Blog Review 951


There are simply far too many reports like this one. Ones where all of the costs are carefully enumerated and none of the benefits. In this instance, yes, of course, alcohol has its costs: but to refuse to even acknowledge that people enjoy it and thus gain benefits is absurd.

This is the most importnt issue about current financial events. What is going to happen to the trend growth rate?

What's really happening between the hedgies, Obama and the UAW.

Amazing, someone has found a positive result from the ethanol programme.

What's wrong with Friedrich List and his idea of national self sufficiency.

News just in: dog food tastes terrible.

And finally, a national database we really do need.


Thatcher: Thirty years on


Thirty years ago, on May 4th 1979, a feeble and bankrupt government was swept to oblivion by the Conservatives under Margaret Thatcher, and Britain began the process of recovery. Few thought it could be done.  Indeed, those of the postwar consensus waited smugly for the U-turn when Mrs Thatcher would find that markets, incentives and private ownership were simply not relevant in the modern world.  It never happened, and Britain was rapidly restored from being the sick man of Europe and an international joke to recover its self-confidence and become one of the world's leading economies.

It has taken a Labour government only a few years to run that recovery into the ground. Profligate spending and reckless borrowing were hidden by the sleight of hand of stealth taxes and false accounting.  Financial downturns were smoothed for political advantage by pumping vast amounts of credit into the system, credit that sent false signals about how cheap money was, and to whom it could prudently be lent.

Now it all hangs out.  The financial crisis has exposed the hidden follies and destroyed reputations.  Britain is more deeply indebted than ever, and faces a contracting economy beset by job losses and no visible means of repaying those vast debts. Yet there is hope, as there was 30 years ago. When this sad apology for a government is finally put down, a new team can repeat the success that was gained then. The problems are different, but financial prudence combined with spending cuts and a boost to private enterprise can work the same magic. It is a magic so potent that it can take on even so daunting a task.

Adam Smith thought little was needed to lift a country from poverty to affluence save "peace, easy taxes and a tolerable administration of justice." We have none of these at present, and could use a spell of all three.  Will the next government please take note.

By Jove, I think he's got it!


Nick Cohen starts off with this in his column:

Just before he died, Kingsley Amis wrote that two dismal groups fought over the use of English: the berks and the wankers. Berks were permissive types who rejected all rules. "Careless, coarse, crass [and] gross ... they speak in a slipshod way with dropped 'Hs', intruded glottal stops and many mistakes in grammar. Left to them, the English language would die of impurity, like late Latin. "By contrast, wankers were authoritarians who wanted to impose every possible restriction on speakers and writers. "Prissy, fussy, priggish [and] prim ... they speak in an over-precise way with much pedantic insistence on letters not generally sounded, especially 'Hs'. Left to them, the language would die of purity, like medieval Latin."

He then uses that to start talking about public health cares and the precautionary principle. But I think this basic division, between the berks and the wankers, explains so much more than either just language or health scares. I think it explains much of what is wrong with the modern world.

Being inescapably a berk myself I often look over at the others and think, well, just what are they thinking? Who really thought that it was necessary to use the criminal law to define carrots as fruit, jam for the making of? (That's an EU one.) Who could possibly believe that in the sad absence of a barcode tattooed on the forehead of every citizen they should carry an identity card instead? (A home grown insanity.) I can understand those in favour of immigration as I can those against but it takes a certain form of very non-berkness to open the borders to 450 million EU citizens but close them to a couple of thousand who have already fought for us.

In short, I'm taking the berk attitude to be the old English one, that live and let live sentiment, that freedom from rules and restrictions that we were really the first place to get as a civic reality from the 1660s onwards (even more so after 1689). And the other side, well they're the dirigistes, the pencil pushers, those who insist that there must be a rule for everything and everything must have a rule. And the power, sadly, seems to have flown from the berks to the others.

Or in Amis' terminology, the berks have let the wankers achieve power.

A holiday whose time has gone


The Mayday holiday on the first Monday of May has brought holiday fatigue to the middle of Spring. We've had Good Friday and Easter Monday, and the late May holiday, formerly Whit Monday, is this year on May 25th. This early May holiday was introduced by a Labour government to coincide with Labour Day in Socialist countries. (They celebrated it in the Spring, full of the promise of hoped-for achievement. The Americans celebrate it in September when the harvest is in and the achievement secure).

Meanwhile, the late August public holiday is on August 31st, leaving a gaping absence of days off until Christmas Day.  The obvious way to ration them out is to move the superfluous and unsound Mayday holiday to somewhere in the middle of that gap.  Trafalgar Day (October 21st) is an obvious candidate. We could have the holiday on the nearest Monday to it to give us another long weekend. It celebrates a great achievement for our nation, and one which secured its freedom until quite recently. As we struggle now to restore some of that lost freedom, the day and the holiday might strengthen our resolve, so that in later years we could celebrate that victory, too.

Blog Review 950


Does the US really need a car industry? And if it does, is supporting Chrysler and GM the best way to have one?

Good news on those "toxic assets". Prices are higher than many had thought.

If Netsmith were able to bash just one point into the heads of idiot lefties it would be this one. That markets are not inherently rightish things, they work for all regardless of ideology.

There's a nasty whiff of something not right about this case of Master Ferry. 4 months remand and no charges brought?

And there's more than a whiff of demonisation of those owners of Chrysler debt who, umm, insisted that such debt was in fact their property,

This just has to be made into a film. Just has to be.

And finally, why the police should not be using loudhailers.


Making use of a good crisis


It's the greatest of political sins, to fail to make use of a good crisis. One example of those trying to do so might be the recent EU report on financial market regulations. Hedge funds and private equity are to be brought under tighter control despite their having nothing whatsoever to do with the current problems.

Another attempt which is unfolding under our very eyes is the attempt to portray this swine flu as being an example of the evils of industrial farming.

The Mexican swine flu, a genetic chimera probably conceived in the faecal mire of an industrial pigsty, suddenly threatens to give the whole world a fever.

It's not a chimera, of course, as that would be mixed DNA rather than mutated. It's also an interesting thought for that's not really how we expect zoonoses to arise. For a disease to spread from one species to another, to become cross infectious, we actually think we need to have the two species living in close proximity. Like the Hong Kong bird flu of 68 came from the way in which small holding farmers in that at the time poor country lived cheek by jowl with their birds. Or SARS from Vietnam from the similarly close proximity of stock and human. (No, Spanish flu was not thought to come from humans associating too closely with Spaniards.) That is, we expect such diseases, and we've seen that they do historically, to come not from industrial farming, but from small scale peasant farming. Sleeping above the stock (rather than, erm, with it) is the cause, not having tens of thousands of stock that have little inter species contact.

But of course this should not get in the way of using a good crisis to get whatever it is that you've already decided you want, as Caroline Lucas shows us

More research is urgently needed to explore the potential link between industrialised animal farming, and the spread of disease. Some elements of the Mexican media are already pointing to the potential role of intensive pig farming in Mexico, which has grown substantially in recent years, with some giant operations raising tens of thousands of pigs at a time.

Very well, let us have some more research. How about a bit of empiricism, some collection of relevant facts?

But agricultural in­spec­tion officials say there is no swine flu virus among the pigs at these farms.

So theory says we wouldn't expect large single species farms to produce zoonoses and the facts say that it didn't. Another glorious theory ruined by those pesky facts perhaps? But unfortunately I doubt that will be enough to drown out the siren voices desirous of making good use of this crisis.

Swine flu and the financial crisis


I guess that Swine Flu is a bit like the financial crisis, in a way. One started in the US on the back of bad policy – forcing banks to lend to minorities who couldn't repay, bad regulation, the government creating lenders who were too big to fail – and the other came from Mexico, with bad farming practices.

They both infected other countries with alarming speed, thanks in one case to modern electronic communications and in the other to daily international air travel. They remind us what a small, interconnected global village we now live in.

They are both things we have not seen before, since 1933 in one case and 1918 in the other, and since then, things have changed (financial institutions and trade, viral strains). So we don't really know how to cure them.

They've both caused panics which seem disproportionate to the reality. As ASI author Terence O'Halloran pointed out in a letter to the Daily Telegraph on Friday, 36,000 people a year routinely die of seasonal flu in the United States, but there was hysteria over a single death from Swine Flu. And both have a real impact on the economy and on output.

Ultimately it will not be elaborate technologies that defeat them, but basic, sound, common sense. Keynesian makework programmes, massive borrowing and quantitative easing will not cure the financial problem. Only sound money, freer trade, lower tax and regulatory burdens on business and better (not more) regulation on the banks will cure the financial problem. And sound hygiene, and putting infected people (like infected assets) into isolation will have more effect on Swine Flu than any of the latest anti-virals.

And we will learn that, just as the human body has amazing powers of fighting infection and recuperating from it, so does market capitalism have amazing powers to restore itself to health. Provided that the policy doctors let it, of course.