The customer is king

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We come top of the National Student Survey because we charge full fees. Full fees not only allow us to fund teaching properly but they also ensure that we treat the students – not the Government – as our clients.

– Terence Kealey 'The league table that has big hitters at the bottom' The Independent

Labour disarray

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The general disarray of the Labour Party continues to amuse those of us on the fringes of politics. Former Home Secretary Charles Clarke MP publicly stated that he believed more than half the Cabinet thought Gordon Brown should go, and that any other party would have eased him out already. Clarke is probably right: Labour's complicated and protracted leadership election procedure is not one that any MP would willingly drag the party through. It's a recipe for looking torn with divisions over a long period. And there's an election coming up, after all.

The other bad news is polling evidence from Populus shows that Labour faces a landslide in London, its 7 point lead having deteriorated into a 12 point deficit. If that 9.5% swing worked uniformly across the capital, Brown's team would lose 17 of their 44 seats. High profile MPs like Jon Cruddas, with a 7,605 majority, would be gone. And the Conservatives are even ahead in parts of the North of England – that's how far Labour's land has slipped.

And it's quite possible that the landslide will get even bigger. Polling has now become so reliable that everyone has a pretty good idea of who's going to win an election long before it's even called. And that feeds on itself. It's like the 'must have' Christmas toy – kids with cred want a Bizzi-Blaster, so the Bizzi-Blaster gets reported as this year's 'must have', whereupon more kids think it must be really cool and want one too. Shops sell out of Bizzi-Blasters, which just adds to the parents' panic that they need to move fast. Of this are bubbles made (Paul Ormerod is good on this).

Something of the same now happens in elections. In 1997 everyone knew Labour was going to win because they seemed united, polished, slick, and normal – unlike the Tories in every sense. And who wants to vote for the losing side? Tory voters deserted to Labour, or stayed at home. It's beginning to look the same in reverse for 2010. Who will want to vote for the slow-motion train crash that is Gordon Brown's government? Populus asked me what I thought the outcome of the next election would be (they flatteringly have me down as an 'opinion former', so how can I resist?) I thought, and said 'Tory Landslide'. Perhaps, in this world of instant polls and 24hr news, landslides are how elections are going to work from now on.

Pondering on Schumpeter

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I've been brushing up by Schumpeter as part of my research on other subjects, and I have been interested to re-discover his views on the future of capitalism. Like Marx, he thought it didn't have much of a future, but for quite different reasons.

Marx thought it would end in giant, exploitative monopolies and then revolution. Schumpeter, by contrast, thought capitalism would drift into a sort of corporatism, where businesses went along with, and perhaps unwittingly promoted, values that were hostile to capitalism itself. (Think about all the cash that big business spends on sponsoring left-wing think-tanks, or sponsoring university chairs for academics who don't have an ounce of feeling for free markets.) So, he thought, the intellectual tide would turn against capitalism, and soggy socialist ideas would rise. People would vote for parties that promised higher welfare spending than greater competition and market freedom. More widespread state-funded education would fuel people's resentment that the market was under-rewarding them (think of all those angry poets and political thinkers). And there would be more and more calls to 'improve' or 'restrain' business with more and more regulation. So capitalism simply finds the life being drained out of it.

Sound familiar? I would say that this has already happened.

3 years and 9 months for Ramsay Scott

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Take pity on Ramsay Scott, a 21 year-old man sentenced on Wednesday to 3 years and 9 months in prison for firearms possession. The student, who has been diagnosed as suffering from Asperger’s Syndrome or a schizoid personality disorder, had bought £20,000 worth of gun components on the internet, and amassed a collection including pistols, sub-machine gun parts and ammunition.

There is no evidence whatsoever that Scott had ever harmed anyone else with these weapons, nor that he had any intention of doing so. As Lord Uist remarked to the High Court in Edinburgh on sentencing him:

It is probably impossible to say what, if anything, you would have done with the weapons had the police not intervened.

He explained that Scott was guilty not because he had actually hurt someone else, but because:

There must have been at least the possibility that you would have used them to cause injury to others.

The law that supports this judgment is grossly unfair in three respects.

Firstly, no free society should lock up its citizens unless it can prove that they have harmed, or intend to harm, others. It is not enough for politicians and judges to talk about the ‘danger of guns’ or the ‘good of society’; they must justify making a free individual, Ramsay Scott, a man who has harmed no one, into a captive of the state for almost four years. If this principle is lost, then many of our freedoms go with it.

Secondly, if the government is going to lock up people for owning harmful objects, it should arrest anyone who has a carving knife, a petrol can or a pair of fists. It is not enough to argue that guns are ‘weapons’ or ‘designed to kill’: the evidence suggests that to Scott they were nothing more than a hobby; they were no more a weapon than his cricket bat.

Thirdly, the punishment is far severer than those handed down to terrible men who have actually harmed others. On the same day as Scott received his sentence, an unnamed 15-year old boy was sentenced to two years by Sheffield Crown Court after punching a man and killing him for not giving him a cigarette, while in Northern Ireland, Ciaran McFall was jailed for three years and 6 months by Antrim Crown Court for sexually assaulting a 13-year old girl.

The Firearms Act should be repealed.

The green economy's assault on our natural landscape

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The basic assumptions of the Obama administration, as well as many other G20 countries, that a possible non-nuclear, renewable energy contribution of 20% by 2020 has been dismantled by a new study. Published by the venerable environmental organization, The Nature Conservancy, “Energy Sprawl of Energy Efficiency" focuses on the impact of climate policy in the US on the natural habitat.

The foremost concern is the amount of land required for the switch to renewable energy. They make it very clear that nuclear renewables are the least land consuming. It requires just one square mile for the generation of one million megawatt-hours – the electricity needed for 90,000 homes. How much land will be consumed for other energy sources?

• Geothermal (natural heat of the earth): 3sq. miles;
• Coal (mining and extraction): 4 sq. miles;
• Solar (thermal heating fluids): 6 sq. miles;
• Natural gas and petroleum: 18 sq. miles;
• Wind farms: 30 sq. miles;
• Biofuels (ethanol and biodiesel): 500 sq. miles.

This does not even include tens of thousands of new miles of high voltage transmission lines. These types of problems are rarely discussed in the renewable debate. Here is another nuisance detail:

Solar collectors must be washed down once a month or they collect too much dirt to be effective. They also need to be cooled by water. Where amid the desert and scrub land will we find all that water?

No wonder even green activists are starting to oppose solar projects in the western United States – the most suitable sites for solar panel fields. Finally some environmentalists are beginning to understand unintended consequences and externalities.

Arsène Wenger on football regualtions

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Wenger, puts that master's degree in Economics to use here. Pity the FA aren't so on the ball...

Alexander S. Ulrich joins the ASI

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I am doing an internship at the Adam Smith Institute from October 2009 until January 2010. During my internship I will be working on a project about highly skilled workers and the importance of attracting a productive workforce. I hold a B.Sc. in Political Science from the University of Copenhagen and am currently a M.Sc. in Political Science, also from the University of Copenhagen. During my studies I have been focusing on economic theories about actor behaviour, wealth increasing policies and the effects of education. Throughout my studies I have worked in numerous jobs, from tennis coach to student assistant at the Confederation of Danish Industries.

In my free time I enjoy running, playing tennis and basketball. Of more quiet hobbies, I like to play strategy games on the computer, photography and reading the newspaper while drinking a good cup of coffee.

Dr Butler's letter in the Guardian

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Baroness Scotland should not lose her job for the mere technicality of failing to take a photocopy of her cleaner's identity documents. But she should lose her job for pushing this law through parliament. Plainly, it is a law with regulations so complicated that even the UK's top law officer cannot follow them. And a law which empowers a quango – the UK Border Agency – to issue large fines that could ruin unsuspecting, struggling small businesses.

Dr Eamonn Butler Director, Adam Smith Institute

Published in The Guardian here.

Broadband tax

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Stephen Timms, the treasury minister in charge of implementing the Digital Britain plan, is pushing ahead with the broadband tax of 50 pence a month for everyone with a fixed line telephone. Utter lunacy.

Firstly it is bad form to pass a controversial finance bill so close to the general election, especially with the opposition coming out against the plans. Although this is not my greatest concern, it is suggestive of political motivations well apart from any concern for the public good. If this is all set up only for the next government just to rip out, this will be more government waste to add to the ever-increasing piles. That is if the next government has the gumption to actually cut the stealth tax.

They should. The tax is being instituted to raise money to encourage more people to have access to broadband. Economics 101: if you want people to do more of something, don’t tax it. Timms is working off the recommendations that came out of Lord Carter’s Digital Britain report. Despite its length – 238 pages – there is no plan on exactly how the £150m to £175m a year will be used to increase access to broadband. There are very real personal protestations and engineering difficulties that have not been properly investigated and given the growth of mobile broadband and dongles, many of the perceived problems are surmountable without government interference.

More tax for wasteful government policies is not exactly what is needed given the state of public finances. As Cameron rightly pointed out on Tuesday, even Thatcher failed to curb the growth of the state. However, his “more consensual" approach does not inspire hope in his ability to get a grip on it. In truth the only time politicians have been able to get us back in the black is when the economy has grown at a quicker rate than they are able to think up ways to tax and waste it. Sadly, as we are now all too aware, this growth is often on the back of government induced bubbles.

Is there a future for free-to-air commercial TV?

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In recent months, several household names have seen their share prices plunge to hitherto unseen levels. They include British Telecom, British Airways and ITV. Following the market rally, their shares have recovered somewhat but all three companies face massive challenges – from their competitors. Furthermore, all are running heavy pension fund deficits.

In ITV’s case, many developments within media-land have conspired to operate against its interests. Following its formation from Granada and Carlton in 2003, the new company was obliged to sign up to the highly complex Contract Rights Renewal (CRR) agreement, under which advertisers were given substantial financial protection to offset ITV’s market dominance. Following persistent pressure from ITV, the Competition Commission has - at long last - accepted the case to reform the CRR.

In its recent half-year results, ITV confirmed that its UK TV advertising revenues fell by a shocking 15%: many commentators wonder whether ITV’s advertising income will ever recover. After all, with the advent of digital broadcasting, there are now many more advertising outlets. For years, commercial television prospered on the back of legendary programmes such as Coronation Street, watched by massive audiences. Whilst recently ITV has sought to improve its content with such programmes as Britain’s Got Talent, this is not obviously reflected in its dire figures.

Net debt has now reached £730 million and a major rights issue is expected once the new Chief Executive - expected to be Tony Ball - has settled in. Ball would also have to consider whether ITV’s free-to-air commercial model is viable, especially since his former employer, BSkyB, is prospering on the back of its Pay-TV model - and its diet of sport and film.

Is Scottish TV’s Roy Thompson, who famously said that commercial television was ‘a licence to print money’, now turning in his grave?