Dr Eamonn Butler on the cost of government and how to reduce it.
The fall in coffee prices has been caused by a 15% oversupply in coffee production. It is a market response to excessive production, rather than evidence of corporate wickedness. More efficient techniques and improved technology may cause prices to fall further. Those who advocate prop-up pricing schemes such as 'fair trade' may have the best of intentions, but they will probably encourage the less efficient producers to keep at it, maintaining the over-supply. What farmers should do is to diversify into other products. Instead of a token gesture such as paying a few pence extra for a cup of coffee, we should be opening our markets to their goods, and cease selling subsidized crops in competition with theirs on world markets.
In a follow up his last report on the Tobin Tax, Adam Baldwin assesses the impact of the European Commission's Financial Transaction Tax on Britain. He draws on the EC's impact assessment and independent research and concludes that it would wipe out derivatives trading in the City, hurt economic growth and increase market volatility.
In this think piece, Mark Skousen considers Marxist, Keynesian and Smithian economics.
... to the economic and political thought of our time. This book, written by Dr Eamonn Butler, gives an introduction to the great Austrian economist and political philosopher Friedrich A. Hayek. The book covers the themes of Hayek's work, which consists more than 25 books and numerous articles. The topics include Hayek's understanding of the market process; his critique of socialism and the meaningless term of social justice, and Hayek's suggestions for the constitution of the liberal state.
Independent schools are too expensive for most people; they provide a
service that is bought by only seven per cent of the population. Yet
polls have shown repeatedly that most of us would like to send our
children to an independent school if only we could afford it.
One of the reasons for their high cost derives, paradoxically, from
their charitable status. If they were profit-making companies that
distributed their profits to shareholders, there would be incentives
for them to keep costs down and operate efficiently. They would try to
sustain dividends and share values by seeking savings.
High Speed 2 will be enormously expensive if the government proceeds with it. But is it worth the money? In this report, Nigel Hawkins examines the arguments for HS2, particularly the "non-economic" benefits of the project, and argues that HS2 is a white elephant that the government should scrap.
Synopsis: Radical changes to housing benefit are required in order to stem the £840 millon of tax payer's money lost annually to fraud and error, and to make the housing market fairer and more responsive to the needs of tenants. Housing benefit should be taken out of the hands of local authorities, and instead paid out by social security offices along with income support. Today's very complicated payment rates, which depend on the tenant's rent level, family circumtances,and the type of property occupied; would be replaced by a uniform benefit for all low paid people. The report's author, housing expert Dr Peter King of DeMontford university in Leicester, says that prehaps £350 million in adminastrative cost and payment errors could be saved by there simplifications alone.
Mid-February 2001, and the Prime Minister proposes that we should start an investment account for every child in Britain. A baby bond' that would be invested and would grow. And perhaps even added to over the years in order to give every Brit a useful cash sum at 18. That could help them fund their higher education, or special health needs, or housing costs, or could be rolled into a pension for their retirement. Great new idea, or what?
Basel III requires an increase in the size of banks’ equity relative to their loans and a more formal assessment of risk, says Tim Ambler. Big companies will be able to shop around within the competitive international markets. However, in a situation where five big banks dominate the UK market, Britain’s small and medium-sized enterprises (SMEs) will be hit both by the reduced availability of loans and by higher interest rates. Since SMEs drive the UK economy, the consequence of Basel III is negative for the UK.