An Englishman's home was his castle

'An Englishman's home was his castle'

Sunday March 25th 2007

At NZ Gold two of our favourite writers are American James Dale Davidson and British Peer Lord William Rees-Mogg. What we particularly like about these two researchers, forecasters, and authors is not that they are always right - such endeavours inevitably mean they will sometimes be wrong - but their capacity to encourage thought, when such activity has become unfashionable. If you have not had a chance to read two of their publications "The Great Reckoning" [published by Sidgwick & Jackson Ltd] and "The Sovereign Individual" [published by Pan Books] we would commend these two you.

Critics of the above publications may point to the fact that the The Great Reckoning in particular is flawed, since it predicted a major worldwide depression in the 1990s that did not occur! At NZ Gold we are more circumspect. We consider the case that Dale Davidson and Rees-Mogg advanced in support of their depression hypothesis to be compelling and we suspect that the events foreseen have merely been delayed - not eliminated. Indeed, we would suggest that one key factor in putting off the depression that they foresaw has been the almost unbelievable expansion of credit. This leads us to a timely observation by one of favourite economists, Ludwig Von Mises (1881 - 1973):

"Credit expansion can bring about a temporary boom. But such a fictitious prosperity must end in a general depression of trade, a slump".

What, you may enquire, has any of this to do with the notion that 'an Englishman's home has ceased to be his castle'? Well, at NZ Gold, we suspect that a 'holistic view' of Dale Davidson's and Rees-Mogg's work delivers the vital insight - that the business of politics is ultimately about 'returns to violence'. Think about it for a moment. When the local authority rates demand drops on to an Englishman's doormat and he opens it what - increasingly - does he think? "By jolly jingo, this represents splendid value for money!" Or "How much have they gone up?". Consider further, the levying of local authority rates is meant to be about a payment for services received. In any normal business transaction, where services are exchanged for payment [certainly in countries that are meant to enjoy functioning market economies] you have the right not to purchase, or to negotiate better terms, if you think you are being 'ripped off'. Yet only facetiousness would encourage the suggestion that you try such tactics with your local authority in England - or New Zealand for that matter. Why, because at the end of the day they have the authority - and ultimate power - to take whatever they want from homeowners largely irrespective of the ability to pay. Does this mean that we believe ratepayers should be entitled to services on a free of charge basis? Of course not, but it does advance us towards the conclusion that rates have ceased to be a simple and modest levy for essential services and have become instead a defacto 'wealth, capital gains, corporate welfare, and social engineering tax' that imposes increasing hardship, bitterness, and misery on more and more people.

As we consider this issue, we believe it essential to understand the concept of 'returns to violence' and how this phenomenon will be increasingly associated with the confiscation of British and New Zealand homeowners 'wealth' - via rates and other taxation measures going forward. The 'violence' that concerns us emerges in two forms. Firstly, irrespective of whether or not you think you are currently getting good value from your rates, you simply have to pay - especially if you have the cheek to be 'middle-class' and are earning a reasonable income. If you do not pay, then initially there will be penalties. In New Zealand's case these are normally set at 10% of the outstanding installment's value - levied on the day after the rates fall due [interesting when we are told that inflation is somewhere around 2.5% per year!]. Ultimately, if you still do not - or cannot - pay penalties compound, legal proceedings may follow and property various may be seized by bailiffs to cover your by now hugely inflated liabilities. At NZ Gold we enquire - is this not describable as a form of violence? If underpinning the system was a culture of earnestly, and transparently, delivering essential services and infrastructure then it would be difficult to have sympathy with those reticent or tardy in paying their 'fair share' of a local authorities costs. However, as we have mentioned before in this website, rates now represent - amongst other imposts - a capital gains tax in which increasing property values lead to those rates demands getting bigger and bigger. So what is the person on a fixed income supposed to do? Go to the bank and borrow the money was one arrogant suggestion we have heard! Just what the superannuitant wants to hear - when they have spent years paying off a mortgage and are now 'debt free'!

Yet, scanning the horizon, we suggest that the above use of rates [or perhaps some future form of local income tax] as a defacto levy on unrealised capital gains from housing may be the least of a homeowners worries. We hold this view because of the radically changing demographics in both England [and New Zealand] and because we believe the 'corporate cabal' may have greater designs on 'middle class' incomes and property rights than is commonly thought. Indeed, we suspect that one of the most common mistakes made by ordinary, sensible, 'middle class' Englishmen and Kiwis is to believe that political conservatism is still alive in the corridors of corporate power. Ironically, we suspect that the 'corporate cabal' has learned from the 'redistributive left' that the middle class represent a 'fat and juicy source of plunder'. In this regard, we now increasingly perceive these two theoretically opposed 'ideologies' not as mortal opponents - but as points along the same continuum. The parallel we would draw, from our days of studying human psychiatry and psychology, would be that of 'bi-polar disorder' in which the same condition can manifest itself - with what appear to be - diametrically opposed symptoms.

Perhaps we are wrong, but at NZ Gold we suspect there is going to be a second - and more directly discernable - form of 'violence' with which English and subsequently New Zealand homeowners will have to contend in due course. In considering this our minds travel right back to the Norman conquest of 1066, because we believe this to have disturbing contemporary relevance to the matter in hand. It had been under the extraordinary auspices of King Alfred The Great that the nation of England had emerged - from the 'dark ages' that followed the final departure of Imperial Rome in AD410. As Justin Pollard has noted in his superb biography "Alfred The Great - The Man Who Made England" [published by John Murray Publishers] Alfred delivered "a new type of kingdom, where protection and prosperity resulted not from physical force alone, but from education, public building, commerce and law". The King died in AD899 leaving an evolving nation that was to be shattered by events 167 years later. At NZ Gold we believe it is a mistake not to uncover contemporary lessons from how William of Normandy behaved towards Anglo Saxon property rights following his victory. Here was a man on a 'mission to confiscate' with the capacity to deliver, and willingness to use, violence to achieve his cynical aim of a politically expedient redistribution of defeated England's property.

Today, it can be argued that another 'invasion' of England is under way via a process of unprecedented legal - and illegal - immigration. This phenomenon is rapidly augmenting the dramatic demographic changes that occured in British society between the passing of the British Nationality Act in 1948 and the election of Tony Blair's 'New Labour' government in 1997. Seen in retrospect, Enoch Powell's concerns about some fifty thousand immigrants a year during the 1960s now seem rather quaint! A huge surge in people moving to England has, of course, come about because of the recent enlargement of the European Union - to include relatively impoverished former 'Eastern Bloc' members such as Poland, Romania, and Bulgaria. We also understand that the European Union is planning to open recruitment offices in parts of Africa [a jurisdiction not even in the EU!] and we have little doubt as to where most of those additionally recruited migrants will be delivered - England.

At NZ Gold we are readily persuaded that many of these new migrants, from the former communist east, are splendid people - often with very high standards of education. Yet, as we have mentioned previously in the website, this is not really the point. What concerns us is that staggering numbers of people are now arriving into Britain, frequently to do jobs that do not provide sufficient transparent remuneration and benefits for such migrants to really survive. We hear tales of "thirty Poles to a house in Swindon" and, whilst exaggeration often adheres itself to 'immigration matters', we have little doubt that what is happening requires a large and rapidly growing subsidy - disproportionately from the established 'middle class' population via income taxes and rates. In this we see the folie `a deux (a madness shared by two) of the 'redistributive left', for whom all immigration into Britain - however reckless - is to be encouraged and the 'corporate cabal' whom, we suspect, has decided it's high time a little 'redistribution' occurred in their direction. After all, if you can procure the poor but skilled from overseas, knowing that they will work exceedingly hard for you, pay them what is not sufficient 'living remuneration' to manage in ludicrously expensive England - and then effectively pass all the ancillary costs of their healthcare, education for their children, housing, supplementary welfare benefits and policing etc onto the established population you are laughing.

Thus, we start to uncover why an Englishman's home is unlikely to be his castle going forward - quite simply it is just too rich a source of plunder to be ignored. Already, the fraud of a 'defacto capital gains tax' is well established - certainly when you include the scandal of death duties in the equation. Moreover, should property prices plunge at some point - as we believe is probable - don't go thinking your rates bill will fall as a consequence. In such a scenario we would expect to see 'new arrangements' emerging to ensure that the process of 'state sponsored theft' can continue unencumbered. Remember, in any situation where house prices were to decline the overall effect on the British economy - and tax revenues - would be severe. Do not forget that the average Englishman is already probably paying the highest taxes in his nation's history - during a period of sustained economic growth! A marked slowdown will not be pleasant. Yet worse, in many respects, is what appears to be coming next in terms of the hallowed sanctity of an Englishman's home - his castle. At least with the current imposition you can pay your rates - if you have the money - and then retreat into your flat, semi-detached, detached, or mansion, pour yourself a drink, and watch DVDs of Dads Army - whilst you reminisce about an England long gone! Under the new scenario it would seem that a quick rejoinder of "et domus sua cuique tutissimum refugium" ["one's home is the safest refuge of all"] to the neighbours across the garden fence may be a little previous - for the inspectors and spy satellites are apparently coming!

Our New Zealand readers may struggle to believe this, assuming that insanity has overtaken NZ Gold. If only! In an article entitled "Tax on peace and quiet" [Daily Mail 18th February 2007] the ominous portents for owners of homes in pleasant, law abiding areas with good amenities [read middle class] are spelled out. Given the appalling decline of 'civil society' in England in recent years we might have thought that the government would have held up those areas where a 'first world ethos' remains as an example to the rest of the nation. Apparently not. If you have the temerity to live in an area where values - proven to lead to success - still prevail then it would appear you are to be punished via a savage revaluation of the rating system. In what appears poised for an episode of 'Orwellian nightmare meets William The Conqueror's Doomsday Book' the most intrusive inventory of private property in England since the Norman Conquest is being planned.

Apparently, over four thousand 'property inspectors' are to be issued with an 80-page book replete with 168 pictures of every type of home - from cottages to mansions. With the usual British penchant for bureaucracy various 'formulae' will then be used by those inspectors to asses peoples houses - their homes - for 'fiscal rape and pillage'. In their search for improvements, or other outrages such as pleasant views or a tranquil garden, we understand the inspectors will have the right to enter homes - replete of course with that item so beloved of the English 'busy-body' - the clipboard! So what happens if, per chance, you live in one of the one in every hundred homes reportedly earmarked for the full physical inspection rather than the 'drive by / spy satellite' arrangement. Well, when some mousey little creature - replete with gaberdine mackintosh, pork-pie hat, nasal congestion, and clipboard defiles your porch [extra charge for that of course] you could politely suggest where he might insert himself! The problem with such flippancy is that it could prove rather expensive - surprise, surprise! Deny the inspector access and we understand you could face a fine of £1,000 [approximately NZ$2,750] with 'rolling' penalties thereafter. Moreover, we enquire - will property inspections be as rigorously enforced in tough urban areas as we fear they will be in more 'compliant' suburban and rural enclaves?

At NZ Gold we surmise that one of the most serious mistakes made by England's 'middle class' is the failure to understand that, in Blair's Britain, it is violence - or the implicit threat thereof - that secures the spoils of appropriated income and not genteel conversation or membership of the parent / teachers association!

Of course, what we may be seeing with this apparently draconian revaluation process is the classic political chicanery known as 'kite flying'. We discussed this tedious practice in our 4th March update "Thoughts on the mortgage tax - Is Weimar New Zealand starting to panic". What may happen is that, due to public outrage, some aspects of the process might be modified or delayed. We would suggest that you do not allow yourself to be fooled. What matters, we suspect, is the trend. In this, we note the sage advice of London based American financial commentator Bob Beckman in the 1980s "the long-term trend is your friend". Even if the classic political con, of inferring something horrific - and then paring it back to something that is merely extremely nasty - unfolds we fear the 'long-term trend' suggests scandalous unfairness for 'middle class' home owners.

So again, we borrow the words of Julius Caesar - from that fateful moment when he crossed the Rubicon to destroy the Roman Republic in January 49BC "alea iacta est" - "the die is cast". Already, statutory powers exist allowing English local authorities to seize private homes that have been unoccupied for more than six months. Thus, the principle that the state has the right not merely to ruthlessly tax - but to confiscate private property - is becoming established. Looking forward we would expect this process to accelerate with new and specious arguments being advanced for why English peoples possessions - generally purchased with after tax income - should be forfeit to the government. Moreover, aside from 'revaluation inspectors' the British state is assuming for itself and its agents more and more rights to forcibly enter peoples homes. Indeed, writing in Britain's Observer newspaper on June 18th 2006 Henry Porter noted: "No longer is a citizen's home his guaranteed personal space". He entitled his article "How the Englishman's home ceased to be his castle". It is a sentiment, a lamentation, with which we are sadly forced to concur!

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