We are developing the social individualist meta-context for the future. From the very serious to the extremely frivolous... lets see what is on the mind of the Samizdata people.

Samizdata, derived from Samizdat /n. - a system of clandestine publication of banned literature in the USSR [Russ.,= self-publishing house]

Samizdata quote of the day

“Political correctness is a moral atrocity and an infallible symptom of social and cultural rot, in essence, of a reluctance to confront reality and a manifestation of the unholy terror of plain honesty. It instils a fear in ordinary folk of calling things by their right names, of speaking truth, of even of telling jokes that might offend some sensitive soul or of uttering something that seems to violate yet another in a burgeoning tally of social taboos. The result is that a culture that hides from itself cannot expect to hide from its enemies. And America, probably the most litigious country on the planet, is in the grip of this mortal disease.”

David Solway, Notes From a Derelict Culture, page 228.

Samizdata quote of the day

“It is not simply scandalous that civil servants and advisers had fun while none of us could; it is scandalous that they were the ones who imposed those rules on us and are yet to apologise for them.”

Marie Le Conte

Samizdata quote of the day

“I have a dream that my four little children will one day live in a nation where they will not be judged by the color of their skin but by the content of their character.”

Martin Luther King, another of those dangerous, probably anti-social individualists who thought people’s moral agency and capacity for self-responsibility was more important than their skin colour.

Today is Martin Luther King Day in the US, for those outside the US who weren’t aware.

Samizdata quote of the day

“Emails exchanged between them after a conference call on 1 February 2020, and only now forced into the public domain by Republicans in the US Congress, show that they not only thought the virus might have leaked from a lab, but they also went much further in private. They thought the genome sequence of the new virus showed a strong likelihood of having been deliberately manipulated or accidentally mutated in the lab. Yet later they drafted an article for a scientific journal arguing that the suggestion not just of a manipulated virus, but even of an accidental spill, could be confidently dismissed and was a crackpot conspiracy theory.”

Matt Ridley

“Woke” and “Anti-Woke” isn’t the only ideological game in town

For some time it has been one of those views that acquire the status of conventional wisdom that our politics has gone through a period of “re-alignment” and people don’t really divide on whether they are for a small State versus a Big State any more. For example, Stephen Davies at the UK’s Institute of Economic Affairs has been arguing that the divisions over Brexit, for example, have driven a 10-ton lorry through old divisions that have been in place for decades. I have heard Dr Davies make this argument many times.

It seems quite persuasive, although even when I first heard it I wondered how it will fit with issues such as Net Zero. All those “Red Wall” voters in the North and Midlands who shifted from Labour to the Conservatives did not seem all down with the idea of being forced to buy electric cars, install expensive heat pumps, and all the rest. Economics, in other words, still seems to count for quite a lot in framing political allegiance. The pandemic and the lockdowns reinforced how there are those who do very well out of Statist controls of lives, and those who don’t. While not always mapping along conventional party lines, Covid has again reminded us that economics is a big deal (which is all the more reason why it is appalling that the UK government has paid so little heed to it until relatively late.)

Anyway, I thought of these points when reading the daily CapX roundup of articles today, including this excellent item by Kristian Niemietz, also of the IEA and a colleague of Dr Davies:

It is a commonly held view that ‘socialism vs capitalism’ was yesteryear’s divide, while ‘woke vs unwoke’ is where the action is now: pronouns are the new tax rates, and cancellation is the new nationalisation.

The problem with this argument is that it is only true on one side of that divide, namely, the ‘un-woke’ or ‘anti-woke’ side. The opponents of Wokeness do indeed tend to get far more animated about the latest Culture War shenanigans than by the latest economic policy announcements. They also find it easy to form loose coalitions over a shared cultural outlook with people with whom they disagree on economic issues. (For example, a left-wing critic of Cancel Culture can easily get a piece published in a centre-right publication.)

But it would be a huge mistake to assume that something similar must be true on the other side of that divide, i.e. that on the progressive Left, woke identity politics has somehow crowded out socialist economics. Quite the opposite is true. It is hard to think of a prominent woke culture warrior who is not also a committed anti-capitalist.

This makes sense to me. I have noticed quite a few cases of people on the “right” almost sighing with joy at finding “un-woke” lefties with whom to hang out, seeing them as converts. Up to a point, Lord Copper. A person who has subscribed to Big Government views all their lives, but who has a nasty experience of being attacked for views on, say, transgender rights (JK Rowling comes to mind), does not therefore suddenly become a champion of classical liberalism, individual liberty and capitalism. Of course, their being bullied by advocates of Critical Race Theory or whatever might make them stop to reflect on whether some of their ideas on other subjects were also mistaken, but in all the recent jousting that has gone on, I haven’t come across many examples of socialists who have abandoned socialism, possibly apart from US personality Dave Rubin.

Samizdata massive understatement quote of the day

“Meeting people is part of the education. Online is great but not for everything.”

– Academic and writer Tyler Cowen, going out on a limb.

Samizdata quote of the day

“The data show that from 2000 to 2021, the number of global weather and climate disasters declined by about 10%, which is very good news and completely contrary to conventional wisdom.”

Roger Pielke Jr

Samizdata quote of the day

“There is a growing Covid industry of companies selling security interventions. Some vaccine manufacturers are enthusiastically promoting repeated boosters. The private gains from PPE sales are so notorious that the Treasury should be considering a war profits tax. There is a burgeoning trade in ventilation and air-filtration equipment. Behind the push for vaccine passports are software companies with digital ID pages in search of customers.”

Robert Dingwall, Daily Telegraph.

The commentary made me think of President Eisenhower’s farewell address about the “Military-Industrial Complex.”

Reasons for attempting energy independence from Russia – a continuing series

From the Guardian, no less (and it doesn’t mince its words):

Russia’s supreme court has ordered the closure of Memorial International, the country’s oldest human rights group, in a watershed moment in Vladimir Putin’s crackdown on independent thought.

The court ruled Memorial must be closed under Russia’s controversial “foreign agent” legislation, which has targeted dozens of NGOs and media outlets seen as critical of the government.

Memorial was founded in the late 1980s to document political repressions carried out under the Soviet Union, building a database of victims of the Great Terror and gulag camps. The Memorial Human Rights Centre, a sister organisation that campaigns for the rights of political prisoners and other causes, is also facing liquidation for “justifying terrorism and extremism”.

OK, readers may ask, what’s with the energy independence headline? Well, as sometimes noted, countries such as Germany (and now Belgium) have cut back on their use of nuclear energy. Germany is a big consumer of Russian natural gas, and that reliance is going to increase via the Nordstream 2 pipeline, assuming Berlin presses ahead in the teeth of rising criticism. This gives more power to the Russian state, and to Mr Putin. In the UK, recently Shell, the energy group, decided not to go ahead with widening its North Sea oil extraction efforts, and the business of fracking in the UK is stymied. There appears zero support by the Boris Johnson administration for the UK to aggressively develop any home gas/oil sectors further. For brave little Britain, apparently, we can shrug off the winter chills and Russian nastiness with windmills, solar panels, and noble sentiments.

Forgive my sarcasm, but you get the point. Western countries appear, at least on the face of it, to favour energy policies that appear guaranteed to embolden and strengthen regimes such as that of Putin’s Russia. It’s as if it was intended.

Cracks in the Chinese wall

In recent years much of the narrative is that China is rising, the US and the West as a whole are declining, and that there is not a lot we can do to arrest that switch, even if it would be desirable to do so, blah-blah-blah. Liberal democracy is on the retreat, authortarianism is the new hotness, so get ready for Social Credit, compulsory school Mandarin lessons and the rest of it. Now it is true that we seem to be well capable of gutting defences of liberty on our own without Chinese influence anyway, but it does nevertheless matter, in my view, if China’s rise continues in the way it has. Well, it is possible that things aren’t going to be quite so straightforward:

Check out this article from US think tanker Thomas J. Duesterberg, in the Wall Street Journal. As it is paywalled, I am going to publish a few paragraphs:

In December real-estate developers China Evergrande and Kaisa joined several other overleveraged firms in bankruptcy, exposing hundreds of billions in yuan- and dollar-denominated debt to default. Real estate represents around 30% of the Chinese economy, nearly twice the levels that led to the financial crisis of 2008-09 in the U.S., Spain and England.

I have been covering the Evergrande saga in my day job. Let’s just say that anyone who remembers the Japanese real estate meltdown will recognise the danger signs.

The real-estate industry has been key to keeping annual growth above 6%. Yet a debt bubble has inflated by 20% annually between 2014 and 2018. Originally intended to accommodate rapid urbanization for the industrial economy, the urban property market is now overbuilt. Some 90% of urban households own their own properties and enough vacant units are available to accommodate 10 years of urban immigrants. Sales and prices have tumbled this year, and overleveraged builders and creditors are suffering the consequences.

It seems the Dr Evil bloke at the helm is not as smart as he’s made out.

Mr. Xi is privileging the less productive and less innovative components of the Chinese economy while enhancing control, limiting financing and punishing entrepreneurial leaders in many leading industries. This isn’t a recipe for maintaining strong economic growth. Despite the frequent assertions that China is catching up or moving ahead of the West in technology industries, it has a long way to go to achieve the self-sufficiency and global leadership it seeks. U.S. sanctions on advanced semiconductors, for instance, have gutted Huawei’s ability to make its own 5G phones. China’s semiconductor industry is 10 years behind world leaders, according to a recent German study.

In short, it is difficult to escape the conclusion that China’s economy is systematically weakening and that Mr. Xi’s new priorities offer little hope for a quick turnaround. The U.S. and its allies could further compound Mr. Xi’s challenges by vigorous enforcement of trade laws, limiting Chinese access to technology and financing from the West, and imposing sanctions against China’s brutal human-rights abuses in Xinjiang and in countries in the developing world that it is trying to exploit through its Belt and Road Initiative. A good example of such exploitation is the atrocious mining conditions for key battery components cobalt and lithium in Africa and South America.

A major slowdown or acute financial crisis in China would certainly have a negative impact on the global economy. But U.S. and allied policy makers do have tools that could both influence the direction of the Chinese economy and help repair some of the accumulated damage to their economies from Chinese mercantilism. A first step is to undermine the narrative of a relentless, unstoppable economic advance under Mr. Xi’s leadership.

That of course would mean efforts to counter China’s thefts of Western IP, and for Western governments to limit Chinese access to Western finance and tech. That isn’t easy. Of course, a big slowdown/recession in China will hit the West, given the web of capital and trade relations. And for what it is worth, I still think the world is far better off with a prosperous China than the horrors of Mao in the 50s and 60s. But it is plain that China’s current behaviour (Hong Kong, South China Sea incursions, treatment of various groups, IP thefts, clashes with India, etc) mean that the regime in Beijing needs a very big kick. Maybe we will see this happen in the next year or so.

Samizdata quote of the day

“Say what you will, but Joe Biden’s first year in office has one crowning achievement to its name. It has provided a real-time, data-rich, high-intensity and ultimately devastating case study in the defining conceit of progressive politics: the idea that government is the solution.”

Gerard Baker

Milton Friedman is still as relevant as he ever was

When President Joe Biden said, in one of his many foolish sayings, that “Milton Friedman isn’t running the show any more”, the hubris of that comment was truly on the Greek tragedy scale. Inflation is almost at 10 per cent on an annualised basis in producer price terms in the US. Consumer price inflation is also high. In the UK, inflation runs hot. Yes, disruptions and energy price spikes are big factors, but these are structural – and ultimately, what causes prices to rise overall is because money loses its purchasing power. (See this decade-old video featuring UK-based investment figure and author Detlev Schlichter.)

Across the developed world and beyond, that loss of purchasing power involves a huge shift in resources from savers to borrowers, with the latter being governments in many cases. Finance ministers won’t admit it, but they want inflation to resolve their fiscal incontinence without having to cut spending or raise taxes.

The late Prof. Friedman pointed this sort of process out many times. Yes, I get that not all aspects of the Quantity Theory of Money hold up, and the “Chicago” school has its disagreements with others, such as the “Vienna” one over money, banking, etc. But the broad point seems to hold that if you print government fiat currencies on a massive scale, eventually inflation will bite. President Biden is unfit for the office he holds for a variety of reasons, and his jeering at one of the great minds of the 20th Century is one of them.

Update: Bank of England slightly raised interest rates today.