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]
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It might seem strange that I would be saddened by the death of man who was supposed to have admired Lord Keynes, but Tony Dye knew a credit-money bubble when he saw one. What Tony Dye did not understand was politics. Every time he was certain that the crash must come, Alan Greenspan (and the mini me versions of him in charge of such institutions as the Bank of England) would just create more money to keep the credit boom going.
“But if he does that it will just make the crash worse when it does finally come” seemed to be Tony Dye’s position, and he was right.
However, he did not understand that political types (and Greenspan was certainly a political type) do not care about the long term.
“In the long run we are all dead” was the position of Lord Keyes, and Tony Dye is now dead. However, he did care about the long term – and the people who are left to live in it.
Down in the dreary bowels of the Financial Times’ website, which has a list of what we happy people can expect in today’s budget, is this classic of FT understatement:
The chancellor will announce a delay in introducing international financial reporting standards to government.
No shit, Sherlock. In plain English, the vast debt bill incurred in the government’s Private Finance Iniative will not be put on to the public balance sheet for a while yet. How jolly conveeenient. If the PFI debt was so accounted for, it would add tens of billions of pounds of debt to the public balance sheet, making the state of the UK public accounts look positively Italian.
As I have said before, this “off-balance-sheet” stuff is a curse of modern finance, and should be scrapped.
The following headline appeared in The Times (of London) this morning:
Greggs chief attacks speculators for driving up the price of wheat
The managing director of Greggs, the high street baker, has attacked speculators for driving up the price of wheat and fuelling famine in Africa.
Sir Michael Darrington, who yesterday announced that he would be stepping down after 24 years in charge, said commodity traders were more to blame for spiralling food price inflation than poor harvests or farmland given over to biofuels.
Ah, bash the speculators. Where would we be without those terrible people? It may be that some of the high price of wheat – now over $13 a bushell and up 118% in the past 12 months – is down to hordes of greedy, Gordon Gekkos bidding up prices for the stuff, but these people make a living by trying to correctly guess future prices and act on imperfect information. They cannot, however, defy the laws of economic gravity. If supplies increase, as is likely if prices are so high and there are big profits to be made growing the stuff, or if demand slackens, as people use wheat substitutes, then all that speculative mania will fall away. In any event, unless this business executive or other folk have looked at what happens when wheat is no longer traded as a commodity but handled by government regulations, they will realise the nonsensical nature of bashing speculators. In the 1980s, years of agricultural subsidies led to the infamous “wheat mountains” that were subsequently dumped onto the world market, hitting producers in the Third World.
Now consider this headline:
Bread basket that is left to grow weeds
The item goes on to explain that large tracts of good, agricultural land in Eastern Europe are lying fallow, ie, un-planted, because of tariff barriers and other restrictions. The Times rightly hammers the EU’s wretched Common Agricultural Policy, the USA’s farm support system, and other regulatory controls on farm production, for contributing to this farce.
It is a joke to attack speculators, who after all bet their own or their banks’ money on trying for forecast supply/demand trends, when it is politicians, who rarely, if ever suffer the consequences of bad investment decisions, who get to bugger up global agricultural markets in this way. At least if a bank or hedge fund gets a bet wrong, the principals in the fund get bankrupted, or executives are sacked. This does not always happen, of course, but generally the market is much tougher on mistaken bets than the political system is. As prices soar in the shops and hit poor consumers, the petty meddling of Chancellor Alistair Darling in today’s budget statement is small beer indeed. Great former UK politicians like Robert Peel have put free trade front and centre of their economic philosophy. It would be a welcome step if western governments today did the same.
[A blogapotamus]
Mr Speaker,
Income tax is an evil. It is an evil not because it is a tax, but because of the way it works.
First, it takes from the citizen the choice of how to spend his money. Indirect taxation, though often in the past tweaked to show the state’s displeasure at certain choices, still leaves you a choice; to spend or save, and whether to have booze, burgers or broccoli for lunch.
Second, it requires the tax authorities to enquire how you obtain your money and how you spend it. The existence of exemptions and allowances, of deductible business expenses, returns and taxes management is essential to the operation of a system that would widely be seen as unfair if it fell as heavily on the pauper, the producer, and the rentier drone. But the existence of allowances and schedules, and latterly tax-credits, means people rightly use their rights, and the Revenue is incentivised to regard everyone as a cheat, to treat careful self-management as a form of fraud, and press for more powers and more bureaucracy. The system becomes ever more complicated, by special pleading and anti-avoidance; the complication allows for ever closer investigation of personal affairs, ever more complicated and impenetrable forms, and ever harsher treatment of the negligent, confused or exhausted taxpayer.
The result tends to a system of brigandage, where the law of collection is as uncertain as the Tax Inspector’s patience, where the small taxpayer is as much prey as he has fat on him, and only someone rich enough to fight a case as far as the House of Lords will ever find out what the law is. Having made the travellers empty their pockets, the suspicious highwayman will resort to strip searches, then to probing body orifices. Anyone who has made tax or tax-credit returns for a few years has had a similar experience.
Third through PAYE and deduction at source, it takes and spends your money before you get it. You may never notice it has gone. And if you do, and your financial knowledge is small, you may not realise how much of it has gone, nor make the connection between your vanishing money and state spending. That makes it easy for tens of millions of people to believe that it is always someone else who is paying for political promises.
Yes, income taxation is great evil. It tends to destroy liberty, privacy, and personal responsibility.
It may come as a surprise to the House and the country, therefore, that I, as the first Samizdatista Chancellor, am proposing to increase the rate of personal income tax. → Continue reading: Playing the budget game
Hysterical Guardian readers are getting absurdly upset. The reason? A member of the Samizdata team suggested that a new tax on prestige cars was more about the politics of envy than saving the planet.
Michael Totten’s latest bloggage from Iraq is as informative as ever, but the thing that fascinated me most was a brief but interesting discursion into the use of the English word ‘Supermarket’ on a sign in a small town in Iraq.
What struck me about the sign on that store, and on many other stores in Iraq, was the English word “supermarket.” The only people in Saqlawiya who find English helpful are the Marines. And me.
I’ve seen this far beyond Iraq. Even in small towns in Libya – one of the most closed societies in the world – I found store signs in English. The amount of English in a genuinely cosmopolitan city like Beirut is even more striking, though no longer surprising. Beirut, at least, has a huge tourist industry. Imagine how differently you would think about Arabic civilization if small towns in Kansas and Nebraska – not to mention large cities like New York and Chicago – had storefront signs in the Arabic language even though no Arabs live there. Perhaps the word “imperialism” wouldn’t seem so much like a stretch. Of course no one forces Iraqis or Libyans to put English words on their signs, so it’s telling that they do so anyway, and that they did not choose Chinese or Russian.
I disagree with Michael’s use of the word ‘imperialism’ and I think he answers that point himself in the very next sentence. An even more demotic variation on the inexplicable prevalence of English puzzled me many years ago BB (Before Blogging). I spent some time in a few fairly rough parts of Croatia and one can hardly miss the prevalence of racist and sexist graffiti on the communist-era concrete tower blocks. The odd thing is that mixed in with the usually ‘Jebi Se’ varient epithets in Croatian, you will find floridly racist threats or extravagant anatomical references in more or less grammatically correct English. And this in an area that was not exactly a magnet for English speaking tourists, particularly in the middle of the then on-going war.
The huge number of people who speak English in Croatia can be easily explained by the ubiquity of satellite dishes, which is why I often referred to the local Croatian English dialect as MTV English. But that does not answer the question of why in a linguistically and ethnically homogeneous area (such as unlovely New Zagreb in Croatia or Saqlawiya in Iraq), people use written English when there is no commercial or political pressures to do so.
Interesting.
It sounds like one of those three decker jokes where part three brings you down to earth with a bump, which is presumably why it got written like that. Hedge your bet by hinting that the story could be all rubbish, and then tell it anyway. Because, maybe he’s right:
BOSTON – He predicted the fall of the Soviet Union. He predicted the explosive spread of the Internet and wireless access.
Now futurist and inventor Ray Kurzweil is part of distinguished panel of engineers that says solar power will scale up to produce all the energy needs of Earth’s people in 20 years.
There is 10,000 times more sunlight than we need to meet 100 percent of our energy needs, he says, and the technology needed for collecting and storing it is about to emerge as the field of solar energy is going to advance exponentially in accordance with Kurzweil’s Law of Accelerating Returns. That law yields a doubling of price performance in information technologies every year.
Tell me more:
… advances in technology are about to expand with the introduction of nano-engineered materials for solar panels, making them far more efficient, lighter and easier to install. …
Is anyone serious now interested in this, other than singularity prophets?
… Google has invested substantially in companies pioneering these approaches.
Okay, but I would have preferred an obscure venture capitalist with a boring name, rather than the overmighty corporation which is, for now, flavour of the decade, and which has, for now, more money than God, to the point where hundreds can have full-time jobs spending it, without making a visible dent in money mountain. How “substantially” has Google invested?
The reason why solar energy technologies will advance exponentially, Kurzweil said, is because it is an “information technology” (one for which we can measure the information content), and thereby subject to the Law of Accelerating Returns.
“We also see an exponential progression in the use of solar energy,” he said. “It is doubling now every two years. Doubling every two years means multiplying by 1,000 in 20 years. At that rate we’ll meet 100 percent of our energy needs in 20 years.”
So, could any of this be true? If it is true, what follows, economically, politically etc.? Beyond the obvious in the shape of disconsolate arabs. Instapundit doesn’t have comments, but we do. My first thought: batteries for laptops and mobile phones are going to be replaced by infinitely powerful black patches on the outside (that’s already happened with calculators, has it not?). Second thought: will big black patches on the roof in due course be enough to power cars? Trains? Lorries? Airplanes? Spaceships?
Third thought: the greenies will absolutely hate this, because there’s nothing they hate so much as technical fixes to their precious and previously unfixable problems. Predictions for what they will say: “The sun is a finite resource! It is running out! Stop consuming Our Fragile Sun! …” And, suddenly they will fall in love with oil industry workers, because they won’t be needed any more.
But, first things first. Is it true?
At first I was going to put this up as a Samizdata quote of the day. It is a paragraph from a piece by Mark Leonard in the latest issue of Prospect, about Chinese think tanks. The Chinese intelligentsia have their left and right, it seems, just like us.
The new right was at the heart of China’s economic reforms in the 1980s and 1990s. Zhang Weiying has a favourite allegory to explain these reforms. He tells a story about a village that relied on horses to conduct its chores. Over time, the village elders realised that the neighbouring village, which relied on zebras, was doing better. So after years of hailing the virtues of the horse, they decided to embrace the zebra. The only obstacle was converting the villagers who had been brainwashed over decades into worshipping the horse. The elders developed an ingenious plan. Every night, while the villagers slept, they painted black stripes on the white horses. When the villagers awoke the leaders reassured them that the animals were not really zebras, just the same old horses adorned with a few harmless stripes. After a long interval the village leaders began to replace the painted horses with real zebras. These prodigious animals transformed the village’s fortunes, increasing productivity and creating wealth all around. Only many years later – long after all the horses had been replaced with zebras and the village had benefited from many years of prosperity – did the elders summon the citizenry to proclaim that their community was a village of zebras, and that zebras were good and horses bad.
Nice story. But the problem, from the quote-of-the-day point of view, is that Zhang Weiying surely has the story upside down and entirely wrong. They did not start by painting stripes on horses. They introduced real zebras, but painted over the stripes and declared them to be horses just as usual. No change was occurring. No upheaval. It was still socialism. Only after the amazing production gains duly materialised were the authorities in a position to wash away the camouflage, and admit that the new and improved “horses” had been zebras all along. But – extra twist – the zebra stripes are still painted over. They still insist that they are horses.
Horse with stripes painted on them are what you introduce when you are trying to get rid of zebras.
There is a depressing article at Reason magazine about the protectionist instincts of both Hillary Clinton and Barack Obama. What the article does not tell us about much is whether McCain is much better (I honestly do not know, so I welcome comments about his voting record). And of course George W. Bush hardly made friends with Britain by slapping tariffs on steel imports – which also hurt American manufacturers and builders (but they lacked powerful friends in Congress). America is the largest economy in the world and despite what some of the more starry-eyed writers on China or the other ‘Brics’ might claim, is likely to remain so for the foreseeable future.
Basically, America matters. If the country goes down a more protectionist path, it will hit the world economy in general. For all his many flaws, Bill Clinton’s signing of the NAFTA Treaty – admittedly when Congress was in Republican hands – was one of the few major achievements of his time in power. It has helped to fuel the ascent of the world economy, lifting millions into higher living standards: if any fans of trade restrictions out there want to contest that assertion, let them provide figures. Here are some official US ones that give some pretty punchy numbers.
As the title says, I wish they could all lose. I have had it with the media guff about how a McCain-Obama contest will somehow elevate American politics and ‘restore’ its image in the eyes of the world. What is the point of winning image points among the Guardian-reading classes if you pull a rug under the world’s economy through greater trade restrictions? How is that going to help America’s ‘image’, assuming that Americans could or should give a flying **** what people think of them in the first place?
The United Nations and the various NGOs which operate within its orbit, which naturally sees the world in terms of nation-states, regards statelessness as a ‘problem’ and the 1948 Universal Declaration of Human Rights include the phrase “everyone has the right to a nationality”.
Yet as the world becomes more cosmopolitan and globalised, the primary threats to security are themselves non-state based (such as radical Islam) and private trade without the intermediation of states has never been easier in the dawning age of virtualised networked economics. Could we one day see a time in which many see modern narrow concepts of nationality and ‘citizenship’ of any Westphalian style state as an imposition rather than a ‘right’?
Alex Singleton’s most recent posting here was on the subject of libertarians in the mainstream media, one in particular. Maybe that has some connection to the fact that Alex seems to be becoming a mainstream media person himself. A few days before that Samizdata piece about a fellow journalist, he did another Samizdata posting about Fairtrade beer, and he returned to the subject of Fairtrade, this time Fairtrade coffee (at the time of me writing this there is a problem with that link – hopefully it will soon work again), in a piece last Friday in one of the Telegraph blogs which he now regularly writes for. Yesterday’s Sunday Telegraph (paper version and online) included a shorter version of that same piece. This was the bit (I’m quoting the longer Friday version) which I found most interesting, and most depressing:
Despite Fairtrade’s moral halo, there are other, more ethical forms of coffee available. Most Fairtrade coffee on sale in UK supermarkets and on the high street is roasted and packaged in Europe, principally in Belgium and Germany. This is unnecessary and retards development. Farmers working for Costa Rica’s Café Britt have been climbing the economic ladder by not just growing beans but by also doing all of the processing, roasting and packaging and branding themselves. Shipping unroasted green beans to Europe causes them to deteriorate, so not only is Café Britt doing far more to promote economic development than Fairtrade rivals, it is also creating better tasting coffee.
But Café Britt is not welcome on the Fairtrade scheme. Most of Café Britt’s farmers are self-employed small businesspeople who own the land they farm. This is wholly unacceptable to the rigid ideologues at FLO International, Fairtrade’s international certifiers, who will only accredit the farmers if they give up their small business status and join together into a co-operative. “It’s like outlawing private enterprise,” says Dan Cox, former head of the Speciality Coffee Association of America. …
Fairtrade is, in other words, a front organisation, crafted by unregenerate collectivists to con believers in nice capitalism to buy something which is neither nice nor capitalist. And the way to deal with cons is to expose them for what they are, so that only those who really do believe in the actual values being promoted here continue to support the thing. Telegraph commenters declared themselves angry and disillusioned, and congratulated Alex on a well-researched piece. I long ago stopped being angry about such people as those behind Fairtrade. I expect duplicity and destructiveness and inferior produce from this quarter. But I do congratulate Alex on a good piece of journalism, and on managing to get paid for doing it.
UPDATE: Patrick Crozier weighs in, quoting another commenter.
The Financial Times is very much the house journal of corporatist Britain; while not blind to the needs for a vigorously entrepreneurial culture, it tends to be hemmed in by a general acceptance of government and its hold on our lives. This headline says it all in the assumptions that underpin that newspaper:
“Boost for Darling as tax takings increase.”
Marvellous.
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Who Are We? The Samizdata people are a bunch of sinister and heavily armed globalist illuminati who seek to infect the entire world with the values of personal liberty and several property. Amongst our many crimes is a sense of humour and the intermittent use of British spelling.
We are also a varied group made up of social individualists, classical liberals, whigs, libertarians, extropians, futurists, ‘Porcupines’, Karl Popper fetishists, recovering neo-conservatives, crazed Ayn Rand worshipers, over-caffeinated Virginia Postrel devotees, witty Frédéric Bastiat wannabes, cypherpunks, minarchists, kritarchists and wild-eyed anarcho-capitalists from Britain, North America, Australia and Europe.
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