“California has met the future, and it really doesn’t work. As the mounting panic surrounding the drought suggests, the Golden State, once renowned for meeting human and geographic challenges, is losing its ability to cope with crises. As a result, the great American land of opportunity is devolving into something that resembles feudalism, a society dominated by rich and poor, with little opportunity for upward mobility for the state’s middle- and working classes.”
– Joel Kotkin (hat-tip, Café Hayek).
The Kotkin article seems to be getting a bit of attention around parts of the blogsphere, and rightly so. I like his writings and keep an eye on them. There is no doubt that California is in danger of being past the “tipping point” where so much bad decision-making (more and more power to unions, higher taxes, regulations, etc) are pushing the state into a bad place. I occasionally hear calls for California to be broken up, but I have no idea how realistic such a move is. Thoughts?
It is of course easy to get sucked into a downward spiral of pessimism, so that every event appears to confirm the worst. Appearances can be deceptive: when I visit the West Coast it all tends to look very swish and prosperous, and it is only when you spend a bit of time there that the other, less flattering details, arise. The same arises elsewhere: I have been on a business trip to Singapore (I’m back later this year) and I could not help but wonder if there could be a similar issue over there at some point, such as when the Lee dynasty that has run that island with a market-friendly, if not particularly libertarian hand, is replaced by something else.
The Labour Party has stirred up the usually rather complacent wealth management sector in the UK by vowing to end the so-called “non-dom” system under which a foreigner who wants to spend some time in the country can avoid paying tax on all his/her worldwide income and capitals gains so long as this money is kept outside the UK. If such a non-dom has lived in the country for seven years, they must pay an annual levy and depending on the duration, that annual levy is as high as £90,000. A study by University College, London, published in 2013, concluded that the system brought in more revenue for the UK than was being lost by the absence of such a system.
At face value, the non-dom system might look like a great deal for a person who is worth tens of billions of pounds, dollars or whatever and who “only” pays several thousands per year to live in the UK. But if such a person’s wealth has been largely generated outside the country and is kept outside it, what is unfair about this position? If Mr Stinking Rich brought those billions to the UK, he would have to pay a thudding great tax bill. Ed Miliband, leader of the Labour Party, must know that, or if he doesn’t, he is being reckless. The whole idea that a person should pay tax to the country of his/her birth regardless of having not lived there for a period – as is the case with the odious worldwide US tax regime – cuts against the idea that one should pay taxes that focus on where you actually live.
Matthew Sinclair has a good piece here on the issue.
From a point of narrow party politics, I suppose Ed Miliband and his colleagues think they are being clever at playing the class war card and hope to trap opponents by having to defend the non-dom system. I notice that whenever a weapons-grade knob such as Miliband makes such a crowd-pleasing proposal, it is seen as a “trap” and that therefore the other side are told that it isn’t wise to oppose it. But this sort of cowardice-as-a-tactic approach merely favours the bully. A braver, and ultimately better, argument is to state that it is in the UK’s interest to encourage internationally-minded investors and entrepreneurs (so long as they are not criminals and jihadi nutcases) to come to the UK and enrich themselves and everyone else. To pander to the zero-sum, dog-in-the-manger mindset of Miliband and others is also foolish.
There is also a broader point to be made here: such attacks represent, at the margins, part of a rollback of globalisation, of the free movement of capital and people, a process from which London, as a global financial centre, has been a mighty beneficiary.
Far too many people in the banking and financial markets more broadly have fought shy of voicing their concerns about the demented nature of so much “banker-bashing” and attacks on inequality recently. Consider the respect granted to Thomas Piketty’s fatally flawed claims about inequality and his call for draconian taxes on capital. It is sometimes stated – I heard such a statement recently at a gathering – that “neo-liberals” (ie, classical liberals) have “won” the argument and that we now need to move on. How complacent that is. The arguments for freedom and capitalism are being lost in the UK, or at the very least, they aren’t being made very effectively.
Tim Stanley has excellent comments to make on the ire that Israel generates and asks why this small country, bordered by far larger ones, attracts such ire. He is writing about a conference at a UK university that seems to raise the question as to whether Israel should exist at all:
It is true that Israel was a state created where no such state had existed before. But so was Iraq, Syria, Uganda and Togo. They were all products of decolonisation, all lines drawn on a map by a bureaucrat with a pencil and ruler. Why, pray, does no one debate the legal foundations of the existence of Nigeria? It is controversial enough. It comprises various tribes and religions with terrible unease, so much so that a near genocidal war was conducted to subjugate its southeastern portion. Yet no one questions its legality.
Why, looking beyond this conference, is Israel the one country in the world whose critics so often conflate its government and its people – even seeking to punish the former by boycotting the latter? It is perfectly possible to dislike Benjamin Netanyahu and criticise the Israeli state’s actions in Gaza without assuming that Netanyahu speaks for all Israelis or that all Israelis approve of what happened in Gaza (indeed, it looks like he’s about to lose an election). No one would suggest that David Cameron’s austerity programme reflects the views of every Briton or that the British are constitutionally mean because the bedroom tax happened. And yet such obvious distinctions are often forgotten when talking about Israel. People chant that “Israel Must Be Stopped”, that “Israel Has Gone Too Far” and that “Israel is an Apartheid State” – as though its entire people had blood on their hands. When it comes to Israel, there is a unique enthusiasm to call into question its very right to exist. Strange, isn’t it?
To challenge the right of Israel to exist is, therefore, morally obtuse. It is to forget the flames from which this Phoenix arose.
Damn right. By the way, one book that I regard as absolutely essential reading for anyone on this subject is The Case For Israel, by Alan Dershowitz. It is over a decade old, but still very good. Another is the Israel Test, by George Gilder.
Gilder’s book is particularly good for noting that Israel, and for that matter Jews more generally, are targeted as much for their virtues – productiveness, educational excellence and so on – by rivals in the Middle East, as for any alleged shortcomings in foreign policy. Recent history suggest that any land-for-peace deals have been met with just more violence from the anti-Israel side, and most citizens of that country have grown weary of it.
Like Gilder, I take the view that broadly pro-liberty (with caveats, obviously), pro-modernity countries that are wealthy and non-crap such as this country deserve the support of anyone who takes liberty seriously, notwithstanding any specific disagreements on its policies. I have long gone past the point where I think that critics of Israel are in the main motivated by good thoughts. While some of them might be, most appear to be fools at best, and anti-semites at worst.
One of the oddities (well, it may not be that odd) of our time is when people who wax lyrical about liberty or the evils of oppression of certain kinds seem to be, well, rather weak at the knees when certain “tough guy” rulers flex their muscles in ways that seem hard to justify by reference to any sort of principle other than naked territorial aggression.
And sometimes defenders of these “tough guys” (or women) are so appalled at what they see as the behaviour of the “other side” in a dispute (such as the European Union or the current leadership of much of the West) that they want to make excuses for such tough guys’ actions, often excusing behaviour that one might assume they would, in other cases, condemn or at least question. . There has been a fair amount of “we had it coming and you cannot really blame X or Y since they were were brutalised by us” sort of thinking long before 9/11. (People sometimes excused Germany’s aggressions in the 1930s by invoking Versailles in a knee-jerk fashion, and for all I know, the Ancients were indulged in similar ways.)
A recent example of this sort of behaviour comes from Peter Hitchens, a columnist who, for those who haven’t encountered him before, is almost self-parodic in his scolding right wingery. (He’s the brother of the late Christopher Hitchens). Peter Hitchens is a lapsed Marxist and I sometimes wonder just how deep any conversion away from that intellectual foolishness has ever taken place. Anyway, it appears Mr Hitchens has big man love for Vladimir Putin, so to speak:
Col. Putin, he says, is at odds with the West because he feels unloved. By us, that is. This is an injustice Peter has set out to correct, sticking out for his bit of rough. Vladimir, according to his swain Peter, is like a murderer who, according to his lawyer, only killed because his Mummy was a whore, he never knew his Daddy and the flat-screen TV set in his room was only a 19-inch.
Thus the object of Peter’s affection is only raping the Ukraine the way he previously raped Chechnia, Georgia and his own people because “We have been rubbing Russia up the wrong way for nearly 25 years.” Had we been rubbing Russia up the right way, Col. Putin wouldn’t be murdering everyone he dislikes, including, incidentally, dozens of Peter’s Russian colleagues. He wouldn’t have blown up blocks of flats in his own country to provoke aggression against Chechnia. He wouldn’t have turned Russia into a giant crime syndicate. And he wouldn’t have waged nuclear war in London by using polonium to murder Litvinenko.
This broadside comes from some fellow called Alexander Boot, of whom I had not heard before. Judging by some other postings, I suspect I won’t be in much agreement with Mr Boot about a lot of issues, but he’s right here.
Some weeks ago, when the issue of Russia’s activities vis a vis the Ukraine came up, one commenter sniffed that we libertarians should not be so beastly about Russia, since for all its brutality/corruption/etc, that we must focus our efforts more on Islamic fanaticism, and that Russia, because of its brutality under Col Putin, was a sort of useful, if rather unwholesome, ally. I don’t fully buy that analysis on even the most hardnosed basis, and on a more highminded view, think that genuine defenders of liberty and justice should raise the bar a bit. Part of the dislike of the Putin regime and what it represents on my part comes from a disappointment in what now holds sway in Moscow. It could and should have been far better than this. Much better.
In his first six years in office, President Obama has performed well for those who wrote those checks. He brought in Wall Street insiders such as Timothy Geithner and Larry Summers to concoct his economic policy, which brought a recovery to the financial plutocracy before virtually anyone else. Wall Street was back by 2009; the rest of us have had to wait for 2015. Obama and the Democrats in Congress also handed the big banks a nice gift in the form of the Dodd-Frank Bill which helped them achieve that “too big to fail” status and has accelerated the growing consolidation of the American financial system. Indeed, since Dodd-Frank was passed smaller banks’ share of banking assets has dropped twice as quickly as before, notes a recent Harvard Kennedy School of Government study. Smaller and community banks – historically more likely to loan to small businesses – have seen a 50 percent drop in their share of lending while the the five largest banks now control over 40 percent of lending, twice their share 20 years ago.
– Joel Kotkin
What is all the more galling is that this “net neutrality” nonsense wasn’t stopped by a Republican-controlled Congress. This cannot be just blamed on Obama and his cohorts, argues Dr Hurd:
The federal government — and this probably includes most of the Republican Party, as well — cannot stand the idea that the Internet economy was a successful instance of (in today’s context) relatively unhampered market capitalism. It’s precisely because this model of (relatively) unhampered capitalism worked so well that government now has to regulate it. Otherwise, it could be held up as a model for the rest of the economy. “If the Internet works so well with little or even no regulation, then what does this suggest for health care, education, lending, and all the other sectors of the economy under government management or control?”
The statists who run the nation’s capital can’t have it, and they won’t have it. That’s why Obama and his Democratic majority on the FCC pushed this through. And that’s why the Republican-led Congress won’t lift a finger in protest. Most of them are just fine with it.
The people I hear defending the Orwellian-named Net Neutrality do so on the premise that it will bring this or that benefit to the consumer. Which consumer? Any action of government bringing benefit to one party (or company), by definition brings harm or loss to another. On what basis does the government take over management of the Internet itself to “benefit consumers” when the government will be the one picking winners and losers based on political — never economic — considerations?
The only proper role for government is a crucial one — to uphold contracts voluntarily entered into by consumers and businesses. Without such a role for government, there would indeed be chaos and anarchy. Advocates of “Net Neutrality” want us to believe that turning the Internet into a public utility will inaugurate this role, when the government was already playing that role all along. The real and only possible purpose for this rule is to ensure that government sets the terms of contracts into which customers and businesses would otherwise freely enter.
Here are more thoughts from the Internet Society.
I haven’t time for a lot of commentary on this but thought I should at the least put up a link to this long, very important Atlantic Monthly essay about ISIS, or whatever else the would-be creators of a global Islamic empire, aka Caliphate, want to call it. The article makes it clear that the people involved most definitely DO regard themselves as serious scholars of Islam. While it might be comforting to dismiss them as hoodlums or chasers after the glamour of violence (not that these are not true), the people involved are much more. They are deadly serious and don’t regard themselves as aberrant or innovators in their faith.
Whatever other issues get mentioned here (AGW, tax, Ukraine, etc) this – the need to utterly defeat such people, and crush and humiliate them in the eyes of any would-be admirers, is the dominant issue of the age.
Identity politics is spreading, filling the chasm where the politics of ideas used to be. Even the general election looks set to be a festival of identity, a less violent form of the communalistic politics we sniffily condemn in places like India. Politicos rarely speak of ‘the electorate’ anymore. Instead, they prefer to change their message depending on which ethnic, gender or generational pocket they’re talking to. Just look at Labour’s pink bus, Operation Black Vote and the Tories wooing of the ‘grey vote’. The end result is implicitly divisive, hinting that the young have different interests to the old, blacks think differently to whites, and women are a distinctive political species.
So writes Brendan O’Neill. He’s right, of course, about the vileness of this but doesn’t really drill down into how this state of affairs came to pass.
I put the rise of such “identity” politics, with its insistence that being “offended” about X or Y is sufficient reason to ban or harm said, down to a long process that to some extent has its origins towards the end of the period known as the “Enlightenment”. We saw early stirrings in the so-called “Romantic” era and the elevation of feeling and emotion above supposedly “cold” reason. The process really got under way, in my opinion, with the rise of post-modernism and with notions of relativism. We have even seen such nonsense as “feminist” science as opposed, say, to science per se. The very notion of there being an external, graspable reality that one cannot wish away is all of a piece with this mindset. (For more on the many horrors of post-modernism, I recommend Stephen Hicks and Raymond Tallis.) Allied to this is the way in which notions of self respect or self esteem have become conflated with a demand that others respect us and make us feel good regardless of any objective merit or otherwise. And for some people, they want to be respected not for any individual achievements or qualities (which might require a bit of work) but for simply being.
That a figure from the left such as Peter Tatchell has come in for the hatred of the PC, identity-politics left is richly ironic. I don’t agree with him on a lot of things, but on certain issues, not least in his brave approach to Zimbabwe, he is morally and intellectually in a different class to many of those on that side of the spectrum.
Just three months into Ukip’s shock victory as the party of government and already Nigel Farage’s mob are starting to show their true colours: morris dancing has been made compulsory for every able-bodied male between the age of 30 and 85; in ruthlessly enforced union flag street parties, brown-skinned people are made to show their loyalty by eating red-, white- and blue-coloured Battenberg cakes until they explode. And what is that acrid smell of burnt fur now polluting Britain’s hitherto gloriously carbon-free air? Why it is all the kittens that Nigel Farage and his evil henchmen are tossing on to beacons from John O’Groats to Land’s End in order to demonstrate that Ukip are the masters now.
– James Delingpole. You don’t have to be a UKIP fan (I am not) to be unimpressed by the tendentious nature of the Channel Four spoof documentary that Delingpole writes about here. Meanwhile, JD imagines what a spoof on the Greens would be like. In reality, the chances of Channel Four, a fairly leftist news channel, doing some sort of job on the Green Party is remote, but it should, given the fluorescent idiocy, authoritarianism and often just sheer ugliness of what that outfit wants to do in practice. See its latest manifesto.
There are already plenty of reasons to take a dim view of Piketty’s leveling ideas on wealth. Here’s another (H/T, Econlog):
I think it would be a big mistake to oppose the objective of global progressive taxation of income and wealth with the objective of class struggle and political fight, for at least two reasons. First, making this tax reform possible would require a huge mobilization. This has always been the case in the past. All the big revolutions engendered a big tax reform. Take the French Revolution, the American Revolution, or World War One: although it was not a fiscal revolution initially, through the Bolshevik Revolution, it had a huge impact on the acceptance of a progressive tax regime and more generally social welfare institutions after World War One – and even more so after World War Two. These were fiercely opposed by the elite and by the right just before these shocks, so this shows that we need a big fight and sometimes violent shocks to make progressive tax accepted. It would be a big mistake to think of progressive taxation as a technocratic process that comes quietly from a minister and experts. This is not at all the history of taxation.
The man was interviewed and had his comments published in a blog rather aptly called Potemkin (not sure how ironic that is).
Perry Metzger, who writes occasionally for Samizdata, nicely skewered Piketty’s reasoning a few months ago.
Of all the legion of bad outcomes that result from political ambition, the most striking of our times is surely the euro, an unashamedly political project bolted on to sovereign European nations of long and proud competing traditions in the hope of making them more like the United States, at least in terms of economic prowess.
– Jeremy Warner.
Absolute crackerjack from Timothy Sandefur:
But the conscience of the free west, too, is much in need of reaffirmation. Many of us have come to take for granted the freedom of expression that our forefathers fought so bravely to secure. It is important for us to engage in free speech now, to remind ourselves of what these rights mean.
These rights are not just for us. They are human rights: all people, everywhere, are entitled to freedom, toleration, and peace. And our free societies respect the freedom to write, and speak, and publish as the right of all—from west and east, Christian, Jewish, Muslim, Hindu, Buddhist, atheist. You are welcome to join us: to write and publish your own criticisms of our society, or even your own offensive cartoons ridiculing things we hold dear. But whether you join us or not, we will not be silenced.
We will not be silenced, or made to fear, and we will not be persuaded to accept the idea that silence in the face of injustice is just, or that appeasement of those who threaten us is safe, or that pretending we are not afraid, by saying we are just being culturally sensitive, is honorable. The right to offend, to chastise, to ridicule and condemn: to these, we will hold fast, knowing as our ancestors knew a century and a half ago, that all freedom, and all that makes life a joy instead of a burden, depends upon it just as slavery depends upon silence and terror.
On that, we will not equivocate. We will not excuse. We will not retreat a single inch. And we will speak.
Some people in the US and beyond might have imagined that the young, appealing chap who was a senator and who ran for office in 2008 was the sort of person capable of giving the kind of speech that Sandefur has written here. We now know very different. What brief remarks he now makes on that subject are, as far as I can see, far too late and too little.