The Pin Factory Blog

49. "It's quite right to make racist or homophobic remarks illegal."

It's certainly not acceptable to make racist or homophobic remarks, or to let people get away with making them in your company. The question is whether it should be against the law, with police involvement, fines and possible prison sentences, or whether we should rely on social pressures. Times have changed, and attitudes with them. An older generation callously and carelessly felt free to abuse and stigmatize others for their racial background or sexual orientation. Now there's more sensitivity to the hurt this can cause, as well as more tolerance. This is particularly true among most younger people.

Despite these welcome changes in attitude, parliamentarians still feel the need to criminalize such remarks. They use the pretext of "incitement," and call even ill-mannered abuse or poor taste humour a hate crime if it mentions some minority. Thus someone was questioned by police after saying humorously on radio that they disliked Welsh people. A shop was visited by police for displaying antique gollywog dolls in its window. Often the person complaining is not of the minority allegedly being derided or mocked, but someone else who thinks that they might be offended.

The point here is that most of us don't want to live in a society where abuse of people in some way different is regarded as acceptable, but nor do we want to live in a society which allows self-appointed thought police to seize on thoughtless but harmless remarks and have criminal proceedings taken against those who utter them. Not everything which is social unacceptable has to be illegal.

Tolerance is best where it is felt, rather than where it is enforced. It works best when people are easy-going about each other's differences and backgrounds, and more concerned with what they are like as individuals than about which groups they can be pigeon-holed into.

Is the drive to biofuels prejudicing the food supply of the world's poorest people? That was the question addressed by Michael Jack MP, Chairman of the House of Commons Environment and Rural Affairs Committee, at an Adam Smith Institute Power Lunch in Westminster this week.

He pointed out that billions of the world's population live on less than $2 a day, but when people start to earn more than that, say up to $10 a day, their consumption of agricultural products increases – not surprisingly, perhaps. And the fact that increasing numbers of people are at last pulling themselves over that $2 threshold is the main reason why we are experiencing a huge increase in world food demand. Indeed, it's expected to double in just a few years.

Meanwhile, of course, there is concern about environmental issues. As in Brazil: wider agriculture can help satisfy food demand, but if it involved cutting down rainforest trees, a lot of people get worried. It's a paradox. Perhaps the clearest manifestation of it, in my view, is the US government subsidy programme which has prompted 20% of US maize production to go into the production of the biofuel ethanol. That (together with some rotten harvests in Australia) has raised food-maize prices, which in turn led to riots in Mexico, a poor country which is highly dependent on the crop for its staple foods.

It gets worse. Farmers use 70% of the world's fresh water, so if we are to meet the rapid rise in food demand, that resource too will be put under strain.

I'm not sure there are any instant answers to such paradoxes. But I am sure that relying on the market is better than relying on governments. People complain that food, water, oil, gas and so on are all getting more expensive to produce as world demand for them increases. I'd say that's a problem for us all in the short term, but just fine in the long term. The rise in prices will prompt people to use these scarce resources more carefully, look at new ways of producing them, or move to substitutes where they can. It will bring forward new technologies like GM crops and the next generation of cleaner nuclear power. Wait for government schemes to produce these changes, and you'll be waiting a long time.

We are delighted to announce that the first twelve blogs in our 'Common Errors' series are now available in Spanish, on a dedicated website run by fellow free-marketeer Ramón Mier. Click here to see the 'Errores Communes'.

On our online bookstore this week, take a look at a book just out, Privacy Wars: Who Holds Information on You and What They Do with it by Rob Hamadi (£10.44+pp).

Governments want our biometric data and the police want our Google records; banks track our spending and our movements. We are caught on CCTV cameras 300 times a day. Who exactly holds data on you – and why?  With interviews with the leading warriors on every side, including Interpol, the DoJ, Equifax and Microsoft, Privacy Wars gives a first-hand account of how the battle is going.

Buy it here from the ASI bookstore. 

Today is E-Day. The day on which we all help to save Gaia by turning off unnecessary and unused gadetry to save electricity. There is some amusement. At the time of writing the collective effect of urging people to save electricity has been to raise consumption by 1%.

Another example of eco-not very sensibleness. 

Remembering Bill Buckley: some bad ideas along the way and some very good ones.

Explaining Cameron's change: there's a public upchuck at the machinations of politicians. 

Not all that much of a surprise when they're making suggestions as inane as this. 

Or the staff are spending so much time altering Wikipedia that whole departmental systems get banned from the site. 

And finally, how many obsolete skills do you possess? 

48. "A university or college education is a public good that society should pay for."

There's truth in the first part of this. Most of us prefer a society with educated people in it, and benefit from it. Educated people can provide services for us, and create the jobs and wealth for the future. They often also add a certain civility which enhances the lives of others.

But they already have access to the rewards of their own education. The main beneficiary of education is the recipient, directly and in measurable ways. The university or college graduate has access to a greater range of fulfilling career opportunities, and has access to much better paying jobs than their uneducated or untrained counterpart. Those who pay towards their education make one of life's very best investments – it repays them many times over in money as well as opportunity.

Someone has to pay for tertiary education. Lecturers have to be paid, buildings and facilities maintained. If this is paid out of taxation, it means that taxpayers in general pay for it, rather than just the beneficiaries of it. It means that the person who leaves school to become a casual labourer is paying higher taxes so that someone who is already better intellectually endowed will have access to better jobs and a higher income for life.

UK university education used to be "free". No tuition was charged and students were given a living allowance to support them. It was a luxury product that could only be given to one in twenty of the age group. Now students have to support themselves with the help of loans, and contribute to the costs of their education. It is much less of a luxury, and one that nearly half the age group can have access to. Education is indeed a good, and should be as widely available as possible.

A year ago, a leading article in The Economist remarked, "Tax havens are an unavoidable part of globalisation and, ultimately, a healthy one". Now tax havens are back in the public eye, with the news that HM Revenue & Customs paid £100,000 for the (stolen) bank details of wealthy Britons with cash stashed in Liechtenstein. Leaving aside the questionable ethics of purchasing illegally obtained information, are HMRC right to go on the offensive against tax havens? After all, don't tax havens cost the Treasury vast sums of money, and force the rest of us to pay more?

Well, yes and no. Certainly, HMRC has a duty to prevent the illegal non-payment of UK taxes and it's probably true that substantial sums of money are indeed being squirreled away overseas. But I still agree with The Economist's sentiment that tax havens and the tax competition they engender is a good thing. And the reason is that competition drives governments towards better tax policy.

The reason that wealthy individuals are able to hide money in tax havens is the British tax law has become overly complex (to put it mildly) and correspondingly full of loopholes for the well-advised individual to take advantage of. Tax competition should therefore drive governments to simplify the tax system, making it fairer, more transparent and cheaper to administer as a result.

Tax competition also helps to keep tax rates low. In a globalized world economy, where companies, capital and high-income individuals are increasingly mobile governments can only raise taxes so much before it becomes obvious that they are losing out. Tax competition helps to keep government lean and encourage them to provide more value for money.

If you believe in high taxes and ever-growing government and public spending all this is, needless to say, rather horrifying and requires urgent international efforts to co-ordinate tax regimes. If, on the other hand, you believe in small government and low taxes, then it's time to give three cheers for tax havens!

Kit Malthouse had a fascinating article in The Times on Tuesday, urging us make greater use of the tunnels under London. A couple of the most appealing ideas in the piece were as follows:

We could, for instance, drop the dual carriageway that currently blights the north side of the Thames into a tunnel below, replacing it with a four-mile long riverside park from Blackfriars to Battersea Bridge. Bypassing Parliament Square at the same time would allow it to be pedestrianised on two sides.

Similarly a tunnel could take traffic from the Edgware Road under Hyde Park and the gardens of Buckingham Palace and allow it to emerge south of Victoria station, where most of it is heading in any event.

The entire Hyde Park Corner interchange could be dropped below ground, and the three great parks of Central London could be united. You could walk from Parliament Square to Queensway, about three miles, without crossing a road. Park Lane would be freed up for redevelopment, and a grand new public square could be created at Marble Arch.

Malthouse's ideas sound good to me. As usual though, the ASI was there first. As we said in our 1994 publication 20-20 Vision:

There are many tunnels under London, and even Underground stations, obsolete for existing use. It should be one of our priorities to investigate how many of these tunnels could be restored and extended for use as urban tollways. They would offer motorists the opportunity to cross under London at various points, paying a toll to miss some of the surface congestion.

A place or country can look wealthy and not be: it depends upon whetther it was wealthy at some point or not. This helps to explain the Argentine debt default, so it is said.

A similar point made here about Zimbabwe. 

Opposing government action is not the same thing as opposing the goals of the well-meaning advocates of such government action. 

That surge in American house prices in recent years: not so much about an increase in mortgage affordability, more an increase in mortgage availability. 

To segue to Northern Rock: yes, we taxpayers will be making the contributions to the Northern Rock Foundation. My, there are a lot of Labour Party MPs in the North East, aren't there? 

Gaining links by the day: correcting Nick Clegg on a matter of corporate accountancy.  

And finally, this might be going a little far, even for theocrats.