The Pin Factory Blog

Apologies for the late start on the blog this morning. Slight technical difficulties...

Hopefully everything should be working now. 

The RMT and TSSA – the underground's biggest trade unions – have threatened to ballot their workers for strike action tomorrow, if Transport for London (TfL) does not meet their demands (which is basically impossible, given the time constraints).

The unions object to ticket office closures and the employment of non-union, agency, security or sub-contractor staff on the tube network. That is not surprising. They know that private-sector workers could do a much better job, at a much lower price. Frankly, they could hardly fail to do so. Unfortunately, the fact that TfL is a public-sector monopoly makes it easy to hold them to ransom and commuters suffer as a result.

Using the tube is a nightmare. According to statistics obtained under the Freedom of Information Act, the average commuter on the Metropolitan Line wasted three days, 10 hours and 25 minutes in 2006 due to delays. I hate to think what the figure would be on my (notoriously unreliable) branch of the district line.

These problems are not insurmountable: the Docklands Light Railway (DLR) provides a good model for the future. First of all, it is computerized and driverless. That blunts the power of the unions but also makes it more reliable, since trains can run a set distance from one another, arriving and departing at set times, without reliance on an antiquated human-signalling system.

Secondly, the DLR is operated and maintained by a private franchise, which means better management and greater efficiency. Our report Underground Revolution advocated a similar structure for the rest of the network, which would be split into four vertically integrated businesses (Metropolitan, District, Circle, Hammersmith & City lines; Jubilee and Bakerloo lines; Piccadilly and Central lines; Northern and Victoria lines). Splitting the tube up would promote competition in ideas on innovation, marketing and efficiency, as well as weakening the hand of the unions. Vertical integration would encourage investment in infrastructure and capacity building.

In short, no other policy would make such a difference to Londoners' quality of life.

According to a survey of 3,000 people commissioned by UKTV Gold, a satellite TV channel, Britons are increasingly confusing fact and fiction when it comes to their historical knowledge. While 58 percent believed Sherlock Holmes was a real historical figure, 23 percent believed Sir Winston Churchill was fictional.

On seeing the results of this survey I assumed that I had overslept and woken up on April 1st but, alas, no. It appears to have been a real survey of real people – something which, humour aside, is very worrying indeed.

Education reform, anyone?

In January we had more than a quarter of a million visits, over a million pageviews, and nearly three million hits.

Thanks for reading... 

A quite remarkable economic finding: the slave trade quite possibly being responsible for the shorter life spans of African Americans. 

A note to environmentalists. Here's the list of things that you can usefully worry about and try to change. Rather than the ones you are worrying about.

A nice laying out of the point of economics. It's not trying to tell us how the world should be: rather, trying to tell us how it is. 

And what can sadly happen when an economist moves from describing how the world is to how he thinks it ought to be. 

Guido points out that the investigative committee into MPs' expenses isn't really all that investigative.

A reminder that not everything in the newspapers is quite what it seems. Some quoted there represent no one but themselves. 

And finally, some money on offer if you can teach economics better than a high priced call girl. 

Liberal Democrat leader Nick Clegg has a real problem. Last week one of his MPs tabled a bill in Parliament to force pubs and bars to sell wine in small measures only, while one of his party's MEPs called for a ban on patio heaters.

Greg Mulholland, Lib-Dem health spokesman, wants to make it illegal for bars and pubs to sell wine in anything other than the little 125ml size popular over a decade ago. These were the tiny little glass bowls that didn't allow the wine's aromas to develop in the glass. His excuse is that "people don't realize how much they're drinking."

Meanwhile Fiona Hall, Liberal Democrat MEP for the North East, called for the EU Parliament to urge the Commission to ban patio heaters on the grounds that they contribute to global warming. Of course they have a negligible impact; it's just one of those gesture politics tricks to create whipping boys. The surge in the sale of them is probably down to the government's ill-conceived smoking ban anyway.

The result is that poor Nick Clegg has seen his party made to look stupid yet again. He needs to take a lesson from Peter Mandelson, who introduced tight controls over what initiatives individual Labour politicians might launch or pontificate about. It made him unpopular, but it made his party able to control its image. Nick Clegg will have to do something similar or risk seeing idiots and charlatans make his party a laughing stock week after week.

Alan Johnson, the Health Secretary, has written to every GP surgery in England urging them to open in the evenings and at weekends. He wants surgeries to be open for an extra three hours a week. The British Medical Association (BMA) is only prepared to offer two extra hours. They say opening for longer would compromise patient care, unless they were given extra resources. The government's proposal would, apparently, only cover a single GP working late at the surgery, without a nurse.

The whole argument is ludicrous. Why do GPs have central contracts with the government at all? Why on earth is the secretary of state sending letters to GP surgeries? This sovietized system is so backward, so obviously inadequate, that it’s a wonder it has lasted so long. In such a system the fight is always between producers and governments, with patients hardly entering the equation.

This could all change very simply. Make GP surgeries independent and self-governing. Then have them agree NHS treatment tariffs with their primary care trusts (the local bodies that commission healthcare services). Let them advertise for patients, or group together into chains of GP surgeries to reduce administrative costs. The revenue these surgeries, or chains of surgeries, brought in would depend on how many patients they treated, and on whether those patients were satisfied with the service and became repeat customers.

In such a system you would quickly find that where there was a demand for such services, GP surgeries would stay open later in the evening or at weekends. All their incentives would be aligned towards providing the best possible service. Of course, the left will scream "privatization" and say this amounts to the abolition of the NHS. Yet services would still be free at the point of use and paid for out of taxation.

It's high time British healthcare put patients ahead of political ideology.

President Bush’s plans to bail out subprime loans by freezing interest payments for adjustable mortgages is ill conceived enough. But did you know that it was another government intervention that goaded these people into making those mistakes in the first place? That is exactly what George Mason University Economist Walter E. Williams is saying in an interesting commentary for the Washington Post:

As with most economic problems, we find the hand of government. The Community Reinvestment Act of 1977, whose provisions were strengthened during the Clinton administration, is a federal law that mandates lenders to offer credit throughout their entire market and discourages them from restricting their credit services to high-income markets, a practice known as redlining. In other words, the Community Reinvestment Act encourages banks and thrifts to make loans to riskier customers.

However, 96 per cent of mortgages are being paid in time. It is only 2 or 3 percent of homeowners who have to face foreclosures. The Bush bailout will help only few people at a huge cost for the rest of the economy. Above all it is a gross violation of contract rights in a free market (and could even be a Fifth Amendment violation) as Williams rightly states:

If a contractual agreement is willingly entered into and agreed upon by a borrower and lender, it is binding and if broken by one party or the other, harsh penalties should ensue.

Since it was government intervention that got us into the mess more of the same does not make sense at all.

Socialism, like the ancient ideas from which it springs, confuses the distinction between government and society. As a result of this, every time we object to a thing being done by government, the socialists conclude that we object to its being done at all.

– Frederic Bastiat

The latest outrage is the proposed muzzling of the Coroners. Here's why it's an outrage. As so often, the courts and the law are there to protect us from an overmighty State.

An excellent list of things that every environmentalist really ought to try and understand about the world. 

Those Cuban election results. You do have to wonder why they bother, really. 

Google's a very smart company: but are they smart enough not to over-estimate the intelligence of politicians? 

Sometimes banning things is efficient. Sometimes it isn't. As so often, the answer is, it depends. 

Reviewing Tim Harford: remember, that by living in the 21st century you have won the lottery of life. 

And finally, looks like someone else has picked up this idea of collecting interesting blog posts.