme but she fought, along with France, the wholesale and unlimited bail out of banks much to Gordon Brown's annoyance in the G20 meetings. The results have been impressive with no huge increase in unemployment and an early exit to the recession while Britain reels at 2.4m unemployed (some say the real figure is 6m) and this will peak at over 3m before the year ends - as yet there is no sign of the end of the recession for the UK.

Germany got it right - we didn't.

Don't React, Think

Another of my New Scientist articles caught my eye. Notice how Government's over react to situations rather than think them through - the soundbite is better than the diligence in most cases as it sustains or wins votes. But you only have to look at Britain's reaction to swine flu to understand we have committed huge resource to try to cover something which could have been contained far more easily and with less cost, and we have simply saved no more lives by doing so. That is one example - another would be how, in the face of a rail disaster we pour millions into rail safety. The result is that we have no more rail disasters in 2008 over 2007 saving a few lives. Meanwhile around 279 deaths happened as a result of trespass and suicides on the rail network in 2008, around the same amount as 60 years ago.

In other words, we tackle the headline, not the real problem costing far more.

We could get onto road saftey but that is its own nightmare deserving far more airtime while all the heightened security, a war with Iraq and spend after 9/11 did not stop 7/7 occurring under our noses. There is now clear evidence that George W. Bush actually got briefed on a threat to hijack US planes just a month before 9/11 and his recation was, 'You have covered your asses, now go.' The subsequent spend on two major wars has got us no further in making us safe - if anything, we are far worse off.

So back to the point. While Germany put specific money like €10bn into education which has to be spent by the end of 2010 on refitting schools or new interactive learning techniques to lay a foundation for the future, Britain chose to put huge sums into bank bail outs without any idea how much was required or when it would stop. In fact, we knee-jerked into taking Northern Rock into public ownership before we had even time to think and then plunged incredible sums into banks and a further £175bn into Quantitative Easing without any idea what the real results would be. Germany and France were right on their game - specific sums for specific effects and no wanton bail outs with incalculable effects.

Guess who is in the better position.

But there is far more. Eminent economists like Kenneth Rogoff argue that we have thrown money at the problem of the banking system with little thought, especially when it comes to regulation. You do not have to be a genius to realise that banks worldwide are now using easy and cheap loans from Governments to fund incredibly high risk debt swap and the likes as they did before but now under the umbrella of taxpayer guarantees should they fail again.

What does it do? Obviously, it will bring vast, short term profits which banks will want to pay high bonuses on - and guess what we have got? Rogoff goes into far more detail but basically he highlights the knee jerk reactionism by the US and UK over Northern Rock and Lehmans as examples of reacting without thinking which has caused a cascade of similar, more profoundly expensive mistakes.

Time and again, we see that Governments react with short term thoughts that have major effects in the long term. Germany and France campaigned against some of the stupidity Britain went for and they have been the quiet, unassuming winners because they put their money into the exactly the right places to get the desired effects.

At the time, Merkel was seen as the ditherer while Brown was seen as the superhero flying from country to country to save the world even if he did inexplicably go through Brazil. Merkel has proved to be right, choosing the thoughtful and precise approach. Brown has a dog's dinner on his hands thanks to his knee-jerk responses to crises. The difference being is that Merkel knows pretty much how much it has cost to get out of the recession - Brown has zero clue and we will pay yet more as banks behave in the same way as before the crisis.

Regulation and reformation of the financial system was the key if £billions were to be thrown at it. We have none and we are faced with the sight of banks paying a thin layer of superstars bonuses that make it look as though we are rich again. Instead we are paying off debts that will last until 2032.

This is not an issue between employer and employee as Darling would have us think, this is about what banks are really earning, what they can sustain and what we have paid them to survive. We are the 'Masters of the Universe' but we need politicians to enforce it. It's our money, after all.

Questions Of Science

The problem with reading a copy of New Scientist on a short flight is that it rekindles the lost academic potential within you - it's a slim chance at the best of times but some 25 years ago science was my best hope of a career. Now I struggle to spell Avagadro let alone remember the man of Turin's famous number but that's life, I suppose.

So I pose a little question - which of the four fundamental forces in nature baffles scientists most as the other three can be explained by the exchange of force-carrying particles? Let me put you out of your misery - it's gravity. Einstein explained it as the force which arises from the smooth warping of space-time by massive objects. Does that sound double dutch to you? I hope so. For the layman, the explanation of 'smooth' is anything which behaves according to a nice equation however much the said equation looks like a set of scripts from a Dead Sea Scroll.

Gravity is the one force which cannot be explained by quantum theory. There have been approximations and strings but realistically they are merely theories which have yet to be proven by any physical evidence.

I put forward another natural phenonemon which defies 'particular' definition and constantly elludes the wit of man - coincidence. This is the happenstance of two seemingly unrelated events occurring from which we may may infer a connection, however tenuous. Well that's my definition anyway. I am talking about the bizarre oddment of me being in Berlin and reading about the premier of 'I,Robot' on the plane over and then literally bumping into Will Smith on the pavement outside the Four Seasons Hotel less than a few hours later. Finer analysis would have shown that the article was in the BA magazine, advertising the route to Berlin where the premier of 'I,Robot' was taking place because Audi were a major sponsor - so the scene was set, the stars aligned. If I happened to be walking along the road at roughly the time Will, as he likes to be called, was going to the cinema with his family then I would bump into him.

That can be explained when using probability theory and the two itineraries (Will's and mine) - we happened to be in the same place at the same time so it may have been more likely we would have bumped into one another. But consider this - and yes I get political here because I am sick to death of it and I cannot stand the man - that Peter Mandelson is invited to have a free holiday on the luxurious, multi-million dollar boat of a very significant player in the world of films and downloads (we are talking David Geffen of Dreamworks here) and less than a week later officials are told to draft laws to punish illegal downloaders of content, even if it is the people who post the content who are doing the real wrongs.

But Peter defies the statistical evidence much more than this. On the same holiday, he has a chance meeting with Colonel Gaddafi's lush looking son and next thing we know the Lockerbie bomber is freed. Fancy that. It reminds us of other rather coincidental events - like the Hinduja Brothers wanting UK passports so there is a donation to the Dome Fund. Or perhaps that Peter spends time on a Russian aluminium tycoon's yacht and then there is an EU vote in favour of lowering tariffs on importing the self same commodity making the self same oligarch incredibly more wealthy. By an an even more science-defying coincidence, the very pages in Peter's diaries covering the dates of the first meeting with the self same oligarch are 'lost' while he is moving back from Brussels and having a gall bladder issue solved.

I wish I had the scientific nous to define a theory to govern all this but it elludes a feeble brain like mine. My curse is to wonder why a twice disgraced dodgy dealer is allowed back into Government as an unelected offical and peer of the realm and then gets to run the country. That is the one thing you cannot put down to the strange law of coincidence - this was premeditated stupidity on behalf of the weakest PM we have had since Chamberlain.

One thing which is not a coincidence is that on the weekend that Gordon Brown chose to continue his holiday and not to open a centre for injured troops we found out that the tally of dead heroes in Afghanistan rose to 204 and the toll of injured troops was over 900 in the last three months alone.

Science can be baffling - the obvious can be even more baffling.

The No Diet, No Exercise Way To Lose Weight

Pinch yourself and read it again. Oh yes, come to papa.

I had to read it twice - an article at New Scientist has potentially identified the way to lose weight without resorting to unnecessary physical exertion and not having to starve yourself on lettuce leaves, vitamin supplements and bowls of steam. Enter brown fat - the fat of the future.

Have you ever wondered why some of your friends can pack away huge quantities of food and not do as much as walk up the stairs but still don't seem to put on weight? Yet people like me, in the absence of sweaty sessions in the gym or straining on a mountain bike, can just look at a cake and it immediately transfers its calorific value to my waist without me even touching it. It seems just one of those amazing curses in life - I put on weight the moment I do not exercise - it's as simple as that.

Fat is adipose tissue and it is the stuff that makes my trousers and belt strain, my shirts tug underneath my arms and my chin to fold. It is the stuff that people pay small and vast fortunes to have sucked out and put in a bin - it is the stuff that overspills your trousers to form the unsightly 'muffin tops' so much the fashion in ladies young and old (why oh why?). It is the stuff that forms the large beer bellies so much the fashion in many men (why oh why?) that spills over their belts and stretches their slinky T-shirts. It is the stuff I have had a running battle with all my life.

Well cop this. Brown fat is the new fat - it's official. Some mammals have this stuff in abundance as brown fat turns normal fat into calorific energy or heat without expending any effort. Read it again and take a long sip of beer and then recline in front of the telly - it's Celtic v Arsenal after all. I'm being serious - this stuff exists.

It was long thought that adult humans didn't possess this brown fat stuff and that only babies had it. But new evidence shows that there is hope on the horizon as there are various zones in the body where this has been found in adult humans. Woohoo! And it is the difference in the amount of brown fat present in our bodies that defines whether we remain slim or become a fat bastard, to coin an Austin Powers phrase. Well now we may be calling skinny people fat bastards of a different kind and that may be a compliment rather than an insult. You can see I'm making this up as I go along.

There's lots of clever detail in the article which I recommend as one of the most uplifting reads of the year, forget the Richard & Judy selection for the book club, get New Scientist this week. You'll feel twice as better, believe me. However, suffice to say that a mere 50 grams of brown fat, which apparently is well within the kinds of amounts that we all possess, can burn off as much as 500 calories without so much as a strenuous effort to fart.

Oh I could wax lyrical about the fact that brown fat has different mitochondria which do different things to normal mitochondria but are all involved in energy release or thermogenesis but it would be far too boring. Suffice to say that brown fat burns energy without having to put any effort in. Bingo.

There is always a catch - I suppose there is really no such thing as a fat free lunch after all. Scientists have yet to conclude how to manipulate the amount of brown fat in our bodies and if that may be something that is risky. But they are hopeful that this may be an important breakthrough in the fight against obesity. For me, I just want to get thin without having to go to the gym everday - to hell with the muscles, just make me fit into my trousers more easily. The caveats go on - there may not be magic pills to sort the problem and it may be that brown fat alone is not the solution - but at last there is hope. Think how much this could save in gym fees, isotonic drink bills, spandex shorts and arm bands for your ipods. The possibilities are endless.

I sure hope that they bring some pills out very soon as I baulk at the thought of having to knock out some up unsuspecting thin person to try and extract their brown fat and inject into my buttocks.

But needs as must.

Rules of Engagement

It may come as a surprise to us all, but HR people have friends. I can even confess that I have several friends who are openly 'HR' and I respect them for it.

We may titter a moment at the idea of friendless HR people but there is a serious point here. With the rise of Social Networking Media and all its wide choice of communication that it offers to us and our friends, there is also the aspect that it is public. Very public.

I remember a story of a person who attended the European Championships in Germany and waved excitedly at the camera when they realised they were on the big screen. They had forgotten that their boss also liked football and was watching back home and the person had not booked holiday but had done a bunk pretending to be sick. It resulted in instant dismissal.

There have been cases of individuals losing their jobs because of You Tube videos of them drunk while holiday or a tour. We may feel very strongly what we do in our spare time is own business but when we risk having such unsavoury antics posted publicly then we are exposing ourselves to the criticism and much more of others. It is very difficult to stop these days as often these clips can be posted without your permission. That may not help when your boss, tutor or best customer sees it.

The fact is that Facebook and all the multifarious derivatives are very open to public view. I even know of a case of where a young PA was so obsessed with using Facebook through the day, one of her bosses had even requested to be her friend, an invitation she accepted, and he promptly sent her a message to get him a cup of tea while sitting no more than two desks away. The point being that the boss felt it was becoming the only way to communicate with her while she was cheesed off she got found out that she was browsing Facebook all day in company time.

At one place I worked a few years ago, there was a high percentage of staff who were relatively young (can I say that anymore?) who were desk based in a large open office. Over 75% had Facebook as their home page and they communicated to each other all day via the messages when they actually sat at the furthest points no more than 20 metres apart. Facebook and the likes can be very counterproductive in the modern office and that's a real problem for employers.

For the employee, it also exposes what they are doing. Messages are timed and public as are the photos. It can be all too easy to be monitored and this can pose serious problems. The adage of 'What goes on on tour, goes on You Tube' is becoming a new mantra and it is getting a little more serious. As we relish the thought of knowing MP Expenses details, would it not be nice to know how much time our paid employees are spending on social network sites during the hours of work?

There are many instances of people who have posted disparaging remarks about their bosses or companies on the web and getting disciplined at minimum while others simply get fired. We all get frustrated and bored in our jobs, we may even dislike the company and individuals such as our boss or a colleague. We may even choose to tell our friends and family, but you wouldn't necessarily take out a TV advertisement with your name on it and let the world know, would you? That's what social networking can be. It's an uncontrolled medium that is public in many places and so it can be monitored far more easily than we like and our bosses and even HR people can have accounts too.

Imagine 'slagging off' a colleague on a social networking site and then that employee raises a grievance that they are being bullied at work - would your comments be evidence of such bullying? Indeed they would.

It is as well to have your own 'Rules of Engagement' on social networking - if you use it extensively, have your own guidelines for when you communicate, how you communicate, what you want others to say to you and what you don't want shown. It makes just a little sense to think this all through beforehand rather than discover a 'mate' has posted a picture of you drunk in gutter when you were meant to be at home ill.

It's as well to be very wary of this. There is a fine line for companies to pry too much into what employees are doing in or out of work hours than can be construed as breaching our privacy. But when we are silly enough to make it all very public, well that's just asking for trouble.

Where Will You Go To, My Lovelies?

Over the weekend some 100 public figures lobbied the Chancellor, Alistair Darling, to curb the 'excessive pay packages' of the few, elite high earners in the banking and financial system, describing them as 'Masters of the Universe'.

The Chancellor himself, in fairness, had already fired a few warning shots about curbing some of the bonuses and particularly guarantees, which is a perennial sore point, claiming he would give more teeth to the FSA to impose tighter rules. He has a problem here as the FSA is crammed full of ex-finance types who bear allegiance to their former colleagues - or worse still, they are the failed bankers who were not competent enough to dip their snouts into the trough effectively and so are not quick-witted enough to catch the banks out while harbouring petty grudges.

It boils down to what the rules are and how the FSA and Government allow banks to operate within them. We have already seen a spate of neat tax avoidance tricks announced by clever accountants on the web who will help anybody who earns above £150,000 next year to minimise their tax bills with some shabby tricks on paying into new companies, some of which are not imaginative enough to scare the HMRC. But it will be the banks who become the most devious as they are absolutely obsessed by the idea that if they limit the bonuses of their 'Top Talent' then they will have a mass exodus of the high-flying high earners to places where the pay is better.

And so where will these little darlings go?

Well first of all, do not underestimate the ability for banks to invent clever schemes to get round the issue or for us to forget the fact that the Government is currently paying around £11m a year in fees to investment banks for advice on the whole issue, let alone around £29m in legal fees. Certainly we may see more of their top traders become non-domiciled so at least more of their 'hard-earned' bonus is spirited away from the thieving hands of the Chancellor. More likely, we will get dummy companies set up and these will be paid lavish 'Consultancy Fees' - and these companies, like strange quantum particles, will exist but briefly to liquidate cash on a capital dispersal idea and avoid things like National Insurance. The fact is that there is nothing in the FSA or Government thinking about 'Consultancy Fees' and I dare say we shall see more of this flying around. In the short term there are stock options which are handy as the market gets back some of its old ground but that is likely to not appeal in the long term as traders like ready cash and they certainly don't want to be held accountable for any collapse in the bank's profits or share price - they have proved that conclusively already.

There will be plenty of 'Guns to Heads' at the moment as the profits clock up on the banks' bounces and traders will be dismissive of their employers' excuses. They will be playing the 'If you don't pay, I'll go to somewhere that will pay me what I'm worth' cards. Theoretically, they have a point as the problem will be that if Britain acts in isolation then they will lose these little mites to other banks who are out of reach of our 'punitive' bonus scheme allowances. This will mean that British banks will become uncompetitive in the 'New World Order' that Gordon Brown talked of.

As the Government wants to show the public it is curbing the excess and high risk strategies by banks, but they do not want Britain to lose out as so much of our economy depends on earnings from the City - there is a dilemma. One way would be to impose windfall taxes on every financial institution for the next 10 years in order to pay back what is generally owed. Of course, most banks would then put their HQs outside of the UK and thumb their noses at us which would be counter-productive but it may be a start that each of them pays exactly what tax they should do from now on and any scheme to avoid tax is fined double the tax owed. It still doesn't solve the problem.

Traders will depart for sunnier climates - to the US or Asia, wherever the banking system allows excessive bonuses to be still earned. This is where I see an advantage. Let them go.

Skimming Off The Highest Risks

You see, the whole system was brought to its knees by the actions of a comparatively small group of people employed in high finance. They say in Iceland you could identify just 6 people who actually nearly bankrupted the whole country and in the City you could draw up a similar but more extensive list. I would do so and I would say to those who think that they can get jobs in other countries, in banks who are willing to pay excessive sums - go. It may well produce a 'Premier League' of banks but frankly it will put all the risk into one area. UK banks can then recruit a new wave of traders who can be weaned on sensible, lower risk banking that never exposes Britain to the kinds of problems we have seen in the last two years.

By skimming off those with the highest risk-taking index and letting them go elsewhere, we make Britain a safer place. And we need it. Should we just lurch into another credit crunch and recession in the near future then we risk simply not having enough resources to bail ourselves out with. Already there are predictions from established sources that by 2014 that British Sovereign Debt could be almost 100% of GDP and we will be paying for every penny of that borrowing, roughly double what we pay were paying for last year.

So my solution would be to let the little blighters go to wherever they think will pay the money for them. Go exercise that egotistic point of view they have that they are 'Masters of the Universe' and far more more intelligent than the rest of us. At some point, I dare say that someone will realise that in order to keep the scam of their elaborate schemes going you need every bank in the world to be as bad at mathematics equally and hopefully one or two will find out how to use calculators and realise that all does not add. Perhaps it will be those banks who first realise that it may be better to trade things you know the value of who will break away from the schemes and focus on logic rather than hot air. Perhaps that is what will help heal the banking system and make it stronger for the future, and perhaps by having a few banks break away more will follow leaving only the very high risk banks in one place. And if they want to be the super-rich ones and pay incredible bonuses, then fine.

Let's just make sure it is the British banks that lead us out of the high risk zone and the first step will be to unequivocally stop high bonuses being paid on high risk business; the second will be to curb high risk business - full stop.