The free radical

4315

the-free-radical

To anyone who holds freedom as sacred, the most urgent problem facing this country is the vile anti-individual philosophies of collectivism and statism that have given rise to this relentless onslaught of the government's violation of individual rights, which includes the proliferation of intrusive, politically correct, government agencies charged with the 'responsibility' of fixing all our problems.

Chris Lewis in The Free Radical

Competition in postal delivery is the solution

Customers must be offered an alternative to the service which has been constantly interrupted by unofficial action, and which now threatens them with a total stoppage, argues Madsen Pirie.

The impending mail strike makes it clear how near-monopoly services seem to breed dinosaur unions. The ability to shut down a service ups the ante for the unions. In services where there is a competitive market, customers can turn to other suppliers. Lord Mandelson rightly points out that a mail strike now will turn customers to alternative communications technologies, customers who will probably not return.

Some will turn to other mail deliverers, rather than other technologies, but the problem here is that the Royal Mail does the end delivery, the so-called ‘last mile.’ Other firms such as the Dutch-owned TNT, use Royal Mail postmen and women for the final delivery through letterboxes. This means that the Communication Workers Union (CWU) has the power to shut down the service totally, giving it a massive industrial muscle it has shown itself quite prepared to use.

One reason why this state of affairs has continued is that the Post Office is uniquely exempt from paying VAT on its services, as its would-be competitors have to. This means that a rival has to be 15 percent (and soon 20 percent) more efficient to compete effectively. Most markets are won or lost on much smaller percentage margins than that. TNT has a case pending before the European Court protesting the unfairness and calling for a level playing field. Until then, though, it is effectively priced out.

The strike is about modernization, as postal services have to streamline to take on the challenge of electronic communication. The government and management know that more efficient and automated practices must come if mail delivery is to survive.

It would be a good move now for the VAT rule to be changed, putting a level playing field into place for postal services. This would give firms like TNT the chance to set up end delivery and keep the mail services running despite the CWU shutdown. This would give the customers an alternative to the service which has been constantly interrupted by unofficial action, and which now threatens them with a total stoppage.

The CWU has been intransigent and antiquated because it has the power to be so. If alternative delivery systems were in place for customers to turn to, the union would soon change its behaviour. The time has come for government to rescue its citizens from the grip of an over-mighty union by opening up the field to firms which can compete on an equal basis.

Published on Telegraph.co.uk here.

On not understanding the point about speculation

4310

on-not-understanding-the-point-about-speculation

Tom Bower makes the most appalling hash of this piece in The Guardian.

Leadership and consensus could solve these problems, but competition between producers, oil companies, governments and traders is preventing anyone thinking beyond profits. "We're not here to help others," Hall once said.

Hall is an oil trader and Bower is blaming him for pushing up oil prices, something which might choke off economic recovery. Hall is also a peak oil man: he thinks we're about to face serious shortages of the stuff which is why he's speculating that the price will rise. And Bower castigates him for being so selfish as to chase oil prices higher in the pursuit of profit: entirely missing the public good of that speculation.

That public good being something that Adam Smith himself pointed out. Assume that Hall is right, that we're going to face shortages of oil in the future. We would therefore desire some manner of reducing our current usage of it, so as to save what little is left for the really important things. We would also like people to go and have a really, really good look to see if there's some more oil that we've not noticed: lurking down the back of the sofa along with the small change perhaps. What can we think of that might achieve these two aims? Ah, yes, that's it, higher prices now.

So, Hall, following his hunches, drives up prices now and then what happens? Well, if that peek behind the cushions doesn't turn up any more oil then we've extended the life of the oil fields because we're using less. We've also encouraged people to develop alternatives. Hall makes a fortune, we're more prepared for the oil running out and things are pretty good. Perhaps that grease in the antimacassars can indeed be used though, we're not short of oil and thus Hall loses all his money. Things are still good, for we've found we don't have to worry about oil.

But this is the point about speculators. If they're correct, if there really is a shortage looming (of anything) then they bring that price signifying shortage forward: thus making shortage less likely. So they make their money from providing us with the signals which mitigate the very problem they've identified. If they are wrong then they lose their money.

All of which leads to the conclusion that, far from decrying speculators in search of profit, we should be applauding them. Indeed, we should celebrate their making a profit for the public good that they have provided. It's the speculators who lose money we should deride and denigrate: for they were wrong.

The trouble with unions

4300

the-trouble-with-unions

With The Communication Workers Union (CWU) trying to hold the country to ransom, at increasing cost to individuals and businesses, it is worth considering how the free association of people into unions can have such disastrous consequences, and how we can stop it happening in the future.

The underlying trouble with unionization is its ability to capture government, particulary when that industry is so protectected by the government. Ironically many on the left – often quite rightly – disparage the relationship between big business and government, but they also need to accept that many unions behave no better. The problem in both instances is not the survival and expansionist interests of business and unions, but the power of the government to regulate and discriminate.

This latest example shows that the interests of the wokers are not always aligned with the country at large; and more importantly considering the rhetoric of the unions,  they are not aligned with the weakest, poorest and least able, but its members. Despite claims to the contrary, unions are not even vehicles for equality, but a special interest group, no less insidious than other corporatists.

The weakest, poorest and least able are – and by definition must be – outside unions. Many of the excluded are in the UK, but many more are in the poorest countries of the world that unions keep down through the promotion of protectionist policies. Protectionism – another misleadingly defensive word – aggresses those that are least able to defend themselves. Unions’ policies are not diverse or fair; only free markets truly help those at the bottom of the ladder: unions are a club to keep them out.

Of course, we should not give in to the bullyboy tactics of the CWU and to forstall the imediate crisis the post office is right to employ temps to cover the work of those on strike. But more importantly it is vital that the next government does not ignore the real problem at hand. All aspects of mail delivery need to be entirely liberalized,  Postcomm needs to be scrapped and employment law reformed to allow freedom of contract between employer and employee. Unless government is taken out of the equation, we will keep getting the same industrial disputes with the same inevitable results.

One only need look to Heath and Callaghan to learn the lessons of inaction.

The empty fourth plinth

4303

the-empty-fourth-plinth

Over the past 100 days, for every hour, a person has stood on the Fourth Plinth. They've come from all sections of society and have either been championing some cause or merely following some desire to become a 'living' statue. They've become a lasting memorial to the diverse nature of the British society but failed to move from the project from the ordinary to extraordinary.

Coming next to the Plinth is a fibreglass statue of Sir Keith Park, the RAF hero from World War Two (an actual statue of him will be erected in Waterloo Place in London in 2010). After him will come Nelson's flagship, HMS Victory, in a bottle. The plinth and Trafalgar Square should be put out of it's misery of suffering at the hand of some high minded arty elite as yet another pointless and insipid piece of modern art is foisted upon us. It should be used as was originally intended, or for a statue that has equal merit on residing there along with Nelson et al.

The major question that was raised by this project was: was it art? The Fourth Plinth, as the politically conceived concept that it is, has a primary use of the installation of modern art. Gormley's project was consumed by the daily, mundane life of the Square. Gormley's previous work with figures in London, Event Horizon, was a huge success with the life size figures imposing themselves on both the skyline and life of London as something out of the ordinary. Whereas the scale of those upon the plinth in comparison to the Square and it's buildings meant that they were overwhelmed. The 2,400 human statues will swiftly become a footnote in the Square's history.

Roll on the next installation. Shame on the Mayor for not making it permanent.

What is government debt?

4308

what-is-government-debt

A government debt is a government claim against personal income and private property – an unpaid tax bill.

– Hans F. Sennholz, Debts & Deficits

Private profit, social cost

4309

private-profit-social-cost

Among the lessons we're supposed to have learnt from the banks falling over is that it's probably not a good idea to allow profits to be private while costs and losses are public and social. If bankers are to make fortunes then they should also lose fortunes when they screw up: not only is that fair it also correctly aligns the incentives. However, we do need to recognise that this doesn't just apply to bankers.

On the subject of solar panels we get:

For if households can properly insulate their homes and install small-scale renewable technologies – such as solar panels – they become independent of energy companies, and turn a tidy profit by selling electricity back to the grid. (...) A report backed by Lord Mandelson’s department last year concluded that under a “plausible policy scenario" nine million dwellings – about one in three in Britain – could be exploiting such “micropower" by 2020, producing as much energy as five large nuclear power stations. A less expensive programme could equip three million homes. (...) Hopes were high of a rooftop renewable revolution this year after the Government finally agreed (or rather was forced to do so by a Tory resolution in the House of Lords) to introduce “feed-in tariffs", the secret of Germany’s success. But the consultation documents show that rates for generating renewable power have been fixed at a level apparently designed to stop it succeeding.

When you unpack all of those assumptions there you get to something highly undesirable. That "less expensive solution" is that there will be fewer subsidies from taxation to install solar cells....that is, that there has to be a subsidy before anyone will install a set. Further, we've got price setting: as you can imagine, the price being set is above market for the clear and obvious reason that there's little reason to set it below market if you're hoping to encourage people to sell (to buy though is another matter).

So what we actually have here is the suggestion that there should be social costs (the tax funded subsidy) and also public costs (we all have to pay more for our electricity) so that others can have private profit. If we're not to do this with bankers then we really shouldn't be doing it with anyone else.

What does infuriate though is that those screaming loudest in opposition to bankers are those screaming loudest for this, exactly the same, private profit and public cost of their own preferences.

Is logical consistency too much to ask for in this modern world?

One final point: there is the defence (however partial) that we want solar cells so we should do this and we don't want banks so we shouldn't do that. One response is that living in a society without banks is vastly worse than living in one without solar cells. But the real argument is that, actually, we don't want  solar cells. At least not this generation of them. At the moment they're still more expensive then other forms of generation (yes, indeed including carbon costs) so they are a method of making us poorer. Another five to ten years and it's highly likely that they won't be more expensive at which point we'll all happily start using them: and at which point we won't require a subsidy to do so.

A circle of extremism

4305

a-circle-of-extremism

If you subscribe to the idea that politics is a straight line, then for you there is a far right and a far left separated by the great central plains of minor differences. This separation is distinguished by the singular outcome of either the right or left establishing a system of governance that is diametrically opposite. The far left would be characterised by the abolition of private property, primarily, privacy and the complete subservience of the population to the pursuit of a commonly held good, excluding those that didn't hold the 'good will' dear. The far-right would exclude those it feared/hated, primarily, abolish/co-opt private property and privacy and attempt to ensure that the population pursued a centrally directed good. It depends where and what the emphasis of political priority falls upon that allows others to define.

Here is where the idea of politics being a straight line breaks down: the realisation that extremists, be they religious, political or just deranged are merely fanatics intent on the violent overthrow of the state. The outcomes of which are fairly certain, and are almost identical. The end result of political revolution has been seen throughout history, Stalin, The Khemer Rouge, Hitler, Mao et al. It is the outcome that should define what type of label is handed to the politics of a tribe. In the UK the BNP is continually referred to as the far-right, yet their policies drip with socialist nationalization, their descriptive is based upon one policy, not all. Yet they should be referred to as an a extremist political party; with no left or right far or otherwise prefixed. The same goes for the SWP, ANL, UAF who are all extremist groups.

The idea that you can break politics into closely defined neighbourhoods with certain areas juxtaposed is a purposely confusing message. Politics is the pursuit of power by representatives of parts of society. Within that society there are outliers who trend to extremist positions. The outcomes are all the same, a rule of centralized power characterized by extreme violence and a fear of the unknown. It is neither left nor right it is merely an expression of hatred of the individual.

ISOS - The Economic and Political Landscape for The Next Generation

4302

isos-the-economic-and-political-landscape-for-the-next-generation-

On Thursday, students from across the UK travelled to Westminster for the ASI’s Independent Seminar on the Open Society. Sir Malcolm Rifkind opened the seminar, discussing the UK’s relationship with the EU and convincingly arguing that the UK’s approach to European integration should be flexible and based upon our national interest. Following this was Brendan O’Neill, who certainly surprised quite a few in the room with his condemnation of moralising environmentalists. Rejecting of their policies of wearing thermals and limiting water use, he argued that climate change is best tackled through the use of large-scale geo-engineering projects.

After the break, the ASI’s own Madsen Pirie forecast a view of Britain after the next election. Drawing on inspiration from public services in Sweden, he considered the likely education and welfare policies that will be pursued in the next parliament. Our final speaker was the ever-exuberant Lembit Opik, who gave a well-received speech about the need for politicians to act with humility, courage and inspiration.

Following lunch, ISOS hosted its first ever debate, considering the motion “This house would prefer to be led by the invisible hand” On the proposition were Rushabh Ravanat, a debater from LSE and James Drey, president of the Oxford Union. Chris Harman, editor of International Socialism and David Ransom, previous co-editor of the New Internationalist opposed the motion. The proceedings were chaired by Peter Barton from Debate Mate. Each side was lively, impassioned and strongly argued their case, while the questions and statements from the floor were excellent and provoked further retaliation between the two sides. However, (and luckily for the ASI!) at the end of the day the motion was carried with an increased majority.

With positive feedback flowing in, the seminar was a great success. However, this would have not been possible without the involvement of the students and the high quality of questions asked, as well the sterling performances given by our speakers and debaters. We would also like to warmly thank The Spectator, Prospect, Private Eye and Total Politics, who very kindly provided magazines for the students.

It wasn't me

4306

it-wasnt-me

Why are 1 in 8 girls pregnant At Robeson High?