Well I heard a terrible April Fool’s trick today on BBC Radio 4, some economist chap talking about a hike in the UK’s minimum wage, saying that raising the minimum wage boosts the economy as there will be more money to spend in retail etc.
– Mr. Ed
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There is a steelworks at Port Talbot in south Wales owned by the Indian Tata group, which is losing money hand-over-fist. The owners appear to have thrown in the towel after 9 years, and are looking for a buyer, for a works losing a reported £300,000,000 a year. So poor old Tata is consuming its capital to the detriment of its investors, and the benefit, for now, of its staff and contractors. The reaction to this disappointing news about the works, which will doubtless be devastating for those who work there and rely on it for their own livelihoods, seems to be that ‘something must be done’, but once again the Broken Window Fallacy should be borne in mind. At present, the UK government appears to be tempering calls for nationalisation of steel works, although one Conservative MP, Mr Tom Pursglove, has come out to call for nationalisation, pointing out that Brexit would make it easier for the UK government to grant state aid to industry.
As my maths teachers used to say ‘Show your working!‘. Funny how EU rules on State Aid don’t seem to apply to farming. What is truly depressing is that almost no one, apart from a valiant chap from the IEA I heard on Radio 4 news this afternoon, is suggesting that a steel plant should be profitable, the Zeitgeist seems to be that the plant should simply exist. However, there are reports that the Chinese government is subsidising steel exports by selling it below cost price. The IEA chap on Radio 4 said that China has, in the past 2 years, produced more steel than the UK has produced in its entire history (but there are many different kinds of steel, and they are not fungible). Is anyone scared that China will up the price of steel once it has caused much capacity in the rest of the world to shut down? March 30th, 2016 | 53 comments - (Comments are closed)
 The whole notion that culture can be “appropriated” in any negative sense is one of the most absurd notions being bandied about (and that is really saying something given the carnival of absurdities that passes for critical thinking these days). Such ideas about culture are profoundly fascist in origin, a collectivist notion that somehow culture and identity must be preserved in a “pure” state from outside influences and somehow “belongs” to an ethno-national grouping. It is very much akin intellectually to abominating miscegenation. Yet strangely the same people who spout such arrant nonsense tend not to picket performances featuring oriental ballet dancers or black opera singers (as well they shouldn’t). Sorry (not really) but the future is cosmopolitan and voluntary. I will take whatever aspects of any culture I think are worth incorporating and there is not a damn thing anyone can do to stop me. And if some collectivist jackanapes is offended by my “appropriation”, well take a guess how many fucks I give because that just makes it all the more delicious 😉 March 26th, 2016 | 90 comments - (Comments are closed)
It cannot be said too often and it is especially pertinent right now, given the state of the world’s economy now, and in particular given how America’s Presidential candidates are talking now: The Great Depression was both caused by and then horribly prolonged by bad governmental and political decisions. The Great Depression was not caused by unfettered capitalism. Throughout this unfolding disaster, capitalism was very fettered indeed, and it was these ever-tightening fetters which proved to be so disastrous:
That is the final paragraph of Lawrence W. Reed’s demolition of Cliché of Progressivism #33 (that it was all the fault of “Unfettered Capitalism”) for FEE (the Foundation for Economic Education). I was steered towards this piece because of its Quotulatiousness. That blog quotulates a few of the early paragraphs of Reed’s piece. I say: read the whole thing. Almost as important as how the Great Depression began and was prolonged is how it ended, just after World War 2, as Reed also explains very well. If you want a bit more detail about that recovery, and in particular of its politics, try reading the chapter on mid-twentieth century America in JP Floru’s book Heavens on Earth (SQotD-ed here), which is about eight such happy episodes around the world in recent times. The world now knows, in the words of Floru’s final chapter heading (also the sub-title of his book), “How To Create Mass Prosperity”. Or rather, the sensible parts of it do. The only uncertainly about the free-market, non-interventionist policies that Reed and Floru recommend is in whether such policies will be applied in the first place, and whether they will then be persisted with. See also this earlier posting here, which reports on, among other things, a ding-dong I had with Lord Skidelsky concerning this exact same point. March 18th, 2016 | 15 comments - (Comments are closed)
In the charged atmosphere in US and other countries’ politics at the moment, immigration, legal and illegal, is a hot topic, to put it mildly. As regulars here know, a key point is that immigration/emigration cannot be divorced from issues such as whether the chosen destination of a migrant has a welfare state, or not. It is worth, with all that in mind, to remind ourselves that on the whole, migrants tend to be highly motivated people, not the malevolent “snakes” that Donald Trump (whose ancestors were immigrants, and we don’t know how fully documented they might have been) might put it. Here is an item from the Wall Street Journal:
Of course, as I anticipate some commenters might say, these immigrants are, one assumes, legals, and they haven’t overstayed their visa terms or they did not jump over any fence. But for what it is worth, these achievements would be no less notable even if they had not been entirely legit as stands under existing law. There is a lot of fear in Western politics at the moment, and it is all too easy to forget the many positives out there. Remember, politicians who want to expand the State usually thrive when people are scared, or made more scared. March 17th, 2016 | 59 comments - (Comments are closed)
NASA, via The Guardian (and other old media) is trumpeting catastrophe again. “February breaks global temperature records by ‘shocking’ amount” says the headline. “We are in a kind of climate emergency now,” says Stefan Rahmstorf, from Germany’s Potsdam Institute of Climate Impact Research. On the other hand, towards the end of that article, they mention the El Niño. At Watts Up With That, Bob Tisdale provides some analysis and graphs. I think figure 6 provides the most useful overview, showing up to 0.17 degrees C per decade warming depending on who measures it. I suppose this might just be warming since the little ice age, or man-made but not terribly frightening. A Guardian commenter wrote: “We spend so much time debating and arguing over things like benefits and the economy. Stories like this end up disregarded. The truth seems terrifying – this is the single biggest crisis facing all of humanity.” I replied: “It’s either the single biggest crisis facing all of humanity, or an el Nino that fits in nicely with the between 0.12 and 0.17 degrees C per decade warming we’ve seen since satellite measurements began (which is what all this turned out to be back in 1998). Personally I hope the economy does well, because people with the wealth of middle-class westerners can cope better with a bit of bad weather than can subsistence farmers in the kinds of places that don’t have economic freedom.” March 14th, 2016 | 20 comments - (Comments are closed)
I found this article vastly entertaining.
Debit? Pah, Champagne lefties require only hugs as payment and presumably offer the same in return if the hapless taxpayers wants their £200,000 back. March 9th, 2016 | 23 comments - (Comments are closed)
Someone I know on Facebook, who turns out to be a fan of Bernie Sanders, the socialist running for the Democrat nomination in the US, defended this man’s idea of jacking up capital gains taxes (on all those evil capitalist exploiters). I contested the wisdom of this, and got this response. I haven’t edited for typos:
So, the argument is that the State is entitled to use the violence-backed power it has to seize the wealth of supposedly less “needy” people and give it to persons presumed more likely to spend it. The presumption that the State is entitled to loot the wealth of persons who don’t “need” it is taken as self-evident, so deep have collectivist assumptions soaked in. An appallingly large number of people subscribe to this assumption and often don’t encounter a contrary view. This nonsense also inverts the insight that to consume a service/product first entails producing it, which requires saving for that purpose by forgoing immediate consumption (resources have time value, which is why interest rates exist). The richer person’s wealth doesn’t simply vanish if he/she does not immediately spend it – that money is invested, and added to other factors of production (labour, mainly), which increases living standards in the longer term. On a final note, it is worth pointing out that under the current tax system in countries such as the US (in my view, far too complicated), the rich pay a disproportionately high share of the total, which rather buggers the point made by people like Sanders. March 8th, 2016 | 29 comments - (Comments are closed)
Lord Mandelson sneered at Brexit supporters this week for failing to understand the complexities of modern trade and how leaving the EU would trigger years of renegotiations that would leave us with a far worse deal than we have inside the EU. Alas Lord Mandelson is a victim of the mandarin-centric fallacy that trade only happens after governments have arranged it in the best interests of their citizens. – Patrick Minford. Sadly the article is behind the Times pay wall but I am sure you get where this is going. March 4th, 2016 | 18 comments - (Comments are closed)
“It turns out Lenin was wrong. Debauching the currency is actually the best way to destroy the socialist, not the capitalist, system.” – Matt O’Brien, from the Washington Post. (The fact that such a comment can be made in a liberal-leaning publication such as the Post is interesting in itself.) Via Business Insider. He is talking about the disaster that is Venezuela. February 12th, 2016 | 19 comments - (Comments are closed)
…for the striking London black cab drivers whose hard won skills have been rendered obsolete by Uber and Addison Lee, just as we should remember with pity the thousands of drivers of hansom cabs whose hard-won skills with horses were rendered obsolete by the coming of the internal combustion engine. I am not being flippant or sarcastic. To lose one’s accustomed livelihood to new technology is a tough spot to be in, and there will be many reading this, some of them highly paid at present, who should look at Trevor Merralls’ situation and tremble. But that pity should not extend to offering to keep Mr Merralls forever in the style to which he has become accustomed simply because he was born working class, or to stifling the opportunity for self-employment that Uber offers to its drivers (also working class), or to depriving Londoners who could not afford black cabs of the ability to take a cab at a reasonable price at any time day or night, and which will, as one of the Guardian commenters put it, “actually go to exotic destinations like Lewisham”. February 9th, 2016 | 32 comments - (Comments are closed)
I have been meaning to link to the excellent blog Oilfield Expat ever since I found it mentioned in a comment here a few weeks ago. There is so much goodness. You can start with its author’s comment on low oil prices below. I particularly enjoyed this piece of prose, which I find a useful retort to doom-mongers. It is important because people need to realise that we have it good in order to understand why we have it good, lest they throw it all away, the risks of which the article it is taken from is partly about.
The blog is robust and straightforward. On concerns about population: “it isn’t condoms that the poor need to start having smaller families, it is 1) increased wealth and 2) reliable, cheap electricity”. On “those jumped-up tossers in places like Aberdeen”: “A cruise past the offices of the oil and gas companies, the engineering companies, and service providers would show the car parks full of Audis, BMWs, Mercedes, Porsches, Jags, and Bentleys, enabled by soaring wages and full employment of those who work in the oil industry. And now they need a bailout? Fuck them.” On architects: “Fordham is your run-of-the-mill statist, authoritarian rent-seeker who has amassed a veritable fortune of taxpayers’ cash by preaching to governments from the environmental pulpit (naturally, his grubby mitts can be found all over the London Olympic 2012 facilities). The world would have been better off if he’d stayed in his spare bedroom the past 50 years.” On the Hubbert curve: “In other words, the curve is subject to change at any point due to unlimited external factors and therefore utterly useless save for an object over which academics can while away the hours pontificating.” There is technical insight into how to invest in oil in the face of low prices. There is discussion of how well-run Netflix seems to be. There is good, old fashioned Fisking. I am not even having to drill deep for this quality. It is lying about on the surface in plain sight. February 9th, 2016 | 11 comments - (Comments are closed)
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