This is too long and not right for a Samizdata Quote of the Day. I am busy today, but just have to put this up:
Under Lockdown Socialism:
–you can stay in your residence, but paying rent or paying your mortgage is optional.
–you can obtain groceries and shop on line, but having a job is optional.
–other people work at farms, factories, and distribution services to make sure that you have food on the table, but you can sit at home waiting for a vaccine.
–people still work in nursing homes that have lost so many patients that they no longer have enough revenue to make payroll.
–professors and teachers are paid even though schools are shut down.
–police protect your property even though they are at risk for catching the virus and criminals are being set free.
–state and local governments will continue paying employees even though sales tax revenue has collapsed.
–if you own a small business, you don’t need revenue, because the government will keep sending checks.
–if you own shares in an airline, a bank, or other fragile corporations, don’t worry, the Treasury will work something out.
This might not be sustainable.
Arnold Kling. (Hat-tip, Tyler Cowen at his Marginal Revolution economics blog.)
Margaret Thatcher once famously said (to the fury of the Left) that socialists always run out of other people’s money. Same applies to locking people down for months on end. It will end. The issue is how high the rubble is going to be.
I could see a positive result from all this.
In Detroit a couple of years ago there were a group of residents who were outraged at the idea that they should have to pay for water service. Wasn’t that just a basic human right?
They didn’t connect their monthly water fees with the wages of the people who maintained that infrastructure, and the cost of the capital goods that were required.
Similarly, I think a lot of people in the modern world look at their light switches, their steel cars, the wood in their homes and furniture, the petroleum products on their shelves and in their cars, and don’t connect those things with actual labor and capital infrastructure.
But when the lights don’t come on, when no clean water comes from the tap, when there is no steel or wood to be had, I think that mental connection will become a lot easier to make.
A gruesomely expensive lesson, but it could be at least a small piece of value amidst all the destruction.
And now Ladies and Gentlemen, the truth is starting to leak out.
“Our New York City labor and delivery unit found 88 percent of infected patients had no symptoms”
Where, have I heard that before?
It’s starting to look as if somebody has perpetrated the most expensive and costly con in human history.
In the Tom Baker Dr. Who era, The Pyramids of Mars had a Zombie, Professor Marcus Scarman, whose animated corpse was used to free Sutekh from his confinement under a pyramid. When he had served his purpose, Sutekh, (the ultimate SJW and moral relativist) released his control, and poor Professor Scarman reacted much as I expect a lot of the British economy to react when the lockdown ends. The purpose of the UK lockdown is not to preserve lives and certainly not the economy, it is to protect the Conservative Party’s reputation (such as it is) for managing the NHS.
In a way, it is laying bare the absurdities of fiat money, the UK government can find £300,000,000,000 (but who’s counting?) to keep the economy going (or rather, to try to keep it looking like it did before the regulations came in), rather than letting it adapt to the drastically-changed circumstances. My fear is that people will say ‘Well if they can do that, they can pay my rent, mortgage, loan etc.” and the Conservative Party will come to enjoy having this ‘power’ to magic money out of thin air, and support businesses, meaning our Zombie economy will never be in a position to recover, and a downward and inflationary spiral will begin.
That’s interesting. I seem to remember that water meters were first installed in England as late as the early 1990s, to loud protests from the usual suspects about poor families having to choose between saving money and taking showers regularly. It was hard for me to believe that the English were so far behind the times, after over a decade of Thatcherism. But perhaps my recollection is faulty?
Snorri Godhi: “It was hard for me to believe that the English were so far behind the times, after over a decade of Thatcherism. But perhaps my recollection is faulty?”
I think previously, all provision, fresh water, sewerage disposal, was ‘on the rates’. In England that was split out to separate bills.
Ferox: “In Detroit a couple of years ago there were a group of residents who were outraged at the idea that they should have to pay for water service. Wasn’t that just a basic human right?”
Anyone can have water, it’s the most common compound on the planet. It is the clean bacterial, viral and contaminant free water that costs.
Another trope I see on some social media is how all this proves that the category of “essential worker” does not include businessmen and women. But it never crosses the minds of such folk (who tend to be hostile to enterprise and free markets) that things such as supermarkets, logistics business, farms, energy production and the like were in most cases set up by and managed by entrepreneurs (consider how shite these functions often are when run by States). People who think that entrepreneurs aren’t important, and should sit quiet while other things go on, are in for a rude shock. Come the end of the lockdowns, we are going to need business creators like never before, assuming anyone in government understands the point.
Mr. Ed, I think you’re quite right. It’s a racing cert that we are going to end the coronavirus pandemic with a much bigger, more intrusive state – and most people will be quite happy with it like that.
I work as an accountant and I’m currently tearing my hair out and grinding my teeth down to the gums in hammering away at this furlough business for our clients with the Coronavirus Job Retention Scheme.
On walking to work I saw one video billboard after another thanking the NHS for keeping Britain ticking, yes it’s the NHS that keeps the world spinning isn’t it.
I have more than just a sneaking suspicion that a few of our clients are claiming to be unable to work when they just want a tax payer funded holiday at 80% regular pay, sit at home kick your feet up and insist that you can’t go to work and the government needs to send you money.
One client I suspect is trying to get a business interruption loan to pay off his existing debts.
Absolute chaos, though it’s more interesting being at work than home I guess.
With apologies to Ned Flanders…
We’re all fuck-diddly-ucked
Six months from now the living will envy the dead.
I do not believe this is a party political matter – at times such as this all the parties just do what the officials and the “experts” tell them to do.
The spirit of Sir Charles Trevelyan and General Douglas Haig is dominating at the moment – the worse the results of a policy (such as putting taxes UP in Ireland at a time of crises in the later 1840s, under the slogan “Irish Property Must Pay For Irish Poverty”, or frontal infantry attacks on prepared defences in the First World War) the MORE the policy is followed.
Government spending here was out of control even before the virus – now the level of government spending is essentially in outer space.
The government holds that this is fine – because the Bank of England will print them as much money as is needed to fund the government spending.
This is the level of thought that their very expensive “education” has led them to.
New Zealand has a Labour led government – but at least the country can feed itself. We can not.
“But we can print money and buy food!”
Oh you vile creatures (as Noel Coward would put it), you ignorant-ignorant-ignorant people.
The New Zealand PM is from Labour, but Labour can’t be said to be “The Government” in any real sense, just as the 2010-2015 Tory/LibDem Coalition wasn’t.
If Jacinda Ardern tried to pull any of that leftist crap out of the closet then the coalition would dissolve pretty damn fast. As it is there is an election due on 19th September 2020 (if Coronachan doesn’t screw that up as well), I doubt that Jacinda will be seeing a second term.
The approaching economic disaster has been visible for weeks.
It is now slowly emerging into public consciousness. Better late than never.
Mr Ed–they can magic up money–though Banker Sunak can’t grasp that a state taking 16 wks to process a dole claim in normal times can’t boost bureaucratic bullshit tenfold in 6 weeks. But they won’t be able deal with the anger that inflation, stagnation and depression will create.
My faith that our societies will eventually regain their senses is devastated when I remember that, 19 years later after ONE GUY attempted – unsuccessfully! – to blow up an airplane with a bomb in his shoes, I am still required to take off my shoes to merely enter nearly any airport terminal.
One guy. Two decades later. Humiliation theater still in place and stronger than ever.
We’re f*cked.
To build on Ferox’s point –
The folks in Detroit who insist that running water is a basic human right and should be free didn’t go away a couple of years ago. They’re still there, just as loud and demanding. They just got the Mayor to announce that unpaid water and sewer bills will not result in service shutoffs for the period of the coronavirus lockdown(s). And who knows how long our good Governor is going to try and punish us for having the temerity to question her orders?
Some backstory on Detroit water. The water supplied by the Detroit Water and Sewer Department is justly-famous in this part of the world for its quality. The DWSD supplies drinking water to a large suburban area surrounding the city – it used to supply the city of Flint, some 50 miles away, until the city of Flint had a better idea . . . . . .
And for years its sales of water to surrounding suburbs were at prices which were elevated to subsidize customers within the city of Detroit. Detroit city water within the city limits was/is famously cheap, as little as $10 or $15 a month for what amounted to a limitless supply. This was possible even with the notorious corruption and featherbedding within the DWSD – an organization, which, until a couple of years ago, employed 3 full-time farriers – horse-shoers. The suburbs could always be relied upon to pay the bills. And it was tacitly-understood that the city would probably-not shut off water service for something so trivial as an unpaid bill.
Not so much with the Sewer part of the equation. As a result of some truly-awful corruption (even by the standards of Detroit) in the 1990s, the sewage treatment part of DWSD’s activity has needed more and more money to keep operating, and they can’t sell this service to the suburbs. As the tax base shrinks, the problem gets worse. This is how you can get people on the TV waving a ‘water bill’ for thousands of dollars and crying the blues about how the cruel and heartless city is shutting off their water supply. What they’re actually waving is a bill for water and sewer service, which has likely been accumulating unpaid for months or even years. The DWSD finally grew a spine and realized that they were headed down the drain if they kept carrying tens of thousands of customers who didn’t pay their bills and never would, and they began to use the only sanction they have, which is to shut off water supply. There’s no practical way to shut off sewer service.
llater,
llamas
llamas
There is, it might involve sewing. but the Constitution thankfully forbids cruel and unusual punishments.
And more seriously, thanks to you and Ferox for the very informative posting. These tales have lessons for all of us.
As I recall, prior to metering residential property owners were charged “water rates”, which were related to the value of the property. Indeed even now I think not all properties are “metered”.
Thanks to APL and mickc for reassuring me that my memory is not yet infirm!
I assumed the plan was to borrow trillions from China and then renege on the obligation? No?
In New Zealand, at least, secondary schools and universities are most certainly not “shut down”.
My daughter’s university courses started again this week.
I am teaching longer hours than usual at my secondary school. Yes, it is distance learning. And no, it’s not as good as being in a classroom. But it sure as hell is a lot of work.
(I’ve been massively surprised at the uptake by the students. At least 75% are buying in and doing reasonable amounts of work. They are finding it hugely stressful because for a 13 year old boy staying on top of a schedule by themselves is a big ask, but they are trying. And decent amounts of learning are happening, especially with the seniors.)
Even in our modern resilient technological economy we still need the tide to recede to find out who has been swimming naked.
Negative prices in the oil futures market. Perhaps I should buy next years heating oil now.
It is I suppose, rather like an infestation of termites. The outer structure of the building looks sound, but inside in the supporting superstructure, those blasted termites have been eating away at your foundations. You suspected as much twenty years ago, but preferred to cover it up with a coat of paint. But now your house is in the process of collapsing. What do you do?
APL
Well, a brief plan for the UK would be:
1. To ensure that bust businesses go bust so that the Zombie businesses stop consuming capital, so no support.
2. To stop inflating the money supply to allow for price stability.
3. To dismiss every public sector worker, rehire no more than half on new terms, salary cap £60k with no pensions (they can save for their own).
4. All public sector pensions are capped at £12k total per person, enough to get by.
5. Every quango (a public funded body that performs government-like functions) is abolished.
6. Every statutory duty of the State is abolished.
7. Scrap a shedload of regulation.
8. Reform the civil legal system to simplify litigation, abolish imaginary claims.
9. Abolish local government, a modest fund to bid for roadworks etc., bin-emptying done by contractors. Vouchers for schools. Social care vouchers too.
Any more ideas?
Mr Ed: “Any more ideas?”
None of those idea’s are acceptable. They’ve all been put forward over the years. And at one point many of them were Right of center Tory party (UK) doctrine. Anything that strikes at the public sector will probably be deemed racist, too.
Otherwise, I think that’s a good starting plan.
Abolish VAT. Road tax only for roads.
Why are we wasting electrons? The scum of BlueLabour aren’t going to do any of these.
They will print £ to try and re-flate the bible. Just look at the silly bastards performance so far.
While I think there is a lot in Paul’s sentence above, Mr Ed (April 21, 2020 at 10:51 am) has a point worth discussing. Although I suggest
definitely needs the word ‘only’ after ‘not’, the claim following
relates to a thought I have had (and will now share FWIW).
Margaret Thatcher decided she was never going to lose an election because of the NHS, so on the practical side she merely did what she could to manage it. She gave it the increased-from-her-Labour-predecessors funding that that bureaucratic organisation needed to function, while devoting her time in power to reforming other aspects of British government. On the rhetorical side, she was that less common kind of politician who was not in the business of deceiving herself and so did not deceive the public even when being ‘polite’. Occasional remarks about the wonderful doctors and nurses in the NHS were perhaps seen by her as the truth, if not the whole truth, about her feelings towards it (after all, there are many admirable doctors and nurses in the NHS, some of whom are my relations, and don’t get them started on how it’s managed). Her friends and enemies alike were never left in much doubt that if she’d been in power four decades earlier she would never have created it.
Much more recently, Boris, Cummings, Gove – the Vote Leave head management in 2016 – made a decision – a decision which is discussed very openly by Cummings and is implicit in others, that winning the Brexit referendum required a ‘take back control’ message on immigration and many another sovereign freedom – and ‘spend our money on our priorities – like the NHS‘. That crucial battle was won 52:48 and would have been lost without the NHS part of the message (or so they and their enemies alike believe, and I do not claim to be a better psephologist than Cummings). I saw, understood and accepted that strategy. I did not of course like it in mid-2016 or later, just as, in the election late last year, I did not of course like sacrificing any chance of a Brexit-party-led realignment to the need to rout the remoaners by voting for a Tory party that had been purged a bit, but not enough. Summarising, Dominic Cummings’ remark that
was part of the strategy that brought me Brexit, and the remoaners rout in the election late last year.
Thus we reach the present (‘about time!’ any who are still reading may feel 🙂 ). Three years of remoaner cheating gave us a more exposed and discredited establishment, purged some Tories and even floated the idea of moving CCHQ out of SW1 and up north where it might become saner (alas, this is on hold during lockdown). But it also meant Boris only finally became PM at much the time as the virus was stirring in Wuhan. The government, so recently elected on this Brexit-campaign-derived mandate, was abruptly threatened with Italian-style triage and the NHS overwhelmed.
All of which is my long-winded way of saying I think Mr Ed has a point insofar as I believe it was not only about doing what the experts said. Both consciously and unconsciously, ‘NHS overwhelmed’ was a headline this Tory government was even more unwilling than any prior one to see in the second quarter of their administration.
Fear not, breaking news this morning, the government’s Debt Management Office has just come out with a target to borrow £180,000,000,000 for May/June 2020 on top of £45,000,000,000 for April 2020.
£225 billion quid piled on the national credit card, on top of the current Debt Bomb of £1,836,000,000,000 +
Mr Ed: “£225 billion quid piled on the national credit card, on top of the current Debt Bomb of £1,836,000,000,000 +”
This is one instance where one can accurately say, “It’s for the children/Think of the children”†.
† That is, don’t think of the children.
“£225 billion quid piled on the national credit card, on top of the current Debt Bomb of £1,836,000,000,000 +”
OK. There are about 30 million households in the UK, so that’s about £7,500 per household, piled on top of an existing debt of £61,200 per household, yes? That’d be like adding another year on the mortgage, roughly.
Undesirable, of course, and certainly unsustainable if you’re going to keep doing it continually every quarter rather than as a one-off disaster response, but if that’s all it costs I’d say we got off extremely lightly!
I’d expect a rather bigger number, for the economy as a whole.
NiV: “There are about 30 million households in the UK, so that’s about £7,500 per household, ”
So, if I’m going to pay out another £7.5 grand, I wouldn’t mind a say in what I’m purchasing.
At the moment, all it seems I’m going to get is a 20% fall in GDP, ~6 million unemployed, sky rocketing rates of mental illness and suicide, ramping inflation into a world wide depression, food and energy shortages.
Frankly, doesn’t seem value for money. But seein’ as you’re so sanguine about it. You can pay my £7.5 grand share.
“At the moment, all it seems I’m going to get is a 20% fall in GDP, ~6 million unemployed, sky rocketing rates of mental illness and suicide, ramping inflation into a world wide depression, food and energy shortages.”
And millions less corpses. You keep on forgetting/ignoring that they’re doing this to save millions of lives.
Now, you might not agree with their predictions of potential mass mortality, just as they don’t agree with your predictions of financial calamity, but we’re all interconnected, what each of us does affects others, and so we *all* get a say. You do, but so do they. It’s like the laws against spraying radioactive arsenic on people in the streets. You might think that’s harmless and innocent, but other people don’t.
I wasn’t commenting on whether it’s value for money. That depends on where you’re standing, and how you assess risks. If you were about to die because I’m being paid to poison you, is it worth me sacrificing £7,500 to prevent that and save your life? Or would you rather die than put me to the trouble? The value of your life to you is different to its value to me. Your assessment of the deadliness of the poison is different to mine. And how much is your life worth to society anyway? But I chose to ignore all that. All I was noting was the numeracy point – that looked at in context at a national level it’s not all that big a number. (Maths education in schools is terrible these days. 🙂 )
Inspired by Niall (April 22 at 9:39 am), a different reply to Mr Ed (April 21 at 10:51 am):
I submit that the purpose of the UK lockdown is to protect the Conservative Party’s reputation (such as it is? but much better than Labour’s reputation at the moment) for preserving lives and the economy.
I, for one, would not think that saving the NHS is even remotely comparable in importance to saving my own life and wealth (not to mention liberty and pursuit of happiness).
It is possible, even likely, that most British voters are more stupid than i am, but not THAT much more stupid!
No. Into the teeth of the COVID-19 epidemic you can only claim 184,249 worldwide as of yesterday – April 23rd 2020.
And you keep reminding us that we find arithmetic difficult, so why don’t you give us the deaths as a percent figure of the estimated world population of 8bn? It would be so helpful of you.
Now we now have some factual comparisons, Sweden’s death rate isn’t dramatically above the trend – they have not instituted a shutdown of their economy.
There are half a dozen US states that haven’t instituted a shutdown and their death toll from Covid-19 isn’t significantly above the US trend, Belarus hasn’t instituted a shutdown, and so far it isn’t reporting significant higher death rate.
So the evidence is mounting that, had we just let this years influenza (COVID-19) go through the population as we have done every other year, we would have had an unusual death rate for the winter flu, but nothing like the millions you and other hysterics put forward as your ‘evens’ case.
Then even Neil Ferguson the ‘top government adviser’ said we can only hope to save one third to one half of those people at risk in the UK because they are already at the end of their lives or suffering from serious co-morbidity.
Guess what?
All the vulnerable folk, they are in various government managed, government regulated, government sanctioned institutions where a targeted isolation policy could have been instituted. But the Government scientists’ computer model, says no, shut down the economy and let the COVID-19 rip through the so called, ‘care homes’.
‘Scientists’ and their models. Huh!
Got to say that as “Control Tests” go, the states and countries that haven’t gone into lockdown don’t seem to have faired horrifically worse than we’ve seen in the UK and other comparable countries. Indeed Sweden seems to be handling the epidemic without a shutdown with far lower death rates than other countries that you would have thought similar are managing.
As “precautions” go, full national lock down seems to be paying a high economic and social price for what appears to be a limited outcome.
“No. Into the teeth of the COVID-19 epidemic you can only claim 184,249 worldwide as of yesterday – April 23rd 2020.”
I’m trying, but it’s really, really difficult to comment on this without seeming rude.
Argument: We have two choices of action: Leaving R0 where it was leads to millions of deaths (in May and June) but less economic damage, reducing R0 to below 1 results in only a few tens of thousands of deaths in each wave, but causes more economic damage. Public opinion values millions of lives higher than a little economic damage. So we’ve implemented a lock-down to reduce R0 below 1, stopping the May/June pulse before it started, and are now headed for a small number of deaths.
Counter-argument: But so far, still in April, we’ve only seen a few tens of thousands of deaths! Not millions! That contradicts your prediction!
1. The prediction wasn’t for millions of deaths in April. We’ve still not got to the point in time that the millions were predicted for, even if we’d taken no action.
2. The prediction was that if we did a lock-down, which we have, there would only be a small number of deaths. So the prediction is actually confirmed.
“Now we now have some factual comparisons, Sweden’s death rate isn’t dramatically above the trend – they have not instituted a shutdown of their economy.”
They instituted a formally less severe shutdown, but they did so earlier in the process, and it had a bigger effect. When the deaths started increasing exponentially in Italy, the cases in both the UK and Sweden were rising at a similar exponential rate. Sweden was actually about a week behind us, but was seeing more cases because they were doing more testing. Both populations reacted, but in the British case it only resulted in a very small reduction in R0, while in Sweden there is a very sharp turn in the rate of rise of cases about two weeks after they started dying in Italy. Over the following two weeks the lines separated – we were still rising very rapidly, they were going up more slowly, so where we were initially a week ahead of them, by the end the gap was about two weeks. Then the UK instituted its lockdown. For the next two weeks the gap kept on expanding until the UK started levelling off too.
So, Sweden had a week’s more warning, and achieved a larger drop in R0 two weeks earlier, and so flattened the curve three weeks earlier into the epidemic than we did. In short, the Swedish population took it seriously and socially distanced themselves voluntarily, while the British milled around in confusion as to whether this was actually a real serious problem, and carried on pretty much as normal until they got told more firmly to stop mucking about. That delay probably cost us about 10,000 dead.
It’s certainly arguable that we might have achieved R0 reduction by other, less stringent means. Judging by the comments made by one of the scientific advisers at one of the press briefings (I forget which one), that seems to be what they’re working on now. They’re trying to figure out what the contribution of each of the measures in place is, and so which ones can they release without having R0 rise above 1. At the same time, most measures are easier to target and easier to control if the number of active infectious is lower, so they’re trying to give themselves some more headroom. And testing strategies work better if you’ve got tests that are more accurate, so they’re also waiting to see how good they’ll be by next month, and what the background infection rate is, and no doubt lots of other stuff. And it may also be that now people are taking it seriously, they’ll be able to drop the coercive part and rely more on voluntary action and local problem-solving.
Part of the difficulty is with things like contracts written under the assumption that life carries on as normal. You’re obliged by contract to pay the bills on time. You’re obliged by contract to come in to work. It’s pretty hard to tell your boss you don’t want to, because it’s not safe, if the advice to socially-distance yourselves is voluntary. People got caught in a web of rules and regulations that *insisted* they carry on as normal, while being strongly advised but not actually forced to act differently. The advice wasn’t actually strong enough to enable people to psychologically break out of the net of existing rules, habits, and relationships. I think that was a big reason for the delay. But if you can tell your boss it would be illegal to do so, the contracts can be set aside more easily. You can claim insurance. You can get compensation from the government. You can blame it on the government. The lockdown actually made it much easier to break/change the normal rules. It made it ‘official’.
The British do have something of a tendency to follow the rules. They’re polite. They form orderly queues. They like ritual and ceremonies and proper ways of doing things. Some have said it is a reaction against their inner violent streak. They exert stiff self-control and self-discipline, because if they lose control things can get really bloody. But you’ve got to be able to drop the rules in an emergency, and it seems we couldn’t.
Perhaps it’s another lesson for the future.
The governments of the world, under “expert” advice, clearly believe that they can just create money (from nothing) to pay for all this “lockdown” madness.
They are WRONG – this policy is not sustainable, it will lead to total disaster (including very large numbers of deaths).
A Conservative Member of Parliament asked me yesterday how the government could avoid political damage from the economic harm now being done.
The simple answer is that they DESERVE political damage. The elected government could have told the “experts” to go to Hell – but they did not, instead they followed the insane “advice”.
In the end the buck stops with the elected government – even if the other political parties would have followed the same utterly insane “expert advice”.
I wonder if Mr Johnson had in mind the need for a tame Chancellor of the Exchequer to implement the current explosion of public spending when he forced out Sajid Javid in mid-February 2020, so all this was planned, just the timings weren’t worked out. The first regulations relating to Coronavirus came in AIUI, on 10th February 2020 at 06.50 am.