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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While activists call for consumers to buy Fairtrade coffee, critics – like the author of the documentary The Bitter Aftertaste – say that the achievements of the Fairtrade movement are too modest. Hostility to the movement is on the rise from right and left alike. As Reason magazine puts it:
The movement has always aroused suspicion on the right, where free traders object to its price floors and anti-globalization rhetoric. Yet critics from the left are more vocal and more angry by half; they point to unhappy farmers, duped consumers, an entrenched Fair Trade bureaucracy, and a grassroots campaign gone corporate.
It has always seemed to me that there is a better, more sustainable approach to raising living standards. That approach is to help farmers move away from just growing coffee and exporting the beans (with very little processing) to the developed world. If coffee-producing countries actually did the processing and packaging, and even stuck their own trademarks on the finished product, developing countries would be able to capture more of the value in a bag of coffee sold in shops in the high street.
When I’ve spoken to Western companies selling Fairtrade produce, they never seemed all that interested in the idea – or they though it was not feasible. So I am delighted to have found a company that actually does it: coffee grown in Peru and Costa Rica where the packaging and processing is also done there too. I went to their UK online store and bought some which I will be tasting in the office on Monday, but it strikes me as a superb way of increasing living standards. More information is here.
I have always found group names quite interesting, such as a ‘crash’ of rhinos, ‘school’ of fish, a ‘gaggle’ of geese, a ‘stupidity’ of politicians, a ‘conspiracy’ of lawyers, etc… but what is a collection of French students to be called? Perhaps an ‘unreasonableness‘? Or would it be a ‘perversity’? Or maybe a ‘delusion’ of French students?
Three hundred thousand of them were protesting and/or rioting because of attempts to change the laws that make no business in their right mind want to hire them in the first place. This is because if they turn out to be indolent layabouts, a company is still not allowed to fire them. So, as unemployment approaches 10% in France (or quite a bit higher according to some), demonstrating that something is just a tad wrong with the ways things work in France, these clever chappies want to motivate employers to continue to not hire people. Outstanding.
There is a lot of stuff about Dubai at the moment. The issue of Dubai Ports’ purchase of P&O and the reaction by certain American Democrat and Republican politicians is a massive story Stateside, though it has not registered much in the UK, unless you are a reader of the business sections. There is a smell of protectionism in the air in Europe too, with a number of European states scratching each other’s eyes out about merger and acquisitions involving banks and utilities. Plus ca change..
Dubai is now a major story on a number of fronts. The BBC recently ran a series of programmes about the incredible amount of construction happening there and the local magnates and immigrants who are driving the economy forward. A vast artificial archipelago of homes and estates has been built into the Gulf. Dubai is also a major business and media centre, a place where a lot of sporting and cultural events goes on. Dubai is also becoming one of the major venues for business conferences in areas such as finance.
So it seems to me that even with all the reservations one might have about that part of the world and the islamist threats not far away, Dubai’s vibrancy is a sort of Good Thing. The place has, potentially, the capacity to exert the same impact on parts of the Middle East as Hong Kong did on mainland China. Perhaps it is all a bubble and will go up in smoke, as the Eyeores out there might think, but on the whole I am optimistic. Let’s face it, pessimism is a sort of cop-out.
May the meme of liberty spread out from its borders and confound the naysayers. Meanwhile, this man is doing something highly admirable.
The Oscars are nearly upon us. (Okay, please try to keep reading) One thought prompted by this circus and what goes on in films is how films can carry messages very different from the intentions of the film-maker. A classic example is the 1987 film, Wall Street, in which Michael Douglas gave what I thought was his greatest performance as Gordon Gekko. Gekko is what your average lefty Hollywood producer imagines is a capitalist: incredibly greedy, callous and crooked, stamping the lives of good honest hardworking people, blah, blah, blah. And yet we know that in the course of the speech, Gekko gives his tremendous “greed is good” speech, which I sometimes think reads like Ayn Rand on acid.
A friend of mine, Libertarian Alliance founder Chris Tame, once told me that during this stage of the movie, he burst into applause, much to the surprise of the other cinema-goers. I wonder how many other folk have had the same reaction to a speech or line in a film where without realising it, a pro-capitalist point has been made in a way the director probably had not intended? Has anyone got any examples?
The ideal gift idea for that collectivist friend in need of enlightenment and help in doing maths. (Thanks to those clever folk at the von Mises Institute.)
Clive Davis approvingly quotes a book by a fellow called Rod Dreher, a “crunchy conservative” (whatever that is) who is, we are told, a passionate environmentalist, a disliker of suburban sprawl, shopping malls (oh, the vulgarity!), television (ditto), McMansions (huh?) and other regrettable features of consumerist, dollar-obsessed America. Instead, this fellow, who sounds rather like an American Roger Scruton (of whom I am an admirer, at least in parts) is a fan of government restrictions and regulations, and mentions the case of the U.S. Pacific Highway, left pristine and free of crass development by land-use regulations.
There is nothing actually all that new in conservatives embracing controls on development. The very word, conservative, is based on the desire to conserve and protect what exists from the new. During the Industrial Revolution, conservatives like the Poet Robert Southey railed against what they saw as the ugliness of industrialism and the associated sprawl. (Some of the dislike was also based on snobbery and fear of an pwardly mobile and undeferential middle class). The trend has continued. It was that perfect symbol of cuddly English fogeyism, Sir John Betjeman, who took potshots at suburbia, penning one of his most famous verses about that place to the west of London known as Slough. (The former Poet Laureate asked Hitler to bomb it).
What is so striking is how unoriginal and old-hat all this sort of thing is. More interesting to me, however, are those writers who do not imagine that shopping malls or mock-Tudor mansions in Surbiton deserve our scorn. Virginia Postrel has recently written approvingly of a book actually describing sprawl rather than automatically condemning it.
And let’s face it, most of us, particularly those with children, live in suburbs or are moving there. It is a conceit, I reckon, of people who have no children, and who do not need the space, to take potshots at those who have decided to leave the supposedly hip inner city. It remains a mystery to me why the desire of people to live in a bit of space and comfort drives certain intellectuals nuts. Maybe it is the garden gnomes.
“There were Eastern men in felt hats with giant rims of rich gleaming fur, talking to long-bearded Jews about racks of animal pelts – the faces of small nasty critters gaping blankly at the sky. Chinese carrying crates of what he had to assume was China, coopers repairing busted casks, bakers hawking loaves, blonde maidens with piles of oranges, musicians everywhere, grinding hurdy-gurdys or plucking at mutant lutes with huge cantilevers projecting asymmetrically from their necks to support thumping bass halyards. Armenian coffee-sellers carrying bright steaming copper and brass tanks on their persons, bored guards with pikes or halberds, turbaned Turks attempting to buy back strange goods that (Jack realised with a shock) had also been looted from the Vienna siege-camp…”
Quicksilver, by Neal Stephenson, page 420.
The above passage relates to when one of the central figures in Stephenson’s marvellous Baroque Trilogy enters the-then famous Leipzig fair. What struck me about this section of the book was Stephenson’s brilliant description of the sheer fun that markets can involve. (Yes, the curmudgeons out there will start muttering about the triviality of reducing market economics to fun, good heavens). His description even reminded me of a more modern market: the futures exchange in London’s Cannon Street. I used to visit the LIFFE building and would look down from the gallery to look at the sea of men – not many women – trading odd-sounding things like short-sterling futures and options, gesticulating at each other in small groups, more often resembling folk on the verge of a pub brawl than a place where gazillions of pounds, dollars and euros were being transacted.
We are so used to critiques of capitalism from people who decry the supposed coldness and soulnessness of markets, unlike the supposedly warmer and more fulfilling communal lifestyles they claim to favour. And yet as Stephenson has reminded me, the market is that supreme example of social interaction and co-operation, often gaudy and loud, alarming even, but never dull.
One of the advantages of having a comments section is providing me with new ideas to write about, even when the comment in question is so flat-out wrong that it makes me gape with amazement at the screen. In my recent post about the economic fallacies surrounding immigration, a commenter opined that Indian immigrants into the UK were leeching money out of this country by not re-investing it in new businesses but merely writing cheques to “inactive” folks back in the old homeland.
It is a lousy argument on a number of levels, and I am not even going to dwell long on the obvious dangers of inciting distrust and hostility towards economically successful immigrant groups and accusing them of not being sufficiently “patriotic” by not spending all their profits in Britain. The argument also fails because it ignores the subjectivity of economic value. If a businessman earns a million pounds in profit from a drycleaning business in Birmingham and sends the odd cheque back to his aged relatives in Bombay, then how is economic value being destroyed? In the eyes of the businessman, helping his loved ones is worth more to him than investing that money in something else, even though other people might disagree with that decision and think him to be deluded. It is none of my business to force a change in that decision.
Also, that businessman is doing something that supporters of a liberal civil society have traditionally supported: philanthropy. How can it be wrong for a man to steer a portion of his wealth to his dependants, educate them, feed and house them? Who gives any entity the right, least of all the State, the power to say yay or nay to that decision? The argument that such transfers are wrong is an echo of the old Bethamite notion that the State is entitled to seize wealth if that maximises the “greatest happiness of the greatest number”.
A final point. No doubt large sums of money are paid by immigrants and migrant workers back to the points of origin all the time. This has happened for centuries. These transfer often sustained people in great hardship.
I have come across some dubious economic arguments in my time, but the idea that immigrants paying money to their folks is some sort of parasitical waste has to be one of the weakest.
Anthony Browne, writing the main feature article in this week’s Spectator, says policymakers have underestimated, or quite possibly fibbed, about the scale of immigration into the United Kingdom from Eastern Europe. I do not want to get into all the cultural arguments that have been aired a lot here in recent months. Suffice to say that Browne makes some good, if slightly alarmist, points about the ability of a small crowded island like Britain to go on taking more and more people, never mind from often very different cultures.
He seems to make the mistake, however, when discussing the impact of immigration on wage rates, of what is known as the “lump of labour fallacy”: the notion that there is a fixed amount of work to be performed in an economy. It seems a bit odd that Browne, who calls himself an economic liberal, should fall prey to this fallacy. After all, as surely the late economist Julian L. Simon pointed out, every additional person is not just another mouth to be fed, but another brain and pair of hands to create wealth.
Which British individual has done the most good for the world during the last half century or more since the Second World War? I nominate Sir John Cowperthwaite, Financial Secretary of Hong Kong from 1961 to 1971, who died last Saturday.
By applying laissez faire ideology to Hong Kong with greater inflexibility than anyone else was at that time even attempting, anywhere, he became, in Patrick Crozier’s words, the father of Hong Kong’s economic boom.
And that, if you think about it, makes Cowperthwaite the grandfather of the Chinese economic boom.
Without the shining example of Hong Kong, and the economically benign influence that Hong Kong has for a long time now had on nearby places still governed by Beijing, who knows what economic – and political – state China would be in now?
Cowperthwaite was criticised during his time in office for not taxing the people of Hong Kong more, and for ignoring, in particular, education. But has there ever been a more stupendous exercise in business education and everything-else-you-can-think-of education than Hong Kong? Hong Kong has been a University of How To Do It for millions upon millions of Chinese, Chinese who are now struggling to turn China itself from a suicidal and murderous world threat into a creative contributor to the world. The productive and trading templates now being followed in China were mostly devised in Hong Kong, and Hong Kong still provides a huge connection between China and the rest of the world.
So, there is at least a decent chance that China will emerge onto the world stage not as a belligerent superpower in the Soviet mold, but as a creative superpower more like nineteenth century Britain or nineteenth century USA.
Of course China still faces severe problems, as has been well explained here. It could all, and quite soon, go horribly wrong. China’s creatively earned wealth and strength might yet – following some kind of economic melt-down – be cashed in to pay for the means to make only mischief on a huge scale.
But China’s economic strength is not a total illusion, any more (well, maybe a bit more) than the USA’s economic strength was wholly illusory in the late 1920s. (The worry about that comparison being that the USA proved that it could be the engine of world economic growth only after a huge depression and a huge world war.) And if, in a hundred years time, historians are able to look back on a century of (mostly) Chinese creativity and progress rather than of Chinese chaos and ghastliness, Sir John Cowperthwaite will arguably deserve more credit for that happy outcome than any other single individual.
The nightmare always was that the Chinese people would feel that they had to fight and to destroy to get the world’s respect. Cowperthwaite’s Hong Kong showed the Chinese people that they were capable of unleashing a better and more creative way to be respected, a way that the whole world is already benefiting from.
Patrick Crozier, to whom thanks for the link, picks out this particularly choice quote from the Telegraph obituary of the great man:
As for the paucity of economic statistics for the colony, Cowperthwaite explained that he resisted requests to provide any, lest they be used as ammunition by those who wanted more government intervention.
The state is not your friend. The less it knows, the better.
“We’ve taken the biggest surge in national income in years and squandered it. The punters are spending every cent they can and Canberra is encouraging that by handing back its share of the commodity price loot as tax cuts.”
Who would say such a thing? Sounds like the rantings of some bleeding heart welfarist think tank, rather than Australia’s leading economics consultancy, as Access Economics likes to describe itself.
Yes, Keynesian wannabes Access Economics released a report fretting about interest rate hikes, and it feels the answer is to remove the financial options of individuals and ensure that the government collects and hoards ever more of the people’s income. I suppose one should look at it this way; some day soon you might benefit if you find yourself in a geographic or demographic sweet spot that the government needs to court come election time.
Talking about rum plans, this proposal from Deloitte floats an admirable (though not particularly original) idea – swapping tax deductions on work expenses for across-the-board tax cuts. Liberals will start to choke when they see Deloitte’s adjustment of the progressive income tax rates:
The poorest tax payers would see their rate cut from 15 per cent to 4 per cent, with the 42 per cent tax rate paid by people earning $75,001-$125,000 falling to 33 per cent. The top 47 per cent rate paid by those earning more than $125,000 could be cut to 44 per cent.
Deloitte would surely have access to the masses of theoretical and empirical evidence showing the superior economic benefits of shrinking the gap between top marginal rates of income tax and the lower rates, not to mention the moral argument. Why this EC (and I do not mean European Community, though maybe I do…) drivel, then? Why do Deloitte believe they need to field a taxation proposal that is going to win elections?
Thankfully, the political party that prides itself on its fiscal responsibility and economic liberalism holds government in Australia. Yet we have a curmudgeonly treasurer (chancellor of the exchequer) who steadfastly refuses to budge over our absurdly high top marginal tax rate of 47%. He is more than happy to ladle out benefits to politically useful groups, however. Oddly named, the Liberal Party of Australia, when one considers it is run by big government conservatives.
Couple these few good men with the leading economics consultancies, who seem to be trying to outdo each other in the social crusading stakes.
Have these people never heard of the Chicago school? I despair.
Jamie Whyte in The Times is a paragon of rational liberalism. Today he neatly skewers the fallacious thinking of those who impose their own heirarchy of values and risk aversion on the rest of us.
Doctors, he points out, will tend to overvalue health relative to other goods, such as pleasure. They “confound what is good for us with what is good for our health.” And this analysis is readily applicable to the army of experts who struggle to control us and get use of our taxes to pursue their own preferences. They all fail to accept that other people have different tastes that in conditions of liberty are traded-off by those people.
Jamie Whyte again:
Politicians always claim that their safety regulations are motivated by concern for people in dangerous jobs. Yet the beneficiaries are always people who do not do dangerous jobs. Workplace health and safety meansures are a zero-sum game in which wealth is transferred from the brave to the timid.
And yet, I think Whyte here simplifies and understates the case. He concentrates on the loss of ‘danger money’ to workers if the market price of the safer jobs falls. That, adding in workplace costs, might look like a zero-sum game, but a business is not a closed isolated system linking effectively infinite reservoirs of labour and capital. → Continue reading: The reality of compliance
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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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