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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More and more mainstream journalists (maybe we need to retire the term “mainstream” as it begs many questions) are sitting up and taking notice of the Argentinian president, Javier Milei. His openly declared support for radical classical liberalism and “Austrian economics”, for thinkers such as Ludwig von Mises, FA Hayek and Milton Friedman are a breath of fresh air in these increasingly unpleasant, statist times. His package of reform moves, including slashes to the budgets of the Argentinian state, are inevitably attracting criticism and pushback.
This is to be expected. When Ludwig Erhard, the former West German economics minister, put the Deutschemark on a firm footing, ended price controls and cut forms of intervention, the UK occupying authorities, for example, thought he was nuts; when Poland pivoted sharply towards free enterprise in the early 90s, things got tough for a while as a lot of formerly concealed unemployment surfaced. The same happens in many other nations that adopt the “shock therapy” of moving off the morphine drip of cheap money. Imagine, if you will, the likely pain if Venezuela moves away from socialism; the UK had a tough time when Mrs Thatcher enacted reforms in the 1980s, and fashionable opinion thought she was mad and could not succeed.
It seems rather typical of this cycle, then, that Daily Telegraph economics writer Ambrose Evans-Pritchard argues that Argentina is engaged in an “extreme” form of Austrian economics, and argues that it is all going wrong. AEP is a Keyensian; he sometimes writes intelligently but a lot of his predictions are way off base. He’s predicted the crackup of the eurozone so many times that his credibility is shot on that issue. He’s all for Net Zero and the policies to make it happen. But there is more than a grudging respect for Milei here – AEP knows that Argentina’s statist, Peronist culture is awful and needs to change. And AEP does argue that maybe Milei ought to take a leaf out of Erhard’s book on the issue of the currency. Unfortunately, AEP is a full-on fiat currency guy, who presumably agrees with Keynes that gold is a relic, etc.
In any event, people are noticing Argentina now. Its currency and debt is more highly valued; thousands of civil servants have been fired, and Milei is pushing to end a lot of controls. He faces resistance, and may not succeed. But here he is, more than six months into power, and I hope he succeeds. A prosperous, liberal Argentina would be a refreshing contrast not just to the Argentina of many recent decades, but to the horrible regimes of other Latin American states. And who knows – it would be nice if the UK could improve relations with such a country, maybe work out something over the Falklands, and forge closer trade ties with a country that the UK helped to build a century ago.
The first speaker I introduced to the platform was Tory leadership hopeful Kemi Badenoch. At one point, she directly addressed the common misapprehension that free speech is “a cover for bigoted middle-aged white men to spout politically incorrect nonsense”. When Badenoch pointed out that she was neither middle-aged, white, nor a man, a heckler shouted: “Are you sure?”
Without missing a beat, Badenoch replied: “I’m sure. I am a woman and I know what a woman is.” This was greeted by cheers and applause, particularly from the strong contingent of Left-wing feminists who were present. The debates that have since raged online about the prospect of Badenoch as the next Tory leader have revealed that she has considerable support from traditional leftists by virtue of her stance on the culture wars. Can this really be described as “a notable swing to the right”?
– Andrew Doyle
A few days ago, HSBC (which is listed in London and Hong Kong) suspended Stuart Kirk, head of responsible investing at the lender, because of how he scorned efforts by regulators to exaggerate the financial and market impact of Man-made global warming. He gave a presentation, “Why investors need not worry about climate risk”, and this seems to have ruffled a few feathers at the bank. (Here is a link to his presentation.)
As the Wall Street Journal comments:
“Unsubstantiated, shrill, partisan, self-serving, apocalyptic warnings are ALWAYS wrong,” one of his slides noted. He highlighted sky-is-falling quotes from banking potentates such as Mark Carney, the former Bank of England Governor, who recently said the damage from climate change will dwarf the current pain from rising prices. Tell that to the working folks dealing with 8% inflation.
But then of course scoring virtue points about climate change is so much easier than not printing lots of money and trying to control inflation, I suppose.
By the way, I love Mr Kirk’s business title, “head of responsible investing”. As opposed to what, “head of irresponsible investing”, or “lazy investing” or “immoral investing”?
There appears to have been quite a bit of pushback, and I am thinking of ordering some popcorn. Standard Chartered chief Bill Winters is reported to have said that all should be free to “speak their mind” on environmental issues, even if executives disagree with them. (Standard Chartered, which is listed in the UK, makes much of its money in places such as Asia.)
And here’s another point: both HSBC and Standard Chartered, given the importance of Asia to their earnings, in 2020 backed Beijing’s imposition of a national security law in Hong Kong, designed to crush democratic opposition to moves around ending Hong Kong’s independence in legal terms under the agreement signed with the UK. Both these banks make much of their environmental, social and governance (ESG) credentials. Where does their defence of China’s bullying of Hong Kong leave their “social” or “governance” credentials, may I ask?
ESG is now a corporate religion in the industry that I report on. It is impossible to seriously criticise it, it seems, without endangering one’s career. That said, I think the hypocrisies and cognitive dissonance involved is showing strains. HSBC may regret suspending a man for telling what is essentially the truth. He is right that there is a lot of self-serving nonsense around ESG and that some people are making a fat living out of it. I hope Mr Kirk, if he is forced out, sues the pants off the bank.
The aforementioned WSJ article notes:
If climate change poses such an enormous economic threat, Mr. Kirk asked, why did asset prices surge as doomsday warnings increased? Either climate risk is negligible, climate risk is already in the prices, or all investors are wrong, he said. If you believe the latter, then you don’t believe in markets and shouldn’t be regulating them.
Credit to Mr. Kirk for exposing the hubris of the regulatory climate emperors even as his superiors shrink in fear.
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.
China appears to be doing its level best to harm itself in the long term. This story hasn’t so far stirred a lot of international commentary, but it matters, I think. It shows that the rising nationalism (and arguably, a degree of paranoia) in China is reaching the point where it is damaging the domestic economy.
According to one report in Forbes:
Chinese authorities have ramped up their crackdown on after-school tutoring companies by unveiling a new set of sweeping regulations that bans the firms from making profits and raising capital from overseas markets.
Tutoring companies that teach school subjects are now required to register as non-profits. They are also banned from raising capital from overseas investors or through public listings.
What’s more, authorities will stop approving new tutoring companies seeking to teach China’s school syllabus, and require existing ones to undergo regulatory reviews and apply for licenses. The companies found to be in violation will be rectified or eradicated, according to the rules, without further elaboration.
The moves by Chinese authorities have hammered shares of firms operating in the space.
One story I read in the Wall Street Journal said that China, while hitting private sector education, is at the same time trying to make it easier for young couples to have more kids, reversing decades of its odious “one child” policy.
Why does this matter? Because the ever-shifting moves of Chinese authorities on certain sectors must make it hard for entrepreneurs in that country to plan ahead. One moment a chap like Alibaba’s Jack Ma is a sort of business “rock star”, and the next, he’s “disappeared”. In my job in the financial services industry, I have heard a lot of comments over the years on how vibrant, dynamic and coherent Chinese policymaking is, so much better than all that messy Western “neoliberalism”.
Well, it turns out that things in China aren’t quite what they are cracked up to be.
One of the paradoxes of the current lockdowns/restrictions that have been imposed by the State is that they make it much harder for private firms and individuals to plan ahead, particularly when the rules are nonsensical and change regularly. (Examples being how in the UK you can have a drink in a bar in certain places but you have to have it with a “substantial meal”, but the definition of latter is left unclear).
Critics of open societies and classical liberal conceptions of how things should be will argue that said classical liberals don’t fully appreciate the need for planning. Sometimes the phenomenon of the market is characterised as anarchic, and in need of planning and control. Markets are messy, so this argument goes, and wasteful and chaotic. So much neater to run things centrally. Now the arguments used to debunk this – such as from the Austrian school – are fairly well known and should be familiar to many of the readers of this blog (such as how no central planner, even aided by modern IT, can possibly know the vast array of tastes, desires and resources to make an extended market order actually work, etc).
But what strikes me is how advocates of Big Government, such as Paul Krugman, often don’t seem to appreciate how their policies and plans make it harder for individuals and the organisations they create to plan in the first place. The pandemic reaction is an example.
Some firms might have been able to plan once they know they are not going to be molested or face sudden changes to how they serve clients, but all too often this is not the case. Even with the Big Techs that have thrived recently, risks of anti-trust shakedowns are an uncertainty that might blunt their ability to plan and invest.
Across a large chunk of the economy, such as hospitality, entertainment, transport, sports and so on, planning has been a nightmare. To take one case in point: try to imagine how hard it has been to launch a film. In many cases, the movie industry has taken the line of least resistence and shut down.
This State regime uncertainty pushes back against the “just-in-time” inventory model that more stable times in the past had made possible, with its vast deepening of the division of labour. A far less predictable policymaking regime – aka “regime uncertainty” – is going to require people in future to accumulate more “padding” in the form of rising savings rates, back-up resources, and the like. But even such efforts are made harder as and when governments use fiat currency debasement to transfer savings to borrowers.
The need to plan ahead is in fact a central fact of life in a free society. We do it all the time. (Every day I jot down my work tasks for the day, for example.) The key is that these plans are those of free individuals acting on their judgement, and not because of some central, coercive authority standing over them.
When the State expands above a certain minimum level, this private planning becomes more, not less, difficult. It is in fact a classic rebuttal to President Barack Obama’s nonsensical “you did not build that” speech of a few years ago. People can and do build a great deal, provided the rules are clear and enforced. All too often, the State does a crummy job in defending legitimate boundaries, and as we see now, does a great deal of damage.
People react to discrediting evidence not by acknowledging reality but by entrenching their beliefs even further. This counter-productive thinking is further exacerbated by ‘cognitive dissonance’, another Festinger theory. When confronted with evidence disproving their beliefs, people will opt for the least painful choice, holding on to their beliefs, no matter how catastrophic these are, rather than admitting they have been wrong. Our political class – the Government – is currently providing a textbook example of this behaviour.
– Karen Harradine
A concerned citizen writes,
Little know fact: sometimes dogs float to the ceiling and get stuck there. It’s a serious problem and we should really start to talk about it more to find a solution.
I urge you to look at the pictures the blogger provides of dogs in this position. Few will remain unmoved. Except the dogs, they do remain unmoved, because they are stuck.
Although the writer did not try to make any political capital from this issue, it did lead me to wonder what other problems in modern society are conceptually similar to the plight of these dogs. I did think of one: as you no doubt recall from your perusal of page 61 of the 2019 Labour manifesto, the Labour Party pledged to tackle the insecurity of casual work by:
Ending bogus self-employment and creating a single status of ‘worker’ for everyone apart from those genuinely self-employed in business on their own account, so that employers can not evade workers’ rights; and banning overseas-only recruitment practices.
• Introducing a legal right to collective consultation on the implementation of new technology in workplaces.
• Banning zero-hour contracts and strengthening the law so that those who work regular hours for more than 12 weeks will have a right to a regular contract, reflecting those hours.
I think the gig economy might be a dogs-stuck-to-the-ceiling type of problem. Can you think of any others?
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That this post is classified as “Hippos” is not an error. It was done firstly because that was the category that most closely matched the content, and secondly because we all need to be alert for hippos stuck to the ceiling.
This is probably one of the few places in the internet, never mind the regular media, where people can get to debate the wonders of socialised medicine without being under the burden of proving that they are not evil. In the UK, we have had since the late 1940s a healthcare system that dominates the field, with a relatively small private sector. The National Health Service, funded from tax and run as a monopoly, with politicians and civil servants allocating resources, was modeled, as so many post-war institutions were, on the idea of state central planning. The narrative of the time was that planning was the way to go, unlike all that messy, chaotic “laissez faire” that had been associated, however wrongly, with the Great Depression and so on. (Here is a good paper on the NHS by the Institute of Economic Affairs.) I can also recommend this book, by James Bartholomew on the many problems with the UK welfare state.
The NHS, like many of the other socialised medical systems in much of the developed world, faces the monstrous coronavirus. And so much of the current policy approach – the UK is going into more of a lockdown as of this weekend – is designed, so it is said, to flatten the potential surge of infections and deaths, so that the NHS and other systems don’t collapse. The cost/benefit calculation is being made that it is better to smash the world economy, to force millions into idleness, possibly for months, and tide them over with cash payments funded from vast amounts of debt, than it is to allow the NHS/other to be forced into a nightmare of running out of resources. In some ways I can see the merits of preventing a horrendous surge in deaths; I also think that saving the NHS and other models of healthcare is a sort of virility test of today’s Welfare States. Nothing can be done to admit they have limits, even if that means economic damage on a major scale.
That cost/benefit calculation may look just about defensible now, but what about in two months’ time, particularly if there is no real sign of a deceleration in the virus, but if the struggle to buy even basic household necessities leaves a lot of people in real hardship? I assume that farmers and others in the food production business are not being told to stay at home, but such is the level of madness about this situation that I wonder. I’d like to know how locking people in their homes for months is going to be enforced.
There are also health considerations to be taken into account by such a lock-down, particularly if it goes on for months on end. Humanity is not designed for prison, and those of us in relatively free societies (“relatively” being the operative word) will move from being restless to downright homicidal of this goes on into the summer and beyond. There aren’t enough police to keep everyone cooped up in their homes.
Those bastards in the Chinese Communist Party have a lot to answer for. And yes, COVID-19 began there, and it shows how derelict some of our media/political class has become that is frowned upon to point that out. (The anger is rising, and will have major consequences for our geopolitics.) It would be rather ironic to think that something unleashed by a Communist state, whether by accident or whatever, has put such pressure on Welfare State societies in the West.
Final point: I was due to give a talk tonight at Brian Micklethwait’s place about the recent calls for anti-trust assaults on the Big Techs such as Facebook, Google and Amazon, and I was going to look at parallels with the campaign to break up J D Rockefeller’s Standard Oil more than a century ago. One thing you can say about Rockefeller, was that as well as being a brilliant businessman, and philanthropist in the area of healthcare, among others, he also understood the importance of integrated supply chains in commerce. He’d have looked at our current predicament with interest.
Woman who no-one had heard of until she married a royal “set out to prove that women don’t need men to give them status”. I mean I agree but she’s got her work cut out.
– Rob Fisher, commenting on this.
Last month, the Sage of Kettering and I went on another trip, this time to England’s oldest ally, Portugal. *It involved brief excursions into Spain over a raia (‘the stripe’ as it is called), one of Europe’s oldest borders, almost unchanged but still disputed many centuries after delineation in 1297, so it was an Iberian adventure. We focused on the north of Portugal, and then Lisbon.
We flew to Porto, with the least user-friendly tram system I have yet used, and made our way up north by noisy Diesel train through pleasant farmland, brushing the Atlantic coast on the way to our first stage, the fine fortress town of Valença on the Minho river, which here forms the border with Spain. Valença has a striking fortress citadel as its old town, with many layers of defences. The scale of the walls can be judged by the horses in the pictures. A drone video of the fortress, a 17th Century construction on an older 13th Century construction, is here.
→ Continue reading: A Lusitanian* adventure
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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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