Blogroll: Adam Smith Institute

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Does the Government have a Strategy for the Voluntary Sector?

Mon, 20/02/2017 - 11:38

A cash-strapped government, looking to expand community welfare, should prioritise the voluntary (or “third”) sector which provides more benefit at less cost that the public or private sectors.  “The labour value of formal voluntary activity in DCMS sectors in 2000 was approximately £12.7 billion [at a cost of] £301 million.”[1]

Increasing social complexity and an ageing demography means more people looking for help whilst the increasing affluence and size of the post-employment population could supply the helpers with a little motivation and support from government. Britain would be a happier place if government raised its attention from spending our money.

The voluntary sector workforce has grown by about one third, to over 800,000 in the 10 years following 2004 although the rate of growth has slowed since.  Government prefers commercial contractors to encouraging volunteers.

In 2012, the NCVO estimated that “The combined income of all 164,000 voluntary organisations in the UK, is of a similar magnitude to the UK revenue of Tesco (£38.6 billion for 2009/10).” The voluntary sector covers a wide range of community services including day care centres for the elderly, Citizens Advice, sports and arts coaching and supervision, feeding and sheltering the homeless, youth clubs, and the National Citizen Service.

The Blair government recognized the importance of this third sector and declared 2006 to be the “Year of the Volunteer”.  Not a lot happened and few remember it.  Responsibility was given to the “Office of the Third Sector” until, in 2010, the Coalition renamed it the “Office for Civil Society”. The Civil Society became, under the Cameron government the “Big Society” which was supposed to take power away from politicians and give it to people.  No action backed that up and the term has largely disappeared.

In 2016, the May government transferred the Minister, actually Parliamentary Under-Secretary Rob Wilson, from the Cabinet Office to DCMS, further downgrading the government’s interest in the voluntary sector.  He remains responsible for:

  • The Big Society agenda
  • National Citizen Service (NCS) and youth policy
  • Social action
  • Civil society sector support
  • Social enterprise and social investment.

Quite why these are seen as culture, media or sport is unclear but they are words without action.

The NCS was conceived as non-military national service where young people would learn life skills and society would benefit from their good works, a.k.a. “granny bashing”.  The NCS Bill is going through Parliament at present: “the scheme takes place in the spring, summer or autumn coinciding with school holidays. Groups of teenagers undertake a week-long residential visit, usually to an activity centre for an Outward Bound-style course in the countryside involving physical and team building activities.

After this, volunteers undertake a residential week, gaining a taste of independent living and learning a variety of skills for their future. In the third (and sometimes fourth) week, participants plan and deliver a 'social action' project in their local community, often to raise awareness of or fundraise for a particular cause. Those completing the [3 or 4 week] course receive a certificate at a graduation ceremony. The certificate is signed by the Prime Minister in office at the time of graduation.”  In January 2017, the National Audit Office reported unfavourably on the pilot schemes estimating, amongst a long list of problems, that just 60% of target (213,000) would be participating by 2021.

However much time Parliament may give to this NCS Bill, it will have minimal impact on Britain as a whole.  Meanwhile worthwhile voluntary organizations are denied the help they so much need.  

In short, the government has no overall grasp of the voluntary sector, nor of its potential. There is no voluntary sector strategy, no plan and no means to implement a plan even if it had one. It is missing a major solution to its problems.

[1]  Engaging with the Voluntary and Community Sector: The DCMS Strategy for Implementation of HM Treasury's Cross Cutting Review, 'The Role of the Voluntary and Community Sector in Service Delivery' Updated February 2006

Categories: Current Affairs

Robots are taxed, Mr Gates – too much

Mon, 20/02/2017 - 11:31

Microsoft creator Bill Gates says that robots that take human jobs should pay income tax. Zillionaire businessman he may be, but does he understand basic economics? It seems not.

First, robots are already taxed – to the hilt. They are a form of capital, and capital has long been an easy mark for high-spending politicians. But capital does not just grow on trees, you have to create it. That means cutting your consumption and putting something aside to make all the tools that you hope will make your life easier and more productive in the future.

Of course, the only certainties in life are death and taxes (and unfortunately they come in the wrong order), so the labour-saving robots we buy for our homes and kitchens come out of taxed income. And if we are silly enough to actually invest our savings until we have enough for that new computer or new car, we pay tax on the interest (and on inflation as well).

Regarding the businesses that make robots and computers other tools, the investors who finance them already pay income tax, or company taxes on the return that their investment makes.

Second, remember that a robot is just a tool. They may be very fancy tools, but to economists they are no different from any other kind of tool going back to pre-history. They are just another form of capital that boosts your productivity.

The tools that have ‘taken’ most human jobs are not robots, but the most basic tools developed by our early ancestors. Think how many workers you could save by digging the peat to fuel your roundhouse with a wooden spade, rather than by hand. It is a hundred times easier. If you then transport the peat back home using a wheelbarrow – another tool – you save even more time and back pain. And so it goes: the spinning jenny, the cotton gin, the water frame, steam, internal combustion, electricity, the internet, industrial robots… they all allow us to produce and enjoy much, much more. Bill Gates’s logic is that we should tax all tools, from spades to spanners. Nuts.

And do these tools actually ‘cost’ jobs? No, they have allowed humanity to prosper and increase, with far more of us now engaged in far more productive and useful things with far less effort, time and cost. 

Most of us would think that a rather good thing. When you tax things, you tend to get less of them. So why tax tools? Why tax progress?

Third, do not get taken in by the politicians’ talk about how great jobs are. Leisure time is Christmas: jobs are the January credit-card bill. Jobs are the sacrifice you have to make to get what you want.

Entirely naturally, we want that sacrifice to be as small as possible. We want to work less, work in more enjoyable forms of labour, and have more time for ourselves to spend with our families, our leisure, our interests, our philanthropic activities and all the rest. You don’t help human workers by making the tools they need to achieve these things more expensive. Indeed, if robots liberate us to do all these desirable things – as they do – they should get a reward, not a tax bill.

Fourth, if you really do want to help humankind, is yet another tax the answer? We’re taxed on what we earn, what we spend, the spirits we put into our cars and our stomachs, the flights we take, the investments we make, the people we employ, the gambling we enjoy. Taxing our tools too is too much.

A much better idea than putting income tax on robots would be to remove income tax on humans. That would spur human progress faster than even the visionary Mr Gates could ever imagine.

Categories: Current Affairs

Fake news spotted in The Observer

Mon, 20/02/2017 - 07:01

And we all do have that duty to fight back against fake news, don't we? That corruption of our body politic which we must be ever vigilant against

One of Britain’s most successful orchestras is moving to Belgium amid fears that its musicians may be among the victims of a post-Brexit crackdown on immigration.

The European Union Baroque Orchestra has been based in Oxfordshire since 1985, but will give its last UK concert in its current form at St John’s Smith Square, London, on 19 May, before moving to Antwerp.

Gosh, really? 

Other major orchestras are also weighing up their options. The highly influential European Union Youth Orchestra (EUYO) has been based in London since it began life in 1976. Now it is making contingency plans to move to the continent while it waits to see what life after Brexit might look like.

Marshall Marcus, former head of music at London’s Southbank centre and now chief executive of the EUYO, said the orchestra had already received invitations to move to other EU countries. “For some time we have been forming our plan to be ready to relocate, if and when this becomes necessary. Or indeed simply advantageous,” he said.

“If we do land with a hard Brexit it is really difficult to see how British musicians will be able to continue to take advantage of the opportunities that the EUYO and other EU initiatives have been able to offer generations of European musicians,” he added.

He lists EU worker protections, customs unions, import documents (carnets) for instruments and visa requirements as possible future headaches. “No one I know in the music industry – here or on the continent – wants to have to return to the bad old days of filling in more forms, taking up more time and spending more precious money in order for musicians to be able to perform for audiences on both sides of the channel,” he said.

Sounds terrible doesn't it? Paperwork in Channel, Europe Isolated!

We do tend to think that it really is about paperwork but perhaps a rather different sort, the now tallow enabled crinkly folding stuff. From the EU Baroque Orchestra page:

The European Union Baroque Orchestra is unique: EUBO nurtures and supports young baroque music performers through the challenging transition between conservatoire study and the music profession.

The activities of EUBO are an integral part of the EUBO Mobile Baroque Academy (EMBA), a Creative Europe co-operation project 2015-2018 co-funded by the European Union.

From the EU Youth Orchestra page:

The EUYO is funded with support from  the 28 member governments of the European Union.

With the support of the Creative Europe Programme of the European Commission

It doesn't seem all that remarkable to us that EU funded projects would like to remain in the EU in order to maintain their EU funding.

What does seem remarkable to us is that absolutely no mention is made of this in a report in a so called serious newspaper. But you know, maybe we're just picky about propaganda and fake news?

Categories: Current Affairs

If the law specifically allows something then it's not a loophole

Sun, 19/02/2017 - 07:01

Yet another whine about how Uber is doing something or other:

Uber has been accused of exploiting a legal loophole that allows its drivers to operate in UK towns and cities where they don’t have a licence, leaving local authorities powerless to regulate them.

Mick Rix, the GMB union’s national officer for the hackney and private-hire taxi trade, said the company behind the cab-hailing app was “acting with impunity” across the UK, where it was increasingly “spreading its tentacles” into smaller towns and cities.

What is happening is that if you've a license from anywhere then you can work anywhere. As opposed to the former system where you could drop off anywhere but only pick up in that local authority that you were specifically licensed in:

After changes to the law surrounding taxi licensing, brought in by the Deregulation Act 2015, drivers with a private-hire licence from a local authority can use it to operate anywhere in England and Wales. Previously, the law required drivers to return to the area in which they were licensed between jobs.

The law was specifically changed to allow this. This is not therefore a loophole. Except if we are to assume that our Lords and Masters who write the laws are idiots of course and that would never do would it? 

It also seems like an eminently sensible change:

Councillors in other local authorities have also complained that Uber drivers who do not fulfil the authority’s specific licensing requirements – such as minimum vehicle age and successful completion of a knowledge test for the area – can still operate legally in their jurisdiction with a licence from elsewhere.

Licensing fees also vary from area to area, leading some to suggest that drivers are seeking out the authorities where it is cheapest to get a private-hire licence.

Reading council denied Uber a licence to operate last year, but during the summer’s Reading festival an average of 1,000 passengers a day took a trip using the taxi app. Although it is not known where the drivers travel in from, it is thought that many are licensed by nearby Slough borough council and Windsor and Maidenhead borough council.

Sensible on several levels. With sat nav that local knowledge requirement is rather old fashioned. Monopolists do tend to be monopolists and there's always the possibility that licensing fees will become, given the former monopoly of their issuance, a nice little tax upon the taxi using public.

But perhaps most important a series of locally planned monopolies is going to have a capacity problem. Demand is hugely variable across small areas - look at that festival there. If provision is limited to the drivers the area would more normally support then many will not be able to get a cab at those times of high demand. Allowing the one license which can then be used nationally leads to supply being able to move across those local authority borders and thus match demand more closely.

The end result of this should be greater efficiency of use of the fleet (and drivers). Which is pretty much the economic offering from Uber in the first place, less time waiting for a ride (on either side, driver or passenger) and thus a more efficient use of said fleet. More rides from fewer cars and less driver time, an increase in economic efficiency and as always with one of those, something that makes us all richer.

We can't see what 's wrong with this picture at all and it's most certainly not a loophole, is it?   

Categories: Current Affairs

Can we please get this business rates thing right?

Sat, 18/02/2017 - 07:01

Two little stories that caught our eyes:

Nearly three-quarters of small companies in London say business rates are the most important issue they face, piling further pressure on the government over the controversial tax.

The Federation of Small Businesses (FSB) warned that London was in “serious danger of losing its vital support system of micro and small businesses”. The average micro business, which employs fewer than 10 people, will have to pay £17,000 to cover business rates from April, it added.

And:

The house price gap between London and the rest of the country has risen almost ten-fold over the last 20 years to reach nearly £300,000, a report has found.

An average home in London was valued at £105,266 in 1996 - around £33,834 more than one in England and Wales as a whole, according to research by Lloyds Bank.

But by 2016 the price gap had increased to £299,631, with a typical home in London priced at £578,381 and an average property in England and Wales costing £278,750.


Domestic property is not the same thing as commercial true, but that's likely to reflect similar changes in the second over the years.

At which point, business rates are a tax upon the rent that a landlord receives. Values have gone up strongly, rents have too, so why shouldn't the amount paid in tax upon those rents go up? 

We've got to get the money from somewhere and land's the one thing no one makes any more so taxing that is the least distortionary manner we've got of getting some tax into the coffers.

Shrug, what's all the fuss about?

Categories: Current Affairs

They can huff and they can puff but....

Fri, 17/02/2017 - 07:01

Apparently Brexit will mean Britain doesn't get the fishing grounds back:

The hopes of British fishermen that the UK can win its “waters back” after Brexit are expected to be dashed by the European parliament, despite the campaign promises of Boris Johnson and Nigel Farage, a leaked EU document reveals.

MEPs have drafted seven provisions to be included in Britain’s “exit agreement”, including the stipulation that there will be “no increase to the UK’s share of fishing opportunities for jointly fished stocks [maintaining the existing quota distribution in UK and EU waters]”.

At which point we need to think a little about what is being said here:

But the leaked report from the European parliament’s committee on fisheries insists that the “granting of access to the EU domestic market to the UK” post-Brexit should be conditional on Britain continuing to respect the rights and obligations in the CFP.

At which point all becomes clear. This is a negotiating stance. If you want to be able to sell into our lovely market here then we've got to keep your fish. Perfectly reasonable and respectable argument to make and there's a perfectly reasonable and respectable answer too - as well as some more intemperate.

Not that it really matters because this "access" they are talking about is the same one that is being linked to freedom of movement. And since the government has already decided that that isn't going to happen then that form of access isn't something that we'll be trying to preserve.

They're huffing and puffing here about how harsh they'll be in negotiations but it's all rather wind signifying nothing instead of being about to blow the house down. We've already, for better or worse, rejected that Single Market membership or access that is conditional upon their keeping the fish.

Categories: Current Affairs

Brexit won't lead to a flood of English champagne across the Continent, no, really, it won't

Thu, 16/02/2017 - 07:33

Our soon to be no longer Lords and Masters in Brussels appear to be getting their gussets in a twist over something that will not happen:

The European Union is concerned that British companies could violate protections given to the names of thousands of European products – such as parma ham and champagne – while the protected status of foodstuffs such as West Country Farmhouse Cheddar Cheese is retained after Brexit.

The European commission has given “geographical indication” (GI) status to 1,150 products, meaning companies can only use the name of a locality in their marketing if the product is from that area.

When the UK leaves the EU, it will no longer need to abide by the directives and could, for example, rename some English sparking wine as English champagne, or ham as English parma ham.

English champagne is that thing which will not happen. Because of the Treaty of Versailles from the end of World War 1 in fact:

ARTICLE 275

Germany undertakes on condition that reciprocity is accorded in these matters to respect any law, or any administrative or judicial decision given in conformity with such law, in force in any Allied or Associated State and duly communicated to her by the proper authorities, defining or regulating the right to any regional appellation in respect of wine or spirits produced in the State to which the region belongs, or the conditions under which the use of any such appellation may be permitted; and the importation, exportation, manufacture, distribution, sale or offering for sale of products or articles bearing regional appellations inconsistent with such law or order shall be prohibited by the German Government and repressed by the measures prescribed in the preceding Article.

That is generally taken to mean that Champagne comes from Champagne, Cognac from Cognac and so on and on. The reason the Americans don't limit themselves in the same manner is because they never did ratify the Treaty of Versailles.

Not that this protected designation of origin is important in any manner. It only started in 1992 for all the other foods and we're really very sure that the world still turned upon its axis before that date.

Still, lucky we're leaving eh, if our Lords and Masters obsess with trivialities and even then manage to get them wrong?

Categories: Current Affairs

Those people have too much money, tax them more!

Wed, 15/02/2017 - 07:01

That seems to be the general thrust of this piece in The Guardian. Pensioners now, at least some of them, have higher disposable incomes than those still in work. This is appalling apparently and must be stopped. By imposing higher taxes upon pensioners:

That might be considered a good thing if it were not for the fact that the cost is unaffordable, is damaging the ability of British business to invest in the future, and fuelling inequality between generations and among the nation’s 12 million over-65s.

Those things could all be true but pensions are simply delayed earnings. Those people have worked for that money:

Perhaps the answer lies in an extension of national insurance beyond retirement , a care tax, or more transparently a separate tax regime for those who become eligible for the state pension. In short, pensioner income tax bands.

Pensioner tax bands would have lower thresholds for the higher rate of tax and the 45p rate, clawing back some of the inflated incomes many of the first wave of baby boomers enjoy from their guaranteed final salary pensions.

They received lower amounts in their weekly paypackets in order to pay for those pensions. Whether or not the pension payers saved enough to pay it is an irrelevance at this level. There was an employment contract which said some money now, some deferred into your pension. To change the rules now is not just akin to it actually is stealing their wages.

Pensioners on incomes above £20,000 a year will usually have paid off their mortgage and have few fixed costs apart from council tax and utility bills sapping their monthly bank balance. Some, we know, will be subsidising children and grandchildren on the bottom rungs of the pay ladder. Many have told the Guardian of their caring responsibilities. But the UK needs to avoid the situation in Greece, where pensions are untouchable because they have become the financial bedrock of extended family life. 

The Greek problem is entirely different. There it's the state pension (s) which are too high. This proposal here is that people who, entirely in the private sector, deferred some of their income to later in life should now be rapaciously taxed because inequality.

And this is all in The Guardian, usually in favour of the workers being able to enjoy their wages.

It's also very much missing the larger picture. We've been working for well over a century now at sorting this problem of old people starving to death in their freezing homes as unable to work they have no income. Funding pensions was the solution. And now that the solution is working we've got to rip up a century's work?

The usual ignorance of incentives is also on display. We'd rather like the younger generations today to do a bit of saving too for their own old ages. And if we go out to nick all the cash off the people who did save then what's that going to do to those we'd like to save? 

We regard this as an appalling set of suggestions and it seems to be driven solely by the idea that if anyone does end up with a bit of money then we musty, obviously, tax them more just because.

Categories: Current Affairs

We fear the BMA has the wrong end of the stick here

Tue, 14/02/2017 - 07:48

The BMA, the British Medical Association, tells us that the NHS, that National Health Service, needs another £9.5 billion stat. That is, the trade union for Britain's doctors says that the employer of near all Britain's doctors should have lots more money.

Well, yes, OK, that's what unions are for but we do fear that they've rather got the wrong end of the stick:

Dr Mark Porter, the BMA’s chief, said: “These figures are especially concerning given that everyone can see a huge crisis unfolding within our NHS, with record numbers of trusts and GP practices raising the alarm to say they already can’t cope.

“The NHS is at breaking point and the STP process could have offered a chance to deal with some of the problems that the NHS is facing, like unnecessary competition, expensive fragmentation and buildings and equipment often unfit for purpose. But there is clearly nowhere near the funding required to carry out these plans.”

It's the unnecessary competition and expensive fragmentation that betrays the error here. For as Adam Smith pointed out those 241 years ago, long enough for people to grasp the point, we become richer through the division and specialisation of labour. Yes, that damn pin factory.

This does indeed apply in medicine - the literature is chock full of research showing that hospitals which do a lot of one type of operation have very much better results than those which occasionally dabble. That doctors themselves study certain specialties is again proof that the specialisation of labour applies here.

One of us here at the ASI spent a decade as the only person in the world doing a specific job. One part of the lighting industry uses rare earths to alter the colour emitted. That unique job was making sure of a supply of just one of those rare earths to that industry. No, not mining it, not processing it, not turning it into light bulbs, just ensuring that there was a supply of the right purity, in the right size, in the right place at the right time. That's the sort of granularity which private industry gets to these days. Just the one person in the world doing a specific task - OK, that level of granularity is still pretty odd but still, that's the possible end point of the process.

Fragmentation is not thus expensive, it's the process by which we become more productive and thus richer. And competition is just the method we use to decide who we are going to divide and specialise with.

Thus we really do conclude that the BMA have the wrong end of the stick here. The very things they are complaining of are the very things which, in every other walk of life at least, make us more efficient. And if it works everywhere else there is no reason at all why it won't work in medicine.

Categories: Current Affairs

On the subject of Merrie England

Mon, 13/02/2017 - 07:01

The Observer draws our attention to a little book called Merrie England:

When Merrie England (quoted above) was published in 1893, it became a literary sensation almost overnight. Written in vivid, plain English by the Manchester-based socialist campaigner and journalist Robert Blatchford, the book was presented as “a series of letters on the Labour problem, addressed to John Smith, of Oldham, a hard-headed workman, fond of facts”.

To this fictional resident of one of Lancashire’s grimmest mill towns, Merrie England advocated a socialist transformation of the most advanced capitalist economy in the world. Using his Latin pen-name, Nunquam, Blatchford deployed satire and polemic to call for communal collaboration to replace competition and chasing profit as the driving force in human lives.

“Take the case of a tram guard working, say, 16 hours a day for £1 a week,” begins one of Nunquam’s rhetorical salvos. “That man is being robbed of all the pleasure of his life. Now there ought to be two guards working eight hours at £2 a week. If the tram company makes big dividends the cost should come out of those dividends.”

The implication there is that the dividends are enough to cover the wage bill going from £1 a week to £4 a week. And if we're honest about it we too would probably say that if dividends are four times the entire wage bill then there's a bit of room for a pay rise. We're not, however, entirely sure that the example is factual.

The paper uses this as a lead in to a discussion over the Labour Party's woes:

It has been estimated that 149 of Labour’s 232 constituencies voted Leave, in defiance of the party’s wishes and at odds with the overwhelming majority of Labour’s mainly professional membership. 

Well, yes, seems about right. However, the part that really interests us is this small detail:

Blatchford’s coruscating critique of free market economics and the culture of individualism became part of the warp and weft of the nascent Labour party.

Those were heady times for a British working class growing in confidence and taking its first political steps. Over a century later, the modern Labour party could use a Merrie England.

Possibly so. It's just that looking at the frontispiece of the original we note something that amuses. The publication was (in part) funded by advertising quack medicines to those stout working classes.

How's that for sticking it to the capitalists and critiquing the free markets?

Categories: Current Affairs

This looks eminently sensible - not very new though

Sun, 12/02/2017 - 07:01

Apparently there's some great new breakthrough in being able to make cancer drugs cheaper for patients and the NHS. This sounds like an excellent idea to us, wouldn't we all like more people to be cured more cheaply?

The high price of new cancer drugs is indefensible and unsustainable, say two of the world’s leading cancer research institutions, who propose a different way to develop them that could sideline big pharma.

“There is a clear and urgent necessity to lower cancer drug prices to keep lifesaving drugs available and affordable to patients,” say leading scientists from the Institute of Cancer Research in the UK and the University of Texas MD Anderson Cancer Center, where many important new cancer drugs have been invented, in a paper in the journal Cell.

How absolutely super, eh? So, what's the magic ingredient in this?

Pharmaceutical companies used to justify their prices by pointing to the high cost of clinical trials involving many thousands of patients. But that is no longer always necessary, the scientists say in their paper. The new targeted drugs require a test for a genetic biomarker to see whether patients will respond or not. That means the drug can be trialled on far fewer people. The drug crizotinib, used for advanced lung cancer, was approved following a trial involving only 347 patients, they point out.

We're not convinced that is actually new though. The standard analysis of drug costs has been that it can cost $800 million to $ 2 billion (dependent upon who you want to believe and how you assign opportunity costs and the expenses of failures) to get a new drug through clinical trials and to FDA or equivalent approval. Further, the standard solution to these costs has been to reduce the costs by reducing the level of proof required - with the FDA specifically to argue only on proof of safety and leave effectiveness to the market (generally you must prove that the new drug is better than those already available in order to gain a licence).

Thus this proposal is not exactly new. Lower the costs of a drug gaining approval and drugs will be cheaper, yes, seems obvious enough and what some have been shouting about for some decades now.

The only remaining oddity therefore is this wibbling about "Big Pharma." Why shouldn't the big firms take part in exactly the same process? If said new process makes drugs cheaper than why not allow all to do so?

Categories: Current Affairs

Why isn't this just blindingly obvious to everyone?

Sat, 11/02/2017 - 07:01

Apparently it's the naughty young people, with their mobile phones and their social media accounts, who waste all the food. We do have to wonder why anyone bothered to try to find this out - surely it must be obvious to everyone?

A generation gap in attitudes towards cooking and eating is helping to fuel the UK’s food waste mountain, research reveals, driven by time-poor millennials who do not understand the value of the food on their plate. 

In contrast to savvy older consumers familiar with post-war rationing, the study suggests, those aged 18 to 34 are preoccupied by the visual presentation of food to photograph and share on social media while failing to plan meals, buying too much and then throwing it away.

The UK churns out 15m tonnes of food waste a year – of which 7m tonnes come from households. The estimated retail value of this is a staggering £7.5bn, and the government’s waste advisory body, Wrap, calculates that a typical family wastes £700 of food a year.

A national supermarket study of the food waste patterns of 5,050 UK consumers, published on Friday, reveals nearly two-fifths of those aged over 65 say they never waste food, compared with just 17% of those under 35.

Using American figures, just because we have them at our fingertips, a poor family in 1963 spent 33% of income on a basic but nutritious diet. Today that is more like 11%. And here in the UK food spending is, on average, some 10% of household income today.

None of us should really be surprised that something which has become markedly cheaper in real terms is subject to a little less conservation now, should we?

More than that, these millennials are not "wasting" food because they don't know the value of it. Rather, they are wasting it because they know the value of it. That value being very much less than it was and thus less effort need be expended in avoiding waste.

It has always struck us as extremely odd this concentration upon food waste. It's easy enough to get someone to understand the value of time. Who these days would stoop down to pick a penny up out of the gutter and who wouldn't have done so 100 years ago? The relative value of a penny and the time taken to collect it having changed markedly over this time to the extent that your correspondent has seen beggars throwing away coppers collected as just not worth the effort.

But when it comes to food this obvious point seems to escape people. Food is now cheap, it is logical and righteous that people expend less effort to conserve it. And yet when it is cheap, needing less attention paid to it is when we are all taxed to have bureaucracies like WRAP shouting at us for doing what is logical and righteous - not caring about it very much.

The best we can come up with as an explanation is that those who rule us were brought up by rather strict nannies of that earlier generation and thus are infested with the idea that food is rare and expensive. Time to wake up and smell the broccoli ladies and gentlemen. Recent decades have solved one of humanity's perennial problems, the availability of cheap food. We just don't need to conserve it as we used to.

Categories: Current Affairs

What a delightfully delicious dilemma

Fri, 10/02/2017 - 07:01

The usual hipsters and food faddists are soon going to face the most delightfully delicious dilemma. Quinoa has the merits of being a forgotten grain from a little regarded civilisation. The "rediscovery" of it thus brought tears to the eyes of all who would mark their social prowess through their bowels. And so it became tres trendy, certifiably chic.

The same group of cheerleaders are of course largely the people who insist that no GM will ever sully those bowels. No, we're not sure either but they at least insist they have some reason why.

At which point:

It has become a byword for metropolitan, health-conscious dining, but new research suggests quinoa could be destined for a far more important future.

Scientists believe the “supercrop” could solve the problem of feeding the world’s growing population.

The resilient seed, which was once the "mother grain" of the ancient Andean civilisation, thrives in harsh environments and provides a more balanced source of nutrients than cereal.

Well, isn't that lovely? And now for the dilemma:

Experts have now discovered a way of manipulating the quinoa plant changing the way it matures and produces food to make the bitter seeds sweeter.

Researchers from the King Abdullah University of Science and Technology sequenced the Chenopodium quinoa genome, creating the world's highest quality quinoa sequence which has already yielded insights into the plant's traits.

The reason you sequence the genetic code is so that you can manipulate it. Thus, coming soon enough, GM quinoa.

Which of the two fads will win? More of a cheap and nutritious grain with which to feed us all, in that most healthy manner as is currently claimed? Or the method of making it cheaper and more nutritious blacklisting it from all GoodThink diets?

Our suspicion is that GM making it cheaper will be the thing which makes it unfashionable. For how can you go around making a moral statement by consuming something that's cheap enough for everyone?

Categories: Current Affairs

There's a reason we use prices to ration things you know

Thu, 09/02/2017 - 07:01

The intricacies of how supply, demand and prices interact seem to be a mystery to all too many people. Unfortunately, those who are so flummoxed appear to include large numbers of those who have the statutory right to reach into our wallets:

Introduction of 30 hours free childcare could mean shortage of places

Well, yes, thanks to The Guardian for that headline. We'd go so far as to insist that when something formerly paid for becomes "free", free at the point of use at least, then demand is really very likely to outstrip supply.

Because, you know, that balancing act performed by prices.

From September, three- and four-year-olds in England will be entitled to 30 free hours of care per week in term time - up from the current 15 hours.

But a poll of local authorities by the Family and Childcare Trust found uncertainty about impact of the policy.

The government says quality, affordable childcare is central to its agenda.

The survey was sent to all 152 local authorities in England, and 112 of them responded.

Of the 112, over half (54%) said they did not know if they would have enough childcare available for pre-schoolers using the 30 hours.

A third (33%) said that there would be sufficient places, while a further 13% said there would not be enough.

This is of course not free nor any reasonable simulacrum of it. Someone, somewhere, is going to have to pay for those places and that care. And doing so through the taxation system rather than the price one is the wrong way to go about it.

What we would actually like to happen is that those who can earn more by going to work rather than caring for their own children - and wish to, of course - do so. And those who earn less than the cost of child care don't. Hiding that decision from the price system is therefore the wrong thing to be doing.

It's actually making us poorer which isn't the point of government nor policy at all.

Categories: Current Affairs

Sadly, Hans Rosling has died

Wed, 08/02/2017 - 06:15

It is not a surprise that Hans Rosling has died, it's been known for some time that he was terminally ill. However, there is of course a sadness for his family and friends and also for us out here in that wider world. For in his final career he became an evangelist for the truth about our world. Things are getting better, fewer children die, the population explosion is near over as a result, the world is getting richer and better day by day.

This is of course in direct contrast to the usual jeremiads about how capitalism and globalisation are leading us down the path to damnation. And as such, of course, all most useful.

If you've not seen any of his talks then we recommend this, the first and breakout one at TED. This one about the decline in child mortality is also close to our hearts. And we have a very soft spot for this about the washing machine. How the mechanisation of drudgery makes us all so much richer.

If you prefer static imagery and data sets to video talks then Max Roser presents much the same information here.

The essential lesson on offer being, and one without which we simply have no hope at all of deciding what to do next, that the good old days are right now. Further, that as long as we don't mess up there is no reason why they shouldn't keep getting better off into the future.

That is, roughly and imprecisely to be sure, with backsliding here and there, we're on the right track with this economic development thing, with that just passed greatest reduction in absolute poverty in the history of our species.

Rosling wasn't feted and awarded in the same manner that Paul Ehrlich, who has been wrong on every point concerning the same matter, has been but then that's just how society seems to work. Gloom sells better than optimism.

All (all!) that Rosling did was stand up and tell us the truth about our world. A worthwhile thing to do with a life, don't you think?

Categories: Current Affairs

Sheesh, the latest Brexit disaster

Tue, 07/02/2017 - 19:01

It strikes us that there does seem to  be a certain amount of umm, reaching, over the disasters that will befall us once Brexit actually takes place:

British tourists will face crippling mobile phone roaming charges in Europe after Brexit, leaked EU plans revealed today. 

EU lawmakers banned phone operators from charging holidaymakers roaming charges - the extra fees for making and receiving calls when abroad.

And from June this year consumers will be able to send texts and surf on their mobile at the same price they pay at home.

But European Parliament documents on the new rules say they should not apply to British travellers after the UK officially leaves the EU - expected to be in spring 2019.

So the situation post-Brexit will be exactly the same as it is today and has been for the past decade or two. This does not strike us as an agonising problem.

As to why this will be true:

However, a leaked analysis on UK withdrawal from the EU confirmed this would not apply to Britons post-Brexit.

The document was drawn up earlier this month by the European parliament’s committee on industry, research and energy, and endorsed by MEPs. It states that “regulation (EU) No 531/2012 on roaming will no longer apply with respect to the UK, impacting business and other travellers to and from the UK”

Why would this be so? Because the various levels of the EU will no longer have the power to impose regulations upon doing business in Britain. It does not mean that roaming charges musty be imposed, it just means that a certain set of government will not be able to insist that they're not., Something really rather different. For:

Other companies have voluntarily dropped them as they sought a competitive edge before the expected 2017 ban.

Really? Izz'at so? There are enough British consumers who are worried enough about this that not charging roaming gains a provider a competitive advantage? And why would we expect this not to be so even in the absence of governmental insistence? 

And if there aren't enough people who think it important enough that offering the option would not provide a competitive advantage then roaming charges or not does not actually matter, does it?

Categories: Current Affairs

Freedom Week 2017

Tue, 07/02/2017 - 14:10

Applications for Freedom Week have just opened. And if you are aged between 18-25, you should be interested.

A joint project of the ASI and IEA, Freedom Week 2017 will be held from 3 – 8 July.

What is Freedom Week? It is a week-long series of lectures and seminars where around 30 of the best and brightest young thinkers are gathered for the time of their lives. I say this not because I work for the ASI (though I do), but because last year I went on Freedom Week, and it proved to be one of the best weeks I’ve ever had.

Though daunting at first, meeting all on the week was a pleasure, everyone was so interesting and kind, and willing to lock horns on subjects from Veganism to the Gold Standard. Many I met on Freedom Week have proved to be friends that I still talk to and meet today. Through attending, I met the team at the ASI, including President Madsen Pirie who pointed me in the direction of applying for one of their Gap-Year internship positions, as well as giving invaluable university advice. And that is why I am sat here writing this now, in the ASI office in Westminster!

Regardless of your background, Freedom Week will give you the opportunity to explore the economic, philosophical and political implications of free market ideas, immersed in talks from some of Britain’s leading thinkers.

As if that wasn't enough, there'll be as many evening activities as you can handle, including a BBQ, a drinks reception, several dinners in the College, trips to local pubs and a seriously fun pub quiz. Attendees will also be able to try their hand at punting on the River Cam, and will have free time to explore Cambridge.

Memories have been etched into my mind that will stay with me forever – all of them good. We worked as hard as we played on Freedom Week. It proved an unparalleled opportunity to network, but doing so was never a chore.

And the best bit? It is all completely free, all expenses paid (apart from beer money of course!) Though, I should mention, gaining a place is highly competitive.

Our brand new website is now live and ready for you to apply. Places are given as and when they come, so don’t delay, pop your name into the hat for the spiciest soirée out there.

Categories: Current Affairs

Sadly, all to many don't understand business rates

Mon, 06/02/2017 - 07:01

Business rates are not perfect as they rely upon the rentable value of the building, not the land it is upon. But they are the closest we've got to a good tax, a land value tax. Meaning that if we're going to have a debate about rates and the current revaluation then it would be a good idea if we all understood them:

April’s new business rates will be the final nail in the coffin for many small shops. A re-evaluation means that overall high-street retailers will need to find an estimated extra £125m to pay increased rates (according to business rent and rates specialist CVS). This lumbers the average small shop with an extra £3,663 added to its rates bill and, as I can attest, there aren’t many that are going to be able to pick up their pricing guns with a devil-may-care shrug and get back to work.

No, in anything other than the shortest of terms it will be landlords who pick up £125 million less in rent a year. For rates are incident upon said landlords and their rent, not the occupiers of the premises. We know this very well- those 80s special development areas were free of rates for a time, rents rose as a result.

 If you happen to be trading in a property hot spot (and, indeed, your brilliant business may have contributed to the success of that place, as in Southwold and Port Isaac, areas with notably good independent shops that will be hit by rate hikes), or big brands have arrived and now surround your enterprise, then your valuation goes up and you find yourself catapulted out of the small business relief zone.

Yes, that's the point. There's a limited supply of land in those hot spots, taxing that land is the least distortionary tax that we have. It's a good tax. And note what is being taxed - that the other people around that property are adding value to it.

But the revaluation works for the online retail giants. According to CVS analysis, the nine Amazon distribution centres in England and Wales will be able to knock £148,000 off their property tax liabilities this year (despite annual sales in excess of £6bn). Similarly, fashion retailer Boohoo gets 13% knocked off the bill for its distribution centre in Burnley; so it goes on.

Quite so, this is what we want to happen. There's a limited demand for chi chi shopfronts in Burnley and there's lots of land. Thus we tax the use of low value land more lightly than the use of high value land.

 So the true value of the high street remains undervalued, fiscally and culturally. 

Which is to miss the point so badly it's like watching England try to pass the ball on the weekend. The exact thing which is being taxed is that value of the High Street. Because that's how the tax is calculated, the value that being on the High Street adds to a particular property for use as a retail or any other business use.

And if we're not going to understand these basics about business rates then we're never going to be able to have a reasoned discussion about them, are we?

Categories: Current Affairs

Shock Horror! as Burmese women employed at legal age on legal wage

Sun, 05/02/2017 - 07:59

Another of those stories telling us how appalling things are in the sweatshops of the world:

Children as young as 14 have been employed to make clothes for some of the most popular names on the UK high street, according to a new report.

New Look, Sports Direct’s Lonsdale brand and H&M have all used factories found to have employed children, after several major brands switched their production to low-cost factories in Myanmar. Workers told investigators that they were paid as little as 13p an hour producing clothes for UK retailers – half the full legal minimum wage.

Labour rights campaigners say that the use of children in factories supplying household names is the result of a “race to the bottom”, as brands chase ever lower labour costs.

This is of course part of the race to the top instead. For, as Paul Krugman, among others, has pointed out this is how that whole thing of industrial development and rising incomes starts out. We've even mentioned this before.

The report itself, if read closely, also tells us that things are not quite as that opening paragraph makes out:

Brands have had some success eliminating child labour from their main supplier factories in recent years, but as wages have risen in countries such as China, companies are increasingly moving production to cheaper markets, including Myanmar, where children can legally be employed for up to four hours a day from the age of 14.

The allegation is that 14 year olds are being employed.

All the factories investigated employed workers below the age of 18.

And the problem is?

Researchers found wages below the full legal minimum at factories supplying Sports Direct, Henri Lloyd, New Look, H&M, Muji, Pierre Cardin and Karrimor (owned by Sports Direct).

The lowest wages of just 13p an hour were found in factories supplying H&M, Karrimor, Muji and Pierre Cardin. The day rate for those workers was £1.06. Myanmar’s labour laws permit factories to pay newer workers at reduced rates.

People of legal age to be working are making wages which it is legal to pay them. Hmm.

Now, do we all wish that incomes in Burma were higher? Sure, we sure do. But it's worth noting that GDP per capita is some $3 a day. And whatever else we might want to talk about we should all realise that average wages across the economy simply cannot be higher than GDP per capita.

So what exactly is the solution here? Again, a close reading of the source article (and Krugman above explains in more detail) tells us what does happen:

The low labour costs in Myanmar have encouraged international brands to switch production from more expensive countries and between 2010 and 2014 exports tripled to £787m. There are now more than 400 factories in the country, employing 350,000 people, 90% of them women.

That's 350,000 people earning more than they would get following a water buffalo through the paddy. Sounds like an excellent idea in fact.

but as wages have risen in countries such as China, 

20 years ago we were hearing exactly the same stories from China. Now we're not. The reason? Because economic development has taken place. And no, it was not because of the various labour rights NGOs, it was simply because we bought the things produced, they became more productive in producing the things we want to buy.

Or as Madsen of this parish repeatedly says, we make poor people in poor countries richer by buying what they make.

None of us are exactly happy at the thought of people living on £2 a day, however much better that might be than the previous choice of being a buffalo soldier. But the question is obviously what do we do about it? The answer being, as Madsen says, we speed that race to the top.

When out looking for clothes, heck, even if not looking for any, check the label. If it says "Made in Burma" buy one, buy three. If we demand more of their production then their wages will rise as has been happening in various places around the world this past 250 years.  We know it works so why not? Spend your money to shape the world to your desires, buy things from poor people and make them rich.

Categories: Current Affairs

We think this is an awesomely lovely complaint

Sat, 04/02/2017 - 07:01

From George Monbiot:

Alec has claimed that more than 1,000 of its bills are introduced by legislators every year, and one in five of them becomes law. It has been heavily funded by tobacco companies, the oil company Exxon, drug companies and Charles and David Koch – the billionaires who founded the first Tea Party organisations. Pfizer, which funded Bertin’s post at Atlantic Bridge, sits on Alec’s corporate board. Some of the most contentious legislation in recent years, such as state bills lowering the minimum wage, bills granting corporations immunity from prosecution and the “ag-gag” laws – forbidding people to investigate factory farming practices – were developed by Alec.

How terribly naughty, people group together to try to influence the laws that are made, even write draft laws to offer up as to what the law should be.

And do note that a business is just that, a group of people attempting to achieve a task. This is of course entirely different from people grouping together to try to influence the laws that are made, even write draft laws to offer up as to what the law should be:

Lady Worthington was the lead author in the team which drafted the UK's 2008 Climate Change Act. This landmark piece of legislation, which requires the UK to reduce its carbon emissions to a level 80% lower than its emissions in 1990. At the time Worthington was working with Friends of the Earth working on their Big Ask campaign, but was seconded to government to help design the legislation.

Isn't David Cameron a very naughty boy, as George says?

Another funder was the pharmaceutical company Pfizer. It paid for a researcher at Atlantic Bridge called Gabby Bertin. She went on to become David Cameron’s press secretary, and now sits in the House of Lords: Cameron gave her a life peerage in his resignation honours list.

Somehow the two cases are entirely different.

Somehow.

Categories: Current Affairs

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