NewLab legacy?

February 23rd, 2010

Yesterday brought us the news that the UK has just about crawled out of recession – or rather, out of the technical definition of it, although the output of the UK economy in the final quarter of 2009 was the same as it had been in the third quarter of 2005 – so over four years of growth have evaporated.

Growth in the UK usually averages 2.4 per cent annually so we are now over 10 per cent behind where we would have been if the country had achieved no more than average growth over that period.

What is even more concerning is that since 2005 UK government borrowing has doubled.

In yesterday’s Channel 4 News knockabout between Ken Clarke and Peter Mandelson, the NewLab argument was put forward that the government had to keep on spending for now to avoid putting the recovery at risk. Well, it doesn’t appear that all that spending over the past four years has achieved much. Borrowing does have to be repaid, but I suppose that is not a problem once you have been voted out of office.

I can’t help thinking that every recession brings with it a certain amount of pain and borrowing heavily to ameliorate the suffering simply prolongs it. Is a sharp, deep, painful recession that enables us to return to strong growth quickly better than engineering a shallower but longer lasting one? I’d have thought so. Too late now, though.

Planning a robbery in the US? Best check with your accountant first

February 23rd, 2010

OK I have to admit: this may not apply to you.

But in the course of some leisurely reading I found “Publication 525″ from the United States Department of the Treasury: Internal Revenue Service. You can find this here; it’s a pdf file. It explains what is taxable and non-taxable income for US taxpayers to help them with their 2009 returns.

It’s fairly comprehensive. On page 36, for example:

“Stolen property. If you steal property, you must report its fair market value in your income in the year you steal it unless in the same year, you return it to its rightful owner.”

There’s no indication of whether you can claim a deduction for any expenses incurred in the course of your trade (ammunition, perhaps) but then if too much detail of that nature were given, why would you need an accountant?

Oh, fair market value is defined on page 8.

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