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"Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism, but peace, easy taxes, and a tolerable administration of justice" - Adam Smith

Something of a blow to one of Polly's pet peeves

Written by Tim Worstall | Saturday 19 April 2014

We're all aware of one of Polly Toynbee's little foibles: her insistence that because the people who own successful newspapers aren't left wing therefore the true left wing nature of our society gets overlooked and overruled.

Never forget what Labour is up against: 80% of newspaper readership for a hundred years has belonged not just to conservatives, but mainly to extreme maverick press barons, using their power to control politics.

We would have a far more left wing government and polity if only those capitalists hadn't been able to brainwash the people.

Interestingly, the John Bates Clark Medal as just been awarded by the American Economy Association. For research into exactly this idea:

A first set of Gentzkow’s papers studies political bias in the news media. In “What Drives Media Slant? Evidence from U.S. Daily Newspapers” (Econometrica, 2010), Gentzkow and co-author Jesse Shapiro use textual analysis of a large set of newspaper articles to classify content as more Republican or more Democrat (“media slant”). This is done using statistical analysis of phrases that differentially show up in Republican versus Democrat Senators’ speeches in the Senate. These constructed measures of media slant match well with conventional wisdom and with other, more ad-hoc and subjective newspaper political classification. Gentzkow and Shapiro then use these measures to estimate demand for newspapers, and to model the newspaper owner’s choice of media slant. They find that most of a newspaper’s media slant can be explained by the preferences of its readers rather than by the tastes of its owner. The second part of the paper tries to sort out whether the bias of individual papers is driven by “demand” – i.e. the political biases of their target audience – or “supply”, i.e. the idiosyncratic preferences of the owners. They find that it is mostly demand.

It's the other way around. Newspapers, editors, proprietors, do not determine the views of the readership, rather they try to divine what those views are and then pander to them. Meaning that if 80% of the UK newspapers are to the right of Polly Toynbee then 80% of the population is to the right of Polly Toynbee. And thus, obviously, in a democracy we should never go anywhere near the sort of policies that Toynbee favours.

Of course, we already know that last but it's nice to get another confirmation.

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Technology, Privacy and Innovation in 2014

Written by Charlotte Bowyer | Tuesday 28 January 2014

Prediction lists for the coming year are always revealing, though perhaps more of the current public mood than the future. A write-up of the tech trends for 2014 by Fast Company's design blog is hardly controversial, but what is interesting is how the areas they’ve chosen highlight the existence of two wider and seemingly divergent technological trends. This apparent conflict in the way technology is heading is far from problematic. On the contrary, it shows our success in adapting and experimenting with new ideas and in response to shifts in the social and political context, without the need for any central guidance.

One thing clear from Fast Company's list is that 2014 will bring a continued increase in the volume and depth of the personal data we create. Things like Google Glass, the ‘quantified self’, hyperpersonalised online experiences and the interconnectivity of theInternet of Things all create new reasons and mechanisms for data capture. This in turn increases the value of our data to ourselves, the companies with access to it and, in some situations, the state.

However, the article also predicts that 2014 will see increasing concerns over cyber-privacy and a movement towards greater digital anonymity. Users will increasingly chose to control their own data and how this is profited from, whilst we will begin to discover the joy of ‘disconnecting’ from the digital world and see the creation of intentional blackspots.

The fact that we seem to be embracing deeper technological integration yet simultaneously finding ways to mitigate and avoid its consequences is certainly interesting. Does this show that we’ve raced forward too fast and are trying to claw back a space we’re realising we’ve lost? It’s perhaps possible that this is the case, but far from giving us cause for concern the two-track path we’re seeing shows the ability of consumers and the tech sector to adapt over time, and in turn gives some hints on the optimal tech policy.

Continue Reading...

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Motorways, pubs and nannies

Written by Dr. Eamonn Butler | Tuesday 21 January 2014

A new pub has opened in Beaconsfield, Buckinghamshire. That's news in itself, given that around 1200 pubs closed down last year, thanks (or no thanks) to the weight of retail and employment regulation that makes pubs so darn expensive to run.

But the Hope & Champion is of doubt interest, because it is in the Extra Motorway Service Area at Junction 2 of the M40. So the people who go there are almost certain to get there by car. So naturally there have been plenty of critics complaining that this initiative sends out all the wrong signals about drinking and driving.

Well, pubs in the UK are licensed, precisely because we know the potential problems that can go with alcohol consumption. But the fact is that the local police did not object to the licence, nor did the local authority. And the local paper is giving the new pub splash coverage. So local people don't think there's a problem here.

The real problem is the message that the critics send out, yet again – that the political class in Britain thinks the adult population of their country are completely incapable of making their own choices, and that their lives have to be micro-managed for them. This pub, like most others these days, is basically a restaurant that also serves alcohol. It opens at four in the morning and starts selling alcohol at nine - though apart from one stalwart getting stuck into a pint for the cameras, most people there this morning were getting stuck into nothing more life-threatening than a Full English Breakfast. And if a group of people want to stop off the M40 for lunch or dinner, why should the passengers be denied the pleasure of a small sherry just so that drivers are 'kept away from temptation'?

Weatherspoons, the pub owners, are a responsible chain. Their menus carry Drink Aware slogans and information. Their staff do not serve people who have already had enough. People know that there are legal limits on drinking and driving - and they know that even drinking below the legal limit can slow down your reactions. So most drivers who visit the pub, alone or with a group, would probably not have alcohol anyway, and their passengers would probably not want them to.

So as the police and local authority figure, there's no problem. The only problem is all those people who deem it their business to treat us like children.

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The Internet Watchmen

Written by Charlotte Bowyer | Wednesday 11 December 2013

As Tim Worstall notes, new government plans to block online terrorist and extremist content are extremely worrying. Along with the introduction of default 'opt-out' porn filters and the criminalisation of rape porn, they are another example of Cameron's politicised censorship of the web. Whereas reducing the proliferation of child abuse images is a good thing, this new measure results in the censorship of ideas. Furthermore, whilst it is relatively straightforward to identify child abuse imagery, it is much less so (and arguably impossible) to decide which ideas are 'too dangerous' to viewed in the UK.

Aside from these issues there is also the question of how such a content block would work in practice. In many ways, how to block can be as problematic as the censorship itself.

The government has said that it wants to model the new blocking unit on the Internet Watch Foundation: a part-EU, part internet industry-funded UK 'hotline' for child abuse imagery. The IWF assesses material submitted by the public and flags up UK-hosted content to be removed by service providers. Content from outside the UK is added to a URL 'blacklist' which ISPs then block UK access to.

There are a number of issues with this model. First, there is no guarantee that what the IWF flags up is actually illegal. With no legal clout, the IWF acts on content it deems 'potentially illegal' - and there is little to stop legitimate content getting wrongly marked. One controversial case saw a picture of an album cover on Wikipedia getting blocked until the backlash forced the IWF to reverse their decision. Appealing against the IWF's decisions can be a difficult and opaque process, not least because of the difficulty of appealing against the illegality of an image you can't even see.

Despite the IWF's lack of legal authority, the Open Rights Group claims that their blacklist has never been assessed by a court or legal body. This makes their actions rather murky. Given its sensitivity ISPs can't see the content of the blacklist to make their own judgement; they must either block all of it or none.  On top of this, there are also problems with the technology ISPs use to actually block the URLs - which can be unreliable and block too broadly.

In addition, from April 2014 the IWF will shift from a being reactive body -acting only on content sent to it - to a proactive one, actively seeking out images of abuse behind pay walls and on peer-to-peer networks.  This approach is another step in the active policing of the web, and is also likely to be followed by the new anti-extremist unit.

Issues of political and religious censorship are much more complicated than that of child pornography. The unaccountability of the IWF and its lack of judicial oversight  therefore make it a poor model to copy for what is an incredibly controversial (and dangerous) policy. Since the new unit will be publicly funded, its decisions may come under greater legal scrutiny. On the other hand, a government-funded body could become politicised and overzealous in its mission. In any case, a clear due process and a rigorous appeals system will be absolutely essential.

Crime & security minister James Brokenshire says an update on the proposals will arrive shortly, though the fact that civil liberty groups claim not to have been consulted on the matter is rather worrying. The sensible thing to do would be to scrap this idea altogether. Since this is unlikely to happen, both the politics and the technicalities of the initiative are bound to prove difficult indeed. 

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Tor, Bitcoin and the Silk Road: three forces for good

Written by Charlotte Bowyer | Friday 11 October 2013

Since the arrest of Ross Ulbricht aka 'Dread Pirate Roberts' — the alleged mastermind behind the Silk Road — media attention has in part focused on the role of legal technologies Tor and Bitcoin in its operation. Silk Road was an online black market where all kinds of restricted and illicit goods (from illegal drugs to forged passports) were sold in an eBay-style setting. Because of the nature of its wares it made up part of the 'deep web' - accessible only by using software such as Tor, which enables user anonymity by obscuring their location and usage, making surveillance incredibly difficult. Its illegality also prevented customers from paying via card companies or PayPal, so business was done using the crypto-currency Bitcoin.

Whilst talk of Bitcoin and Tor is old hat amongst technophiles, reporting of Silk Road's takedown is probably one of the first times that many people would have heard about such technologies. And, understandably, when their raised profile comes in association with a giant underground marketplace in drugs and a man charged with charged with ordering an assassination, people may be swift to discount them as 'hacker tools', or look upon them unkindly. (The Guardian's leak of GCHQ's presentation 'Tor Stinks', which depicts an apparently typical terrorist Tor user masked and toting an assault rifle (and sat in front of a giant onion) is in this respect both amusing and depressing.)

However, Tor and Bitcoin aren't used just for shady dealings. Both can be used to great benefit — Tor in providing freedom and safety online, and Bitcoin in encouraging financial and monetary innovation.

There are huge numbers of people who aren't terrorists, sex offenders or drug barons who benefit from anonymising software such as Tor, and those whose lives may depend on it. Tor allows people across the globe to communicate freely when doing so is risk and the internet is monitored or subject to blocks. It circumvents national firewalls, empowering and educating citizens who would otherwise be restricted. It allows whistleblowers to divulge their information anonymously, journalists to share news, and activists and citizens to criticise, dissent and organise in protest. Millions around the world benefit from Tor.

And it isn't just citizens in oppressive regimes who benefit — Tor is used by the military in operations to protect their location whilst communicating securely. It could also be argued that concerned parents can help protect their child online by using Tor to mask their location. Whatever else Tor may be used for, its capacity to liberate and protect is great.

Similarly, the development of crypto-currencies such as Bitcoin carry with them great potential. Bitcoin is an open-source, peer-to-peer electronic currency. It has no central issuing authority; the money supply is increased as users's computing power crunches numbers to verify pervious transactions. This has made crypto-currencies very interesting to those who wish to abolish central banks and establish new forms of currency. But Bitcoin also has a growing number of practical uses.

Increasing numbers of vendors are accepting payment in Bitcoins and it can be used to pay for things from Wordpress services to pizza. It doesn't require any third-party intermediary such as credit card companies or PayPal to process payments, making transactions cheaper and easier. This can lower transaction costs for businesses, which, were Bitcoin to become widely adopted could also be passed onto the consumer. The Mercatus Center's primer on the currency suggests that this aspect of Bitcoin could also revolutionise the global redistribution of wealth. In 2012 immigrants to developed countries sent $401 billion back home to developing countries. The average fee doing so at places like Western Union is close to 10%, whilst fees for similar services using Bitcoin are less than 1% of the transaction. Wiring companies are looking at integrating Bitcoin services into their own, and if they were to do so this would be a tremendous boon for the poorer people of the world.

Transferring traditional currency into Bitcoins can also allow people to overcome domestic economic problems and the consequences of corruption. With tight capital controls and an inflation rate of 25%, it is no surprise that Argentinians are some of the most enthusiastic users of Bitcoin. Other great uses of Bitcoin, such as in conjunction with SMS banking in developing countries, are developing all of the time. Bitcoin definitely has the potential to be more than a plaything for nerds and a way of buying hash.

Cathy Reisenwitz is right: the world is less safe now that Silk Road is gone. The violence associated with drug dealing is not a consequence of the products, but of their illegality. As a stable, trusted and effective platform Silk Road removed that need for violence. Drug laws need a serious overhaul, and the user rating and delayed payment system of Silk Road offer a great model for a legal marketplace for drugs. I therefore think that it is great that technologies such as Tor and Bitcoin are being put to such use.

However, many will disagree. This is why it is important to point out the great potential and liberating capabilities of these technologies before people discount them, or worse turn against them. No technology in itself is 'good' or bad' - what matters is how it is put to use, and while we worry about the potential dangers of new technology, we should remember its use in positive ways too.

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The end of loneliness

Written by Anton Howes | Thursday 26 September 2013

There's a video doing the rounds by Shimi Cohen, called the "Innovation of Loneliness". The thesis is that modern, internet-based social networking results in more loneliness. Impersonal communication displaces the intimacy of conversation. This, combined with the ability to tailor those communications to promote our self-image, results in us claiming "to have many friends while actually being lonely", while technology's promise of constant interconnectedness, causes us to constantly share our experiences in a desperate bid to not feel alone.

Not all of the claims stack up. For a start, sharing is not the only function of a social networking platform, the main one being, of course, to network. Connections are powerful resources that can fulfil a wide variety of ends - not just the selfish-sounding pursuits of "career, wealth, self-image, and consumerism" that Cohen emphasises, but also the intimate pursuits of friendship and romance. You might upload a selfie to Facebook or post on Twitter about your brand new shoes, but you might also use either of those social networks to arrange a drink with friends or, if you're lucky, even a date. Even then, some modern platforms like Skype facilitate the intimate conversations that Cohen fears we are losing. Rather than eroding social and familial connections, modern communication technology allows us to keep in touch with friends and loved ones when they are half-across the globe: there is now simply no excuse to never write home.

The truth is, we're usually well aware of which are our close or intimate friendships, and which are our wider connections. The benefit of having those connections though, is that they have the potential to turn into closer relationships, on a scale that is just totally unprecedented in human history.

Many of Cohen's claims are perhaps simply facts of human nature, rather than the fault of advancing communication technology. Was the age of letter-writing that preceded email much better when it came to wasting our time and energy "pursuing the optimal order of words in our next message"? Given the lengthy delay between replies and the added time and cost of writing and posting, letters were undoubtedly more stressful and time-consuming.

The internet for many people has freed them from the millennia-old tyranny of village gossip. It allows us to forge connections that then more intimate relationships with people who we actually like and agree with, wherever they may be, almost totally freeing us from geographical constraints. It even allows us to choose to whom we cater our self-image. Some of us may well spend hours agonising over our profiles, but it's a small price to pay to also spend far less time agonising about how Bert from next door, who never liked you, could seize upon any quirks and differences from the rest of the village, and make you a social pariah. You can now choose your own 'village' without actually having to move house, and it's no accident that social liberal attitudes are most prevalent among the most interconnected generation the world has ever seen.

Humans have always been lonely at times. The internet can make that fact more obvious, as we gain a remarkably open window into the everyday experiences of more and more people around us - but it is also the technological advance that has done more than anything else in human history to put an end to loneliness.

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The BBC and the licence fee will be tackled when hell freezes over

Written by JP Floru | Thursday 12 September 2013

In the light of the recent pay-off scandals at the BBC, one would expect there to be demands for the abolition of the licence fee and the excessive protection the BBC enjoys.  There have been some mutterings, but nothing serious.  Nor is it likely to.  Why is this?

Public Choice Theory, which explains human actions in terms of weighing the costs and benefits by each individual, offers a powerful explanation as to why the BBC continues to enjoy such widespread support.  It is important to keep in mind that the more an individual has to gain from a particular action, the harder he/she will fight for it.

The politician
Fighting the licence fee and the BBC:
                Cost: Very high. Death by BBC silence. Politicians live and breathe by media attention.
                Benefit: Low. A large part of the population believes in the BBC.
Standing up for the BBC:
                Cost: nil.  Will have political outlets to make his views known. The licence payer pays.
                Benefit: Very high. Becoming the Darling of the BBC. Re-elected.

The BBC employee
Fighting the licence fee and the BBC:
                Cost: Very high. Ostracised/unemployed/no leaving sweetener.
                Benefit: Nil. Unlikely to succeed – portrayed as disgruntled ex-employee.
Standing up for the BBC:
                Cost: Nil
                Benefit: Very high. Promotion?  High salary, cushy job, big sweetener when leaving.

The licence payer
Fighting the licence fee and the BBC:
                Cost: very high if one wants to make any impact at all, as virtually everybody has a reason to like the BBC (favourite nature programme, that soap, etc.).
                Benefit: £145.50 if the licence fee were to be abolished.

Standing up for the BBC:
                Cost: Little—join the club.
                Benefit: The BBC continues as before.

Observe that in all three cases the individuals involved have a personal vested interest in the continuation of the licence fee and the BBC as before.  Politicians and BBC employees have the strongest incentives and will therefore campaign extra hard.

So the BBC need not fear: neither the pay-off scandal, nor Jimmy Savile, nor BBC bias are likely to challenge the status quo.  The only chance of change is a Churchillian figure with a bee in his bonnet. Churchill famously abolished the BBC monopoly in favour of commercial TV.  He called the BBC tyrannical for having effectively banned him from the airwaves in the 1930s. John Reith, the BBC’s founding father, said that commercial television would be as disastrous for Britain as “dog racing, smallpox and bubonic plague”.  John Reith’s objection was probably the main reason why Churchill went for it.  One more Churchill might just do the trick tomorrow.

JP Floru is the author of What the Immigrant Saw and How to Create Mass Prosperity. On Saturday he will speak at the Conservative Renewal Conference about the abolition of the licence fee.

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Holy Credit!

Written by Jan Boucek | Friday 26 July 2013

So Archbishop of Canterbury Justin Welby wants to make the Church of England’s property available for Credit Unions so they can wipe out those dastardly payday loan sharks. This is a brilliant idea with wide-ranging opportunities for both entrepreneurial clerics and banks.

Just consider the convenience for consumers of banking and praying at the same time. After the queue for communion, you simply shuffle over to the bank teller next to the altar to pick up your loan or maybe deposit whatever spare change you have after passing the collection box.

Meanwhile, over in the confessional, the priest can follow up an absolution prayer with a financial product pitch – “Have you considered insurance for seven years of drought?”

Recruitment of young folk into the priesthood has become a real problem for the Church but Credit Unions on site offer an added attraction in the area of branch security. Wearing body armour under cassocks, learning a martial art or designing bank vaults disguised as crypts will broaden the profession’s appeal.

Of course, established banks won’t be sitting still against this new competition on the High Street. Many branches surely have space available for any number of religious sects to set up shop.

What depositor with a bag full of cash could resist first lighting a candle in the hopes his deposits won’t attract the attentions of the taxman? Impatient couples could stop off at the on-site wedding chapel before opening a joint bank account.

Imam calling for midday prayers while you’re stuck in the queue behind the old lady counting out thousands of pennies? No problem – step aside to our prayer rug area and we’ll hold your place in the line.

And what customer wouldn’t appreciate an evangelical choir lifting the spirits before meeting  the bank manager about those persistent overdrafts?

Keep those ideas coming, Mr Welby!

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Political ignorance and the porn filter

Written by Sam Bowman | Wednesday 24 July 2013

Recently I wrote about the problem of political ignorance: most voters don't know much about political issues, and most of the informed elite is also very closed-minded. Today we have an example of the worst of both worlds. Claire Perry MP has accused Guido Fawkes of 'sponsoring' the hacking of her website and of linking to it by putting a screenshot of her hacked site on his website



Given "the fact that she evidently doesn’t understand the difference between a hyperlink and a screenshot", as the Ministry of Truth blog puts it, isn't it a bit worrying (and revealing!) that Ms Perry is the driving force behind the government's plans to require people to opt-out of a block on pornography?

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Libertarian film screening of Brazil

Written by Dr Madsen Pirie | Monday 15 July 2013

Tom Stringer has arranged a really fun Saturday morning outing on Saturday August 3rd.  It's a showing of the movie "Brazil" in the Everyman theatre at 96-98 Baker Street.  There's a coffee bar for pre-movie snacks, and a real bar for those who can't wait for their gin and tonic.  Everyone's in for a treat, with most going along to local pubs afterwards for lunch with a pint.

"Brazil is set in a dystopian world in which there is an over-reliance on poorly maintained (and rather whimsical) machines. Brazil's bureaucratic, totalitarian government is reminiscent of the government depicted in George Orwell's Nineteen Eighty-Four, except that it has a buffoonish, slapstick quality and lacks a Big Brother figure."

Sign up quickly for this on the facebook page.  You won't want to miss the movie and the camaraderie of like-minded  fans.

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