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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

Public services, private suppliers

Written by Steve Bettison | Saturday 31 May 2008

Dr Madsen Pirie spoke to a group of University of Miami students earlier this week at the ASI’s Westminster offices.  He spoke about the problems raised when private firms were brought in to run public services.  Extra safeguards were needed, he suggested, to make sure the whole process was transparent and fully subject to independent scrutiny.  The lack of expertise on civil servants in some areas such as IT had led to some dreadful outcomes, including delays, cost over-runs and inadequate results.

The most contentious issue, and the one which interested the students most, was the use of private firms to perform what were, in essence, military duties in combat zones such as Iraq and Afghanistan.

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And another thing...

Written by Junksmith | Saturday 31 May 2008

Jacqui Smith's identity for sale. What goes around...

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Blog Review 613

Written by Netsmith | Friday 30 May 2008

Is anyone actually surprised at this? Bureacracies exist to perpetuate bureaucracies, nothing else.

Another view of that "surplus" recently found in the NHS.

On the subject of State monopolies and bureaucracies, would you be interested in a list of Labour MPs who enjoyed a private or grammar school education but would deny such to everyone else?

What happens when you enact sensible and humane laws. Yes, things do get better.

Bill Easterly strikes again: no, we really don't know what makes an economy grow, at least, not enough to be able to make it happen other than by getting out of the way.

If people can see that higher petrol prices cause people to use less petrol, why are they so adamant that the same doesn't happen in a number of other cases?

And finally, explaining why the English dress as they do (or in fact don't to foreign eyes).


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Sweeping dirt under the rug

Written by Jason Jones | Friday 30 May 2008

An article in the Financial Times has prompted me to give a little sneak peek into a research project I’m working on. The Royal Institute of Chartered Surveyors is opposed to Boris Johnson’s plans to publish crime data for public use. A spokesman for RICS said:

Publicising high crime areas in such detail could literally wipe thousands off house prices overnight, further disadvantaging those who are already struggling to make ends meet.

Ironically, just last week I wrote,

Although “real estate developers and agents feel that public crime statistics will lower housing prices," this consequence indicates the potential success of the programs. In fact, one of the principle benefits of transparency is that ordinary citizens have the information necessary to make rational decisions. If access to knowledge of pre-existing crime conditions would adversely affect home prices, then the price should be lower. Property owners in the area would then have incentive to fight crime—both with and independent of the government.

The information would also allow the police to focus their efforts in hotspot areas and reduce crime. This would prevent house prices from falling and make the area safer for citizens.

A lot of us are unsatisfied with the status quo. Let’s hope Boris Johnson ignores the surveyors and moves forward boldly.

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The skills revolution undermines egalitarianism

Written by Dr Fred Hansen | Friday 30 May 2008

Chicago economist and Nobel Laureate Gary Becker has specialized in human capital and claims that three quarters of America’s wealth is now represented in its people - meaning that human capital is now more important than physical capital. Today’s wealth of the nation lies in people’s skills, knowledge and health. It’s less the fertility of the soil but that of the population that counts.

In his Treatise on the Family, Becker argues that the quality of children also matters because investment in education results in an ability to command a high price on the labour market. His definition of quality comes very close to that of Thomas Hobbes:

The value or worth of a man is, as of all other things, his price; that is to say, so much as would be given for the use of his power, and therefore is not absolute, but a thing dependent on the need and judgment of another.

The surging role of human capital in Western economies increasingly undermines the politics of the welfare state based on egalitarianism. It is not possible redistribute wealth if it isn’t something people have but is rather what they are. But it goes much further than this with science and health issues. The belief on the left in egalitarianism as an instrument for social justice is increasingly challenged by modern science:

Science measures our material and animal qualities, and it finds them to be patently unequal…We are born physically and mentally unequal, and always remain so…inequality is the human condition.

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Equality's legislative burden

Written by Dr Eamonn Butler | Friday 30 May 2008

John Baden runs an influential environmental-economic think-tank in Montana. In his syndicated column for the US papers this week he strays off that brief onto what is for him a more personal issue. The so-called 'Title IX' law passed in 1972 bans discrimination on the basis of sex in colleges that receive federal funds. It was designed to end the discrimination against women that was rife in employment and selection policies at the time. But it can also be taken to demand equal treatment – and numbers– in college sports.

Baden welcomes the six-fold increase in female college sports participation since the legislation. But he cites three problems. First, a number of men's teams have simply been disbanded in order that colleges can claim they are achieving parity. Second, there has been a huge rise in litigation over the work conditions and salaries of female coaches and administrators. These are hardly happy outcomes.

But Baden is perhaps most concerned with the fact that, because more women are encouraged to participate at more demanding levels so that colleges hit their quotas, serious injuries among female athletes have increased. Baden's own daughter needed knee reconstruction as a result of this – and such injuries, he says, can be a lifetime burden.

Baden supports equal sports opportunities for women. But he acknowledges that it comes at a price we would be irresponsible to ignore.

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And another thing...

Written by Junksmith | Friday 30 May 2008

A toaster that can poach eggs. To quote the mathmetician and philiospher Alfred North Whitehead: “Civilization advances by extending the number of important operations which we can perform without thinking of them."

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Blog Review 612

Written by Netsmith | Thursday 29 May 2008

Nigel Lawson joins the blogging world....if only for a brief appearance.

Continuing with climate change, it seems that Steve McIntyre was in fact correct once again. Would be nice of course if Nature actually admitted as such.

More environmentalism: apparently the new President of the Soil Association thinks it's right that the poor elsewhere should suffer so that the UK's organic farmers can prosper.

On the perils of blogging (alternative title, do grow up Emily).

That first past the post voting system does have its merits: the UK is the only European country without a proto-fascist party in the legislature.

The day America sent an expedition to New York.

And finally, yes, we English do have a reputation for liking our animals more than our children.



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The prince of lightness

Written by Philip Salter | Thursday 29 May 2008

On June 7th Tim Parker will step into the job of First Deputy Mayor of London and Chief Executive of the GLA Group. Later in the year he will become Chairman for Transport for London. He is a talented man. Three FTSE100 companies have turned to him for his business acumen.

From his statements it is clear Parker will aim to bring much needed financial accountability to politics in the capital. It is a pleasure to see the antithesis of former mayor Ken Livingstone, so soon after his demise. Parker states:

Throughout my business career I have been accountable to exacting shareholders. In my new role, my shareholders will be the taxpayers of London. Throughout my career I have tried to focus companies on the core product demanded by consumers. My core products now will be the key services vital to Londoners.

Presently there is a distinct lack of private sector experience in the government. Surely things would be better if a number of those running the country had an understanding of the businesses that they spend so much of their time and our money controlling and regulating.

As a case in point, Parker has learnt a lot through his experience in the real world, moving away from his Trotskyite Labour roots to embrace the free market. I wonder how many in the government would revere their tax and spend agenda, if they had benefited from a similar experience of life outside of Westminster.

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The brain gain

Written by Jason Jones | Thursday 29 May 2008

It is no secret that many Africans have little reason for optimism. Civil war tears countries apart while AIDS, malaria, famine, and pestilence rage across the continent. The best and the brightest Africans have little incentive to stay, leading to a continent-wide brain drain. Fred Swaniker, a 31-year-old Ghana native trained at Stanford, decided to do something about it.

Swaniker will open his African Leadership Academy, a high school aimed at giving Africans a professional network that will allow them to flourish on their native continent. After raising millions of dollars from various corporations, Swaniker hired top teachers from around the world and bought a first rate property for the school. 

As the adage says, “Losers focus on problems, winners focus on solutions." Swaniker is a winner. His graduates will stay and invest their money in Africa, which will yield more people jobs. This will in turn improve infrastructure, give more Africans access to education, and create even more jobs.

This story illustrates two important points. First, governments that are corrupt, overtaxing, or that seek to redistribute wealth will encourage the most talented to seek greener pastures. Second, while government foreign aid to Africa can help with basic survival needs, private companies can solve the underlying structural problems that prevent growth and investment.

Swaniker will not solve Africa’s problems by himself, but he shows how much one person can do. 

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