Tim Worstall Tim Worstall

The privileges of liberty and the sanctity of the individual went out and whipped butt.

Harry Wallop has a lovely piece about bananas. The point we’d lift from it being:

Keeping track of all the bananas comes down to barcodes on the outside of the boxes and a warehouse that operates, Hopkins says, with “relentless focus”. He deciphers the code on one box, which is destined for Iceland supermarket and has come from Colombia. “I can see that it was harvested on March 27 at 10am,” he says. “We have 3D warehouses, so I can tell which container, which ship it came in, who drove the forklift truck and which supermarket it will end up at.”

This is, of course, planning to the nth degree. Bananas crop 52 weeks a year, demand varies little. The entire system faces little variance in either supply or demand and the process is really just about the efficiency with which the transport can be arranged. Profit margins are tiny - 1 to 2% of turnover sorts of levels.

This is exactly what a planned economy should be good at - planned economic activity. That is the justification for the entire idea, that planning is more efficient than the chaos of mere markets.

But to offer a second PJ O’Rourke quote:

“For all the meddling the Communist bloc countries have done in banana republics, they still never seem to be able to get their hands on any actual bananas.”

Which gives us our lesson for the day. Planned economies aren’t even any good at planning. At which point the Hell with them really, there’s no other rational response, is there?

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Tim Worstall Tim Worstall

How excellent about deep sea mining - we should do more of this

The Guardian is becoming increasingly hysterical about deep sea mining. Articles here and here. To add to that Billy Hague piece we critiqued here. The demand is that there should be a pause, everyone should have more time to think this through and so on. Or, as it might also be put, hit the issue into the long grass where it can be strangled by ignoring it. Note, not issuing the rules for a licence would achieve the goal of not ever issuing a licence, after all.

The particular and specific issue here is the set up. An exploitation licence - as opposed to an exploration one - is, in effect, a shall issue licence. Two years after someone says well, what are the rules here, can we have a licence please, that exploitation licence must be issued. Or at least the rules for one must be. Note “must”. It is not possible to argue for more time, greater consideration and then lose the issue in the bureaucracy.

Which is exactly why the issue is coming to a head here. Either those rules, that licence, gets issued or the reason why not has to be published and defended. With, obviously, the opportunity for court action and so on against any refusal.

To go from that general to the very particular. One of us recently applied for a holiday let licence in one of the minor continental countries. The expectation was that this would take months, if not years, as the desire to not issue them - already well known and telegraphed - meant lost paperwork and echoes of Kafka. Except the national government had changed the rules. If the licence was not denied within 7 days then it was automatically issued. Indeed it came through, via email, 7 days later, within minutes in fact of the filing time (not just date) plus 168 hours.

We think this idea should be more generally applied. In fact, not generally, but universally. Every licence, every permission, for everything, becomes a shall issue one. There is a specific time period, 7 days sounds good, in which the bureaucracy can say no. Can say no while pointing to the specific law they are saying no under, the reason why, in a form that can then be used in a court to test the power of the bureaucracy to do that. Failure to issue such a denial within those 7 days means that the licence is automatically granted. One granted it is not appealable.

This applies to pylons across the countryside, fracking plants, planning permissions for housing, everything.

We insist that the planning bureaucracy micturate or get off the pot. That phrase can be modified for less family friendly conversations.

Note that this doesn’t stop planning. It does though stop delay in planning. So, everyone should support it, right?

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Tim Worstall Tim Worstall

So, obviously, delay installing solar for 5 years then

The logical outcome of this is that we should delay installing any solar for 5 years:

Solar power cells have raced past the key milestone of 30% energy efficiency, after innovations by multiple research groups around the world. The feat makes this a “revolutionary” year, according to one expert, and could accelerate the rollout of solar power.

The breakthrough is adding a layer of perovskite, another semiconductor, on top of the silicon layer. This captures blue light from the visible spectrum, while the silicon captures red light, boosting the total light captured overall. With more energy absorbed per cell, the cost of solar electricity is even cheaper, and deployment can proceed faster to help keep global heating under control.

The perovskite-silicon “tandem” cells have been under research for about a decade, but recent technical improvements have now pushed them past the 30% milestone. Experts said that if the scaling-up of production of the tandem cells proceeds smoothly, they could be commercially available within five years, about the same time silicon-only cells reach their maximum efficiency.

The technical stuff there is correct too. But if solar is about to get very much better - which it is - then the correct response is to stop installing this soon to be surpassed solar technology - installations do last 20 to 25 years after all - and instead wait and install the newer and better starting in 5 years’ time.

Actually, this has been true of solar for the past 25 years. Costs have been going down 20% a year. As Bjorn Lomborg predicted they would those couple of decades back. As Lomborg also pointed out assume that holds true and by the mid-2020s then solar would become the installation of choice. Why would anyone bother to install anything other than the cheapest alternative, after all?

The corollary of this is that everything we’ve spent upon subsidy up to now has been a complete and entire waste of money. Technologies do mature into being usable and cost effective - it’s simply spraying cash up against the wall to try and install them before that has happened.

Please do note our position here. We’re not against doing things to beat climate change, not in the slightest. We just keep insisting that we should be doing these things efficiently. For, as the Stern Review itself points out, humans do more of cheaper things, less of more expensive. Therefore attacking climate change inefficiently means we’ll do less attacking climate change. That might not be a good idea.

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Oliver Ind Oliver Ind

NHS at 75: Why I’m not celebrating.

Yesterday may have marked the NHS’s 75th birthday, but there was no reason to celebrate. Whilst children’s choirs sing happy birthday and the country raises a ‘cuppa’, I kept my party hat away. For, the system is no longer “fit for heroes”. The NHS does not work.

Waiting lists sit at a record high of 7.4 million, whilst median A&E wait time is a dangerous 3 hours 2 minutes. Ambulance services repeatedly miss their targets, causing half of those who need rapid treatment to die. Occupied beds sit at a worrying level of 92%, reducing overall capacity. And in December 2022, only 54.4% of cancer patients waited under 62 days for treatment, in contrast to the target of 85%. In short, the NHS is not just in crisis, it has essentially collapsed. The NHS is no longer the envy of the world, rather it is fast becoming a laughing stock. It is no wonder no other countries have followed suit in our system. Indeed, the only comparable systems were in the Soviet Union and Cuba, where hospitals were in a similarly dire state.

Why is there a crisis?

The left would have you believe that it is wholly situational. They blame the pandemic, Conservative “underfunding” (despite record spending) and Brexit. The system is not the problem they claim, rather poor governance and recent events have made it impossible for the NHS to act the way it should. This is plain wrong. The NHS is systematically flawed, and the only real solution is a complete overhaul of our healthcare system. 

Of its systemic flaws, none is more prevalent than its sheer size. The NHS is the fifth largest employer in the world and the largest state-owned employer in the free world. Its goliath size comes with challenges, one of which is management. Currently the NHS is managed top-down and with Trusts; policies, however, remain Westminster centred. The current system can be characterised by excessive bureaucracy and micro-management, held back by short-term political priorities. Indeed, there are more bureaucrats in the NHS then there are beds.

Socialists like to lecture us on the dangers of private monopolies. Yet, the NHS is the largest monopoly of them all. Monopolies are terrible for productivity and give the consumers no choice. Patients have little choice within the system. Many cannot choose their doctor’s surgeries. And patients are unable to see a specialist without a GP referral, which all too often involves further immense bureaucracy and long waiting times, such as waits up to seven years for an ADHD pre-assessment.

Meanwhile our infrastructure is constantly on red alert for the threat of strikes loom. The NHS can keep certain costs down, but it does this by suppressing wages and creating less than ideal working conditions. If we want our NHS to remain competitive and for the best doctors not to quadruple their income on fixed salaries at London’s new Cleveland Clinic, the NHS must radically change.

The alternative –

Simply more tax and spend won’t fix it. Sweeping structural change is needed.

Common rhetoric suggests there is but one alternative to the NHS: America’s bankrupting system. This is not the case. No rational individual would argue in favour of this, for it is mind-numbingly ineffective as a healthcare system. Other options exist which may be far more effective.

The government should pursue a competing social insurance scheme, similar to the Netherlands, Germany, and Switzerland, as we have proposed previously . This system will separate government from providers and patients. The government would have no direct management role, ending the health service’s known problem of limitless bureaucracy and unstable policy direction. In this system it would be compulsory for universal enrolment for social insurance, and insurers would be banned from refusing service. Premiums would be calculated by income, with the poorest paying nothing. This system would be fair, for it would be a one-tiered system where all receive the same (exceptionally high) level of care. And, crucially, all services would be free at the point of access, unless the consumers choose to pay in order to have lower premiums.

Short-term bandages –

Clearly in the current political climate the above is a stretch. Thus, it may be helpful to explore things we can do in the short term to make the crisis slightly less bad. This could be through outsourcing. Despite what Julia Grace Patterson or WeOwnIt would like you to believe, outsourcing does not mean privatisation. As Kristian Niemietz of the Institute of Economic Affairs puts it, it is a “failed conspiracy theory that never dies.” Outsourcing means hiring private firms to do certain jobs within the NHS, typically non-medical such as IT. And for all the fear-mongers out there, rest assured that it will continue to be free at the point of receipt. Let’s face it, private companies are likely to be better than NHS bureaucrats at delivering certain services. Remember that terrible NHS app? If this was outsourced to a tech firm rather than developed in house, maybe it would have been a success. 

Conclusions –

Our medical professionals are heroes. They do a stellar job, especially given the terrible environments they are made to work in. The system is letting them and their patients down. In the interim, more outsourcing should occur. In the long term, the government should completely overhaul our health system and replace it with a social insurance scheme. That way we will finally have a system “fit for heroes” as Attlee and Bevan envisaged. 

Oliver Ind is a Summer Intern at the Adam Smith Institute

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Eamonn Butler Eamonn Butler

Mr Smith goes to Oxford

On this day in 1740, no doubt full of trepidation and excitement, Adam Smith set off from his home in Kirkcaldy, on the east coast of Scotland, to take up the ‘Snell Exhibition’ scholarship in Balliol College, Oxford. His time in Oxford would teach him much — though it would by no means enhance the reputation of Oxford in general and Balliol College in particular.

At school in Kirkcaldy, Smith’s passion for books and learning, along with his extraordinary memory, became apparent. He went on to Glasgow University at the age of 14, and studied under the great moral philosopher Francis Hutcheson – libertarian, rationalist, utilitarian, plain speaker and thorn in the side of authority. Hutcheson seems to have infected Smith with some of the same.

Oxford and incentives

Smith excelled, as he had done at school, and won the scholarship to Balliol College, Oxford. In 1740, now just 17, he saddled up for the month-long horseback journey. If thriving, commercial Glasgow had been an eye-opener to a boy from backward Kirkcaldy, England seemed quite a different world again. He wrote of the grandness of its architecture and the fatness of its cattle, quite unlike the poor specimens of his native Scotland.

But the English university education system did not impress him. Indeed, it gave him an important lesson on the power of incentives, which he would catalogue acidly in his great 1776 work of economics, The Wealth Of Nations.

Oxford teachers were paid directly from large college endowments, not from students’ fees as they were in Glasgow. It hardly encouraged their interest in their students. “In the University of Oxford,” wrote Smith later, “the greater part of the public professors have, for these many years, given up altogether even the pretence of teaching.”

Ouch. But it got worse.

College life, he observed was contrived “for the interest, or more properly speaking, for the ease of the masters.” There were disciplines aplenty on the students, but not on the teachers. In his words, “Where the masters, however, rarely perform their duty, there are no examples, I believe, that the greater part of the students ever neglect theirs. No discipline is ever requisite to force attendance upon lectures which are really worth the attending, as it well known wherever any such lectures are given.”

From this experience, Smith drew out a general principle of economics: “It is the interest of every man to live as much at his ease as he can; and if his emoluments are to be precisely the same, whether he does, or does not perform some very laborious duty, it is certainly his interest, at least as interest is vulgarly understood, either to neglect it altogether, or, if he is subject to some authority which will not suffer him to do this, to perform it in as careless and slovenly a manner as that authority will permit.”

And institutes like a university, he noted, indulge each other’s laziness. They “are likely to make a common cause, to be all very indulgent to one another, and every man to consent that his neighbour may neglect his duty, provided he himself is allowed to neglect his own.”

Smith, then, learnt little from his Oxford teachers. Yet, thanks to Balliol’s world-class library and his own love of reading and learning, Smith was able to educate himself in the classics, literature, and other subjects. He left Oxford in 1746, before the expiry of his scholarship, to return to Kirkcaldy, where he began to write essays and articles that would make his reputation and launch his academic career — a career that would culminate with these insights on economic incentives and the cutting rebuke of the system that had so let him down.

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Tim Worstall Tim Worstall

The problem with socialist healthcare is that pretty soon you run out of everyone else's hospitals

A political party (shhh, no names!) is running a campaign based on how many babies the NHS has delivered. So, plugging my birth date into the calculator, something based upon census records, I find out that I’m the “10,723,296th BABY TO BE BORN ON THE NHS!” which is, I am sure we all agree, terribly exciting. Torbay General for the completists, out of Seaview in Strete.

Something else I know about the NHS. The first hospital to be actually built by the NHS opened in July 1963, the QE II one in Welwyn Garden City. So while I was indeed the 10.7 millionth baby delivered by the NHS that all happened 4 months before the NHS actually added, at all, to the medical infrastructure of the country.

For the creation of the NHS was simply the nationalisation, without compensation, of all medical facilities within the country. Which is, I think we can all agree, a little different from the idea generally put forward, which is that medical care only started with the NHS? Something that there is a familial memory of, given that the grandfather so interested in that first grandson was a GP, the grandmother equally interested a practice nurse.

But it is still interesting, isn’t it? These claims that the national debt was 200% of GDP when we started the NHS - so therefore we can achieve anything we want if we’re prepared to want it. The idea that it only used to cost 1% of GDP in fact.

Well, yes, but the problem with socialist medicine is that eventually you run out of other peoples’ hospitals.

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Tim Worstall Tim Worstall

The BMA says drink driving should be brought to the European standard. But which one?

Chris Snowdon has the BMA right here:

“The BMA’s new president, Ian Gilmore, is Britain’s leading temperance activist so he won’t mind if more pubs close, but he gives the game away when he says he wants the limit reduced to almost nothing.

“This would not just stop people drinking anything before they drive, it would discourage them from drinking in the evening if they were going to drive in the morning.

“It is an anti-alcohol policy, not a road safety policy.”

But let us take the proposal seriously for a moment:

The British Medical Association (BMA) on Tuesday voted formally to lobby the government to bring England and Wales in line with the European average, with senior members describing the current threshold as “scandalous”.

But in line with which European standard? Yes, the drink drive limit in most of Europe is lower. The rate of deaths per billion miles driven - the only useful measure here - is higher in most of Europe than it is in the UK. No, really, page 53 here. Actually, by that only useful standard - for what else is a useful measure other than the number of deaths compared to the amount of travel? - the UK is about half the EU 17 average. So, umm, why isn’t everyone else having to follow our standards? You know, the efficient ones? The standards that actually achieve the task at hand?

Actually, we know what’s happening here. The doctors - as with so many people, so many times - are only looking at the one part of the system. The blood alcohol level. Britain’s punishments for breaching our (agreed, higher) limit are positively bloodcurdling compared to some of the penalties elsewhere. In fact, a lot of those 02 and 0.5 limits elsewhere are simple and mere fines - significant punishments like suspension of licence kick in with “aggravated” drink diving, at the same or higher rates than the UK’s limit.

It’s also true that you’re much more likely to get caught on the British roads than in many other places.

Finally, there’s the fact that the current limit is socially supported. There is zero sympathy for anyone caught under the current limits. If two pints at lunchtime mean you can get caught driving home at the end of the day then that societal support will vanish.

We have a system that works, the moving parts work together to give us, depending upon which measurement you choose, the third or fourth lowest drink driving death rate in Europe. As with any complex system fiddle with one part of it at the cost of possibly destroying the entire machine. #

The current British system works - why would we want to change it?

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Tim Worstall Tim Worstall

To disagree with William Hague on something we actually know about

Hague says that Britain really should oppose deep sea mining:

Deep down beneath the waves, in nodules below the seabed, minerals such as cobalt and nickel can be found in abundance.

No, that’s “on” the seabed.

And in the “black smokers”, the deep vents on the ocean floor often associated with the earliest origins of life, copper can be found in large quantities.

No, mining the smokers is not the suggestion. The entire point of such smokers being that as the fissures in the crust expand - the smokers being the little pinholes - then what used to be the site of a smoker becomes not one. The copper suggestion is to mine where there used to be one, not where there is. As that’s where the deposits are, where they used to be.

But far more than this the assumption is being made - certainly the impression is being given by Hague - that some vast area of the seabed is to be disturbed. Which is simply nonsense. The seabed is 3.618×10*8 km2. That’s, umm, a lot. As with surface mining the idea is to mine some hundreds of square kilometres, perhaps even thousands. Which is, when we’re talking about 10*8 quantities of km2, pretty much nothing.

Even the economics, let alone the environmental point, is wrong:

An unnecessarily weak stance is not only bad for the environment but not even in our national interest. No British company has developed deep-sea mining technology.

There’s a definite absurdity in claiming that cheaper nickel, copper, cobalt and manganese will not be beneficial to Britain or the British people. Consumer benefits do in fact count, you know?

Even the environmental damages are grossly overdone:

According to the review commissioned by the government which reported two years ago, “a 20-year mining operation may discharge an estimated 100,000 tonnes of sediment”, which would settle over millions of square kilometres on the sea floor.

Umm, OK, so 100,000 tonnes over millions of km2. Say, just for the ease of the maths, 10 million km2? That’s 10kg (no, really, ten kilos) of sediment to be spread across each square kilometre of seabed.

We’ve lived in flats dustier than that and not just as a student either. In fact, that complaint is piffle. For it’s one hundredth of a gramme of sediment per square metre. Most damaging I’m sure we’ll all agree.

Mine the abyssal deeps and get on with it - whatever Billy Hague has to say about it.

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Tim Worstall Tim Worstall

We'd really suggest Nick Timothy doesn't take Michael Lind seriously

One of those little things we hope not to see in a newspaper column:

That story is recounted in Hell to Pay, a brilliant new book by Michael Lind about how the suppression of wages is driving economic, social and political crises in America. The idea that we are paid what we deserve – and that the decline in mid-skilled, mid-paid jobs simply reflects the high-tech, globalised economy in which we live – derives from free market theory. But it is, Lind argues, utter nonsense.

Lind and “brilliant” isn’t quite how we’d put it. For we always recall Paul Kurgman’s comments upon the economic commentary of Michael Lind:

One of America's new intellectual stars is a young writer named Michael Lind, whose contrarian essays on politics have given him a reputation as a brilliant enfant terrible. In 1994 Lind published an article in Harper's about international trade, which contained the following remarkable passage:

"Many advocates of free trade claim that higher productivity growth in the United States will offset pressure on wages caused by the global sweatshop economy, but the appealing theory falls victim to an unpleasant fact. Productivity has been going up, without resulting wage gains for American workers. Between 1977 and 1992, the average productivity of American workers increased by more than 30 percent, while the average real wage fell by 13 percent. The logic is inescapable. No matter how much productivity increases, wages will fall if there is an abundance of workers competing for a scarcity of jobs -- an abundance of the sort created by the globalization of the labor pool for US-based corporations." (Lind 1994: )

What is so remarkable about this passage? It is certainly a very abrupt, confident rejection of the case for free trade; it is also noticeable that the passage could almost have come out of a campaign speech by Patrick Buchanan. But the really striking thing, if you are an economist with any familiarity with this area, is that when Lind writes about how the beautiful theory of free trade is refuted by an unpleasant fact, the fact he cites is completely untrue.

More specifically: the 30 percent productivity increase he cites was achieved only in the manufacturing sector; in the business sector as a whole the increase was only 13 percent. The 13 percent decline in real wages was true only for production workers, and ignores the increase in their benefits: total compensation of the average worker actually rose 2 percent. And even that remaining gap turns out to be a statistical quirk: it is entirely due to a difference in the price indexes used to deflate business output and consumption (probably reflecting overstatement of both productivity growth and consumer price inflation). When the same price index is used, the increases in productivity and compensation have been almost exactly equal. But then how could it be otherwise? Any difference in the rates of growth of productivity and compensation would necessarily show up as a fall in labor's share of national income -- and as everyone who is even slightly familiar with the numbers knows, the share of compensation in U.S. national income has been quite stable in recent decades, and actually rose slightly over the period Lind describes.

The question here is not why Lind got these numbers wrong. It takes considerable experience to know where to look and what to worry about in economic statistics, and one should not expect someone who does not work in the field to be able to get it right without some guidance. The question is, instead, why Mr. Lind felt that it was a good idea to make sweeping pronouncements about this subject, when he clearly was unwilling to invest time and energy in actually understanding it. The short answer in this case is surely that Mr. Lind, who is always looking for ways to enhance his enfant terrible status, saw this as a perfect opportunity. Free trade is a sacred cow of economists, who are well-known to be boring, stuffy types; what could be a better way to reinforce one's credentials as a radical, innovative thinker than to skewer their most beloved doctrine? (It seems not to have occurred to him that there might be a reason other than ideological rigidity that the striking fact he thought he knew has not been noticed by economists).

Matters have not improved over the decades.

The most important point of ignorance here is though that no one really did go out and design or even build globalisation. Yes, obviously, there were spouting from politicians but when, and of what, isn’t that true? Tariffs came down a bit.

But the real drivers were cheap transport, cheap telecoms and cheap travel. Barriers to trade are not just the tariffs or quotas imposed by governments. They’re also the barriers imposed by the physical cost of trading. All of which have collapsed in these past few decades.

We saw this before in history too - after the Civil War the US raised tariffs considerably. The ocean going steamship lowered physical costs by more than the rise in tariffs - total trade costs fell and we can prove this by noting the falling differences in prices of tradeable goods between the US and Europe over this period.

Everyone loves the gravity model of trade these days and very few note that it talks about economic distance, not geographic. Those plummeting transport, travel and telecoms costs meant that economic distance also plummeted over the past 50 years. Therefore everywhere was becoming closer in that economic distance and so trade should increase. QED.

In order to stop this - if anyone wanted to be that stupid - tariffs would have to be raised, viciously and violently, to cover the reduction in those other costs.

It isn’t true that anyone went out and designed globalisation - they just didn’t stop it. And thank the Lord Above for that one, eh?

Oh, and, obviously, don’t take Michael Lind seriously on the subject of trade.

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Tim Worstall Tim Worstall

We have a suggestion for the Liz Truss Growth Commission

Of course, at times like this everyone brings out their own bugbears for a good trot around the paddock.

Liz Truss will launch a new international task force to revive flagging economic growth in the West.

The former prime minister has convened the non-partisan group, which is being called The Growth Commission, to investigate the causes of sluggish growth.

The commission, which is to be chaired by Douglas McWilliams, the leading economist, will also analyse the impact different policy decisions have on GDP per capita.

Our particular bee in the bonnet is counting. It’s vital to recall that like so many economic numbers GDP is a proxy. And reifying proxies doesn’t work - because it loses sight of the fact that it is a proxy.

Yes, we all know the standard critiques of GDP, it doesn’t count household work, includes cleaning up pollution as growth and so on. But the real biggie is that it doesn’t include the consumer surplus. A useful definition of the consumer surplus (one to horrify actual economists but one that works all the same) is the amount we are richer that doesn’t get included in GDP.

If the relationship is stable - say, the consumer surplus is equal to 100% of GDP, always - then there’s no problem. GDP still works as a proxy. If that relationship changes, which we would insist it is doing, then GDP becomes an ever worse measure of societal income and wealth.

To construct a ludicrous example. Someone invents the black box which provides power at zero cost. OK, we’re all vastly richer because power is now free (to continue with the example being ludicrous, no distribution costs etc etc - power finally too cheap to meter). But at the same time GDP has fallen - fallen by the amount we used to pay for power but now don’t. The consumer surplus has soared - hey, free power! - and GDP has fallen.

Don’t reify the proxy.

This is, of course, also Hal Varian’s point, “GDP doesn’t deal well with free”.

Now to give a non-ludicrous example. WhatsApp (at least did at one point in time) carries no advertising, makes no charge. The output associated with WhatsApp is zero in GDP. The costs, the couple of hundred engineers at Facebook that work on it, they’re still there, counted properly. So, labour costs but no output, WhatsApp appears in the GDP accounts as a fall in productivity. Yet some billion people are gaining some or all of their telecoms, for free. The consumer surplus has soared. To the extent that folk use WhatsApp instead of metered phone calls GDP falls. And the whole is measured as lower productivity, us getting poorer per hour of labour put in.

Any real examination of growth needs to deal with this problem. Much of the growth in the modern economy is digital, is free at the point of use. The consumer surplus of all of this is very large, entirely out of proportion with the usual rule of thumb that the consumer surplus and GDP about equal each other. That is, we’re getting vastly richer and not counting the fact that we are doing so.

If we’re really going to examine the counting of growth then we need to really examine the counting of growth.

There is also an obvious corollary to this. If ever more of the growth is turning up not as GDP - where we measure the distribution - but as the consumer surplus - where we don’t measure the distribution - then all claims about the inequality of society are wrong.

Think on it. You, me, Granny, Zuckerberg and that peasant on the paddy in Pakistan all have exactly the same access to WhatsApp - and therefore telecoms - at exactly the same price of nothing. And yet there are people claiming that society is becoming more unequal, are there?

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