The US has effectively dropped the term 'War on Drugs', a tacit admission of that policy's failure. Here, Henry Oliver argues that Britain should learn from the rest of the world and its own history. The government should rethink its policies on drugs and find new policies that work.
Some people might actually benefit from the nanny state, but the questions of who decides what is in people’s interests and whether individuals can be coerced will forever separate libertarians from paternalists, says Tom Papworth.
Should libertarians support assisted suicide? Or is the question akin to Locke's consideration of legalized slavery? Henry Oliver weighs the debate and argues that freedom over ones body is intrinsically linked to the freedom to die.
True to form, the BAA leviathan, which owns and operates seven airports in the UK, is predictably resisting the Competition Commission’s recommendation that it should be broken up, and an element of much needed competition finally injected into the monopoly it has enjoyed since the business was privatised in 1987.
Accusations of ‘flawed’ analysis and other jibes favoured by lobbyists are thrown at the Competition Commission’s 290 page report, but in truth, the Commission’s robust assessment highlights the company’s lacklustre vision with regard to planning capacity, its poor standards of service and its high-handed snubbing of its main customer base: the airlines.
Combined with a score of other criticisms this explains BAA’s abysmally poor position in the Airport Council International league table of airport operator performance. Indeed, perceptions of BAA have sunk so low that the company must win the duffer’s prize for the least favoured business currently operating in the UK.
BAA plc was created as a dominant monopoly by government. And it ranks as probably the foremost monopoly in Britain. No less than 91% of all passengers flying in and out of airports in the South East fly through one of the company’s three airports that encircle the capital, not to mention its 84% share of airport passengers in Scotland. [Cont'd]
Amongst the events that predictably lead to demands for government action are business failures and corporate scandals. Demands for government action to improve corporate governance are, however, based on a dual mistake. They wrongly presuppose that the problems have been caused by a lack of sufficient regulation, and they erroneously assume that government regulation can make things better.
Ian Powell (pictured left), the newly appointed chairman of PWC, Britain’s largest accountancy practice, warns that our competitiveness is seriously damaged by a combination of increased regulation and uncertainty over taxes. Accountants are one of the main beneficiaries of excessive regulation – many businesses are obliged to employ them to advise on how to comply with the plethora of new regulations issued by national and EU authorities.
In the longer run, however, over regulation shackles GDP and, in turn, accountants’ fee income from audit and consultancy services. It is therefore highly significant that PWC’s chairman is saying enough is enough. Referring to the threats posed to the UK economy Powell observes, “The quantity and scope of regulation combined with the level of uncertainty and complexity in this country’s tax system are particular causes for concern”.
Meanwhile, yet another hedge fund - Krom River – announced it was relocating from London. In this case, the winner was Zug in Switzerland (pictured right). Mounting tax bills and Switzerland's more conducive regulatory regime, which was recently overhauled, were given as the principal reasons for the move. [Cont'd]
Perhaps one should be relieved to learn that regulators have failed to come up with any plans on how to use their new powers granted by the Regulatory Enforcement & Sanctions Act that came into force yesterday.
The Financial Times reports that BERR – the Dept for Business, Enterprise & Regulation – had received no plans yet from the 27 national regulators allowed additional powers under this new legislation. Originally intended to streamline business regulation across the board, the Act actually provides powers for regulators to impose hefty fines on those who do not conform to a raft of regulations. [Cont']
Adair Turner, the former McKinsey consultant who now heads the FSA, published his much-heralded regulatory response to the global banking crisis last week. By all accounts, Gordon Brown will use the report as the basis for his initiative to re-regulate the world’s banking markets at the G20 Summit due to be held in London next week. While the report includes some telling insights into the current credit crisis, described in the opening paragraph as “arguably the greatest crisis in the history of finance capitalism” it is fundamentally flawed in its approach to the daunting task ahead. The report sets out a raft of new initiatives: higher capital adequacy margins; closely monitored liquidity regulation; greater oversight of hedge funds; curbs on bankers’ bonuses; rating agency oversight; and what is referred to as “intrusive and systemic supervision”. Yet in truth what is needed is not so much a stack of new regulation, but a regulatory regime that enforces the existing rulebook while eliminating regulations that are either unnecessary or unenforceable. [Cont'd]
Testament to the inability of non-executive directors to maintain a rigorous oversight over the activities of banks’ executive team is reflected in the mounting losses reported by those two ugly sisters of Scottish banking, RBS and HBOS. Cross-examined by the Treasury select committee earlier this year, it was clear that the non executive members of the board had failed to rein in their CEO’s meglomania. What is more, it was revealing to learn that neither the chairmen nor the CEOs of the two banks had any banking qualifications. Nor had Adam Applegarth, the CEO of Northern Trust, or Matt Ridley, the chairman, ever sat a banking exam. [Cont'd]