Tim Worstall

Fuck off.

You know, just. Right. Off.

Lovely people, great continent, deliriously happy to cooperate as necessary, visit, trade, gorge and sluice: just not willing to share a system of governance with you, sorry.

I’m getting emails about how I an make $150 an hour……

Greece, austerity, disaster, new thing needed then:

It is now being challenged by parties of the left that reject a
failing neoliberal system

He’s still not got it , has he?

The neoliberals have been screaming for years that the euro is a bad idea, that it shouldn’t exist and if it does Greece certainly shouldn’t be in it. And that the only solution for Greece’s woes (and Portugal, Spain, Italy etc) is to stop being in it.

The is true whether we use the US meaning of neoliberal, Krugman P for example, or the much less important UK version of neoliberal, like me.

We’ve all been leaping up and dopwn screaming that default, exit and devaluation is what has to happen. Otherwise there will be this decades long process of internal devaluation. Either way is hard, either way a loss of wealth to the locals, but one way is a fuck of a lot easier than the other.

The “neoliberals” here are arguing exactly the case that Seumas thinks we’re not. It is the broadly social democratic centre of European politics that we are both arguing against. Those who are, as is the way of these things, the general establishment and thus the most conservative of all the political groupings.

Default, devaluation and start again: this is the neoliberal solution!

Chuka Umunna, the shadow Business Secretary, told The Daily Telegraph Wonga’s move was “a damning indictment” of the British banking system and the failures of the coalition Government to get cash to successful firms.

“Look at the rates of interest Wonga is charging. This is not cheap money,” he said.

“It is such a damning indictment of the failure of Government to get the banking sector working that an outfit like Wonga feels it can step into this market and that there will be a plentiful supply of customers.”

New entrant into the market, offering sorely needed, as Chuka says, business credit. And Chuka complains. Presumably because it’s not one of Chuka’s ideas that the problem be solved by a new market entrant.

What he should be doing of course is applauding the market entrance: and urging other firms to do so too.

In a letter broadcast on Channel 4 yesterday, MP David Willetts told the Prime Minister he considered the minimum unit pricing “very likely to be deemed illegal” under competition and trade law.

The minister added the Attorney General had already written saying the policy “carries a significant degree of legal risk”.

The letter is understood to have been sent four days before Mr Cameron publicly outlined the proposal to tackle the “scourge of violence” on Britain’s high streets.

So, by announcing it was he being dim, not realising that the policy won’t work? Won’t be allowed to “work”?

Or disingenuous in that it’s waving a bit of policy about to appease the idiots while knowing that nothing will come of it?

Either way he’s a scumbag or a politician but I repeat myself.

And to think that this bloke used to actually write a good chunk of the government’s drivel on the subject.

These are, please note, consecutive sentences from his blog post. I have not just collected the worst parts:

The paper uses scientific analysis to calculate the world’s total subsidies to oil, coal and gas companies at between $400 and $500 billion per year.

That’s about £45 for each man woman and child on the planet.

This hardly seems possible, but this is a peer-reviewed paper.

1) The paper does not use scientific analysis to calculate this. It quotes the well known finding of the International Energy Authority that a certain group of nations (Iran, Russia, Saudi etc) subsidise the consumption of fossil fuels.

2) A subsidy to consumers is not a subsidy to producers.

3) This is not a peer reviewed paper “Hansen et al. 2012, submitted”…they are waiting for the results of the peer review.

That’s three strikes and, yes, David Thorpe, you are out!

Now he stands wide-eyed with shock at the consequences, with eloquent pen to capture what he sees. The facts are neatly arrayed: chief executives’ pay in FTSE 100 companies rose from 45 times to 120 times more than the pay of average employees. Money didn’t trickle down, it was sucked upwards; the share of national pay going to the lowest earners fell steeply over the last three decades, half the population getting just eight per cent of a doubling in national income. Even after the crash, the pay packages of FTSE 100 directors soared up unabashed, rising 49 per cent in 2011 alone.

‘We did not expect this and most of us are at a loss to understand exactly what has happened,’ Mount writes. If globalisation destroyed the jobs and pay of erstwhile well-paid industrial workers, why is that same globalisation used to explain the inflation of top executives’ pay, instead of levelling them down too?, he asks.

Err, because globalisation increases in country inequality?

By exposing everyone to more competition: and those very few who win the global competition are raking in the winnings of having beaten global competition, not just national.

half the population getting just eight per cent of a doubling in national income.
….
On the falling pay of the bottom half of earners

Pay rising not as fast, pay rising unequally, is not the same as pay falling.

Corporate organisations are “stupid” in that they don’t learn very effectively (pdf) and in most cases, improvements to productivity and new innovations tend to come from new firms entering the marketplace with new ideas, not incumbents making incremental improvements.

To what extent this is true will vary by sector: in the UK during the 1980s, 90% of all productivity improvements (pdf) in manufacturing came from firms exiting and entering the marketplace. One look at the cut-throat history of the tech market suggests it is probably in a similar ballpark.

Improvements in productivity is the same statement as the society getting richer. And entry and exit is how this happens.

Another strategy is to tackle the problem from the other end – reduce the need for firms to go bust in a market, and so in turn reducing the frequency of crashes. Achieving this would have the added benefit of reducing the other associated costs of a bust for involved labour and capital, as well as consumers.

Therefore we should deliberately limit exit and thus hamstring entry so as to make sure that the society cannot get richer.

Facepalm.

A bigger immediate threat is that a Greek exit from the euro – rated as a 50-75% probability by Citigroup – will have a domino effect on Portugal, Spain and Italy.

Jason Conibear, director of foreign exchange firm Cambridge Mercantile, said the euro was currently as attractive to investors as a toxic derivative during the sub-prime crisis: “There’s every chance the euro will go into freefall in the weeks ahead against all the major currencies. Investors are waking up to the fact that the once-ridiculous notion the euro could collapse is increasingly the most likely outcome.”

It was a ludicrous thing to have in the first place and the sooner its gone the better.

Gonna be painful but it’ll be a lot more painful to keep it.

Looking around southern Portugal economic activity is simply grinding to a halt. Leaving the euro, expanding the money supply, defaulting on the debt, devaluing the currency. These aren’t, as some seem to think, heterodox or unusual prescriptions.

They are, in fact, the straight old IMF prescriptions for countries in this situation. This is just mainstream economics.

The internet is a bigger part of the British economy than education, healthcare or construction. Britons generate more money online than any other G20 nation. But when it comes to high-speed broadband, the country is falling behind.

The UK’s average download speed is ranked 16th in Europe, according to IT company Akamai, and experts warn that the country is beginning to miss out as a result.

Ergo, high-speed broadband is not required to gain economic value from the internet. For we are gaining more economic value than others while having less high-speed broadband.

Not that The Guardian seems to be aware of this point. For they go on to say that obviously the answer is that the State should organise a monopoly company to roll out high-speed broadband. Apparently so that we can all have multiple channels of HDTV to watch as singletons.

Which doesn’t in fact sound like a huge addition of economic value to be honest.

The Japan Times reported on 29 March that radiation inside the vessel has reached 73 sieverts per hour – high enough to administer a lethal dose to a human in a matter of minutes, even to disable the robotic devices which are sent regularly into the reactor to monitor what is happening there.

High radiation levels inside a nuclear reactor.

Just fancy that, eh?

It’s a righteous old jeremiad as well.

The evils of Cameron’s austerity, the joys of Hollande’s spending in a slump.

One thought: the UK deficit as a percentage of GDP this year is expected to be 8.3%. That of France, 5.3%.

It’s not immediately apparent who is doing the austerity here, is it?

But here I am, poised at the gangway of a 36,000 ton, 642 ft ship that has docked in Lisbon.
….
By the time we have docked at Cádiz, I am beginning to think that, while you don’t have to be obsessive to go on a cruise, it certainly helps.
….
And as I gaze out at the Med while taking afternoon tea,

You’re in the Atlantic love.

Every bit of my body tells me not to go on a cruise. The Costa Concordia. The Costa Allegra. Do I even need to write the word Titanic? The 350 passengers who caught the norovirus two years ago aboard a Caribbean cruise liner. The people who have just logged a complaint with Thomson over the ship they claimed gave them gastroenteritis; the one with a swimming pool that allegedly contained human faeces and food that was undercooked. And I am 31. Thirty-one-year-olds do not go on cruises. In my mind, 61-year-olds do not go on cruises.

Thus the cruise line giving a 31 year old journo a freebie if only she’ll write about it.

They seem to have known everything about how humanity should live and nearly nothing about actual humans.

A new Groceries Code Adjudicator Bill. An adjudicator will be given legal powers to ensure that supermarkets give their suppliers a fair deal. Supermarkets bullying or treating farmers and other suppliers badly will be “named and shamed” and may be fined.

Is St. Vince an idiot or a fool?

Ministers are to announce plans to allow magistrates to sit on their own in community centres or police stations in a bid to speed up justice.

They’ve just spent a decade or more closing down local Magistrate’s Courts and organising them into more “efficient” regional ones.

And this?

Sittings would take place in varied locations including community centres and police stations as well as via live video link to cells.

No fucking way. Even for a guilty plea on a trivial offence everybody, but everybody, gets their moment in an open court. Summat to do with this Habeas Corpus thing, no?

How long would it be before commital proceedings were done by video link? Before bail decisions?

Just no.

And perhaps dragging the physical body into court makes the courts system more expensive. But that’s just absolutely fine for the administration of justice is what the State’s fucking for. It’s vastly more important than quashing inequality, fighting misogyny or proividing duck houses for our rulers. This is the whole damn point of having a State and a taxation system, so that we can indeed have that public good of the tolerable administration of justice.

At the ASI.

We don’t know much about macro but we do about micro: so let’s concentrate on getting the micro stuff right, eh?

The blunt warning from Linden Homes, the housebuilding division of Galliford Try, is just one of a barrage of policy criticisms submitted last month to a government consultation on new Building Regulations.

The regulations would require higher efficiency standards on new homes from next year and are a step toward the government’s plan to make new homes ‘zero carbon’ from 2016.

Linden Homes, the UK’s fifth-largest residential developer, said the 2016 proposals risk “strangling the building industry with massively increased costs” of up to £30,000 more on each new home.

“The extra costs would make many developments unviable and choke off house-building at a time when the UK’s stalling economy needs it most to provide jobs and tackle the housing crisis,” it said.

They do have a point. If you want to get more of something produced it’s probably a bad idea to insist that production of those things must cost more.

And that increase in cost is a great deal more than it at first seems. As we know, the majority of the cost of a house in the SE of England is the value of the permit to build one. The actual construction cost is in the £100k region, so we’re talking about a 20% or more increase in construction cost.

This just ain’t the way to solve a housing shortage.

A quarter of the population is involved in providing some form of care for older family or friends, it finds.

And almost one in five of them regularly spend at least £100 a month.

The figures emerge from a report detailing how a “secret generation” of carers is helping prop up Britain’s crumbling social care system.

That’s good, isn’t it?

The good people of this nation are good people. Caring for their families and friends as they age.

Far from this shwing that the social care system is crumbling it shows that it is in robust good health.

As to the State social care system, we only need that to fill in the gaps of what people do not do out of love of family and friends don’t we? So the existence of this private network also lowers the pressure on that State network.

Trebles all round really.

Although, sadly, that’s not quite the way that even the Telegraph reports it.

The insight that the fiscal policy stance in the periphery prior to this crisis was insufficiently countercyclical

Talkin’ about Spain and Ireland although the same was true of our own G. Brown in smaller measure.

Let us, for a moment, accept the basic Keynesian premise, that we should run great big stonking deficits to provide fiscal stimulus in the middle of a recession/depression.

That also means that we should run great big stonking budget surpluses in the middle to end periods of the largest and longest economic booms in advanced country history.

They don’t quite have to be symmetrical given the effect of growth and inflation upon debt levels. The surpluses and the deficits that is.

But there does have to be, or at least there ought to be, some connection between the general size of them.

Now, look around you, we’ve got countries that are, or have been, running deficits of 5, 10, 15% of GDP in those recessionary years. This implies (but for the above reasons of asymmetry not quite proves) that countries, back in that boom time or the next time a boom comes along, should be running surpluses of 5, 10, 15% of GDP.

And no, it’s not just to save up the money to leave room to blow out the deficit again in the next recession. It’s that this is what you’re supposed to be doing to manage the economy: temper the booms just as you temper the recessions through fiscal policy.

OK, hands up, who can imagine anyone running a 2 or even 3% budget surplus consistently for some years, let alone 5 or 10%?

We actually had this ourselves: debt repayment in 2000, 2001 wasn’t it? Before Brown splurged after the second election to “invest” in public services? To the great cheers of all at The G?

Quite: it’s the politics of Keynesianism that clearly does not work. Doesn’t in fact matter whether it actually works as economics, the incentives to politicians mean that it never will work in practice. Simply because the body politic would never let anyone get away with running the appropriate surpluses that are a necessary part of the complete theory.

Keyens may even have been right in his economics but that’s not the appropriate argument. It’s just not possible to make it work in this real world.