Today is no smoking day. I am sure all non-smokers will enjoy having a day to themselves to celebrate their health and wealth thanks to not smoking. The government have joined in the excitement and hype and jumped onto the bandwagon by announcing measures intended to help reduce the numbers of people smoking.

Smoking is bad for your health. There is no doubt about that but it is somewhat puzzling and rather worrying that smokers are singled out as a special case when there are so many health issues facing the country.

Smoking is one health issue that costs the NHS and the country a great deal of money but it is also a business that employs lots of people, generates a lot of exports and pays a great deal of money in tax.

The cost to the Health Service for treating smokers is said to be around £2.7 Billion per year.
Lobby group Forest has previously pointed out that smokers pay over £9bn a year in tobacco tax.
(http://www.theywouldsaythat.co.uk/governments-and-hypocrisy/)

According to the think tank, Policy Exchange, the cost of smoking is made up of the cost of treating smokers on the NHS (£2.7 billion); loss in productivity due to smoking breaks (£2.9 billion); increased absenteeism (£2.9 billion); the cost of cleaning up cigarette butts (£342 million); the cost of smoking-related fires (£507 million); and the loss in economic output from the deaths of smokers and passive smokers (£4.1 billion and £713 million respectively).
(http://info.cancerresearchuk.org/news/archive/cancernews/2010-03-22-Tobacco-duty-must-rise-to-reflect-cost-of-smoking-to-society)

There seem to be some figures used there that are questionable at best. As an example, when it is difficult to ascertain a cause of fire it is frequently put down as smoking related because something has to be put in the box and that is an easy solution. The figures for the loss of economic output from those who have died from smoking related causes must be a made up and estimated figure because we have no idea if many of those people would have been on benefits or could have been bankers and people in the financial industry draining money from the economy rather than adding to it.
It should also be pointed out that the figures given for cleaning up cigarette butts refers only to cleaning up cigarette butts and nothing else but I am not aware of many people whose job is to clean up cigarette butts whist leaving other litter on the ground.

NB. If you have ever tried clearing up litter, and I have,  you will know that the biggest problem is caused by chewing gum. It is a nightmare to try to remove and it is absolutely everywhere.

For arguments sake we will assume the figures may be correct and there is a net cost to the country for smoking but these figures ignore many of the financial benefits of smoking to the economy. Goodness only knows how many jobs are created or supported by smoking product sales. We have the factories producing the stuff, transport firms moving it around the country and shops selling smoking products. It is a very big business and no doubt contributes enormous sums to both the economy( £££s unknown) and the exchequer (around £9 Billion). Plus all the extra taxes paid by people working in the industry and the companies that make the products.

So why the drive to reduce smoking yet allow other health problem areas to continue with far less pressure to reduce?

The government intends to make it illegal to display smoking products in public in shops and stores. It would make just as much sense, and probably even more, to require that alcohol to be hidden from display and what about the huge, and growing, problem of obesity? Should we not hide food from public display in supermarkets to cut down on those impulse purchases?

You could argue that financial products should not be allowed to be promoted since they cause immense problems to people all over the country. No doubt we would all have weathered the financial crisis a lot better if we had not been encouraged to take up financial products such as credit cards, loans and huge mortgages. So perhaps Financial Products Should Be Kept Under The Counter and hidden away to prevent people signing up to them and destroying their lives and their financial health.

Where should we draw the line?
Parliamentary report: estimates for 2001:
Cost of Obesity to NHS: £2bn
Cost of Obesity to UK economy: £7bn (3.5 times greater)

Britons spend £30bn on alcohol each year
The government raises £7bn through taxes on alcohol
Alcohol costs £6.4bn in lost productivity
The NHS spends £1.7bn treating alcohol-related illnesses
Alcohol-related crime costs £7.3bn
Another £4.7bn is spent on the human and emotional costs of alcohol-related crime
Some 22,000 people die prematurely each year because of alcohol misuse
(http://news.bbc.co.uk/1/hi/health/3121440.stm)

We don’t know the health effects of financial products on people but there can be little doubt that financial problems cause people to suffer from depression and other physical health issues as a result of the stress caused and we do hear of suicides due to financial problems.

Why stop there. What is the cost of football injuries, or rugby, or cricket, to the National Health Service and how much time is lost from work because of injuries or people simply wanting to watch a special football match on TV? Should these sports be restricted because of their health costs and costs to the economy?

There is no consistency in government thinking. There is a total lack of common sense when they approach these issues. Decisions are made more on the basis of what is politically acceptable and what might score a few points with some of the public rather than on what is right or good for the nation.

Drugs are illegal because they are supposed to be bad for us. If smoking is bad for us, is it any different? Alcohol costs the country a fortune and destroys many peoples lives. Should we ban that too? Obesity is becoming a real and very serious issue. We are building up a time bomb for the health service of the future. What are the government doing about it? I have seen no suggestions whatsoever that supermarkets should be required to hide food displays from the public. Is it really that different to smoking products?

Financial companies have done imense damage to the economy and to people’s lives. For all the talk of more regulation little seems to be happening. Is it acceptable to destroy peoples lives and the economy with financial products but not with cigarettes or drugs?

There needs to be a grown up discussion about what is actually good for people and what does them harm. The government should decide if it is right to ban and control the sale of things it thinks are bad for us but it must be able to demonstrate a consistency of purpose in its actions.

The current crop of smoking related laws are quite ridiculous when you look at the many health issues facing the country. Perhaps the reason we don’t ban alcohol is that so many MPs enjoy drinking and they do no doubt enjoy fine dining and good food. Perhaps, if the majority of MPs were smokers the laws on smoking would be different.

There can be little doubt that while so many ex-MPs go into nice positions in the financial industry their future prospects might cloud their thinking when it comes to being more proactive as regards regulating and controlling the financial industry. Perhaps the fact that few of them plan to go on to work in the tobacco industry affects their judgement?

We need good and wise government. Consistent government policy based on facts and common sense. Current smoking policy simply seems to be a case of jumping on the current bandwagon rather than genuinely trying to improve the health and wealth of the nation. Control of smoking products should be a part of a larger policy that restricts the sales of alcohol, food and financial products in a way that is beneficial for the health and financial well being of the whole nation. I see no sign of that happening.

Money Magic: Seven Simple Steps to True Financial Freedom (Quick Reads)

It was reported yesterday that the cost of food has risen more in the last year than it has for many years. Costs of all sorts of raw materials are higher now than they have been in a long while and we all know how expensive fuel has become.

Life is becoming more expensive and this as meant the cost of living and inflation are rising. The response to this from those who see this as an academic exercise is to say that interest rates will have to rise.

Raising interest rates has always been the standard response to rising prices. The idea is that it will slow down consumer spending and reduce wage inflation. That may have been reasonably effective in the past but will it work in the global economy we are now forced to live in and in a country where many people are struggling just to keep food on the table every day?

The UK is not that big a player in the world markets these days. We obviously play a part but the idea that an increase in interest rates in the UK will somehow change the world price of copper, coffee or oil seems unlikely.

Increasing interest rates is more likely to cause more business closures, more redundancies ad a lot more people finding their debt payments are more than they can afford with the result that there will be more bankruptcies and bad debts.

In the good old days, whenever they were, raising local interest rates did have a significant effect on reducing consumption and lowering inflation. It is hard to see how that would either work or be beneficial to the economy right now.

The most efficient economy of the future may be one that has nobody working so there will be nobody spending money to encourage inflation. Great in theory but hardly a practical solution.

When will those in power start worrying about the people and less about the hugely powerful banks and international corporations around the world. The middle East has recently been showing that people can only take so much before they react. Raising interest rates in the current climate could provoke reactions even in a mild mannered country like the UK.

High interest rates benefit the wealthy while causing problems for the less well off. If inflation is caused by excessive spending then we need to reduce the spending power of the wealthy first. They are the ones who are flush with money and able to throw it around without any worries.

In an economic climate where there are major cutbacks in government spending taking place and huge job losses are expected inflation should be one of the the last things we should need to worry about.

Stopping huge bonus payments and introducing higher taxes on people who earn large salaries would do more to reduce than making life tough for people who can barely afford to feed their families.

You have to wonder who the system we have is set up to benefit. The people who cause the problems seem to carry on regardless while the rest of the population suffers as we have clearly seen when it comes to the banking industry. Fundamental changes of approach to how we run our economy seem to be ugently required.

Money Magic: Seven Simple Steps to True Financial Freedom (Quick Reads)

How come people seem surprised that food prices have been rising? Why did anybody imagine that house prices could go on rising forever and why did people make forward plans with an assumption that oil would remain around $25 a barrel?

For the last twenty years or so computers have been commonplace and the one thing that computers are good at is making millions of calculations in the blink of an eye. You can set up a spreadsheet that will take all the figures you throw at it and it can make projections on anything that can be measured. So how come these price rises come as a surprise to anybody?

Governments have thousands of people doing these sorts of projections all day and every day. These people spend their lives working on figures, statistics and spreadsheets so they surely must have had these sorts of projections showing oil at over $100 a barrel, food prices rising and house prices peaking and dropping back. So why is anybody surprised?

We live in a world of supply and demand. If demand rises then a shortage of supply will lead to increased prices and the prices will continue to rise will demand is there and people can and will pay the prices demanded. Prices rise when there is more demand than supply and prices drop when there is more supply than demand. It isn’t rocket science.

So, as we have seen the growth of China, in particular, growing at around 10% per annum and other major countries growing almost as quickly we should not be at all surprised to see the demand for oil growing very fast nor be surprised that as China has grown it’s people have more money they want to buy more and better food. All this is happening at the same time as farmers are finding they can make more money growing food to be used as biofuel than they can if they sell it as food and who can blame them?

The farmers have always been the butt of jokes and the people who earn the least money in the food supply chain so if they can earn more money growing biofuel that should come as no surprise that they prefer that direction. While the suits in the city have been making millions in bonuses for doing a deal in pork bellies the farmer who produced them has been out in all weathers struggling to survive on the pittance he gets paid for them.

We should not be surprised. Everything we do has an impact and an effect. We should have been planning for expensive oil twenty or more years ago but governments sat on their hands and did nothing. We had the oil crisis back in the 1970′s which sent shockwaves around the world but it was patched over and everybody forgot about it.

The housing market demonstrates quite well that even though the signals are there to be seen people tend to ignore those signals. When house prices were beginning to peak experts were still saying houses were a great investment and that the minor blips in the market were nothing to be concerned about. The minor blips became bigger blips and the experts began to talk of house prices stabilising for a while, then they spoke of possibly a temporary but minor correction and eventually they started saying that maybe now wasn’t such a good time to invest in property.

The truth is that for most of us house prices are not too significant. Unless you bought in the final months of the boom you have a reasonable cushion of paper profit and even if you end up in negative equity you have lost nothing unless you have to sell and even then you would be buying another property at a lower price. Everything is relative and of course there are many people struggling to pay their mortgages already and if house prices fall they may lose out if they reach a point where they decide they can no longer be home-owners. Sadly these are the results of the supply and demand process. Some will always lose out by it but listening to experts and self interested advice doesn’t always help.
Everybody has their own point of view and for many that view is tainted by self interest. An estate agent would prefer you to buy the house he is selling. It doesn’t make him a bad person but that is his job and he gets his income from selling property. An investment adviser would prefer you to buy an investment through him. He has a family to feed and he makes his money from selling investments. Who can blame him for that? So long as people are honest in their dealings we cannot criticise them for trying to make a living but we must be more aware that it is in their interest that we buy and not always in our own.

In a world that revolves around money and profits, where the population is growing and supplies of oil and food are becoming more limited we should not be surprised at rising prices. I think we have every right to be disappointed that our leaders in government have not been better at planning ahead to take account of these changes but they have self interest at heart too. The way our democracy works means that politicians are looking to getting votes at the next election. If governments back in the 1980′s had been investing heavily in energy reduction and alternative energy supplies they would have been voted out for ‘wasting’ money. With hindsight, how wise would it have been if they had? Who would be complaining now if we had huge supplies of cheap wave energy today? It is in the nature of our democracy that governments think short term but we need long term planning now.

Years ago things changed much more slowly and perhaps thinking four years ahead was perfectly adequate. With the rapid changes we see around us now we need strategic planning that can cope with change. We need a commitment to farming that ensures we have food supplies and commitment to energy supply that gives us dependable energy at a reasonable cost and we need planning for a future where we have a society that lives within it’s means in both energy and food. This should be a cross party issue where we should find general agreement and build a future we can all be comfortable with. It is a very serious issue and not one to be the subject of points scoring and sound bites.

We are used to going to the supermarket and buying anything we want. We have not experienced the problems of supply of food that our parents or grandparents suffered. Yet, on tv last night I was shocked to discover that rice is in short supply. Partly due to poor rice harvests in Asia but also due to growing demand there is less rice around than there is demand for even though the price has doubled in a year.

The experts may have got their projections wrong on house prices in part, perhaps, because they didn’t want to believe the figures. Governments may have got their projections wrong on oil prices and again that may have been because they didn’t want to believe it could happen but they had better be very, very sure they get it right on food supply and demand. When people start going to the supermarket and finding they can’t find food or can’t afford it they will become very angry indeed.

We need to stop worrying about politics and start worrying about simple human needs like food. I just hope government treats this issue with the seriousness it requires. My fear is that they will start off more concerned about sound bites and only start taking real action when the crisis hits us all. Perhaps we should all start digging for victory now rather than waiting for the politicians to start talking about it.

Money Magic: Seven Simple Steps to True Financial Freedom (Quick Reads)