Friday, April 28, 2006
That leaves Tony Blair (who's promised to leave), Jack Straw (why?), John Hutton (who Brown clearly dislikes), Margaret Becket (why?), Alistair Darling (dull), John Reid (should really be a bouncer), Geoff Hoon (demoted for a reason), Peter Hain (dull), Ruth Kelly (hasn't there been an education scandal yet?), Hillary Benn (is the country ready for another Benn yet?) and Des Brown (who?) in the Cabinet and not proven liabilities. Hardly the most inspiring of lists.
Perform a similar experiment for the end of the Major years and you had Ken Clarke, Michael Howard, Michael Portillo, Malcolm Rifkind and William Hague all left with sufficient credibility and substance to later make leadership challenges. Like them or loathe them they were national figures none of whom had done anything worth resigning over. Probably the closest to such notoriety was Michael Howard thanks to the Paxman interview but I doubt that any of the current Labour scandals will be looked back on as such non-events. Perhaps Alistair Darling could mount a John Major style dark horse ascent but I doubt it. None of the names in the Labour list look like they are going anywhere despite their being ministers and, hence, those you would expect to become national figures during Labour's long stay in government.
Given that we still, theoretically, are a country of cabinet government where a Prime Minister is only the first among equals it is important that Brown have impressive figures around him. He is hardly the magnetic political personality required to carry a government alone. How on Earth are the Labour party going to build an impressive government with such an unimpressive set of ministers? Granted there are Brownite back-benchers sure to be promoted but they will be establishing their national reputation pretty much from scratch.
Of course there is one name in the Labour cabinet I haven't mentioned yet. Ask a Labour supporter to name someone impressive in the parliamentary Labour party and they will almost certainly give you one name; David Miliband. David Miliband is apparently a "thinker" and the great hope of those still attached to the Labour party. This Observer article gives a decent account of what the Blairites think of him.
What does this mean for the Tory party and blogosphere?
We have ourselves a target... being local government minister hasn't he, just once, offered to alter the funding formula in favour of the local council which paid the most into his Tuscany fund? Being a Labour minister surely he's paid an illegal immigrant he met in a Carphone Warehouse to come back to his house and choke him while he touches himself?
We need to find out... get to work people.
Thursday, April 27, 2006
The free market response to rising oil demand is that it will increase prices which, in turn, will incentivise new investment and make new fields profitable. It's no co-incidence that North Sea oil came online not long after the last oil price shock. This mechanism is ruined, however, if you take the opportunity, as the Chancellor has done, to place a windfall tax on oil profits as this endangers the market signal that increased investment in oil will be rewarded.
This harms investment in the North Sea and is likely to hasten the UK's move away from supplying most of its own energy needs. This will make the UK more vulnerable to oil price shifts and make the oil prices a more credible excuse for incompetent Chancellors in the future. At the moment a rise in the oil price is no direct concern for the United Kingdom, particularly if countries like the US which genuinely depend on oil grow more robustly.
Wednesday, April 26, 2006
Iain Dale doesn't explain his mystifying personal attachment to a Home Secretary who has spent his time restricting civil liberties, freedom of speech and is now failing to fulfill his basic duties of administration but still comes to the correct conclusion; Charles Clarke should clearly resign.
Last week's Economist contained an article about the failure of the Democratic party to take advantage of the weaknesses created by Republican incompetence on major issues. The article made it clear that the Democratic Party's 'netroots' can create problems by preventing the party sticking to the center and expecting the Democrats to focus upon their pet causes (indicting Bush is a favourite):
"The embrace is awkward, though, because the netroots are always goading
the party to get as angry as they are. They tend to favour the most frothingly
anti-war, Bush-bashing candidates, who usually lose at the polls."
I think that the Conservative Movement has the potential, and is likely to be, a huge boon to the Conservative Party but it will need to avoid the temptation to force its priorities, from Europe to Immigration, on a party that needs to appeal to a broader mass of voters. Disagreeing with the party is part of a debate in any mature political movement but that debate has to keep the political reality the parliamentary party is facing in mind.
Tuesday, April 25, 2006
He leads into the article, and I presume the book, with the fact that survey evidence suggests no increase in happiness since the 1950s despite vast increases in income. This is, as he notes, due to the fact that people's aspirations also change over time in line with their incomes; the ability to own a TV made you a king in the past but now seems dull and ordinary. He then argues that the rise in aspirations means that there are externalities to being rich which deserve high marginal taxation in order to reduce their numbers and compensate for the "pollution". Layard has, therefore, justified the crudest kind of old socialism which explains why he is being published so widely in founts of common sense like the New Statesman. Flaws with Layard's work in no particular order:
1) His study of happiness is vulnerable to the Lucas critique. While the notion that only relative changes in income matter may be true now if the engine of steady increases in income stops this result could certainly change. Perhaps people only treat incomes as a relative quantity when rising absolute amounts are a given and they have the luxury of comparison? Perhaps the steady state happiness with no growth is a lower amount?
2) He assumes that global governance can be established. Were high marginal rates adopted in Britain we would be able to compare ourselves with the French and everyone else we had become poorer than. We would also suffer a chronic decline in national power. People like their team to be winning and would be unhappy to see our collective status so diminished.
3) He assumes that income comparisons are made between a person and the mean income. More likely people compare to their peers (those at a similar status to themselves). I find it credible that seeing richer students around me makes me feel poor and inadequate. However, Bill Gates is simply outside my frame of comparison at the moment and I would expect this is true for nearly every person who isn't incredibly rich. This suggests that reducing the number of rich people won't make much difference to the happiness of the middle classes or poor.
4) He first argues that comparing yourself with those around you is an inescapable part of human nature and then almost immediately that performance related pay is dangerous because it encourages you to compare yourself with those around you.
5) He dismisses the connection between high levels of legal protection of job security and unemployment despite the simple logic that making people hard to fire makes them far more risky to hire and the evidence available from a cursory examination of the results in the continental European states. He does this by arguing that there are unnamed "exceptions" and claiming a lack of welfare to work is the problem. Given that welfare to work only affects the willingly unemployed is he arguing that there are plenty of job opportunities available in Germany and France right now? That the unemployed of the banlieues are all choosing to remain on benefits because the income from working isn't worth the effort?
6) He uses the data on the decline of trust in others as evidence for a general moral decline rather than using the simpler explanation that people spend more time dealing with those they don't know and should be careful about trusting.
7) His logic extends to other activities besides getting rich which have implications for the happiness of others. Ann Coulter probably upsets far more people than she enthuses. The clear implication from thinking in happiness terms is to censor her. Equally, some people are real misers and will bring down those around them; thinking in terms of happiness suggests shunning them or worse. Without liberalism the kind of crude utilitarianism Layard is proposing requires some fairly unpleasant behaviour; if Layard is willing to admit liberalism in cases of free speech then surely he has to extend it to free economic activity?
8) He ignores the Brave New World critique. For someone who wants to establish "happiness" above all else this is surely a massive failure. If we all want to be really happy why not just drug ourselves silly? His section on Mental Health sounds positively sinister in this light.
I'm sure there are plenty more reasons why Layard is wrong; that's just a quick survey. In the end he has chosen a measure of human progress (happiness) which sounds inoffensive but which is used as a blunt tool to attack human progress on the grounds that keeping up is stressful. This is a part of the intellectual tradition that has us drugging our poor until they can't feel the pain any more. This is the latest manifestation of the Left's ability to find a new way to be wrong with each passing generation.
Monday, April 24, 2006
A few axioms from which policy formation can begin:
1) Immigration is generally good for the economy as it alleviates skills shortages in key sectors of the economy.
2) Too much immigration places a strain on the ability of any society to integrate the newcomers and ensure smooth community relations.
3) We have a moral duty to provide safe haven to those fleeing persecution abroad.
With axiom 3) in mind it is pretty clear that leaving the 1951 convention would be a dereliction of duty. We do not take a particularly high number of asylum seekers relative to the rest of the world so have no substantial grounds to complain. There are justified complaints about the failure to deport those who are judged to not be genuinely seeking asylum but other than that complaints about asylum seekers are morally bankrupt.
With 2) in mind it seems sensible to have some kind of limit on the numbers of economic migrants allowed in. I am not sure of any way of 'automating' this decision so I think it is probably necessary to set a limit for total immigration of X thousands. The number of economic migrants allowed would then be X - asylum seekers. If asylum seekers exceeded X then some flexibility could clearly be shown as that would probably mean an exceptional humanitarian crisis.
2) also begs the question of how we deal with those with no desire to integrate and form a constructive member of British society; the Germans have a, fairly radical, solution that I mentioned in a previous post.
The final question is therefore how to allow for 1) and ensure that economic migrants are allowed in who provide the greatest benefit to the UK. The problem with using a points system, as we have recently introduced, is that we are relying on the government to predict and ration out a valuable economic resource. Government is very bad at this and makes mistakes, as it has in Australia, which leave sectors of the economy without the workers they need and others oversupplied with immigrant labour.
The best solution would seem to be to auction off slots for economic migrants to employers who wish to employ migrants. Once a company has bought a slot that entitles it to bring in an economic migrant and it should advertise for migrants abroad as it would for workers in the UK. This would ensure that the migrant slots are allocated to where they are most needed. As the total number of economic migrants would be determined by the exogenous variables of the political target and asylum applications economy wide skills shortages would still increase the general price of obtaining a worker and the incentives to develop the skills of current citizens would not be significantly endangered. The money raised would also be something of a fiscal boon in place of the administrative cost of a points based system.
The basics of a conservative immigration policy?
It also explains exactly why Mr Eugenides is having such trouble adjusting to Hewitt's analysis of the state of the National Health Service.
A few choice selections from the Jenkins article:
"Yet as a recent report for auditors KPMG by Rupert Darwall — a director of
the Reform think tank — has shown, Thatcher’s fundholding yielded a more
dramatic fall in waiting times than did Labour’s extravagance."
"When Blair came to office in 1997 he wrecked this structure out of sheer
political vengeance. His health secretary, Frank Dobson, dismantled fundholding
and the internal market and reduced the NHS to administrative chaos. "
"After a further doubling of health spending Blair has returned to where
Thatcher was in 1987, with fundholding, trust hospitals and internal markets.
This time he appears to mean it, but he will need to keep his nerve."
"GPs should go back to the arrangement before the war, under the wing of elected local health committees. They were cheap and they worked. There will be “postcode lottery” rows. But democratic accountability will be clear, as in Scandinavia, Germany and other countries where healthcare contrives to be better than ours yet is not “nationalised”. In Denmark just 5% of patients need treatment that cannot be supplied within the remit of their elected county health authority."
What I am currently struggling to understand though is the change in the size of drinks at cinemas. When I first headed out to the States I was amused that all of the portions were a size or two up from what I expected in the UK. Now it is safe to rely on a small being what used to be a large and when I ask for a small it is almost certain that I will be told a large can be mine for a negligible increase in price. My best understanding of the economics behind this is that the increase in cost to the cinema of increasing the size is insignificant but that an increase makes people less likely trouble over paying extra. Despite this it would seem that the cinemas probably cause some people with appetites less formidable than mine to either not buy a drink or share it between two or three people. This would seem to be quite a risk as this halves the cinemas income from the sale and therefore offsets a lot of marginal rises in price. The effect of all this on me is unambiguous though, I order a small and drink more than I did before when I ordered a medium.
That I am talking about the old days at twenty two worries me. Only trying to relate to myself before the existence of the Internet and e-mail gives me a similar shock of modernity.
On another note popcorn's margins are some of the highest of any product; less profitable than Kalashnikov's but without the risk.