economics – All Things Considered

05 Jan

It’s not the economy, stupid!

The heart is always gladdened when someone in authority makes a definite and determined statement. So congratulations are in order for Sadiq Khan, mayor of London, who stated in his election manifesto of 2016:

“I shall challenge gang culture and knife crime head on.”

Well said, Sir! So how’s he doing at the end of his first year in office?

Homicides in London rose by 27.1%. Youth homicides increased by 70%. Serious youth violence is up 19%. Robbery up 33.4%, while home burglaries rose by 18.7%.

That’s a remarkable increase in serious offences of all sorts. But there’s more…

Thefts increased by over 10,000 incidents in a year, up 33.9%, Alarmingly, there were more than 4000 additional knife crime incidents, a rise of 31.3%.

Rape in the capital rose by 18.3% and there were 2,551 incidents of gun crime, a rise of 16.3% on the previous year.

Meanwhile, we have seen new and ingenious forms of sociopathic behaviour, such as the epidemic of acid attacks.

First the mayoral authorities crack down on the possession of firearms: then incidents of gun crime increase to surpass those in New York.

Secondly, these same authorities “challenge knife crime head on”: then we get those 4000 “additional knife crime incidents.”

Can we expect a ban on sales of Domestos end to the terror of acid attacks?

Mr Khan continuously blames central government’s “police cuts” for this shocking increase. Is he right? There has been a small reduction in the number of police officers but there are still 30,379 of them in the Metropolitan Police. The Met has an annual budget of £2billion and £240million of reserves.

The mayor says it’s all a result of central government’s economic policies as people are impoverished and deprived of adequate social infrastructure by the Tories in Westminster. But London is booming and there are more people in employment than ever.

So instead of subscribing to the prevailing Marxist explanation that increases in criminal behaviour – and just about everything else, actually – are the result of immutable economic forces, let’s try looking somewhere else to find answers. If economic depression leads inexorably to an increase in crime, why is it that – as Christie Davies pointed out in his book The Strange Death of Moral Britain – “Crime persistently decreased in the long economic depression at the end of the 19th century and crime has increased terrifically during the long period of economic expansion since the Second World War. The only people who believe the opposite to be the case are sociologists and left wing politicians.”

Oh, and Mr Khan of course.

For him and for all those sociologists and lefties, I have a question: “What if virtue and vice, law-abidingness and criminal behaviour are not mere functions of economic forces, as Karl Marx vainly believed, but have actually to do with the individual freedom which makes possible personal and public morality?

28 Nov

Theresa’s Romantic Fantasy

Theresa May is very angry with Prince Harry. There was the great lady – Theresa, I mean, not Harry’s intended – with more press releases than she has pairs of shoes. For yesterday was to mark the launch of the government’s Grand Industrial Strategy: to give it its full title, The Industrial Strategy Challenge Fund. Acres of newsprint had been set aside for the publication of details of this great national plan. I nearly wrote Five Year Plan, after the manner of the former Soviet Union. But Theresa is far more ambitious than Joseph Stalin and her strategy looks forward as far as 2040. Television and radio schedules were cleared in advance for exciting ministerial appearances. Then, wouldn’t you just know it: the Prince and his Yankee girlfriend – “I’m just wild about Harry” – are the only news in town. Surely Theresa must be our unluckiest prime minister: first she loses a general election which even a pussycat would have won; then she cocks up the Tory conference with a coughing fit; and now her big strategic launch lies smothered under a pile of royal fluff.

Theresa did actually say something yesterday but, since nobody was listening, I’ll give you the gist of it here:

“Our modern Industrial Strategy will shape a stronger and fairer economy for decades to come. It will help create the conditions where successful businesses can emerge and grow, and support these businesses in seizing the big opportunities of our time, such as artificial intelligence and big data, whilst also making sure our young people have the skills to take on the high-paid, high-skilled jobs this creates.

“As we leave the European Union and forge a new path for ourselves, we need to focus on building a better future for our country and all the people who live in it. With the Budget last week, and our Industrial Strategy in the years ahead, we will build a Britain fit for the future.”

So you see, whatever the deficit in its other capabilities, our government can still be relied upon to produce shoals of jargon.

In the strategy, the government has identified Four Grand Challenges. (Have you noticed how, whenever the country is in the middle of some irretrievable mess, it’s always referred to as a “challenge”?)

Brace yourself for another fusillade of gobbledegook: “…global trends that will shape our rapidly changing future and which the UK must embrace to ensure we harness all the opportunities they bring. The Four are:

Artificial intelligence – we will put the UK at the forefront of the artificial intelligence and data revolution

Clean growth – we will maximise the advantages for UK industry from the global shift to clean growth.

Ageing society – we will harness the power of innovation to help meet the needs of an ageing society

Future of mobility – we will become a world leader in the way people, goods and services move.”

You will be wanting to know how much it will cost you – not Harry’s wedding but the Grand Industrial Strategy (GIS). It will, of course, cost as much as it takes – but £725million for starters.

To be honest, there were a few paragraphs about the GIS in today’s papers, but these were most depressing. All the newspapers assumed that industrial strategy has something to do with the business of government. Then, after much head-scratching, I twigged what’s going on here: Theresa May is doing a Tony Benn and reinventing the National Enterprise Board which – as the GIS will be – was doomed from the start. For the government doesn’t know anything about industrial strategy and there’s no reason why it should. The government’s job is to defend us from foreign enemies and keep the peace at home. So why are we spending more on the GIS than on our armed forces? And why has expenditure on the police forces fallen steadily for the last five years?

There are plenty of people in our country who know loads of stuff about industrial strategy, inventiveness and entrepreneurialism. Government intervention is the last thing they need. All they require is for the government not to get in the way, but to step back and let the hands-on people get on with the job. They would best do this by creating the conditions which will allow industry and enterprise to flourish: that is make huge cuts in taxation and scrap business regulations.

But Theresa and the corporatist gang of left-wing ideologues who surround her won’t do this one thing needful.

Britain today is unique among the nations: we have a socialist opposition and a socialist government.

As for the GIS, it’s a bigger romantic fantasy than any royal wedding

22 Nov

Let’s hear it for the nasty party!

Theresa May’s brand of conservatism has been called “socialism lite.” This is unfair to her. Perhaps it used to be socialism lite, but it now shows every sign of turning into socialism ‘evvy.

The latest wheeze takes the form of a bribe as the Tories hope to grab the young voters by offering cheaper rail travel. But this is only a gimmick, a sideshow. Across the whole range of economic policies, the government looks increasingly left wing: not far off Miliband’s 2015 election manifesto and certainly well to the left of anything produced by Harold Wilson or Jim Callaghan in the 1960s and 1970s.

It gets worse. The Tories have not merely slipped half-forgetfully into socialism, they have seized on it with relish.

Let me offer you a sign or a symbol of this radical shift. Last Tuesday George Freeman MP resigned from the Downing Street Policy Board, the internal party think tank cum PR agency which dreams up policy and then tries to sell it first to the party and then to the people.

Mr Freeman thinks that Mrs May’s economic policies are still not far enough to the left. He spoke of “a lack of vision at the top of government.” Well, he’s right there! But his own vision looks rather blurred to me. He wants to see – among other things on his spendthrift wish list – housing subsidies, reduction or abolition of tuition fees and increases in public sector pay.

He says “Intergenerational unfairness is the biggest issue of our times.”

Mr Freeman’s vision is at least clear enough for him to notice the one thing we have all been noticing for a long time: the kids have turned to Corbyn in big numbers. Corbyn has created, through his 300,000 storm-troopers in Momentum and his skilful use of social media, a revolution in British politics. It amounts to this: he is talking to the 18-30 year-olds in the language they speak every day and tweet and post and twitter on their electronic gadgets. The Tories have failed to connect in this way. In fact, they have never really tried.

Jeremy has understood what Theresa has failed to understand: the gospel according to Marshall MacLuhan: “The medium is the message.”

So, says Mr Freeman, we need to capture the young voters by offering them bribes. He doesn’t put it quite like that – not in public anyway. But that’s what he means. He said this week: “Unaddressed, we risk loosing an entire generation under forty rejecting not just conservatism but capitalism too.”

In other words, he wants May and her “compassionate Conservatives” to go into competition with Corbyn and his revolutionary socialists.

It would be hard to conjecture a more stupendous error than that.

The Tories cannot possibly compete with Corbyn. They might promise people – especially these darling millennials – the moon. But Corbyn will reply – indeed, he has already replied – by promising them the whole galaxy.

How utterly barmy to try to out-left the left!

Barmier still to encourage voters to turn to the Tories by transforming conservatism into socialism.

There is only one sane strategy, one strategy alone that will work. That is to preach and practise conservative political and economic values and to demonstrate that these work: that they are the only sort of policies and values that have ever delivered the goods.

Cut taxes and business regulation. Reduce public spending. Use every political and fiscal measure in the book to encourage industry, commerce and entrepreneurialism.

So we’re doomed to a Corbyn government red in tooth and claw.

And why are we doomed? Because there is more chance of my winning the men’s singles at Wimbledon than of Theresa May acting like a Tory.

A long time ago – remember – Mrs May rejected the Conservatives as “the nasty party.”

06 Nov

Taxation: Institutionalised Theft Disguised as a Virtue

Anything to have a go at the Queen.

Her Majesty is accused of being among those who invest some of their money in countries and institutions where tax rates are lower.

The word used all over the press is precisely that one “accused.” But accusations are only in respect of actions deemed to be wrong. The Queen and others who seek to avoid tax have done nothing wrong: they are merely acting prudently.

Tax evasion is a crime but tax avoidance is not.

Naturally, all lefties, Guardianistas and the BBC endemic are appalled that people should – though it be within the law – decide to pay as little tax as possible. For example Dame Margaret Hodge adorned The Today Programme this morning with her efflorescent platitudes and excoriated all tax-avoiders. She said, “We have a social contract in which we all come together and, according to our means, contribute to the common pot.”

No we don’t. If that is anyone’s idea of how politics and economics works, then it’s bunkum. The whole notion of the social contract from Rousseau to John Rawls is the mythological framework, masquerading as moral rectitude, by which governments persuade, coerce and bully the people into paying…paying for what? For the government, of course. And for the institutionalised profligacy which spends our money on things we don’t want.

The government doesn’t know best. We know best how to spend our own money.

For example, I’m not at all happy that the government should use my money to provide, free of charge, homosexuals with prophylactic pills which enable them to go forth and fornicate profusely without the danger of catching AIDs

Among the other wastages I resent paying for is the state education system which is so dysfunctional that it should be described as child abuse. What other words are there to describe such a system which, according to the Education department’s own figures, leaves 43% of our children – after eleven years of full time, compulsory and hideously expensive schooling – unable to read, write and count efficiently?

We have lived a long time under Labour and Conservative governments based on a lie. This lie is the article of socialist faith which declares that what unreconstructed political reactionaries like me describe as “my money” really belongs to the government to control, disperse or with-hold according to its own whim.

This sort of government – the only sort of government seen in Britain for decades – is not about good management of the nation’s resources: it is about political control.

Taxation is the government’s method by which it seeks – and in which it succeeds spectacularly – to control us.

All socialism is inherently unjust. And it has never worked anywhere. When it is practised moderately, it inhibits the people’s freedom. When it is practised thoroughly, it leads to Stalin and the gulag or presently in Venezuela – so admired by our leader-in-waiting Jeremy Corbyn – people rummaging in dustbins for food.

Down with the Exchequer! God save the Queen!

24 Sep

Who were those far right national socialists?

After today’s elections it seems likely that the Alternative for Germany party will hold seats in the country’s parliament. The BBC and all our newspapers are appalled. First item on the news this morning the presenter said, “This will be the first time members of the far right have achieved significant political representation since the days of Hitler’s Nazis.”

I can find only one thing wrong with that statement: the Nazis were not a party of the far right, or indeed of any sort of right

They were called The German Workers National Socialist Party. And the name was appropriate.

It is often argued that the Nazis were not socialists because they left industry and commerce – the means of production and distribution – in the hands of private companies. But this facade concealed the truth that the bosses of these companies were merely functionaries, managers who obeyed the orders of the actual owner which was the Nazi government.

The socialist policy of the Nazis was enforced three years into their rule when, in 1936 the government introduced controls over prices and wages. These controls inevitably lead to shortages, because they abolished the flexible system of supply and demand.

The response of a socialist government to shortages is rationing. This is made easier when the socialist government is also totalitarian and brooks no opposition.

Hitler’s totalitarian socialist regime didn’t stop at the regulation of wages and prices: it decided what goods should be produced, in what quantities and how these goods should be allocated and distributed. The thorough bureaucracy required to do this produces stagnation and economic chaos.

Figuratively speaking, in a National Socialist brewery, there wouldn’t be enough beer to organise the proverbial piss up.

Shortages produce endless queues for whatever goods might become available.

They also produce a flourishing black market. The government must clamp down very heavily on this and ensure harsh punishments for those convicted. This requires a huge network of informers which makes daily life hell on earth for the people who are forever in the most fearful doubt over who might be an informer – often one’s own friends or even family.

Convicted black marketeers were not tried by normal juries, because ordinary citizens sitting on a jury would never hand out the stiff sentences which the government required – for a trivial offence such as selling a pound of meat illegally. So judgement and sentencing were carried out by government-appointed administrative tribunals.

The last state of that polity which began with price and wage control was a regime which exercised total control and its instrument was the secret police, the Gestapo.

Welcome to the full-blown reign of terror. And it was a Socialist reign of terror as thorough as anything instituted by Joseph Stalin.

09 May

Worse than the U-boats

Theresa May is turning out to be a Red Tory who takes her economic policies from Ed Miliband. When Labour pledged a cap on energy prices at the 2015 general election, this policy was rightly rubbished by the Tories – because such manipulations of the market always end up in higher prices in the long run. Anyone but a blockhead, or a Red Tory, would be able to see this at once. Competition among the energy producers would diminish. For the energy firms would get together and agree to charge similar prices – to create a “cost cluster” just below the level of the cap.

The best way to reduce the cost of power for householders and for industry is to resource energy supplies from cheaper and more readily available fuels.

But the Conservative government refuses to do this – having made the absurd promise to reduce Britain’s carbon footprint to zero by 2050. Incidentally, we are the only country to make this pledge.

Our present energy policy is an act of criminal insanity.

What economic sense is there in offering massive subsidies – at the taxpayers’ expense – to wind and solar power, especially when these sources are unreliable? The Red Toryism of Mrs May is hardly achieved by giving huge handouts to rich landowners to erect thousands of inefficient windmills.

Odd that fanatical environmentalists should so conspire to ruin the landscape.

A few years ago, new advances in technology enabled our mines to produce increasing supplies of “clean” and cheap coal. Now we have closed down the coal mines and the huge power station at Drax is importing, at colossal cost, massive amounts of biomass from the other side of the Atlantic – incidentally destroying whole areas of woodland

Such an absurd policy amounts to both economic profligacy and environmental vandalism at the same time.

In the USA there has been achieved, through the spectacularly successful fracking industry, a revolution in energy production and supply which in little more than a decade has changed America from being an oil-importing nation – dependent on the greed and chicanery of the Gulf States – to become a net exporter of energy. This bloodless revolution has resulted not only in gigantic economic benefits but in shifting the strategic geo-political balance to favour the western nations. For the first time we are freed from Saudi Arabia’s economic blackmail.

To favour western nations? Well, at least to favour those western countries which go in for fracking: Poland and Hungary come to mind.

Mrs May says she is the champion of those “just about managing.” Given sensible energy policies the country would enjoy economic boom years and a considerable reduction in the cost of living – especially for those described by the new Red Tories as “vulnerable.”

With fuel prices constantly on the rise – the only possible result of our insane energy policies – those currently just about managing will be able to manage no longer.

Meanwhile, Britain is sitting on vast resources of shale gas and yet production has barely begun.

By these follies and by gross neglect, Mrs May’s government is imposing the sort of hardship on our people that would have been the envy of the German U-boat commanders.

30 Mar

Lies, damned lies and democracy

I am getting fed up with the misuse of the word “democracy.”

Last week all the papers screamed that the atrocity in Westminster was “an attack on our democracy.” This week the same papers are screaming that Mrs May’s signing of the letter to tell the EU that we’re leaving was “the reclaiming of our democracy.”

Democracy – demos, the people and cracy, rule – implies that voters have genuine choices. But this is not so, and that’s why the word is being misused. Of course, we have all these party labels: Con, Lab, Lib and Loony, but they all implement the same policies. And these policies all add up to socialism. We are forever being told by the politicians and the media (and especially our intellectually-challenged bishops) that we live under a capitalist system, but this is very far from the truth.

Nearly 50% of Britain’s GDP goes to the public sector. In so called communist China it is only 17%. At the height of their totalitarian tyranny, the Soviets were only spending 10% more than we do today. Never mind the anti-capitalist rhetoric, examine the facts…

You are taxed on your wages. Then you pay 20% VAT on nearly everything you buy with the money on which you have already been taxed.

Scandalously we are taxed even on our meagre pensions.

Fuel taxes are at an outrageously high level. If we have a car we pay road tax. If we drink or smoke, the price of our pints and fags is artificially inflated by taxation. Governments ask people to save, so to reduce the burden of taxation. But the prudent who do save are paid little or no interest. In fact, with rates as they are, savers – especially among the older generation – are actually losing money by their thrift. If we do save, we are taxed again on the minuscule interest

If we do our bit by buying shares in British companies, we are taxed on our dividends. There are further taxes on share dealing. The state broadcasting propaganda department fiercely polices an annual tax called the TV licence. The industrial, commercial, financial and manufacturing companies which generate income for the country pay large sums in Corporation Tax and other business taxes. And, in the form of Inheritance Tax, we have to pay up again even when we’re dead. British businesses which ought to be leading our economic recovery are prevented by labyrinthine corporate and state regulation.

Is this what the bishops condemn as “capitalism”? These levels of taxation and regulation are combining to hinder economic recovery. And such taxes are required only because the government needs them to pay for its massively expanded army of civil servants, its quango mountain, its legions of useless box-tickers, its lousy education system, the failing and disgracefully corrupt NHS, and its bloated state welfarism. Then there are the bishops’ hysterical protests against “the cuts.” The truth is that this government will be borrowing and spending more when it leaves office than it did when it came in. Whatever economic and social system is currently being operated in our country, it is not by any shadow of meaning capitalist.

It is socialism through and through. And it’s what you’ll get whichever way you vote – for our prized “democracy” is a lie and a sham

23 Sep

The Holy Stuntman

How’s this for a slice of ostentatious humility? When Pope Francis arrived in the USA yesterday, he declined a limousine and opted for a modest Fiat saloon. Mind you the number plate was SCV-1 – that’s Status Civitatis Vaticanae which, being translated, means, “I’m Number One.”

I forgot to mention that, before he left Cuba, he treated us to a Lady Diana moment when he called for “A revolution of tenderness.”

Will it be a universal revolution, though? I don’t think so. It presumably won’t include successful businessmen, for earlier the Pope referred to capitalism as t”the dung of the devil” – thus showing us something of the dung of historical reflection: for it is the dung of capitalism which has raised more people out of poverty than any other economic system in history.

But back to the stuntman.

Isn’t there something in the Gospels about the sin of parading one’s self-denial? I was thinking of the Pharisee who said, “I am not as other men. I fast twice in the week. I give tithes of all I possess.”

And then those words of Our Lord to his disciples:

“When ye fast, be not as the hypocrites…” He was criticising those who make a show of their good works.

This Holy Stuntman Pope resembles Uriah Heep. I can just hear him saying, “Oh do look – there is none so ‘umble as me!”

19 Aug

Is the social engineer here?

When you notice two items side by side, do you get the urge to join them together?

A report on the BBC’s Today Programme this morning told us that Tony Blair’s 1999 ambition – “Educashun, Educashun, Educashun,” remember – to have 50% of all youngsters attend university has been achieved. But the reporter confessed that this is not quite the roaring success it appears to be. For many graduates are going into jobs which don’t require a university degree.

This item was followed immediately by the announcement that the number of houses being built in Britain is a lot lower than the country’s needs. The main reason given for this was that building companies can’t find the carpenters, electricians and other skilled tradesmen they require.

I’m not normally fond of Americanisms, but their pithy phrase, “Go figure” seems apt here.

For when we’ve gone and figured, we understand that youngsters who might, better advised, have been inclined to learn a trade, instead found themselves saddled with a government loan in order to waste three years “reading” Golf Studies with Tourism or, as it might be Applied Social Policy and Hairdressing.

Quite apart from the important point that our higher education system is not producing the numbers of people to do the work that the country requires, Blair’s impudent piece of social engineering guarantees that many young people are not fulfilling their vocations, exercising their aptitudes and settling into suitable and rewarding work.

Square pegs and round holes. Lives are being spoilt – and all for Blair’s arrogant obsession.

We are now told, of course, that universities shouldn’t be elitist. What should they be, then mediocritist?

For centuries the university was a place where that minority of people interested in such things – and who perhaps experienced a calling to study them – devoted themselves to philosophy, theology, literature and the theoretical sciences. Most people were neither interested in these subjects nor called to study them. Fine – there are many other noble and respectable ways of spending one’s life. You could be an electrical engineer, a plumber, a joiner or any one of a hundred different trades.

Proficiency in a trade such as engineering or carpentry is not inferior to theoretical activity; only it is different. Wittgenstein was an engineer. Jesus was a carpenter.

Now we are living in the mess caused by Blair’s perverse desire to send half our youngsters to waste their time in universities

And what, pray, is Tony Blair? Is he an intellectual? Is he a practical man? No, he is that most arrogant and destructive of creatures: a social engineer.

17 Aug

Capitalism, wot capitalism?

A report claims that, under our unfair capitalist economic system, the wages of senior executives are 183 times those of their workers. But now here’s a funny thing:

“in the second half of the nineteenth century, when Marx’s dreaded capitalism was at its peak, robber barons were at their most oppressive and, according to Freedom House, democracy did not exist, the average ratio of income earned by US corporate directors and their employees was 28:1. Yet in 2005, when history had ended, democracy was in full bloom and egalitarianism proudly reigned supreme, this ratio stood at 158:1 (a study jointly conducted by MIT and the Federal Reserve). – Democracy as a Neocon Trick by Alexander Boot.

In other words, western economies are much more socialised than they were a hundred and fifty years ago. Today governments control the economy to a degree undreamt of in Victorian times. Taxes are higher and there is considerably more public spending – and yet the pay ratios between the top and the bottom are more extreme.

How much capitalism do we actually have?

50% of Britain’s GDP goes to the public sector. In so called communist China it is only 17%. At the height of their totalitarian tyranny, the Soviets were only spending 10% more than we do today. Never mind the anti-capitalist rhetoric, examine the facts. You are taxed on your wages. Then you pay 20% VAT on nearly everything you buy with the money on which you have already been taxed.

Fuel taxes are at an outrageously high level. If we have a car we pay road tax. If we drink or smoke, the price of our pints and fags are artificially inflated by taxation. Governments ask people to save, so to reduce the burden of taxation. But the prudent who do save are paid little or no interest. In fact, with rates as they are, savers – especially among the older generation – are actually losing money by their thrift. If we do save, we are taxed again on the meagre interest

Is this what today’s report calls “capitalism”? These levels of taxation and regulation are combining to hinder economic recovery. And such taxes are required only because the government needs them to pay for its massively expanded army of civil servants, its quango mountain, its legions of useless box-tickers, its lousy education system, the failing and scandalously corrupt NHS, and its bloated state welfarism. Then there are the orchestrated protests against “the cuts.” The truth is that this government will be borrowing and spending more when it leaves office than it did when it came in. Whatever economic and social system is currently being operated in our country, it is not by any shadow of meaning capitalist.

All Things Considered

Rev Dr Peter Mullen

Category Archives: economics