Double Entry Bookkeeping and Childhood Dreams

As my cogent yeomen know, I am a bear of very little brain. This isn’t always a disadvantage, sometimes it is positive asset.

Take the G20 summit in London, while all of the leaders took turns in announcing the unanimity of all concerned and the success of the summit (see Note 1), I remained unconvinced. When all the papers laud the communiqué (see Note 2) as giving real hope for the world economy, I remain disappointed. (see Note 3)

You see, I find it difficult to believe that additional regulations will achieve anything more than provide job opportunities for those young children who have dreamed since they were at kindergarten of becoming auditors. (see Note 4)

Regulation is a problem because it flies in the face of human nature. My logic for being cynical about its likely success is because business, like sport is a competitive environment. With the will to win so great, human nature is such that people are encouraged to play by the letter of the rules rather than to the spirit. I’m not going to search out any of the zillions (see Note 5) examples where sportsmen have sought ways to bend the rules or those where the rules were deliberately or accidentally broken, but I think you can find plenty of your own.

In the UK, the regulator, FSA, had a budget for £250m for staff costs in 2008/09 (increasing to over £300m in 2009/10) according to their latest business plan. Printing out their regulations would destroy a small forest. Yet this didn’t stop various banks from playing pass the parcel with various toxic debts.

You see, the various financial institutions juggle risk against reward (see Note 6) and will still seek to maximise the reward. By simply adding more regulation we will achieve very much. What will happen is that the various financial institutions will simply seek to employ cleverer people with the intent of finding ways to maximise the reward by, like sportsmen, finding ways to take the risk by sticking to the letter rather than the spirit of the rules.

Sadly, business success has only one measure – profit and everything else, including ethics are secondary to the pursuit of wealth.

But fear not, my saturnine yeomen, for this singular purpose of business is also the means by which we could make other considerations, especially ethical considerations more important in the corporate world.

For every profit is subject to taxation. Whatever the risks, whatever the excesses of a business, our governments take their cut of the profits in taxes.

The answer is to make this taxation voluntary. By offering businesses exemption on their tax bill for showing they comply with an accredited and ethical scheme. So Trade Unions could run an accreditation scheme that would knock 20% of the tax bill if a company complies. You could knock a further 20% off if the company is accredited as following the spirit of the regulations as well as the letter. It could be extended to fair trade, the environment, community and all sorts of different considerations.

The profit would be directly affected by the ethics of a business and BINGO! We have a way of stemming the excesses.

Not only that, when wrong doing is detected, we have a way of making sure that we have the means to exact retribution. Remember, Al Capone was eventually brought to justice for tax irregularities.

So for all you G20 leaders reading this little blog, why don’t you phone round your pals and see if you can persuade them of the wonderful simplicity of my little plan in time for your next little shindig in Japan? If you want a few extra details, you can always leave a comment below, I’ll happily put a little meat on the bones.

Note 1: And then promptly returned home to tell their domestic audiences how they fought out to secure an agreement that secured their own particular national interests.

Note 2: I am sure that President Nicolas Sarkozy of France is particularly pleased because he can return to France and proudly announce that after weeks of concerted lobbying and negotiations behind the scenes, he gained international agreement that the G20 would issue a communiqué instead of the a vile anglicised statement.

Note 3: This disappointment was extended to cover the protests as well. They seemed all rather lacklustre. I guess that even anarchists are finding their budgets are being cut back in these uncertain economic times.

Note 4: Otherwise we would end up with a nation of train drivers, nurses, firemen and lap dancers.

Note 5: A few years ago, in order to exaggerate a point I would have used ‘millions’. The responses to past disasters and crisis meant that soon became devalued in the exaggeration stakes so ‘billions’ had to be used. The current crisis has the G20 talking in terms of ‘trillions’ so I am now forced to jump up to ‘zillion’ and I don’t even know if that is the next step up from a trillion or even if it is a real number.

Note 6: We all balance risk against the reward as part of our daily lives. Some of us are more risk averse than others. On a hot day we may fancy an ice-cream from the shop over the road. Some of us will consider crossing the busy road to risky and forgo the treat. Others will consider the risk to our long term health and give the cool gloop a miss. Then there are those who will shout ‘GIMME THE LOLLY’ and run headlong into the rush hour traffic.

Media Whimsy Watch.

My theory is that the appearance of whimsical items in the “serious” media is in direct proportion to the economic prospects.

The G20 summit has obviously had some impact, albeit small.

Privileged Poor and Horsehair Pancakes

A member of the privileged poor?

My animated yeomen, I need to select a particularly woody word for my state of mind today. You see, I am in a quandary. You may remember, I did a short entry about the origins of April Fools Day and it seems it failed to match my usual high standards. It seems that Sean not only knew of the origins, but was able to follow my synaptic tangents.

As all of teachers never tired of telling me (well those that were not carted of to the technicians area in tears) – I must try harder. So I set you the following conundrum. Why have I described Sir Peter Ustinov as a member of the privileged poor and what is the connection to today (5th April 2007)?

There is a huge temptation to pause here and hand the stick of chalk over to Sean and repeat another favoured phrase of my teachers, but I won’t. (Note 1)

Today is the last Thursday before Easter, the day of the Last Supper. While we all remember the breaking of the bread and the taking of the wine that are now symbolically taken as part of Christian Communion Rite, another symbolic gesture was widely followed in the early church – that of washing the feet of the guests. (Note 2)

So it is on the Thursday before Easter, some churches run a “Mandatum" ceremony where the clergy wash the feet of twelve specially selected members of the congregation (I’m not sure I would want to be in charge of the selection process though).

In the past one of the downsides of Kingship in Britain was that you had to get involved in the feet washing thing at the local cathederal. This was part of Maundy Thursday ceremonies. This all died out in 1736 and the monarchs instead handed out alms to specially selected poor people (although again probably selected on their ability to smell like fresh paint and ability to look reasonably presentable). The monarch would hand out a donation equivalent to the monarch’s age in pence. As Queen Elizabeth (God Bless you ma’am) was 80 last year, she handed out 80p to the selected poor people.

For rather obvious reason this is known as Maundy Money.

All well and good I hear you yell, but what has this got to do with Sir Peter Ustinov?

Well, up until the 1970s, it was customary for Maundy Money to also be given to the youngest students in Westminster School - an independent school with fees around £16 800 per year. Sean has probably already guessed it, but Sir Peter Ustinov was a pupil at Westminster School – although I cannot say if he received Maundy Money.

So, there you have it. Maundy Money going to the poor. I feel within my rights of describing the students of Westminster as privileged. So Westminster students (including Sir Peter Ustinov maybe) who receive the Maundy Money must be the privileged poor.

All that remains is to explain the horsehair pancake. This is a tradition at Westminster School and is no way indicative of the standard of school dinners there. On Shrove Tuesday, a pancake reinforced with horsehair is tossed over a bar and students fight over it. The student gaining the greatest weight is given loan of a gold sovereign. You really can’t make this stuff up you know, I found this wonderful fact courtesy Wikipedia).

Oh, Sean? If I bored you, I’m sorry.

From 14th June 2006, the industry standard Crozzy Standard has been applied to footnotes.

NOTE 1: You may have gathered that for the most part, I had a rather uneasy relationship with my teachers at school. There was a certain tension in the air between us. They had this idea that I should accept what they say as absolute truth, while I believed that it was my duty to talk about anything but the matter in hand. My old geography teacher used to tried to counter this by handing me the chalk and saying “If you know so much, Holder, why don’t you teach the class?” Only he backed out when I rushed to the front with a look of glee on my face. Looking back on it, I think the teachers had the last laugh. Had I tried that little bit harder in school, I might now be feted as a “British-born actor, writer, dramatist, wit and raconteur” rather than a smart-arse. Click to return

NOTE 2: Personally this would kill any appetite I had for dinner. If I was honest, if I was invited anywhere it would kill the appetite of all my fellow guests as well as soon as I took my shoes off. Click to return

TECHNORATI TAGS : Peter Ustinov ; Maundy ; money ; history ; Synaptic ; Westminster.