Gordon Brown Debunked

As long as the UK chancellor Gordon Brown makes nonsense comments I will write counter comments. He likes things to be settled and I don’t like his settling.

Now let’s have a look at his speech to the annual gathering of the trade unions. Full text of his speech is given in Guardian.

Now, let’s see again what he thinks about oil.

GB: “First, because this is, at root, a problem of demand outstripping supply, Opec must respond at its meeting on September 19 to rising demand by raising production.”

>>> Brown, you still couldn’t learn it. There is more oil in the market they demand. Look at the IEA’s numbers.

GB: “Second, lack of transparency about the world's reserves and plans for their development undermine stability and cause speculation. The world must call on Opec to become more open and more transparent.”

>>> Transparency will not solve anything. It is a looser anyway. What is transparency anyway? The Saudis are telling that they have 260 billion barrels of oil and nobody believes. They say they produce 9.5 Mb/d and nobody believes. You really want to get rid of speculation? Then close down IPE oil futures trading. Check who owns IPE, and also check who trades futures, who buys how much and when, let them be very transparent or make it transparent. And stop this “call on OPEC” mania.

GB: “Third, from the additional $300bn dollars a year in revenue Opec countries are now enjoying and the additional $800bn available to oil producers, there must be additional new investment in production and global investment in refining capacity.”

>>> Absolutely ridiculous. OPEC must invest billions of dollars in production capacity! A dead investment. Invest also in refining capacity, a low profit making business and money is gone. Maybe the UK government should lend them some money with some nice interest, after all their money gone! Why do you think that there is no new refinery built in the US since 1976? Why don’t you ask BP to build new refinery in the UK? Why don’t you lower taxes and royalties to the companies who operate in the UK continental shelf?

GB: “Fourth, the search for alternative sources of energy and greater energy efficiency is urgent to ensure both the maintenance of economic growth and tackling climate change, and the World Bank should set up a new fund to support developing countries investing in alternative sources of energy and greater energy efficiency.”’

>> This useless World Bank is the cause why so many developing countries are in debt up to their throat. The UK and the EU just wants to create market for their alternative energy technologies in developing countries. Just admit it! What is alternative sources of energy can you explain? And also explain how they can replace oil and in which sectors! You just want to push those looser alternative energies to developing countries for them not to use oil so that the price drops and developed countries enjoy cheap oil again!

GB: “Fifth, poor countries and poor people should not ever be left defenceless against oil and commodity price shocks and the International Monetary Fund (IMF) should agree, as a matter of urgency, to create, a new facility for countries hit by these shocks.”

>> Check the IMF and World Bank data again. Even though the oil prices went up so much, developing countries had never experienced and enjoyed such high economic growth rates over the past 25 years as they did in 2004! Create another useful institution you mean? Or the IMF should create something like the UN did for Iraqi oil! A very transparent thing that except for Iraqis everybody benefited!

GB: “And, because we have a special duty to help not just the immediate needs but the long-term prospects of the poorest of the world, oil producers should now agree to use their windfall revenues to create a special trust fund where oil producers help debt ridden poor countries write down their unpayable debts.”

>>> This doesn’t smell good at all. You mean, rich countries understand the long term needs of developing countries, as the history proved already. But you don’t and can’t do anything but developing countries should just help each other. BUT they should create a special trust fund. I assume you think that this fund should be kept in a developed country which has very developed financial markets, UK for example. Then this fund should be used to pay their debts, and money goes into the pockets of rich ones. Great plan.

Indeed you described your strategy and aim by yourself Mr. Brown: “At each point willing to take the tough long-term decisions.”

However, Mr. Brown, let be fair. You said one good sentence at your talk

“it is only by building universal free schooling and creating free universal health care that the people of Africa and developing countries can begin to eliminate illiteracy disease and poverty.”

And as you admit, that unfortunately belonged to Tony Blair!