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Bernie Sanders fails to compete with the AAPP

Bernie Sanders announces a plan to guarantee every American a job, but he fails, yet again, to come even close to the promises made by the And A Pony Party (“AAPP”).

We remind you, once again, not to be swayed by politicians hopping on to the bandwagon by cynically pushing inadequate substitutes for the program of the only political party that really cares.

Stay the course. Support the AAPP.

How the Corn Laws and all that may not be all that

The story that I and most people here are familiar with is that in the 1840s Britain abolished the Corn Laws, became the pioneer in free trade and that this was a good thing.

John Nye begs to differ. In this Econtalk podcast (from, ahem, 10 years ago) he makes two points. Firstly, British tariffs were falling throughout the 19th Century and that the abolition of the Corn Laws was not particularly significant in that process. Secondly, French tariffs were by-and-large lower than those in Britain.

But surely Britain was much richer than France at this time? Yes it was, and according to Nye that was mainly due to it having fewer taxes and regulations. France even had internal tariffs as Samizdata’s own Antoine Clarke once pointed out.

So much as I don’t think Trump’s trade war is a good idea it is possible that it may not be as bad as all that.

Discussion point…

Conventional theory has it that capitalism arose in England in the 16th century but I long ago found it thriving in the 13th century. Rowland Parker’s ‘Men of Dunwich’, a treasure of my bookshelves for many decades, uses ancient pipe rolls and mediaeval manuscripts in our historic archives as the author turns detective. Why did Ada Ringulf, with a cottage by St Peter’s, pay only ¼d rent a year when neighbours paid 1½d?* Parker thinks he knows. Anyway, Dunwich merchants, shipowners with vessels we know as ‘cogs’, would speculatively take cargoes of wool, barley, cloth to Europe and the Baltic and return with iron, wine, silk and spices. Profits could be handsome – but the loss of a cog to a hostile port, pirates, minor warlords or official blackmail could ruin a man and his family overnight. So merchants offset their risk by investing in eachother’s cogs and cargoes, risking only a fifth or a sixth on each voyage. Parker has the evidence. That’s capitalism. And it was happening three hundred years earlier than thought. Capitalism means risk, even if it’s managed risk. What the global corporates do is risk free; monopolistic, monopsonistic or oligopolistic, they have a licence to make money with virtually no risk, by virtue of their size and power.

Raedwald

Agree, disagree? Not convinced by the entirety of the thesis at all but there are some interesting points being made. Read the whole thing.

Gender gaps

Julian Jessop, at the Institute of Economic Affairs’ blog:

Few can have failed to notice that UK companies with 250 or more employees are now obliged to report specific figures about their ‘gender pay gap’. Supporters argue that the data are helping to expose the disadvantages that many women face in the workplace. In my view, though, the system is failing.

For a start, the data are frequently misunderstood and misrepresented. Variations in hourly wages or bonuses between men and women are often interpreted – wrongly – as evidence of different pay for the same work. This sort of discrimination would, of course, be illegal. It would presumably be uneconomic too; if women were indeed willing to do the same work for less money, they would surely be over-represented in the highest paying jobs.

Readers in the UK will also have noted an increase in volume of news stories about the so-called gender gap in pay and overall remuneration as it affects women. I am not dismissing concerns about this as fabricated or an example of Leftist mischief-making against the market economy, although I am sure such criticisms would be valid. But as Jessop says, there is a basic problem with the approach that many critics take in assuming that the State should “do something” about it, or that the simple fact of group A earning, on average, less/more than B is ipso facto proof of some wrong being committed. (I urge people to read the whole article; one of the most silly sleights of hands of those trying to make out that there is a major issue is to lump part-time and full-time jobs together.)

The great Thomas Sowell, debunker of many woolly ideas, has dealt with the gender gap issue, as the linked Youtube clip shows.

The US-based economist Tyler Cowen has argued that the gender gap will eventually close and it seems, largely for reasons unconnected to interference by the State.

Common sense is quite uncommon

So here is some from Madsen…

An unintentionally honest headline to an unintentionally honest article

“Labour’s plan to tackle inequality can revive the ailing development sector”, writes Nick Dearden in the Guardian.

Clicking on Mr Dearden’s name took me to a link that said, in true Grauniad style, “Nick Dearden is director of the Global Justice Now (formerly World Development Movement)” The faltering fortunes of “the Global Justice Now” and similar organizations in what is called the aid “sector” (as if were part of the economy rather than a drain on it) distress Mr Dearden for understandable reasons. No man likes to see his prospects of a secure and comfortable living imperilled. I do not see why the rest of us should care. I would be quite happy to issue the development sector with a one way ticket to Switzerland.

Mr Dearden writes,

At the height of New Labour’s power, Peter Mandelson famously said: “We are intensely relaxed about people getting filthy rich.” To be fair, he added, “as long as they pay their taxes”. But New Labour never had a burning ambition to reduce inequality. They could live with inequality as long as no one was really poor.

Extreme poverty was the focus of New Labour’s international development policy. The wanted to make global capitalism work for the poor – better markets and voluntary codes of conduct to encourage the private sector to “do the right thing”.

And the problem with this was…?

It wasn’t without its achievements, coming as it did after an era in which the poor were regarded as responsible for their own poverty. But it continued to allow the real drivers of poverty, western corporate and foreign policies, to go unchecked, while offering a charitable contribution to clean up the mess they created.

Emphasis added. Libertarians and similarly inclined folk often see the Guardian commentariat as being no less daft than the Guardian writers. That is not always true. Nearly all the most popular comments to this piece make pretty good sense and I am going to quote several of them. For instance take this one from someone called ‘Humza’, who says,

No, fighting poverty is much more important than fighting inequality. Trust Labour to come out with a policy that would punish the person who makes $5 a day and scream injustices because his neighbour can only manage $1 a day.

Absolute/extreme poverty has dramatically declined over the past couple of centuries and quelle surprise, that coincides when most of the world began to transition to world trade and free markets.

https://ourworldindata.org/extreme-poverty

Mr Dearden continues,

On Monday, Labour announces a new development policy which takes a radically different approach. In essence, you can’t solve the problem of poverty without tackling inequality. And you can’t tackle inequality without dramatically changing how the global economy works.

In other words, Labour’s policy is unworkable.

Concretely, Labour proposes a new law, ensuring that all aid money must be spent fighting inequality as well as poverty.

Neocolonialism! British interference in the policies of sovereign African nations! (Hat tip to commenter ‘daveg861’ for that point.)

Fighting inequality requires huge changes to the way the global economy works.

In other words, Labour’s policy is unworkable. Wait, didn’t I say that only a minute ago? Yes, I did, but if Mr Dearden is going to repeatedly state that reducing inequality cannot be done unless the Labour party conquers the world I am just going to have to repeatedly point out that it ain’t gonna happen.

Labour proposes a range of policies that will require further clarity in office

Those policies require further clarity in office the way a fish requires further water on the deck of a trawler.

but include changing the way we trade with southern countries, clamping down on tax dodging, reforming the debt system, transforming institutions like the IMF and World Bank, introducing a financial transactions tax, changing the way we measure wellbeing, and providing “global leadership on the refugee crisis”.

As ‘FatherChewyLouie’ says in the most recommended comment, “What exactly do Labour mean by providing “global leadership” on the refugee crisis? If it’s what I think it means then I can guarantee it won’t be a vote winner.”

Meanwhile, back in the The Global Justice Now! universe:

Countries like Britain grew rich on the turbocharged exploitation of Africa

Countries like Britain might have, but Britain grew rich because of the Industrial Revolution before it had African colonies. When it got them it turned out they were a net cost to the British government and were unpopular thereby. The original “Little Englanders” were opposed to expansion of the British Empire for that reason. (I swear, I had already written that when I saw a comment by ‘YEverKnot’ saying the very same thing. Of course it is a fairly obvious point to make.)

– and still today Africa bleeds wealth to rapacious corporations. Aid, which should be a form of reparation or, at least, redistribution of wealth akin to taxation, becomes largesse: a gift which should be cut in the bad times, and given to our current government’s pet projects in good times.

Reparations? That might not go down well with voters. However, the point about aid being largesse which can be cut off on a whim is true. And thus Mr Dearden unintentionally makes an excellent argument against government-to-government foreign aid and against the very existence of his beloved “development sector”.

Austrians on barbarians

Mises sees ideologies – sets of ideas – as guiding people’s actions such that they extend or curtail the growth of the division of labour. But people can participate in an extended division of labour while still holding to an ideology of violence which must run counter to, and undermine, peaceful cooperation. Many who joined this extended order by moving into urban areas remained strangers to the ideas which made wider specialisation and exchange possible:

“One cannot make a social philosophy one’s own as easily as a new costume. It must be earned – earned with the effort of thought.”

Hence in history there appear periods in which the division of labour is extended and others in which it regresses: “More menacing than the barbarians storming the walls from without are the seeming citizens within – those who are citizens in gesture, but not in thought.” – Hayek too excoriates those “non-domesticated barbarians in our midst” who “refuse to accept” the “acquired discipline” of a world-wide division of labour while “they still claim all its benefits”.

Sudha Shenoy, Towards a Theoretical Framework for British and International Economic History: Early modern England, a case study, p283. Don’t be confused by the title – not a dicky bird so far about post-Black Death cesspit management – this is an overview of Austrian economics. And a rather good one at that.

Samizdata quote of the day

…as I have complained about in the past, there has been a major shift in modern companies from delivering something useful – such as a bridge which doesn’t collapse – to managing processes. A lot of companies have subcontracted out the actual work – designing, building, manufacturing, operating, maintaining – and instead busy themselves with “managing” the whole process. This involves lots of well-educated people in nice clothes sitting in glass-fronted office buildings sharing spreadsheets, reports, and PowerPoint presentations by email and holding lengthy meetings during which they convince one another of how essential they are.

Tim Newman speculating on the causes of the Florida footbridge collapse.

Trade Wars: A Phantom Menace?

Bloomberg is the only TV news channel I can stomach watching in the UK; it is the only one that is not instinctively leftist. I suppose if you are trying to provide a service that people will pay for to help them make financial decisions, a better standard of truth is required.

This morning they were very excited about Donald Trump’s threats to impose tariffs, especially now that (relative) voice-of-reason Gary Cohn has announced his resignation. They reported that the EU is threatening to respond to Trump by cutting off EU consumers’ noses to spite Donald Trump’s face.

Perhaps if we are lucky post-Brexit Britain will be a refuge of sanity, free-trade, and economic growth amongst all this madness.

Or perhaps, as one commenter on Bloomberg suggested, it is all bluster and this is just Trump negotiation tactics and it will come to nothing.

On the enduring stupidity of tariffs

Virginia Postrel:

Aluminum foil wraps burritos, physics equipment and the highlighted tresses of hair-salon customers. It forms flexible ducts and lasagna pans, lines cigarette packs and fast-food sandwich wrappers. It hides between layers of film in flexible packaging. It protects aspirin bottles from tampering, petri dishes from light and tractor engines from overheating. It tops yogurt cups and peanut cans. It backs blister packs of antihistamines, antacids and birth-control pills. It goes into automotive parts and air-conditioning systems.

U.S. manufacturers rely on aluminum foil. So do nail salons, building contractors and bakeries.To the Trump administration, however, none of these businesses—or their employees—matter as much as a couple of domestic aluminum makers. Disregarding the ripple effects, the Commerce Department has said it will impose preliminary duties of 97 percent to 162 percent on the Chinese imports that supply much of the U.S. market with thin aluminum foil. That’s likely to have much more far-reaching effects on U.S. companies than the minor deals President Donald Trump announced on his trip to China.

As the Wall Street Journal (paywall) editors said:

Mr. Trump seems not to understand that steel-using industries in the U.S. employ some 6.5 million Americans, while steel makers employ about 140,000. Transportation industries, including aircraft and autos, account for about 40% of domestic steel consumption, followed by packaging with 20% and building construction with 15%. All will have to pay higher prices, making them less competitive globally and in the U.S.

And the national security argument trotted out to support such tariffs is given suitably short shrift by the WSJ:

The national security threat from foreign steel is preposterous because China supplies only 2.2% of U.S. imports and Russia 8.7%. But the tariffs will whack that menace to world peace known as Canada, which supplies 16%. South Korea, which Mr. Trump needs for his strategy against North Korea, supplies 10%, Brazil 13% and Mexico 9%.

On just about all conceivable grounds, the tariffs are stupid.

Last year, reflecting on a few of Trump’s acts, such as deregulation moves, the tax cuts, Supreme Court picks, crushing of the Paris AGW accord and the Jerusalem embassy decision, I felt that, while Trump had said a lot of foolish things, maybe he was turning out to be a pretty good POTUS after all. The protectionism, however, remains a major blot on his record.

Ross Clark at the UK’s Spectator, meanwhile, makes an interesting observation of how all this plays to the case for Brexit.

South Africa decides Zimbabwe is an instruction manual, not a warning

Grim news from South Africa. Just in case anyone thought that the departure of President Zuma, a corrupt man who has stripped his country (South Africa faces severe water shortages brought on by neglect of infrastructure) might lead to better things will be disappointed. The new regime has signed off on a land-grab policy of confiscating white-owned land without compensation. (About 70 per cent of South African farmland is owned by whites.) The claim made is that any white person who owns land in the country must, by definition, have stolen it. (The idea that such ownership might have come into being without theft just does not cross certain persons’ minds. That fact is simply undiscussible.)

As we have found in the seizure/collectivisation of farms in the former Soviet Union, in China, and in Zimbabwe more recently, such moves herald mass poverty and violence. South Africa has ironically seen an influx of poor Zimbabweans since the vile Mugabe regime started to attack white farmers and seize land; the country has suffered a catastrophic decline in its farmland output, which may never recover. South Africa seems keen to follow suit; it has a range of largely self-inflicted woes: the current government is deeply corrupt. The country needs inward investment – seizing white-owned property hardly encourages any investor, of any racial background. As a matter of simple common sense, taking land by brute force, without compensation, from owners and giving it to those who are political cronies and hangers-on will inevitably reduce output and wealth, not the other way round.

The unfolding of South Africa’s history is a tragedy, and it is easy to see why there is an element of “score-settling” at work here. Apartheid, let it not be forgotten, was introduced in the late 1940s at the behest to some degree of the white trade union movement, keen to bolster its bargaining power. Even if you were a private entrepreneur who wanted to hire non-whites for certain jobs, for example, you couldn’t. (Minimum wage laws operated in ways that hurt, not helped, non-whites.) The system was as absurd and vile as the Jim Crow laws of the US, or other examples of serfdom and oppression down the ages. It had to go; for anyone who supports a free market economy, apartheid and its cousins are absurd as well as wrong.

But the solution of seizing white-owned land, regardless of the honesty or provenance of it, and giving it to people via a political carve-up, turns the injustices inherited from the old regime on their head, creating a new form of racism. Two wrongs do not make a right. And further, one suspects that the land seizures are an attempt to deflect attention from the failings of the existing regime. Compare and contrast how, for example, the “Asian tigers” threw off their old colonial masters and focused on getting seriously rich, not least by respecting property rights. And wherever one looks, there does seem a pretty tight correlation between respect for property rights – indeed their very existence – with prosperity and happiness more broadly. Hernando de Soto has made something of a career pushing the point that the world needs more property rights, spread among more people. (Check out this recent lecture by Niall Ferguson on the same sort of issue.) As an aside, it also seems to be a pretty solid marker of respect for property rights to have a large and growing middle class. I suspect that one of the underlying problems in South Africa is that among the non-white population, persons who can be so described aren’t a big portion of the total.

Lest anyone pounces on the notion that what has happened proves that certain racial groups are incapable of building a civilized political order, bear in mind that here in the UK, the oh-so-white Caucasian leadership of Her Majesty’s Opposition, Jeremy Corbyn, and his colleagues, want to do to the owners of privately-owned industries such as electricity, gas, and the rest what the new leadership in South Africa wants to do to white farmers. The defence of settled property rights remains a vital cause for anyone interested not just in prosperity, but liberty. As of this week, that cause took a turn for the worse in South Africa.

Antiquated attitudes

Thus saith the EQUALITY AND HUMAN RIGHTS COMMISSION to its anointed, to the BBC, whose right hand it hath holden, to subdue the unrighteous before it:

Employers still have ‘antiquated attitude to female workers’

Many employers still live in the “dark ages” when it comes to recruiting women, the Equality and Human Rights Commission (EHRC) says.

In a poll for the EHRC, 36% of employers thought it reasonable to ask a women about plans to have children.

Some 59% agreed that a woman should have to disclose during the recruitment process whether she is pregnant.

The commission said the poll of 1,106 male and female decision-makers showed worrying attitudes.

The EHRC said its study showed that many employers needed more support to better understand the basics of discrimination law and the rights of pregnant women and new mothers.

EHRC chief executive Rebecca Hilsenrath said: “It is a depressing reality that, when it comes the rights of pregnant woman and new mothers in the workplace, we are still living in the dark ages.

“We should all know very well that it is against the law not to appoint a woman because she is pregnant or might become pregnant.

“Yet we also know women routinely get asked questions around family planning in interviews.”

Other findings from the YouGov survey of small, medium and large firms included:

– 46% of employers agreed it was reasonable to ask women if they have young children during the recruitment process

– 44% agree women should work for an organisation for at least a year before deciding to have children
About one third believe that women who become pregnant and new mothers in work are “generally less interested in career progression”

– 41% of employers agreed that pregnancy in the workplace puts “an unnecessary cost burden” on the workplace

– 51% agree there is sometimes resentment towards women who are pregnant or on maternity leave
The EHRC said its survey revealed antiquated beliefs, including two out of five employers saying women who have had more than one child while in the same job can be a “burden” to their team.